More Silk and ermine as the Lords debate devolution

It is the time of year when we think of 10-Lords-a-leaping but whenever that many peers gather they are more likely to discuss constitutional reform.

Indeed, almost as many members of the House of Lords turned up for a mini-debate on the Silk commission on Welsh devolution as turned up for some of the commission's public hearings.

Yesterday's 55-minute debate in the Moses Room in the Lords was led by former Plaid Cymru leader Lord Wigley who sought, more in hope than expectation, a guarantee that the UK government would implement the report in full.

Indeed, Lord Wigley wanted to go further, and devolve corporation tax to the Welsh assembly: "It is one of the tools with which we can tackle our economic problems," he told peers.

A Labour former Welsh Office minister, Lord Rowlands, was worried about the prospect of income tax rates being decided in Cardiff Bay, in particular a potential rise in the basic rate and its impact on low-income communities.

"In constituencies such as the one I represented (Merthyr Tydfil and Rhymney), we would be swapping - in fact, converting - beneficial public expenditure into a tax burden," he said.

"That would be the effect of implementing additional rates of income tax. We must be honest. Politically it is highly unlikely that a future Welsh assembly government of any complexion will substantially reduce income tax and cut expenditure. The whole ethos of political life, among almost all parties now, would be against such a proposal."

I suspect that Lord Rowlands' concerns about the prosperity of Wales won't have been assuaged by this revelation from the census figures.

Labour spokeswoman Baroness Gale confirmed that her party believed there should be a referendum before income tax-varying powers are devolved.

Wales Office Minister Baroness Randerson closed the debate, giving little away about the government's thinking ahead of its formal response to the report expected next Spring.

Whenever two or more Welsh politicians are gathered together, the talk turns sooner or later to the spending formula that decides changes to the Welsh government's budget.

Lady Randerson argued that Wales is doing rather better under the Barnett formula than it was two years ago. (This may largely be due to the way it increases convergence in public spending between Wales and England when spending is rising, and increases divergence when spending is falling).

Lady Randerson said: "Indeed the figures show - and these are figures agreed between the Welsh and UK governments - that we are within the rough area that the Holtham commission stated in its report was the fair level of funding for Wales."

Things have clearly moved on from February 2010 when the deputy leader of the Welsh Liberal Democrats, Roger Williams, accused the last Labour government of being "content to tinker round the edges, assessing trends in spending rather than actually doing something by acting" and "treating Welsh people like second class citizens".

What Lady Randerson didn't say was what the UK government plans to do about the Silk report. Perhaps the most significant statement on that yesterday came from her boss, David Jones, who told MPs on the Welsh affairs committee that the Treasury would be calling the shots when it came to offering Wales powers over income tax.