2. ASSEMBLY POWERS

What precisely is the situation or problem that requires attention?
The implication of the terms of reference is that the Assembly may not be functioning in the best interests of the people of Wales. To establish whether this is actually the case, and if so in what respects, requires hard evidence of circumstances where problems have been encountered or, from the experience of NAW’s first term, are anticipated. To what extent, and if so why, has NAW been unable to pursue desired objectives or had to overcome avoidable difficulties or obstacles or not resolved them for want of powers?
Developments since the enactment of the Government of Wales Act 1998 ("GWA") and experience from working the devolution settlement point up a number of factors that may be relevant in this context. These include:
	The complexity, and potential uncertainty, of the devolution settlement as a result of the bewildering ways in which functions were transferred initially and new functions are being conferred subsequently.
	Despite the corporate nature of NAW under GWA, the pragmatic separation of the role of executive from non-executive AMs and the recognition of the Welsh Assembly Government (‘WAG’) and the Presiding Office ("PO") as distinct entities.
	An increase in the size of the executive through appointments of Deputy Ministers, although the office has no formal legal status.
	A major transfer of substantive policy formation from Whitehall to the NAW in many matters within the devolved subject fields, in contrast with pre-devolution when the Welsh Office was principally concerned with implementation and administration of Whitehall policies.
	Confirmation of the centrality of the Secretary of State for Wales and the Wales Office in the relations between London and Cardiff.
	Dependence of NAW on Parliament for the enactment of primary legislation where needed to enable NAW to pursue its policy objectives, and the likelihood that most changes will have to piggy-back on to legislative projects as prioritised in Whitehall, rather than secured by Wales-only bills.
	The emergence of relatively smooth co-operation arrangements between WAG and Whitehall departments with respect to legislative projects, in contrast with the limitations on the involvement of non-executive AMs in those activities.
	The emergence of arrangements that enable NAW to participate in pre-legislative scrutiny where extended to bills affecting Wales and of increasing possibilities for contributing to the Parliamentary consideration of such bills.
	The heavy toll of committee responsibilities on non-executive AMs, suggesting that there may be insufficient to meet the differing and competing demands of the numerous statutory and non-statutory Assembly committees.
	A degree of ambivalence concerning the role of subject committees, notably with respect to policy formation.
	concerns lest arrangements which have been worked out between administrations largely drawn form the same political party may not be sufficiently robust at some future date when different parties hold power;
	A considerable increase in human resource and budgetary support for NAW from that projected during the devolution debate.
What are the objectives and desired results that are to be sought?
How far is the Commission constrained by the objectives of the scheme for executive devolution as envisaged in the 1997 white paper A Voice for Wales? Are the aims of any proposed changes to powers to be confined to ensuring improvements in policy formation and more effective implementation of such policies? Alternatively, is the aim to strengthen NAW to a point where it can begin to assume full responsibility for formulating and enacting the policies in its subject fields that it considers most suited to Welsh circumstances? Decisions on such matters will indicate whether the focus of the recommendations is to be on making refinements or improvements to the existing scheme of executive devolution, or on its replacement by legislative and executive entities, or on devising some intermediary solution.
What options are available for achieving those objectives and results?
1. No change: collated experience is likely to show that this is not an acceptable option. Nonetheless, why this is not viable should be demonstrated convincingly if recommendations for change are to carry weight.
2. Rationalisation of existing functions: a re-examination by the concerned Whitehall departments and NAW of the list of functions currently conferred for the purpose of removing anomalies, unnecessary restrictions (for example concurrence of Whitehall) and conferring additional functions so as to provide greater coherence in the devolved subject fields.
3. Clarification of existing functions: amendment of the GWA to confer on the NAW general executive authority (including secondary legislative powers) over the devolved subject fields instead of the current mode of transferring particularised functions. This device is found in the Scotland Act 1998² but in that case the devolved executive competence is confined to matters within the legislative competence of the Scottish Parliament³. Accordingly, reference has to be made to the detailed limitations on the Parliament elaborated elsewhere in that Act⁴. If this approach were to be used for Wales, in the absence of any legislative competence, a series of reserved areas and generalised and specific exceptions would have to be formulated with respect to the general heads of devolved executive authority.
4. Authorising NAW to make secondary legislation to provide needed coherence: amendment of the GWA to confer on NAW secondary law-making powers with respect to a series of listed topics comprised within each devolved subject fields. Such powers would include Henry VIII powers (that is, powers whereby NAW is permitted to repeal, amend or replace provisions of Acts of Parliament), thereby enabling NAW to clarify and rationalise the extent of its own functions. This builds upon one of the principles for adoption in Government Bills recommended by the Assembly Review Group and endorsed by the plenary Assembly⁵. However, again some generalised reservations and exceptions would have to be formulated that set limits to the NAW’s authority.
5. Conferment of primary legislative powers: this would entail fundamental alteration of the devolution settlement by establishing the NAW as a legislature. Again, reserved areas and general and specific exceptions would be needed as in the case of Scotland. The precise content of these would be influenced by the extent of the legislative authority, which need not be coterminous with executive competence. Accordingly, it is possible to contemplate primary powers:
	In all the devolved subject fields.
	In a limited number of the subject fields distinctive to Wales (for example, culture and the Welsh language).
	Initially in a limited number of the subject fields (e.g. health and education, culture and the Welsh language) that can be added to in the light of experience and a demonstrated need.
	In new matters, such as limited taxing powers.

6. Additional subject fields and identification of the functions to be transferred within those fields: suggestions have been made from time to time that the Assembly should exercise devolved authority with respect to new fields, such as policing, broadcasting, railways, energy and aspects of the justice system. This option runs alongside all the previous ones.

What structural or institutional changes will be required with respect to each option?

If a scheme of executive devolution is continued, in principle the existing structure could be retained. However, a case can be made for reviewing the corporate structure with a view to formalising the separation of WAG from the rest of NAW, as well as regularising the status of Deputy Ministers. On the other hand, if primary powers are granted, continuation of a corporate body is likely to lead to considerable artificiality and complexity. The case for institutional separation of the legislative and executive functions must be considered. In those circumstances, the GWA might have to be substantially rewritten.

Consideration should be given as to changes that may be needed as a result of the way in which each option is likely to impact on the current arrangements by which NAW, and in particular WAG, can influence Whitehall policy-making, including the development of legislation that will affect Wales.

Increased powers almost certainly justify an increase in the number of AMs, which may be shown as already too small to enable NAW to discharge even its existing responsibilities satisfactorily. Extra powers in the executive may require additional numbers of Ministers. The duty of NAW to hold the executive properly to account for exercise of extended powers may require new structures, e.g. additional subject committees; the creation of a Finance Committee and procedures (e.g. to enact primary legislation). An estimation of numbers necessitated by each option is called for. Arguably, the appropriate number should be determined by the requirements of the NAW as a body with extended responsibilities, rather than by the convenience of electoral arrangements or the capacity of the new Assembly building.

What gains in terms of effectiveness and efficiency are anticipated for each option?

Some estimation should be attempted as to which option is likely to enable NAW to discharge its responsibilities better with respect to policy formation and implementation. But consideration should also be given to whether the structural and institutional changes necessary to give effect to the option are likely to advance the underlying values of devolution, such as transparency, fairness and accountability.

What are the likely costs (e.g. in terms of human resources and budget) of each option and are they proportionate to the benefits that are anticipated?

Public interest in the cost of NAW is likely to be considerable. Accordingly, a case needs to be made to show that additional expenditure is commensurate with the benefits that are expected to flow. Both need to be spelt out for each option. Patently, these will be different depending on the extent to which NAW increases in numbers and additional human resources have to be provided, as well as increased administration costs that would inevitably flow, especially if additional subject fields or functions were acquired. In this respect, consideration should be given of the additional support that will be needed for the non-executive side of the Assembly (or the legislative body if one is recommended). A case can already be made that the support that can be provided by PO to AMs is hampered by the relatively small numbers of civil servants assigned to this aspect of NAW’s work.

In the light of Scottish experience, acquisition of primary powers almost certainly will require some strengthening of the Wales Office, especially in the legal field, for example to conduct negotiations as to whether Parliament, rather than the Assembly, should be asked to legislate on a devolved matter or to advise Whitehall departments as to the law in Wales. Indeed the emergence of constantly growing areas where the law in Wales differs from that in England will have resource and probably institutional implications.

What consequences, direct and indirect, desired or undesired, are anticipated for each option?

Consideration should be given to likely impacts of each option, which may differ in their effect between options. Extension of powers is unlikely to be accompanied by any change in the financing of the devolution through the block grant and the Barnett formula. Could this affect the delivery of services to Wales?

What will be the effects of each option upon Whitehall policy-making? What are the likely reactions in Whitehall to each of the options, not least with respect to the task of implementing them? Will the present working arrangements devised within a framework of the Memorandum of Understanding⁶and various concordats be sufficiently robust to govern the relationship between Cardiff and Whitehall if Assembly powers are increased? The closer the settlement moves towards a quasi-federal system, the greater the potential for divergence of policies made in Cardiff and London. Is such a trend in the best interests of Wales and the United Kingdom?

Will an increase in powers in Cardiff reduce the attention given to the Welsh dimension at Whitehall and Westminster? If the Scottish experience is any guide, Parliament will be asked by NAW to legislate on devolution matters even if primary powers are acquired. The Commission’s terms of reference do not expressly mention relations between NAW and Parliament, although it can be argued that the question of NAW’s power, especially at the initiative of non-executive AMs, to feed into the legislative process is important. The current inquiry by the Welsh Affairs Committee into the legislative process as it affects Wales is likely to be relevant.

Is it likely that the number of Welsh MPs will be reduced if wider responsibilities for Welsh matters pass to NAW, thereby weakening the Welsh input to Parliamentary activities? If Wales acquires a parliamentary style system, is this leading to a quasi-federal settlement that may necessitate the establishment of formal institutions to handle inter-governmental questions?

How acceptable to the public and affected groups in the community is each option?

The Commission’s inquiry is not an abstract or academic study. Its recommendations must have a realistic possibility of public acceptance. In the present circumstances where public attitudes towards NAW are rather ambivalent, and perhaps ill-informed, it seems important to establish whether the options are likely to meet with public support or opposition, and the strength of those responses. The inquiry will be conducted against the backdrop of the Assembly elections when political parties may claim that electoral support for them is evidence of support for the position on the Assembly that they have advocated in the electoral campaign.

If the Commission were minded to recommend the conferment of primary legislative powers in the context of a NAW restructured as a legislature and an executive, would this be seen as such a fundamental change as to necessitate a referendum?

What methods of gathering required information on these matters (including consultation with the public and with interested bodies) should be used?

Reference has been made above in the Preliminary Considerations to the desirability of selecting appropriately from a variety of consultation techniques. In addition to evidence from the public in response to the suggested issues paper and from obvious interest groups such as political parties, the Commission may wish to identify particular interests from which information should be sought, and to determine the timing of those consultations. As also proposed earlier, we are strongly of the view that the Commission should consider commissioning research that will provide it with the information it needs to reach informed conclusions. Suggestions for the latter are set out in Appendix 2.

After assessment, which of the options appears likely to be most effective in achieving the objectives and results?

2 Sections 53-57.
3 Section 54(2).
4 Sections 29-30, Schedules 4 & 5.
5 Report of the Assembly Review of Procedure (February 2002), Annex V, principle 6.
6 Cm 5240, December 2001.