On 1 May 2003, the first term of the Welsh assembly will draw to a close and the electorate will choose who should exercise the devolved responsibilities of government in the second term.

The creation of the Welsh assembly in 1999 was one key part of Labour’s radical programme of modernising and decentralising the British state by devolving power. In the first instance, this has been to the smaller nations which nest within the family of the United Kingdom. It has been the most exciting period of constitutional change in the UK since 1688.

In 1999, Labour gained 28 seats in the 60-member assembly, failing narrowly to gain an overall majority. For the first year, we conducted an experiment in forming a government on the basis of minority support in the assembly, brokering votes on a daily basis. Since October 2000, we have had a partnership government, in which Liberal Democrats have committed support for the government, which includes two Lib Dem ministers alongside seven Labour ministers.

The objective of the Labour party in Wales at the coming election is to gain an overall majority in the assembly, and to form a majority Labour government for the next four years. The arithmetic of proportional representation in Wales (20 members are elected on regional lists where seats are gained in proportion to the votes cast for parties) is different to that in Scotland. We can gain a majority, and that is our aim. In this sense, the Welsh election is the real test for the Labour party in 2003 – it is the one national election in which Labour can succeed or fail to get a majority.

However, the experience of partnership government has been positive. With stable support in the assembly, the Labour-led government has proved its capacity to govern effectively. This has been Wales’ first experience in self-government for six hundred years, or possibly ever; the sceptics had been predicting calamity and practising their weary, ‘told you so’ tones. Through the Welsh assembly, Labour has proved its ability to work with the people of Wales. We have been inclusive of our country’s richly diverse cultures and promoted prosperity and fairness for all. On this basis, we have laid the foundation to ask the people of Wales to trust us with an overall majority, which we can use to take Wales forward.

The Thatcher-Major era had left much of Wales in a state of despair and decline. Traditional industries and established communities had been laid waste. New capital had been encouraged into selected areas of Wales only on the promise of a low-cost, low-skill, compliant workforce. By the end of the twentieth century, the Welsh nation, which had forged the first industrial revolution, was left with grave problems of low productivity, low levels of economic activity and forsaken communities with diminished public services.

Labour in Westminster and Labour in the Welsh assembly have combined to recreate hope and expectation, upon which we are building a new future. We have not yet escaped the dreadful Tory legacy, but we are leaving it behind.

Labour’s management of the UK economy has provided Wales with a magnificent opportunity to transform itself. We now have the lowest unemployment since 1975 and Wales is currently leading the UK in the growth of overall employment. Long-term youth unemployment, which during the 1980s and early 1990s seared the soul of families and communities throughout Wales, is now almost eliminated.

A key indicator of the turnaround is the extent to which Wales is sharply increasing its economic activity – halving the long-standing gap between itself and the rest of the UK in the space of a year. Our relatively high levels of inactivity have been related to ill health, low confidence and expectations, and low wages, which make the transfer from benefits to work uneconomic. The increasing level of activity is an indicator of significant positive change in our poorest communities.

Labour’s assembly government is playing its full part in this transformation. Working with business, trades unions, development agencies, and further and higher education, we are creating a ‘Team Wales’. The team is now developing skills, applying research and development and fostering investments into the frontiers of new production technologies in manufacturing, communications and services. This is our future, with high-value employment in diverse and innovative enterprises.

We are transforming our communities, by modernising and re-investing in our public services. Public expenditure in Wales, determined by the block grant from the Treasury, was £7 billion in 1999 and is set to increase to £12 billion in 2006.

School class sizes are being reduced and school buildings renovated. Effective learning and teaching means that attainments are higher than ever. Large-scale investments are being made in our health service and we are achieving clear improvements in many areas.

There is a radical programme for ensuring that the poorest communities of Wales can take their place in contributing to and benefiting from our social and economic progress. At its core, Labour’s Welsh assembly government is about the achievement of social justice – working with local people to develop their confidence and capacity, targeting public services at those with the greatest need and dispersing economic opportunities.

Labour has a vision of a Welsh nation confident of itself and its place in world. It is a learning country, where all people fully develop their capacities and have the opportunities to apply them. It is an enterprising country, where business prospers through innovation and partnership with government, competing in local and global markets. It is a country of social justice, which succeeds in the modern world through the contribution of all its people.

This is a vision that Labour shares with people in Wales – which is why I expect them to vote Labour on 1 May.

When Labour fulfilled its 1997 promise and delivered devolution, it was the end of a long campaign to secure a Scottish parliament, but the start of the process to increase and improve democracy in Scotland. Now, nearly four years after the parliament opened on a tide of genuine national celebration, we should take stock of just how Scotland and the UK have benefited from this new devolved arrangement.

Scotland’s vote for devolution was never just about moving the political administration of Scotland from England to Edinburgh. It was the settled will of the Scottish people, a settlement to increase democracy and open up government in Scotland and throughout the United Kingdom. It was also a settlement of opportunity – the opportunity to reflect the distinct identity of Scotland and deal with its own pronounced problems.

As we approach the Scottish elections in May, any objective appraisal of the parliament would say that our achievements are not bad for a young parliament. True, the parliament has not had to seek its troubles. The death of Donald Dewar, its first First Minister, could never have been anticipated. And the construction of a new parliament building that exemplifies many of the worst aspects of public sector procurement has taken its toll on public opinion. In the early years, we did not always meet the expectations raised by the euphoria of winning the devolution referendum.

But Scotland still believes in devolution, and it is only the minority parties that want to destroy it. Now, the parliament is stable, starting to deliver, and moving in a direction that, I am convinced, most Scots want. By focusing on the issues that matter to people, rather than politicians, and by seeking Scottish solutions to Scottish problems, the parliament has achieved a lot and offers the prospect of further improvement.

Now, all of Scotland’s resources are focused on growing the economy and increasing opportunities for all. Our record investment in public services is explicitly linked to public sector reform, and we are taking courageous action to tackle those cultural and sociological deficiencies that restrict our ability to become a more confident and successful country. Sectarianism, racism, poor health and violence must be consigned to history. Scotland can be, and must be, more confident, more ambitious, and a better place in the years to come.

The Scottish parliament has ensured we have mechanisms that secure scrutiny and openness. These are innovations that other institutions worldwide could learn from. The committee system allows a greater level of debate on bills. The part that the public can play in instigating our business through petitions is good for the parliament.

Devolved government in Scotland has had to forge new ways of working, too. Not just in establishing new power relationships between ministers in Edinburgh and London, but also in learning to govern through coalition.

Growing the economy must be central to all that we do in the future. Only then can we ensure that our public services improve, our communities get stronger and we become more confident as a country. There are those who say that devolution does not give us control over the levers that we need to make these changes, particularly the powers that are needed to grow the economy. But they are wrong.

Scottish businesses get the best of both worlds through devolution. They have a government which recognises the particular needs of Scotland’s communities and commerce. It has the resources and commitment to accelerate investment in transport, and in improving the science and skills of our people in line with those needs. But they still benefit from the stability of a UK tax and regulation regime, and are not disadvantaged by barriers to the key UK market.

The elections in May will offer people a real choice between those parties which believe in devolution and those that don’t. The choice will also be between the parties that have the confidence to deliver for Scotland using devolved powers, and parties that don’t. But the first choice that the Scottish people will have to make is whether to vote at all.

That is why it is fundamental that all parties remember why we voted for devolution and just what Scotland’s aspirations were during that referendum campaign. Scots voted for a parliament that would be consensual where possible, positive and effective. It is vital that, in the run-up to May’s elections, parties and politicians have a real debate around the policy choices for Scotland. It is just as important that parties do not betray the confidence that the devolution vote gave us by engaging in the negative personality politics that we know discourages people from voting, and which we hoped our country had left behind. We campaigned for over a hundred years for devolution. We have achieved a lot for a young parliament and have made a good start. There’s a lot done, but more still to do.