Draft State Aid (EU Exit) Regulations 2019
(Limited Text - Ministerial Extracts only)
Read Full debateThe Committee divided: - Ayes: 9 / Noes: 5 - Question accordingly agreed to.
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Kelly Tolhurst)
I beg to move,
That the Committee has considered the draft State Aid (EU Exit) Regulations 2019.
It is a great pleasure to serve under your chairmanship, Mr Hanson. The draft regulations were laid before the House on 21 January. They transpose into UK domestic law the EU state aid regime, as set out in articles 107 and 108 of the treaty on the functioning of the European Union and in various EU regulations. By so doing, they transfer the state aid regulatory functions of the European Commission to the UK’s Competition and Markets Authority. The draft regulations will therefore ensure that state aid rules continue to operate in a domestic context after exit day in the event of a no-deal exit. If passed, the regulations will come into force on exit day.
State aid is any Government subsidy or support provided to an economic operator that gives it an advantage that it could not get on the open market and that distorts competition between EU member states. The EU therefore has tough rules governing the way that subsidies can be given, to stop companies gaining an unfair advantage over their competitors. However, there are good policy justifications for state aid—when the rules enable it to be given—if the benefit from giving aid outweighs the potential harm that a subsidy would cause.
The rules are intended not to prevent public authorities from supporting industries and business, or indeed nationalising assets, but to minimise distortion to competition. Ultimately, spending decisions within the framework of the rules—how much, to whom and for what—are for successive Governments, the devolved Administrations and local authorities to make. To be clear, the state aid rules are about supporting fair and open competition, and the UK has long been a vocal proponent of them. Ultimately, the rules are good for taxpayers, consumers and businesses.
There are three main reasons to maintain the state aid rules and establish a UK regime when we leave the EU. First, it will provide continuity and clarity for public authorities that grant state aid and for organisations that receive it. That will give confidence to the wider business community, which will benefit from the continued protection provided by the rules. Secondly, it will help to maintain a level playing field throughout the whole of the United Kingdom.
Nick Smith (Blaenau Gwent) (Lab)
In appendix 1, there is a letter from Mick Antoniw AM, who chairs the Constitutional and Legislative Affairs Committee of the National Assembly in Cardiff. The letter is dated 6 February 2019. It points out the
“problem that the Welsh Government and the UK Government disagree as to whether State Aid is devolved.”
Mr Antoniw states:
“The Welsh Government has requested from the UK Government, an explanation of their legal position but there has been no response.”
Can the Minister please give us the Government’s legal position on that?
Kelly Tolhurst
The hon. Gentleman may be referring to the commitment, made by my noble Friend in the other place, to write to the Committee. He still plans to do so. The Government’s position is that state aid is a reserved matter.
Martin Whitfield (East Lothian) (Lab)
The Minister referred to the regulations being UK-wide and mentioned the devolved Administrations in Scotland, Wales and Northern Ireland. In the light of the Government’s contention that state aid is a reserved matter, can she share with the Committee the Scottish and Welsh Governments’ responses to the draft regulations?
Kelly Tolhurst
I thank the hon. Gentleman for his intervention requesting further clarity. We consulted the devolved Administrations before laying the draft regulations. It is true that there is a lack of agreement with the devolved Administrations on whether state aid is a reserved matter. We maintain that it is. The statutory instrument will bring over EU regulations so that they work in a domestic setting. We are not proposing any changes.
The European Commission’s powers will be transferred to the CMA. That will not result in fewer powers or less involvement for the devolved Administrations. Under the domestic regulations, they will still be responsible for submitting their own state aid requirements directly to the CMA. They will not lose any powers that they have at the moment.
Martin Whitfield
I am grateful for that clarification. It is therefore the case that, in essence, the devolved Administrations have the responsibility but not the authority, and they run the risk of having punitive damages found against them should it be decided that they are exercising state aid.
Kelly Tolhurst
No, I am afraid I disagree. Currently, the devolved Administrations are responsible for aid givers, and they will potentially be aid givers. Under current EU regulations, the devolved Administrations have to notify the Commission of the giver of that aid. The SI will not change that. In a no-deal situation, the CMA will act as the notified body. There is no change. I disagree with the hon. Gentleman’s statement, but I respect his attempt to push that point and get further clarification.
Nick Smith
Mr Antoniw’s letter was dated 6 February, which is now over two months ago. May I press the Minister on when we will get the Government’s legal position? Can she give us a date, please?
Kelly Tolhurst
I thank the hon. Gentleman for his intervention. I believe that the Secretary of State replied to that letter, but I will have to go back and look at what letters he has sent before I can clarify further. I am more than happy to let the hon. Gentleman know after the Committee, if that is agreeable to him.
The Chair
Not only that, but Mr Esterson has indicated that he might wish to have an adjournment. It is perfectly possible to table a motion that the Committee should now adjourn. A vote would be taken and the Committee would determine it. There are a number of options. The key point is that the documents before us have been tabled by the Government and speak for themselves. The Minister has to explain them to all members of the Committee accordingly.
Kelly Tolhurst
The Government made it clear in the intergovernmental agreements on the European Union (Withdrawal) Act 2018 that state aid would be a reserved matter. The SI before us relates to a UK-wide regime and would transpose retained EU law into UK law. Any further discussions or decisions on future state aid policy that might or might not be introduced will obviously not be for this Committee. As I said in a previous answer to the hon. Member for Sefton Central, I will happily provide him with the letter to which he has referred. However, I point out that the Secretary of State has communicated comprehensively with colleagues and with the devolved Administrations, and through officials. There has been no lack of communication between the Secretary of State and the devolved Administrations.
The hon. Member for East Lothian referred to appeals against decisions. The CMA is not the arbiter; it will be the decision maker, and the courts—either the High Court in England and Wales, or the Court of Session in Scotland—will make the judgment on an appeal. Looking at how the EU regulations already work, the Commission makes a decision and the courts then make a decision on an appeal. All law will always be a mixture of legal judgments and future policies. There is no contradiction in what I have said. The CMA will effectively be the decider and will hold the powers, and it will be for the courts to decide whether that decision is correct.
Brendan O'Hara (Argyll and Bute) (SNP)
I appreciate the fact that the Minister is taking so many interventions. This SI, like so many others, seems completely half-baked. Given that there is such opposition to it in Cardiff and Edinburgh, can she tell us whether the discussions with the devolved Administrations have ceased, or are they ongoing? Has any thought been given to what indemnifying policy or process could be given to the Scottish and Welsh Governments, should they be found in breach of these state aid regulations?
Kelly Tolhurst
I point out to the hon. Gentleman that the devolved Administrations are highly aligned with the policy position on setting a UK-wide state aid regime. Our conversations with the devolved Administrations are ongoing and will continue as they are. The Secretary of State has made it very clear that he is committed to meeting the devolved Administrations to discuss these matters and many others in relation to how we exit the EU. In fact, the Prime Minister has made it clear that, were we to enter into an agreement with the European Union and therefore not be in a no-deal situation, we would extend the opportunities for devolved Administrations to feed in.
Andrew Griffiths
Does my hon. Friend agree that just because we do not like the answer to a question, it does not mean the answer is incorrect? Is not what we are doing here just transposing the current EU regime into UK law, with the CMA replicating the role that the Commission currently undertakes?
Kelly Tolhurst
I thank my hon. Friend for that contribution. That is absolutely what we are doing here today. We have before us a no-deal SI, so in the event of no deal we will be replicating the EU laws in the domestic setting. The SI is extremely important for fairness and competition in the UK, so there really should be no resistance from the Committee to what is in it, because it is a fundamental of how we already work, and in a no-deal situation it would be important were we to enter into any future trade deals with the European Union.
I will continue with my opening remarks. Maintaining a level playing field across the whole UK means that the richer parts of the UK will not be able unfairly to distract investment away from less prosperous parts of the country. The existing principles and practices of the regulation of state aid will remain substantively unchanged in the domestic regime, in accordance with the aims and powers under the withdrawal Act. These regulations will therefore have minimal impact on public authorities that grant state aid or entities that receive it.
Instead, the regulations correct deficiencies in the retained EU law relating to state aid. That includes correcting references to EU concepts, such as the internal market and the functions of the Commission, which will ensure that the law remains operable in a domestic setting while minimising the impact on stakeholders. An alternative test of trade within the United Kingdom, however, would inadvertently change the scope of the rules by catching local measures that are currently not caught.
The main practical change under the new regime is that rules will be regulated and enforced by the CMA in place of the European Commission. The CMA is well placed to take over the European Commission’s role of approving, investigating and monitoring state aid across the whole UK. It has extensive experience and understanding of markets as the UK’s competition regulator, and is independent of the Government in its decision making. To prepare for its new role, the CMA has received £20 million from the Treasury contingency fund to prepare for EU exit in 2019-20, in addition to the £23.6 million it received for the year 2018-19, which specifically included £3.3 million for its state aid function.
The Government are working to ensure that the CMA will be ready to take on the new role and have every confidence in its ability to do so. The CMA is on track to recruit all the staff needed to start working on state aid by exit date, if necessary. The CMA will adopt the Commission’s existing state aid guidelines, which provide clear parameters for how and when aid should be approved. The CMA will also receive investigatory and enforcement powers broadly equivalent to those of the European Commission, although I should explain one point of divergence from the EU regime.
Under the EU rules, the European Council has the power in exceptional circumstances to intervene and approve aid before the European Commission has reached a decision. That power does not easily translate into the UK context and we do not consider it appropriate to use the regulations to vest the Government with similar powers. The regulations will still allow the Government to act swiftly if necessary, much as they have been able to do under the existing regime. Ultimately, the Government could bring forward legislation to amend the state aid rules if they deemed that to be absolutely necessary—an option that is not available to the European Council in the EU context.
I mentioned earlier that state aid rules help to ensure fair and open competition throughout the UK. Over the past year the Government have engaged extensively with each of the devolved Administrations and shared drafts of the regulations. As agreed, each devolved Administration will be responsible for managing the communication between their respective aid givers and the CMA. The Government have offered to sign a supporting memorandum of understanding with the devolved Administrations about the operation of the state aid regime, which we still hope to agree. Those discussions have indicated broad agreement on the substance of the Government’s policy to establish a UK-wide state aid regime that mirrors the EU’s. We will of course continue to work closely with the devolved Administrations on the development of state aid policy in the longer term.
As we leave the EU, the draft regulations will give certainty to public authorities and recipients of state aid, and help to maintain confidence for businesses across the UK. Commitments on state aid support free trade, as is recognised in the political declaration. The CMA has the expertise, operational independence and resources to enforce a UK state aid regime.
Martin Whitfield
I wonder whether the Minister will address the exemptions. With respect to Horizon 2020, with an uncertain no-deal departure date—or, we hope, no no-deal departure—what will happen where people have submitted applications but have not heard or are in the process of appealing decisions? With respect to the specified EU projects in schedule 2, what is the position on our contribution to CERN? CERN has always stood outside the EU, but our contribution is a Government-funded payment within the EU. How would the state aid rules apply to that?
Kelly Tolhurst
The draft regulations are not intended to stop any existing schemes in a no-deal situation, which is why we have the exemption list. The Treasury has been clear that all the projects that were committed to prior to EU exit will be honoured. I cannot go into detail about the specific project the hon. Gentleman mentions, because I do not have all the details to hand, but I am happy to give him further clarification on that.
I emphasise that the intention of the draft regulations, and the reason for including those projects in schedule 2, is to ensure that there are no unintended consequences of transposing the EU regulations and that state aid recipients have clarity and understand what will not be subject to state aid. I point out that in 2017, under the current state aid regime, 97% of state aid issued in the UK was pre-exempt. I commend the draft regulations to the Committee.
Bill Esterson
Oh, the hon. Gentleman does not have a legal background either—never mind. We are in danger of being diverted again.
In paragraph 6.10 of the explanatory memorandum, the Government say they will rely on EU case law in their application of state aid rules, but there is legal opinion that we may have to rely on case law from before we joined the EU—this point was picked up in the Lords—as we will no longer be bound by the treaties of the EU. That may be tested in the UK courts, and it may take years to resolve. That has been the case with other regulations passed in Committees like this, and Ministers have not been able to give a satisfactory answer—presumably because there are conflicting legal views about how it would be resolved. Before we joined the European Union, there was of course no comprehensive state aid regime to regulate what was and was not permitted, so the difference between the two options is very significant.
The information provided to us does not give us the evidence we need to make a reasonable judgment about the technical adequacy of the regulations. For a simple example of that, I refer Members to paragraph 6.14 of the explanatory memorandum. I have no doubt about the need to omit specific references to Germany in article 107(2)(c) of the EU regulation, but I also have no way of knowing whether such a technical change is appropriate. More to the point, we have no way of knowing whether all the necessary technical changes of a nature similar to those identified in paragraph 6.14 and a number of other paragraphs have been made.
A further example of our inability to form an opinion can be found in the wording of paragraph 6.28, which states that
“a large number of deficiency corrections were required to make the Procedural Regulation operable in a domestic setting.”
The explanatory memorandum does not describe in detail what that large number of deficiency corrections is, it does not say what the evidence base is for asserting the need for those corrections, and it does not give back-up expert witness evidence in support of that assertion. That sentence is a pretty fair indication that we have an impossible task and are being asked to approve something with a clear lack of evidence to support doing so.
The CMA is being asked to take on responsibility for oversight of the state aid regime from the European Commission. In paragraph 7.2 of the explanatory memorandum, the Government refer to
“the costs and benefits of setting up a completely new body or having an established regulator take this on”.
I note the information before us does not give the details of that cost-benefit analysis or why the decision was taken to choose the CMA rather than setting up a new body.
That takes me back to the points made in earlier interventions about the devolved Administrations. Paragraph 10.1 refers to the discussions with the devolved Administrations and the CMA. It sounded to me in those earlier exchanges as though the Minister was in danger of being right in the middle of a constitutional crisis. Without publication of the Secretary of State’s response to the letter from the Welsh Government, this dispute has not been resolved to anybody’s satisfaction. How can we judge what the outcome is or should be without sight of that response?
Kelly Tolhurst
I would like to clarify what I said earlier on that particular point, where I alluded to the fact that the Secretary of State had responded. I understood it to mean a letter that had been sent to the Secretary of State earlier in the year, which is known and has been published. I had not appreciated that the letter that the hon. Gentleman referred to was the letter sent to the Lords Committee, which my hon. Friend Lord Henley of the other House will respond to. I hope to clarify that point, since the hon. Gentleman raised it.
Bill Esterson
I am grateful to the Minister for that intervention, which tells us that we have not had the response from the Secretary of State. I am pleased that we got that on the record.
The Secondary Legislation Scrutiny Committee (Sub-Committee B) report, published on 7 February, refers to this issue and asked
“whether the Devolved Administrations were content with the approach”.
It is pretty clear that there has not been an answer to that question, let alone the more detailed letter published as evidence given to that Committee, which my hon. Friend the Member for Blaenau Gwent quoted from earlier and which I will quote from in more detail now. Not only are those responses not recorded, but it does not appear they have been made.
Kelly Tolhurst
It is great to be able to answer a few of the questions put to me. I have faced the hon. Member for Sefton Central in Committee several times in recent weeks, but I hope that earlier he was not questioning my integrity by not understanding or believing what is in front of him. I hope he accepts that I always try to answer the questions as openly as they are put to me.
Bill Esterson
On a point of order, Mr Hanson. I am sure that had anything disorderly taken place or the suggestion the Minister just raised been made, you would have intervened and stopped it. May I have your confirmation that that is what would have happened, and that as it did not, nothing disorderly happened earlier?
The Chair
We are having a lively debate and views are being exchanged. The Minister is on her feet, responding to the points made, at length, by the hon. Gentleman, and I call on her to continue.
Kelly Tolhurst
Thank you, Mr Hanson. I think the hon. Gentleman’s point of order highlights that he was not questioning my integrity, so I thank him for pointing that out.
Andrew Griffiths
We have heard Opposition Members speak at such length and with such passion that one might have thought that, if they were so bothered and exercised about the subject, half of their members of the Committee would have turned up to take part.
Kelly Tolhurst
My hon. Friend makes a fair point.
In many of our debates on no-deal regulation, the fact that we are where we are regarding the powers in the withdrawal Act and bringing in retained European law through secondary legislation has been a bone of contention for the hon. Member for Sefton Central. I understand that he wants further scrutiny, but I assure him that the reason we are here today, dealing with a no-deal SI, is that we are retaining EU law and bringing it over so that in the event that there is no deal on exit day, we have a functioning domestic regime. The regulations have been laid and there have been opportunities to read and examine them. I do not believe that the Government in this case are shirking their responsibilities or not giving Parliament the opportunity to scrutinise. We have been debating for an hour in this Committee. The withdrawal Act does not allow us to make big policy changes; we can make the changes required. We are debating a no-deal SI, which will come into effect if we leave the European Union with no deal. If we can reach agreement on a deal, the regulations will not be relevant.
Bill Esterson
That is interesting. I read the regulations and the explanatory memorandum in some detail several times. Although the Minister is right that the regulations will apply in the event of no deal, it is pretty clear that they will also apply if there is a deal. Indeed, I checked this point with the Library, and the regulations will apply whatever the arrangements for our exiting the EU. Will she confirm that that is the case?
Kelly Tolhurst
The hon. Gentleman makes a good point. If we entered into an agreement, we would go into an implementation period, and we would be bound by EU rules as they stand until the end of that implementation period. In any arrangement for our future relationship with the European Union, state aid would be subject to debate and to further negotiation and agreement. It would not be right for me to anticipate that. I am here to talk about a no-deal scenario and the legislation in front of us.
On the hon. Gentleman’s shopping list of state aid requirements—the things he would like to spend money on—I point out that the Post Office effectively does receive state aid. We subsidise the Post Office. We have maintained our network of 11,500 post offices, unlike previous Governments, who have undertaken programmes of closures. I am proud to stand here as the Minister responsible for post offices and say that the Post Office is in a much better place financially than it has been for many years. We are committed to delivering postal services in rural areas, and there are a number of funds to support that. I am determined that that will continue under these regulations.
It is a matter for debate whether, how, where and how much money will be granted to other worthy schemes. It is not for us to decide today which schemes and which parts of the country will receive additional funding. This debate is about the regulations—the rules—and how those decisions will be made. I understand the hon. Gentleman’s wants, but this debate is about the rules for agreeing or disagreeing.
The hon. Gentleman spoke about support for the regions. As he will know, the regional growth fund and most of the regional support funds granted through state aid are covered by the block exemption regulations, so these measures do not stop the Government supporting local communities and regions where required. This Government operate a successful industrial strategy and are determined to continue to invest in research and development, regional growth and opportunities, particularly for small and medium-sized enterprises. Let us not forget the funding available from the British Business Bank, which is an example of where those regulations have been used to benefit SMEs and provide access to finance.
On the devolved Administrations, I repeat that the Government consider the regulation of state aid to be reserved to the UK Government. However, individual choices about how and when to give aid within that framework are for public authorities, including devolved Administrations, to make. The devolved Administrations will have full autonomy in state aid case management and in dealing with the CMA. As I outlined, I recognise that there is a difference of view about whether the regulation of state aid is a reserved matter. However, given that the UK Government are closely aligned with the devolved Administrations on the substance of the policy, and given the limited scope to depart from mirroring the EU regime using powers in the regulations, it is not necessary to resolve that question now. The Government will continue to work closely with the devolved Administrations on the development of state aid policy.
Brendan O'Hara
The Minister says it is not necessary to decide that now. If not now, when will it be decided?
Kelly Tolhurst
As I have already outlined to the hon. Gentleman, the Government are clear that we believe state aid to be a reserved matter. I have tried to outline that a number of times, and I have outlined that there will be no loss to the devolved Administrations.
As I have said, under the current regulations, when the devolved Administrations decide to give aid they have to notify the European Commission. In the future, they will notify the CMA. As I have outlined, the Secretary of State will continue to consult, work with and have conversations with the devolved Administrations on any future aid policy. The Secretary of State has made that commitment, and there is no reason to suspect that it will not happen.
Nick Smith
Surely the Minister accepts that, although she may assert what the Government think, it is fair and reasonable for us to ask them to give us the legal explanation for their view. That is all we are asking for, and we should have it.
Kelly Tolhurst
As I have outlined, we expressed our belief in the intergovernmental agreement on the withdrawal Act that state aid is a reserved matter. That is our opinion, as I have said a number of times. It is not for the Committee to debate whether we were in the right when we expressed that position. The SI in front of us concerns a UK-wide regime. It is a no-deal SI that transposes EU law into UK law and remedies the deficiencies within that law for the UK domestic system, so that if we leave the European Union with no deal we have a functioning state aid regime, which is extremely important for us to trade with the European Union without a deal. If we leave without a deal, businesses will still want clarity over trade opportunities with the European Union. Therefore, the regulations are an important part of ensuring consistency and continuity for the business community and aid givers.
Bill Esterson
I will repeat part of the quote that I read out from the Welsh Counsel General about clauses 7 to 9 of the withdrawal Act. It relates to the inter- governmental agreement that the Minister has just referred to, and states that
“the powers will not be used to enact new policy in devolved areas; the primary purpose of using such powers will be administrative efficiency”.
I put it to her that this is a million miles away from being just about administrative efficiency. By any definition, this is about new policy in devolved areas.
Kelly Tolhurst
I thank the hon. Gentleman for that, but the SI does not create new policy; it relates to retained EU law. As I said, if there are any future changes on state aid—I cannot answer hypothetical questions about what might be coming in future—we will continue to consult and work with the devolved Administrations. If we reach an agreement to leave the European Union with a deal, the devolved Administrations will have a greater opportunity, as outlined by the Prime Minister, who has been very clear that she wants to work with them on formulating the future relationship.
I reiterate that this would be a UK regime. The devolved Administrations would still be able to act as aid givers and make those decisions on where they want to put that aid; they will just have to notify the CMA rather than the European Commission. I highlight the fact that a number of aid options are covered through the block exemption, which I have already outlined; as I said in my opening comments, that covered 97% of the state aid given in the UK in 2017. I therefore believe that the regulations we have before us are sensible, valid and definitely required if we leave the European Union with no deal.
The hon. Member for Sefton Central also asked whether the CMA is the correct authority to take on the state aid function, and why another regulator would not be set up. Let us be clear that the CMA has an international reputation and is extremely well respected for the work it does within competition and markets. It also has relationships throughout the international community. I am absolutely assured that it is the right organisation to take on this function, because of its expertise, the respect it commands and its understanding of competition, which will enable it to ensure fairness while being able to guarantee that state aid is administered without restricting competition or giving unfair advantage. That goes to the heart of what our state aid regime will be. In my view, the CMA is the right organisation to take that on and it has the necessary expertise, so there is no need to create a new regulator.
The hon. Gentleman also asked how the CMA’s preparations are going. I have outlined already the funding that has gone to the CMA to enable it to prepare. I reassure him that we are indeed looking at the devolved Administrations; that is why the CMA has been strengthening its Edinburgh branch—it is expected that some state aid work will be happening in Edinburgh. I assure hon. Members that the CMA has done a great job so far with its recruitment and getting the numbers of people that it will require in place before exit day to manage the new state aid regime. There are only 24 people left to recruit and the CMA has made great strides in that respect.
The hon. Gentleman also talked about the guidance that is being reissued. The guidance that will be provided by the CMA on approving state aid will be issued prior to exit day. He talked about primary legislation and where the Secretary of State will be able to—[Interruption.]
Richard Harrington
I do not know what happened. I pressed every button to try to make it stop.
Kelly Tolhurst
The hon. Member for Sefton Central mentioned paragraph 7.6 of the explanatory memorandum. He read out the passage relating to how the Secretary of State would enact primary legislation. The Secretary of State would do so, in the event that the state aid rules were too restrictive, to provide any state aid that was required. That would rarely be used, but it is an option detailed in the explanatory memorandum.
The hon. Member for Bassetlaw mentioned the motion of regret that was moved in the other place, which focused on the provision of aid rather than the rules governing it. It is important to note that the motion was withdrawn and not divided on. I want to touch on his comments about state aid and the WTO. I understand that he is a great supporter of Brexit and that he might have concerns about this SI. I would like to explain that we have a set of rules here that relate to a no-deal situation. I want to reassure him that the state aid rules in front of us, and the European rules as they stand, have vast flexibility. Over the past 40 years, we have had only six negative judgments against the UK. The decision on whether to offer state aid is a matter for the Government of the day. The regulations before us have not been a barrier to the use of state aid, and they have not restricted our ability to fund the British Business Bank or other projects.
With regard to WTO rules, there are rules that would still need to be adhered to. These regulations would obviously help us establish a future trading relationship with the European Union, and it would be helpful to us to have a clear regime in place, so that the European Union could have confidence in our ability to offer that trade. Quite rightly, as we would be a third country, WTO rules would still be used. They do not necessarily offer us any better protections or give us more flexibility in the long run, but I understand the concerns of the hon. Member for Bassetlaw.
I think I mentioned earlier that WTO rules do not stop any Government nationalising a service; the rules stop them paying more than the market rate for a particular asset. By the Opposition’s admission, they would like us to have a deal with the European Union rather than to go into a no-deal situation, so I would have thought that the Opposition would welcome these regulations to give assurances. Indeed, were we to move to a customs union—the policy favoured by Opposition Front Benchers and their leader—there would need to be some kind of state aid regime.
I could keep rabbiting on forever about state aid. We need to provide continuity and certainty for public authorities that grant state aid and their beneficiaries. This approach will maintain business confidence, particularly in the event of the UK’s leaving without a deal. The regulations safeguard competitiveness, and I commend them to the Committee.
Bill Esterson
On a point of order, Mr Hanson. In the light of the Minister’s inability to deal with the point about the response from the Welsh Government to the Secretary of State, is there a way for the regulations to be further debated on the Floor of the House as part of their passage? That would give the Minister time to get us the answers to that question and others, because this is very unsatisfactory.