United Kingdom Internal Market Bill

Lord German Excerpts

Committee stage & Committee: 1st sitting (Hansard) & Committee: 1st sitting (Hansard): House of Lords
Monday 26th October 2020 Lords Chamber

Let us follow the example we set with that legislation. There is no need to agree to the blunderbuss approach in this Bill. A great deal of work has gone into the common frameworks already, work that can and should be built on. At the end of the day it will help restore confidence by demonstrating that the Government genuinely want to respect all four nations of the UK and do not want to fuel separatist rhetoric. I beg to move.

[Lord German (LD)]

My Lords, these amendments have been prepared by the Welsh Government and have their support; I am pleased to support them. The Welsh Government, as noble Lords know, are committed to the union of the United Kingdom. These proposals before us today seek to find a route through in the way that the Bill has been put together. In fact, they intend to put the horse before the cart rather than the cart before the horse. In the discussions that we had on the previous group and subsequently, there have been for me some very puzzling matters, and I am trying to work out quite where the Government have placed themselves.

First, on timing, the Government seem to argue that we must have the Bill in place in its entirety so that on 1 January they can move forward and have something absolutely concrete to work from. I will come back to that point in a moment. The second point is that the Government have not been able to find any way to describe something which falls outside the area of the structure.



In the last round of amendments, the Minister described additives for flour. Flour and additives are part of the common framework on nutrition. I am told that the three frameworks which are already on the way to early delivery and will be fully operational by the end of the year cover nutrition, hazardous substances and emissions.

I am puzzled why the Government are not able to provide any specific examples of what falls outside the framework, apart from “the future”. We do not know what the future is, but as it arrives we will sort out legislation and frameworks as we move along. That is bound to happen.

Timing is another puzzle because the Government do not want to proceed with the common frameworks as the underpinning structure for this Bill. They seem to want to use what the noble Baroness, Lady Finlay, called a blunderbuss. Battle axe might be another way of putting it. Basically, they do not want the co-operative approach which has been at the forefront of these frameworks.

In September, the Government published their view of the frameworks. Right at the front—on the first page—were the principles which the Government are now seeking to break about the way in which they intend to govern, and about giving and not taking away powers from the devolved Administrations. They were right at the top of the Government’s own papers as recently as last month. If the Government want to put them front and centre, but need something temporary, why not say so? Why not put in a sunset clause, or some form of clause which says this will be a temporary measure until particular frameworks are in place?

The Government’s position is not defensible inside Wales as I know it. The Welsh Government have sought to bring forward a proposal which meets the Government’s aspirations. It says, “Put the common frameworks first and then, if there is any dispute whatever, use the backstop which is being put into this Bill through regulations.” We all want to see an alteration to the way in which they have been carried out and for there to be adequate consultation and debate.

My concern is that I am not certain that the Government know where they are going. I am not certain that they know what they mean by “putting the common frameworks front and centre”. Is this a timing issue? I hope that the Government will be able to answer all these questions.

I want to talk briefly about the one-use plastic teaspoon. They will be banned next year by the Welsh Government, through the Welsh Assembly, because they are bad for the environment and do not degrade in the soil. One-use cutlery is damaging for us as a country and for our environment. However, if that legislation is passed, there is nothing to stop a whole generation of English single-use plastic spoon manufacturers bringing them across the border and distributing and selling them wholesale in Wales. This is an extreme example, but it illustrates that there are bound to be some divergences if the power exists. If, as a Government, you have been given powers and you want to enable them, but you find you are being stopped because of this sort of extraordinary behaviour by a Government somewhere else, that is not going to help the union. The union of this United Kingdom is to be treasured, but to treasure it you have to respect it. I do not believe that the Government are doing so in this Bill. So I ask them all those questions about the direction in which they are going. Will they try to outline whether these frameworks will be placed front and centre? Is it a timing issue? Can they come up with some examples—one would do—which would tell us where the gaps are?

[Baroness Andrews (Lab) [V]]

My Lords, I can speak more briefly to this amendment than the one I spoke to earlier, because my arguments will be much the same. What attracts me particularly about this amendment is that it once again asks the Government to look at the possibility of putting in the Bill the process whereby the Bill becomes the default position and the common frameworks process has to be exhausted before the market principles kick in. I have said before that I think that this is logical. It helps the Government to achieve their own objectives.

When the Minister replied to the previous debate, it was very welcome to hear him say that he was prepared to give more thought to things he had heard the House say this evening. He seemed to think that this process of exhaustion was somehow going to be rather difficult and messy to achieve. From what we have seen in the Common Frameworks Scrutiny Committee, the dispute resolutions are worked out very clearly and in detail. I do not see a problem with that process at all and I would be happy to talk to the Minister about it. If he is worried about that, we can provide some reassurance and, as we scrutinise it, there may be some things we can do to improve the process. If it is a technical problem, then that is what we are here to solve. If it is a problem in principle, then we need to know; he needs to tell us.

The rest of the amendment is slightly more legislative in structure than the amendments from the noble and learned Lord, Lord Hope of Craighead, but I continue to support it in principle because it flags up the significance of common frameworks and the importance of the need for a fit between the Bill and the common frameworks.

The noble Baroness, Lady Finlay, asked me whether we had come across any areas where there was deadlock or difficulty in securing agreement. In the summaries of the frameworks that we have seen so far, and in the one completed framework, we have not seen anything that would alert us to the fact that there is a continuing problem. The problem that the framework negotiators have is the unsettled nature of European negotiations and the issues posed by this Bill itself. They are bound to be waiting for resolutions of different sorts. The processes that they are establishing are clear, transparent and robust. As I say, they offer a solution in practical terms, as well as, frankly, in ethical and political terms, as far as the Government are concerned.

With that, I simply say that I am pleased to support the amendment in principle. I look forward to the Minister, the noble Lord, Lord Callanan, having another go at some of these very specific questions that I think we have a right to hear some answers to.

United Kingdom Internal Market Bill

Lord German Excerpts

2nd reading & 2nd reading (Hansard): House of Lords
Monday 19th October 2020 Lords Chamber

[Lord German (LD)]

My Lords, it is a pleasure to follow the noble Lord, Lord Desai, because I want to talk about the union—the union of which we are all members. I remind the Government that the union that we now call our United Kingdom is very different from the union that existed prior to our membership of the European Economic Community. We have now had more than 20 years of devolution, and the Bill threatens the union as we know it. Many noble Lords have given examples of how it threatens devolution, and I pay tribute to my noble friend Lord Shipley, who talked about the health implications, and to the noble Baroness, Lady Finlay, who also spoke on this matter. So there are big questions about the union, and they are what I want to address.

First, do we need the Bill now? I do not think we do, because there is no threat to the internal market at the moment. The common frameworks, which are close to agreement, could be used in their draft form, if they are not finally detailed and ready. Common frameworks do not even get a mention in the Bill, yet that work has been going on for two years.

Have the Government put in place appropriate dispute procedures? No, they have not. The Government’s engagement with the devolved Governments has not given an inch on their involvement. Will the Bill weaken devolution in our country? Yes, it will, because it produces override and bypass mechanisms that have the effect of reducing devolved powers. Will the Bill guarantee high regulatory standards? No, it will not, by creating a system that places you at a competitive disadvantage if you follow high standards. Will the Bill promote co-operation and trust between the Governments of the UK? That is an easy one: no, it will not. It will self-evidently not, because of the approach to devolution that the Government have shown. The evidence is that it has managed to bring together three very different democratically elected Governments in their view that it is not the right thing to do.

I will mention a few words on Part 6 of the Bill. That is the add-on part, related to spending. It is not clear how that links to the proposed regulatory structure for the UK internal market, which is the intention of the Bill. Perhaps, in reply, the Minister can say why this section is there at all.

In answer to an Oral Question of mine in your Lordships’ House earlier this year, the Government stated that Wales would receive, pound for pound, what it had previously received from the EU, and that that money would be controlled by the Welsh Government. The question that the Bill documentation does not address is whether the Government still intend to follow the pound-for-pound statement they previously made, and that any money proposed to be spent in devolved areas by this UK Government is in addition to the former EU funds replacement. I must say that the reference to “EU programmes” in the impact assessment says to me that the Welsh Government are set to lose control over these funds.

As it stands, it is very unlikely, almost impossible, to see this Bill having the support of all three devolved Administrations. However, with amendment, there is a very slim chance that it could meet with the agreement of the Welsh Government. I ask the Government to live up to the agreement they made in July 2017 that a UK internal state aid framework needs to be drawn up co-operatively and consensually between the UK Government and the devolved Administrations as equal partners. The Government must avoid actions that could lead to the breakup of this union, but to defend the union, you have to have respect for it, you have to have regard for it, and that is simply not apparent from the way this Government are proceeding at this time.

Rolls-Royce

Lord German Excerpts

Wednesday 14th October 2020 Lords Chamber

[Lord Callanan (Con)]

As I said in previous answers, we are supporting Rolls-Royce extensively, but Covid-19 has had a devastating impact on the aerospace industry globally—Airbus and Boeing, the two largest companies, have reduced production by around 40%. We are doing all that we can to help companies such as Rolls-Royce at this difficult time—as its chief executive, to be fair, made clear when making this announcement.

[Lord German (LD)]

My Lords, this pre-Covid decision by Rolls-Royce has an appalling effect upon the skilled workers in that company and, at the same time, on those workers who are to follow. Advanced manufacturing technology is an important part of the apprenticeship programme and apprenticeship numbers are tumbling. How are the Government going to rectify that matter and put back into place the sort of advanced manufacturing skills which the apprenticeship scheme should provide but is failing to do?

[Lord Callanan (Con)]

We are providing extensive support for training opportunities. I have already outlined the enormous support that we are giving to Rolls-Royce and other high-tech manufacturing facilities. I agree with the noble Lord that we need to do more in this field; we need to get more people online and more jobs in these sectors.

REACH and CE

Lord German Excerpts

Thursday 17th September 2020 Lords Chamber

[Lord Callanan (Con)]

Under the terms of the Northern Ireland protocol, Northern Ireland will remain aligned with all relevant EU rules relating to the placing on the market of manufactured goods and with the EU REACH system.

[Lord German (LD)]

My Lords, the UKCA marking will not be applicable in Northern Ireland, whereas the CE marking will be, as well as the UKNI marking. Can the Minister afford the House some advice? What advice would he give to suppliers and traders working in the United Kingdom and producing in Great Britain if they might see their goods popping up in a shop in Northern Ireland? Should they register both with the CE marking and the UKCA marking to ensure that their goods can be marketed not only in Northern Ireland but across the European Union?

[Lord Callanan (Con)]

If those traders wanted to sell their goods into the European Union market, because that was the system they had, they would have to be CE marked. They would have to comply with similar standards if they wanted to sell them in the North American market.

Enterprise Act 2002 (Specification of Additional Section 58 Consideration) Order 2020

Lord German Excerpts

Wednesday 15th July 2020 Lords Chamber

[Lord German (LD) [V]]

My Lords, the Government have frequently used the argument that substantial policy changes should not be made as a result of the coronavirus pandemic, and that mixing a permanent policy change with a policy designed to deal with the Covid-19 crisis is to be avoided. In fact, this very argument was used by the Government this week in rejecting an amendment to the rules on bounce-back loans in the Business and Planning Bill. Well, here we have the Government making the very opposite argument to the one they made in another measure affecting the future of our economic base.

Also this week, the Government deployed this argument about a no-smoking ban in the spaces outside pubs and restaurants, where pavements are now being made available to these businesses. So next week, when they try once again to resist these amendments, I hope that they will not try to deploy arguments that run counter to those they are using today. I have no issue with the Government seeking to advance these policy changes, even when opportunities arise from the pandemic. I am simply asking for consistency.

The Government say that these regulations are

“brought into focus by the demands placed on the UK by the COVID-19 pandemic and its impact on the economy”

and that

“as a result of the economic uncertainty caused by the pandemic, usually stable businesses may be suffering a short-term impact to their share price or profitability”.

But they go on to say that the measures are

“not time-limited to the current pandemic”

and are therefore permanent. So, despite what the noble Lord is saying about a Bill yet to come, these regulations are permanent until such time as the Government alter them; there is no time limit in these regulations at all. So, in supporting these measures, I hope that the Government will explain their volte-face on policy-making in the same week—in fact, within the space of three days.

Contracts for Difference (Electricity Supplier Obligations) (Amendment) (Coronavirus) Regulations 2020

Lord German Excerpts

Thursday 2nd July 2020 Lords Chamber

[Lord German (LD) [V]]

My Lords, it is worth reminding ourselves that the purpose of the CfD is to incentivise investment in low-carbon electricity generation in the UK. I support the measures taken in this set of regulations, in so far as they avoid a large increase in suppliers’ payment obligations at this stage, thereby temporarily avoiding the inevitable passing on of those extra costs to the consumer or a reduction in the effectiveness and economic sustainability of those suppliers. However, we must see these regulations through the perspective of whether they will incentivise investment in low-carbon electricity generation.

As many noble Lords have said, these regulations imply a loan, which will have to be repaid. At present, that is envisaged for next year, although I note, as the Minister said, that it is not time limited. I suspect that he is not in a position to tell whether, if it is to be repeated, there will be an equivalent investment by the UK Government, putting money into the pot to make sure the books balance.

I want to consider the impacts on the generators’ side of the CfD, which are current as well. Can the Minister explain the impact of the changes that have arisen from the targeted charging review? The changes proposed will have an impact on the revenue stream of most low-carbon energy generators. Larger generators will miss out on transmission generation residual payments, which are currently equivalent to about £2.30 per megawatt hour. Once these TGR payments are reduced to zero, a wind farm bidding for a CfD will have to increase its bid by £2 per megawatt hour to ensure the same internal rate of return. This, in turn, will have an impact on new generation projects coming forward. Ofgem acknowledges the impact of the TGR on generators, stating:

“There is a risk that these changes could lead to the cancellation of some projects, including renewable generators which have been awarded CfD contracts”.


Can the Minister tell us whether these changes have been postponed? They would certainly affect the quarterly reconciliation process under the CfD, which determines obligations. In turn, that would mean a shortage of low-carbon generation to meet the Government’s targets. The regulations we are considering today acknowledge the urgency of ensuring that additional costs arising from the response to Covid-19 will not fall upon suppliers. But if the whole purpose of the CfD is to incentivise low-carbon electricity generation, these regulations must provide a temporary fix not just to one side of the equation; they must pay attention to the generation incentive as well.

Discontinuing Seasonal Changes of Time (EUC Report)

Lord German Excerpts

Wednesday 24th October 2018 Lords Chamber

[Lord German (LD)]

My Lords, I pay tribute to the staff and clerks of this House for drawing up this reasoned opinion, and also to the noble Lord, Lord Whitty, for chairing the sub-committee so well and presenting this reasoned opinion to the House.

I do not intend to use this debate to promote the merits of retaining or abolishing daylight saving time. The House of Lords has debated this matter on several occasions and come to its conclusions. It is quite clear that there are different opinions across the United Kingdom. However, the principle of whether abolition should be within the competence of the European Union is at the heart of the matter for debate and decision here today.

As the noble Lord, Lord Whitty, says, this reasoned opinion debate opportunity presents itself to the UK as we are currently full members of the European Union. If the timetable for the European Union legislation implementation, as outlined in the draft directive, is followed, then the proposed European law would come into effect in March or April of next year, meaning that the UK—should we leave the EU with a deal—would be obliged to implement it during the transition period. If we fail to change this legislation at this point, and if the UK leaves the European Union without a deal, then the potential for time differences between the UK and Ireland, and thereby also across the Northern Ireland border, would vary for six months of the year.

The European Union believes that it has competence to bring forward this proposal to ensure the proper functioning of the internal market. This debate and decision—because this House has one vote in the European Union, as does the House of Commons—if given appropriately, could mean that the European Union would have to change its mind if sufficient numbers of parliaments across the European Union agree. The purpose of this debate is, first, for Parliament, and the House of Lords, to assert that matters regarding major time changes should be left to member states; and secondly, to pass the reasoned opinion, then build agreement with other member state parliaments so that a yellow or red flag can be raised, causing the Commission to think again.

The principle of subsidiarity serves to regulate the exercise of the Union’s non-exclusive powers. It rules out Union intervention when an issue can be dealt with effectively by member states at central, regional or local level, and means that the Union is justified in exercising its powers when member states are unable to achieve the objectives of a proposed action satisfactorily, and added value can be provided if the action is carried out at Union level.

Under Article 5(3) of the European Union treaty, there are three preconditions for intervention by Union institutions in accordance with the principle of subsidiarity. First, the area concerned does not fall within the Union’s exclusive competence; that is called non-exclusive competence. Secondly, the objectives of the proposed action cannot be sufficiently achieved by the member states; that is necessity. Thirdly, the action can therefore, by reason of its scale or effects, be implemented more successfully by the Union; that is added value. It is on the second of these preconditions—necessity—that the case is being made to Parliament today.

First of all, I want to deal with the counterargument that might be put to us by the European Union: that the United Kingdom agreed to synchronise daylight saving changes across the European Union under a European Union directive, and therefore, they would maintain, the competence required by the European Union has already been demonstrated.

Apart from the legal base of this legislation over the 2000 directive, here I must turn to the principle of proportionality: that actions must be limited to what is necessary to achieve the objectives set. Unfortunately, the Government’s Explanatory Memorandum is woefully thin on this matter. It is quite thin gruel, because it places the principle of proportionality under the heading “subsidiarity”, which is of course a separate principle. However, putting the Explanatory Memorandum aside for a moment, the argument from the European Commission is that it is safeguarding the proper functioning of the internal market in respect of time arrangements through harmonisation. But we already have harmonisation of time: our clocks move to and from daylight saving time at the same time as those of other member states. The Commission fails to adequately explain why the abolition of daylight saving time would bring proportionate benefits to the internal market beyond the harmonisation we currently have.

As well as that, a change from daylight saving time harmonisation to abolition altogether is a major change to the arrangements in this country, and indeed in other member states which operate daylight saving time alterations twice a year. Put simply, moving the date at which we altered our clocks to a common date meant we shifted our clocks a week or so differently than we had been used to. Something we already did every year was subsequently done on a uniform date: a relatively minor change with little meaningful negative impact. However, abolition altogether would mean a different time for six months of the year, which I maintain is a major change to our arrangements. I believe that this House can justifiably argue that the change proposed breaches both the subsidiarity principle and the proportionality principle under which the European Union operates.

I turn now to the evidence which the Commission has provided. It cites as evidence of the need for change an assessment paper on the impact of the 2000 directive harmonising the dates for daylight saving time for the European Parliament, and a paper outlining the results of a public consultation. I will take each of these in turn.

The assessment paper helpfully points out that,

“EU legislation did not introduce summer time in the EU, but instead harmonised existing national legislation”.

That is a very important point, because that argument again strengthens the case for subsidiarity. The document further states:

“No EU government has called for a change to the current DST provisions”.


This is another argument which poses no question about the necessity for intervening with member state governments.

The paper makes further conclusions which are relevant to this debate. First, it concludes:

“DST benefits the internal market, leisure activities and generates marginal energy savings”.


Secondly, it says that,

“the impact of DST on various other sectors … remains inconclusive”,

and, in terms of health, the evidence is mixed, with some good and some poorer effects. Obviously, if you change the arrangements, there will still be some good and some poor effects. Taking these factors together, the current system has not given rise to significant complaints, either economic or social.

The public consultation seems to be one of those surveys where the questions asked—and to whom they were asked—give rise for concern. There were 4.5 million respondents, of whom 3.1 million came from Germany. The next biggest responding country was France with 393,000 respondents—about one-eighth the size of the German sample. Given the small numbers from other large member states, including the United Kingdom, it seems obvious to me that two factors were at play. First, clearly an effort was made in Germany to achieve a high response, through whatever methods, which was not emulated elsewhere. My second conclusion is that the relatively low numbers for the majority of member states indicates that those with concerns were more likely to respond than those who were happy with the status quo. I hesitate to mention one of the five questions that was put. I ask myself, what is the obvious answer to the question, “Would you prefer permanent summer time or permanent winter time”? Answers on a piece of paper.

The reasoned opinion drawn up by this House illustrates these matters well and explains the case for powers over time changes remaining with member states. Here and in the European Union, we are well organised on the current daylight saving time arrangement. The clocks go forwards and back at a time we all know; the airlines have their schedules ready and use them accordingly. The status quo is working. My plea to the Government is to assist in getting the support of other Parliaments to provide reasoned opinions as well. I request the noble Lord, Lord Whitty, to understand what steps this House will take, having passed this reasoned opinion, to promote it to other Parliaments in the short timescale left. I support both Motions before us.

Brexit: Competition and State Aid (EUC Report)

Lord German Excerpts

Thursday 24th May 2018 Lords Chamber

[Lord German (LD)]

My Lords, I join others in thanking the noble Lord, Lord Whitty, for his chairmanship of this committee and for the report that has emerged. I also thank the committee staff, who have been moving with the sands of time, and therefore the noble Lord’s skilful chairmanship of the committee has been absolutely essential in taking us to this stage.

It will not surprise noble Lords that I do not agree with the noble Baroness, Lady Noakes, on the roles of the European Union Committee and its sub-committees. The primary purpose of the committees of this House is to scrutinise the Government’s relationship with the European Union. These matters are top, front and all that dominate their work in relationship to Brexit—it is the one show in town—and it is perfectly appropriate for committees to carry out this kind of scrutiny.

The noble Baroness has raised issues on which I agree with her—I will come to them in a moment—but I do not agree that there are not new issues raised in the report. The issue of state aid, on which I want to focus, did not exist prior to our membership of the European Union, and what happens next is of critical importance, particularly to the poorer parts of the United Kingdom which have a lower success rate than the south-east of England.

Regarding the committee’s report, on the issue of mergers, acquisitions and anti-trust issues it was demonstrated that we have a robust policy in this country at the moment and that continuing the robust nature of our policy is important. The UK regime is perhaps a leader in this matter, and the issues considered and agreed raise only one major fundamental difference, and that is whether or not the UK regime can continue to engage with, and continue our membership of, the European competition networks. There is benefit in being able to share, learn and work with others even though we may be separated from them. However, when the committee started taking evidence, it became clear that state aid was increasingly cutting through as a key issue which needed to be understood and progressed.

In their response, the Government have said that they do not yet have a state aid policy, but we will need one from day one of our exit from the EU. That end-point could occur whenever the transition or implementation phase comes to an end, so there is time for the Government to come up with a state aid policy for the UK and, therefore, the issue is one that they will have to address. Given that, beginning to address it now is critical in order to avoid the uncertainty that will otherwise result for those parts of the United Kingdom where legal powers enable them to promote and support industry and business development.

As we know from the government response but did not know at the time when we took evidence from the Minister, the CMA will be the state aid authority. I draw the conclusion that we were told at the time of the evidence session, and before we were told that the CMA would take on the state aid authority role, that the £23.6 million which had previously been announced by the Government was for the CMA to undertake Brexit-related issues within its existing responsibilities and that it was therefore not related to the new responsibility of becoming the state aid authority, which of course resulted from the evidence given by the Government in response to this report.

However, I agree absolutely with the noble Baroness, Lady Noakes, that the body has to be independent of government, since it will be advising not only on the state aid regime which the UK Government may have responsibilities for but also that for which the devolved Administrations may have responsibility—and, further on from them, the elected mayors and perhaps the northern powerhouse, which may gain some traction as well. The question of what form that independence for the CMA will take and how it will be guaranteed in its state aid role is pretty critical. I agree with the comments of the noble Baroness, Lady Noakes, in that respect.

The other issue, which was touched on, by both the noble Lord, Lord Whitty, and the noble Baroness, Lady Donaghy, is that the state aid rules are not a barrier to developing business and enterprise in this country. As we have heard, we would have to triple the amount we spend on state aid as a proportion of GDP in order to match the amount that Germany spends on such aid. We might wish to spend more, and we are certainly not among the big spenders. But neither do the state aid rules prevent state ownership, which some people are in favour of and indeed some parties have already set out their stall on this matter. The EU already has 800 state-owned companies working within it, and therefore no barrier is imposed by the state aid rules should any future UK Government wish to go in that direction, which I hope they will not.

EU structural funds, which is the funding that the European Union provides to this country and will be coming back to the UK should we ever leave the EU, already permit distortion to the level playing field, which is a principal pillar of the single market and the customs union. These funds have been greatly useful in west Wales and in the valleys, where GDP has persistently been below 75% of the EU average for the whole of the past 20 to 25 years. The ability to develop infrastructure for business training support and business assistance programmes, which have received European funding and are available in most other parts of the United Kingdom, clearly shows that there is some need to be able to support the different parts of the United Kingdom. State aid is a facilitation of the infrastructure, but despite this, business in the UK has not been a major user of the interventions which have been permitted.

I should also point out the change that has occurred since devolution. Those Members of the House who were involved in political life prior to us joining the European Union will of course be aware that, at that stage, we had regional selective assistance programmes, which were a major subject of dispute within government. But think what will happen now, as those disputes arise between those with the legislative powers to execute those changes. Business development support is certainly something that is within the power of the devolved Administrations. As a former Minister for Economic Development in the Welsh Government, I had to use those powers to the extreme when we faced the closure of steelworks in Wales, where we needed to provide as much assistance as we could to create and retain part of the steel-making fabric in other parts of Wales.

There are now new players on the agenda, apart from Wales, Scotland and Northern Ireland. In the future, this could mean that mayoral powers and local government might be given more in the way of business support. In its new role, the CMA will have to reflect both those changes and the interests of each of those legislative bodies, which it will adjudicate on. So it is not sufficient for the CMA to take instruction from the UK Government alone.

That brings me to the issue of frameworks. The Government’s response to the report mentions that they will need a framework because, although the CMA will be the regulator, it will not provide the strategic framework in which a UK single market will operate. If a UK single market is to operate with those different legislatures, it will need instruction, direction or some form of agreement—at least a fabric of agreement—from them on the framework in which it will operate. As noble Lords just heard, there will be a difference, for example, in the water industry. Some parties in this Chamber may want to nationalise the water industry, but I would point out to those of us who are recipients of water from Welsh Water that it is a not-for-profit organisation, and I do not think that the people of Wales would want to change that—thank you very much. Blanket policies that try to operate across the United Kingdom will certainly not work in the interests of parts of the UK where legislative powers exist to make sure that these things are dealt with at different levels.

So the framework that is about to be discussed is urgently important. Who will determine it? In the debates on the European Union (Withdrawal) Bill, issues relating to powers for Scotland and Wales were the subject of great dispute. While the UK Government have reached an agreement with the Welsh Government, they have not reached one with the Scottish Government on how they will operate certain powers. There is a lesson in this: the UK Government ought to work now with the devolved Administrations, local government and mayors to try to find a way in which this framework can be put together.

Of course, a route for that to happen is through a joint ministerial council, which is meant to bring together Ministers from the different Administrations to come to an agreement. I believe that there is now a role for a JMC to be put on a statutory basis and become the body that will issue and develop a strategy that has the agreement of the whole United Kingdom, so that the CMA can operate in its new state aid role. As we know, the current agreement with the Welsh Government on the European Union (Withdrawal) Bill is that the various powers that reflect on the Welsh and UK Governments have been frozen until the framework is in place. That agreement was reached by the UK Government with the Welsh Government but has not yet been reached with the Scottish Government. That route was taken because the Government needed some process by which they could advance on how those powers would be developed and used. We need joint agreement very rapidly.

Finally, I want to ask the Minister some questions about the future. First, when will the Government begin engagement with the devolved Administrations on the structure of a future framework for state aid, or whatever they might think of as a suitable name for the new subsidy regime for the United Kingdom?

Secondly, does the Minister anticipate that any form of trade deal with the EU, or indeed any other country, will require some form of state aid restriction? We know that the WTO rules are different from the EU rules, but do the Government anticipate some form of state aid restrictions inevitably being put before us?

Thirdly and finally, do the Government agree that some formulation for determining the future state aid regime similar to the joint ministerial committee is an appropriate mechanism? Given the variety of frameworks, not least those identified during the passage of the EU withdrawal Bill through your Lordships’ House, is a permanent statutory structure of a joint ministerial committee an appropriate way of dealing with it?