I rise to speak to new clauses 5 to 8 in this group, which are in my name. Madam Deputy Speaker, you will be glad to hear that I will be as brief as possible, because I am desperate to get to the third grouping so that we can have a vote on those amendments.
My new clauses aim to achieve two things: first, to secure justice for my country in the formulation of monetary policy; secondly, to help monetary policy
formulation better to reflect the fiscal reality of the evolving UK. They are probing amendments, and I wish to draw the Government’s attention to them again as these are important points that the Government should go away and look at before possibly coming back with their own proposals, given the relatively light legislative programme before the House these days. I was glad to hear that Labour was holding a review into these issues, and I look forward to reading its findings, although it would have been handy if the review had been prepared in advance. We could then have discussed those issues in this debate on the legislation.
The first of my new clauses proposes a change to the name of the central bank. We in Plaid Cymru believe that the Bank of England’s name should be changed. It is the UK’s central bank, and it is time that was reflected to a greater degree, not only in its name but in its structures and practices. It is an undoubtedly contentious issue for me as a proud Welshman that the central bank that decides monetary policy in Wales is named after another country. The Bank of England was created in 1694, before the present British state was constructed. Wales was annexed in 1536, Scotland in 1707 and Ireland in 1801. The central bank was therefore created to serve a political entity that consisted only of Wales and England. I suppose the fact that Wales was omitted from its title reflects the inferior status that my country enjoyed in 1694.
Many of those present will have heard my schoolboy hero Sir Ian Botham on “The Daily Politics” yesterday, saying of the EU referendum:
“England is an island and we should be proud”.
I was going to say “If only”, but I thought I might get into trouble. That dubious geographical knowledge reflects an error continually suffered by the other nations of the UK at the hands of those who use “England” to mean a larger entity. It is an injustice that persists in cricket, Wales being denied a national team in its own right. Similarly, the other nations of the UK are denied recognition when it comes to the central bank. If the British state is a partnership of equals, all its institutions must reflect that reality, including perhaps the most important institution underpinning its financial system: the central bank.
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My suggestion is that our central bank be called the “Sterling Central Bank”. This would reflect the fiscal and political reality we live in, and it would show that those in this place genuinely believe in the respect agenda and a partnership of equals. I notice that the hon. Member for East Lothian (George Kerevan) has tabled a similar amendment to the same effect, and I will of course vote in favour of it, if he is minded to press it to a Division.
New clause 6, in my name, seeks to ensure representation of the four nations of the United Kingdom on the Monetary Policy Committee. Measures relating to major fiscal levers flow from the Treasury in London to the devolved countries—measures relating to corporation tax being devolved in its entirety to Northern Ireland, to full income tax devolution to Scotland, and to partial income tax devolution to Wales. Even though I believe that we should have a symmetric devolution of powers, the trajectory is clear none the less.
Fiscal responsibility, when combined with a genuine no-detriment fiscal framework, increases the political accountability of the devolved Governments to their respective electorates and, critically, incentivises those Governments to boost economic performance in order to invest in public services. The co-ordination of monetary and fiscal policy is vital in any economic policy. Obviously the central bank is independent, but there is undoubtedly co-ordination with the Treasury, as would be expected. Similar protocols and links need to be developed with the Welsh, Scottish and Northern Irish Exchequers. The national Parliaments should nominate a member to serve on the MPC to ensure that those involved in interest rate setting have an understanding of economic conditions and events in Wales, Scotland and Northern Ireland.