PROPOSED laws are being drawn up by cross-party politicians to create a new Act of Union that would “wrest back the initiative from the separatists” and help save the 300-year-old United Kingdom by creating a bottom-up federal system.

The group hope to win the backing of the devolved governments for their plans, which if passed into law, would be put to the people of the UK's four nations in a new referendum within the next few years.

It would have to win approval from voters in Scotland, England, Wales and Northern Ireland, for the new system to be implemented, meaning any one of them would have a veto.

Labour peer Lord Hain, who is a member of the steering group of the Constitution Reform Group (CRG), said: “What is distinctive about the model we are proposing is whereas devolution up until now has been a top-down process…this is a bottom-up process.”

The former Welsh Secretary said the four nations would “federate upwards to the UK and decide what is done at the centre and at a national level”.

He claimed this would make the UK a lot stronger and more appealing, particularly to Scotland, as, under the proposal, it would be “deciding what is done at the centre rather than the centre deciding what is allowed to be done by Scotland”.

He added: “That is what makes it attractive; a new Act of Union on this particular model.”

The Marquess of Salisbury, who chairs the group, told the Lords Constitution Committee, which is inquiring into the Union and devolution, that powers which might be reserved to the centre could include economic security, defence, basic levels of health and social care, human rights and distributing help from the wealthy south east of England to the rest of the UK.

The life peer, who has taken a leave of absence from the House of Lords, said there was a “horrible probability” that the Scotland Bill, which was transferring more tax and welfare powers to Holyrood, would “not be the end of the matter” and that the SNP would always seek more powers.

In its written evidence to the committee, the group said: “We see an immediate threat to the constitutional future of the United Kingdom in the likelihood of a repeated referendum on Scottish independence in the near future.”

Lord Salisbury told the committee: “Those who want to keep Scotland in the UK need to wrest back the initiative from the separatists, which has been lost (to them).”

He explained the “neatest way” of doing that was to propose a new Act of Union; some 300 years or so since the original acts created one united kingdom of Great Britain.

The group is likely to propose two main options - a fully federal system or, once central functions are identified, using the current system of devolution to distribute power to local, regional and national institutions.

The Tory peer said the hope was that as support grew for the new legislation that the UK Government would, over the next two years or so, take up the idea of having a new Act of Union.

The formal introduction of draft legislation would be preceded by consultation and parliamentary scrutiny but Lord Salisbury explained: “It could be brought into force only by a post-legislative referendum; which would obviously have to be approved by all four parts of the kingdom.”

The former Conservative Leader of the Lords argued that draft legislation would enable the idea of a new constitutional settlement to be “injected into the political bloodstream” in the run-up to the May 5 elections in Scotland, Wales, Northern Ireland and England.

“We have made very considerable progress in a first attempt at a draft bill, which we hope to have at least three-quarters cooked within the next relatively few days.”

The draft bill would be accompanied by a number of opinion polls and focus groups, “particularly in Scotland,” to guage the level of public support. These are due to take place in the next few days.

Labour peer Baroness Taylor pointed out how it might become clear in the consultation that the Scottish Government would not “buy in” to the proposed new Act of Union.

Lord Salisbury admitted there was a “high risk” of this happening but said the polling over the next two months would ascertain the level of Scottish interest in the group's proposal.

Asked about the sharing of resources from richer to poorer parts of the UK under the federal model, Lord Hain said a key attraction of a Union was fairness and equal rights but noted that if the devolution of tax powers went too far it would hamper the redistribution of resources to the poorer parts.

“This Act of Union has to address that seriously and have a taxation mechanism in which there is considerable room still to redistribute,” he stressed.

Lord Salisbury added: “As always trouble is going to come over money…It’s very difficult for a Union to keep together unless there is a way of making sure the centre can support the individual parts of the polity and, if there is no way, there’s a good reason for the individual parts of the polity to break away.”