Brexit: Devolved Administrations

Lord Wallace of Tankerness Excerpts

Thursday 25th January 2018 Lords Chamber

[Lord Wallace of Tankerness (LD)]

My Lords, I too congratulate the noble Lord, Lord McInnes of Kilwinning, on introducing this important debate. It is a great pleasure to follow the noble Lord, Lord McConnell of Glenscorrodale, with whom I worked co-operatively and productively in government in Scotland for six years.

I think I was one of those, along with the noble Lord, Lord McInnes, who believed in the union—indeed, I speak unashamedly as a member of the only party that unequivocally supports Scotland within a United Kingdom and a United Kingdom within the European Union—but I was one of those who felt fragile about Scotland in the union in the immediate aftermath of the 2016 referendum. Indeed, when the First Minister was putting forward the idea of a second referendum, which, as we all know, has subsequently produced a collective yawn, she found out that it was difficult to persuade some of her own supporters. A significant number of people who had supported independence also supported Brexit. I actually applaud the consistency of that position.

I also think that what we are now finding is that, almost certainly inadvertently, the Scottish Government are starting to make out some good arguments for Scotland remaining in the United Kingdom. Last week, they published a paper entitled Scotland’s Place in Europe: People, Jobs and Investment, which said that a failure to stay in the European Union single market or secure a free trade agreement would see Scotland’s GDP around £12.7 billion lower by 2030 than it would be under continued EU membership. That amounts to a loss equivalent to £2,300 per person per annum. Our experience of the somewhat fantasy figures produced by the Scottish Government in their White Paper in the run-up to the independence referendum should perhaps mean that we take these figures with some care, but the general impact will not be doubted.

But if that is the impact of leaving the single market, what greater impact would there be of leaving the single market of the United Kingdom, which has lasted for more than 300 years with a single currency and a common language? The SNP point to the fact that the European Union market is one of 500 million, but as Mr Kevin Hague of These Islands says in his blog this week:

“Of course the EU market is much larger, but even after nearly 45 years of unfettered market access our exports there are relatively small (16%) compared to those to the rest of the UK (63%)”.


So we may perhaps suggest that leaving the single market of the United Kingdom would have an impact four times as great.

The noble Lord, Lord McInnes, said we should not be complacent. Indeed, we cannot take our union for granted; it needs careful nurturing. That is particularly so at a time of constitutional upheaval. I agree with the noble Lord, Lord McConnell, who said that as we approach the European Union (Withdrawal) Bill we must apply to it the rigour with which the initial devolution settlement was approached in 1997-98. There will be plenty of opportunities over the next few weeks to look at that Bill in general and Clause 11 in particular.

I do not believe that this Government have done the union any favours by the cack-handed approach they have adopted to the Bill, particularly their treatment of the devolution settlement in Clause 11. As the conclusion of the first report of the Public Administration and Constitutional Affairs Committee in the other place said in November:

“The overall concerns regarding the devolution aspects of the EUW Bill arise from the constitutionally insensitive nature of the UK Government’s approach in Clause 11”.


It is not fit for purpose. It turns on its head the spirit of the devolution settlement: that everything is devolved except what is expressly reserved.

We now seem to have got some recognition from the Government that they got it wrong. The Secretary of State for Scotland promised amendments in the House of Commons. I will not indulge in scoring political points that they were not produced; I think it is better to get it right than rush it. However, it is a matter of regret that the elected House will not have a proper opportunity to consider the amendments—only in ping-pong.

I very much share the view expressed by the noble Lord, Lord McConnell, that getting an agreement should not be terribly difficult. In Scotland, there are an estimated 111 instances where powers being repatriated have a devolution component. The Scottish Government agree that there are areas—not least with regard to the functioning of the single market in the United Kingdom—where UK frameworks are necessary. The United Kingdom Government agree that some elements can be directly devolved to Belfast, Cardiff and Edinburgh on Brexit day plus one, but on others we will require memorandums of understanding, working together and common agreements. Rather than political grandstanding, a bit of rolling up the sleeves and getting down to it would be very helpful.

I cannot accept that a Parliament such as this—which in the past two years devolved the whole of income tax, with one or two exceptions, to the Scottish Parliament—will find a stumbling block when it comes to issues such as chemical regulations, including pesticides, or energy performances and building directives. A good dose of common sense will sort this out. The Minister should tell the House, as we approach Second Reading, where the agreements are that have already been reached. Is it a complete stalemate, or are there areas where it has already been identified what goes into each basket, be it in terms of common frameworks, memorandums of understanding or direct devolution?

The European Union Committee, whose report, as the noble Lord, Lord McInnes, indicated, we debated in October, talked about the need to set aside differences and work constructively. That is particularly the case today. Looking to the future, we need that spirit of co-operation.

Last night, I attended a seminar by the Institute of Chartered Accountants of Scotland—I refer to my entry in the register of interests as chair of the regulation board—on what we can learn from Canada for Brexit. I learned that when CETA was being negotiated, representatives from the provinces and the territories were always in the negotiation room. I think the Government could do a lot better than they have been up to now in engaging and embracing active collaboration and co-operation from the devolved Administrations. Early on, I remember giving evidence to the Select Committee on the Constitution, where it was suggested, not only by me, that there was much merit in seconding civil servants from the Welsh and Scottish Governments into DExEU or the Cabinet Office to assist. I am not sure whether it ever happened; perhaps the Minister can tell us.

Again, looking to the future, when the UK frameworks are established—and they must be established by consent—we should look at ways in which we can entrench them, be it by statute or, as the Welsh Government have suggested, a UK council of Ministers, so that the UK Minister does not act as the English Minister in imposing a solution but that there is respect among the different nations of the United Kingdom and their Ministers. In that way, we can move forward. If it is by establishing these relationships and providing suitable mechanisms that we take the United Kingdom further down the road to federalism, then the very dark cloud of Brexit may yet have a silver lining.

--- Later in debate ---

[Lord Duncan of Springbank]

I thank the noble Lord, Lord McConnell, very much for his intervention. The respect agenda is at the heart of the answer to that question. The deep dives are vital for each of the participants to recognise that the solution needs a common framework to address the particular challenges. There will be tensions—I do not doubt they will exist—where there is disagreement, where one of the Administrations say, “Actually, in this particular area, we believe this and the other one disagrees with it”.

Part of the bigger challenge is the movement of rules coming back from the EU, where there are—as the noble and learned Lord, Lord Wallace of Tankerness, pointed out—111 laws that directly affect Scotland. For Northern Ireland, it is more than 140; for Wales, it is around 60. Of course, because of the devolved settlements, the rules are different; so again, the point is to try to find areas of common consensus. In truth, representatives of the various individuals who are part of the stakeholder community will each have to be able to defend their points to the stakeholders, to explain to them why they are arguing one way or another. Those stakeholder communities must also lend their acceptance to this particular point, because upon the hearing the outcome of these discussions, they cannot—and should not—rise up in arms and say that it is an absolute travesty and a scandal. They should be satisfied that this is the best and right way of doing things. The important thing to emphasise is that this is not in any way an attempt by the UK Government to demand certain concessions from the devolved Administrations. That is not the ambition at all.

On the wider question of the institutional arrangements whereby the various parties come together and meet, there have been challenges. There is no point in pretending otherwise. I have a very helpful list somewhere. Noble Lords have asked very thorough questions so I have many pieces of paper; I am now hunting for the right one. We had a hiatus between February and October 2017 for one particular reason: the election. That slowed things down quite considerably. The important thing to stress is that for a very long period, the JMC’s arrangement had been all but moribund: it had not been a functional part of the engagement between the devolved Administrations and the UK Government. Recognising that that was no longer fit for purpose, the UK Government have sought to expand the number of forums by which we have agreement under the JMC, as well as recognising that the frequency of those must therefore be driven by the necessity of the particular issues. That is why what would have been the traditional ongoing European legislation—which was the most important forum for the focused issues before the devolved Administrations—is, if anything, the quieter forum. The negotiations forum is now absolutely critical, as is trying to make sure that there are opportunities at those meetings for a free and frank discussion. There are, and I can assure noble Lords that the discussions are very free and very frank.

There are challenges. I am reminded of the words of the noble Lord, Lord Bruce of Bennachie. At the outset, one of the challenges in this area was that it was very hard to reconcile the demands of the different Administrations because they were not bridgeable in simple terms. So, the notion and the paper put forward by the Scottish Government could not be easily reconciled with the reality of what the UK Government believed they had to deliver after the referendum. That caused a lot of the political tensions. It is very hard to meet on common ground when one party is on one side of the chasm and one is on the other; you end up falling to the bottom like Wiley Coyote, with your arms flailing in the air. We were trying to avoid that outcome. It is bridge building that gets us across the chasm, I hope.

We need to give some consideration to the situation in Northern Ireland. Many noble Lords have rightly mentioned that there is a void in Northern Ireland. We cannot pretend otherwise. I can assure noble Lords that my right honourable friend the Secretary of State for Northern Ireland is actively pursuing facilitating the dialogue required to develop a functioning Executive. On more than one occasion, I have said from this Dispatch Box that Northern Ireland is ill served without an Executive. Although the civil service there can do a great deal to help in many different areas, they cannot do everything. That is why it is important to recognise again the need for a realistic and functional dialogue. Those talks are ongoing; we hope that those around the table will recognise the importance of securing agreement on this occasion but we recognise the challenges that we face.

On the question—again, raised by a number of noble Lords—of the agreement reached by the UK Government and the EU before Christmas, which touched on Northern Ireland and the border question, it is important to recognise that that is but one step toward a larger agreement between the UK and Northern Ireland. Without that agreement, there will be significant challenges for both sides. That is why, in this instance, the ongoing negotiations again seek to address the challenges. One would hope that through that, the negotiations will deliver the Northern Ireland question as part of a bigger settlement. Those negotiations are ongoing. I believe—this is where it becomes important—that we often find ourselves, particularly when following certain newspapers, caught up in an almost daily crisis of one sort or another, with the narrative driven forward in that fashion. However, if we step back and think about it, just before Christmas the UK Government managed to deliver on what they said they wished to do: secure agreement on these three key areas, to allow negotiations to begin shortly thereafter. They achieved that. From some of the reporting, you would have thought that they had failed, but they did not. They moved things forward in that fashion.

The time ahead will not be straightforward. I realise that we will have plenty of opportunities to discuss further the questions that underlie the repeal Bill. I am sure that many of the contributions made today will help inform the Government as they begin to think about how best to approach the investigations into the repeal Bill and its functionality. But we will have to resolve those questions here in such a fashion that we can return those amended clauses to the House of Commons to allow them to deliver upon that. I believe that we will make a difference and, indeed, do what this House always does: seek to make things better. I think the Government will appreciate the work done here in that area.

We have to recognise that the union is perhaps something larger than just the moment of Brexit and the discussions that surround it. A number of noble Lords have pointed out today that immediately after the referendum on Brexit, there was a great fear that our union would itself begin to experience some of the challenges but in truth, there has been a degree of resilience. As we witnessed through the, shall we say, unexpected general election last year, the parties that had perhaps anticipated doing better, certainly in Scotland, did not do so on the basis of what they offered the people. That should be a salutary reminder to anybody who believes that they have the people behind them: it is always worth looking over your shoulder, just to make sure they are still there. You cannot take the people for granted in this regard. The result of that election was a useful reminder to us all to focus on what the people want, whether that be the people of Scotland, the people of Wales or, I hope soon, the people of Northern Ireland.

We in this House must recognise that we have a role to play in ensuring that our union works, and works well. That is why I am indebted to my noble friend Lord McInnes for bringing before us today an opportunity to discuss and explore these issues. It is timely because next week, we will be knee deep in thorough discussions on the questions before us regarding repeal. As I try to answer the questions, I am aware how useful that will be to my colleagues in facilitating, I hope, the right sort of dialogue as we go forward. But I am also aware that there is heavy lifting to be done and we have not yet resolved these issues. On the question of Clause 11 as it affects the devolution settlement, we need to be able to bring before your Lordships a workable amendment that can deliver exactly what it says on the tin—and when we tell your Lordships that we have it, we are telling you that other people in Edinburgh, Wales and, through consultation, Northern Ireland agree that this is the way forward. That should allow us to make that necessary step.

When I began my remarks, I pointed out that in some respects we have been through a revolution, as only Britain can do, in the way that our powers have moved. But we have done so in a piecemeal fashion; again, a number of noble Lords made this point. We need now to refocus on trying to ensure that we are not making stumbling progress but have a clear objective: to make sure that the devolved Administrations fit into a sensible and workable government structure for the United Kingdom. People have to recognise that whether they are in Edinburgh, Wales or Northern Ireland, they have two Governments, not just one. It is important to stress that. Again, we need to be better at explaining to people what the Governments are doing and what their actual responsibilities are. Quite often there is sheer confusion on these points.

[Lord Wallace of Tankerness]

I generally agree with the point the Minister is making but, as part of that better integration, will he respond to the suggestion I made, based on the Canadian experience, that Northern Ireland officials and Scottish and Welsh Ministers might also be involved at the table in the forthcoming phase 2 negotiations?

[Lord Duncan of Springbank]

The noble and learned Lord, Lord Wallace, makes an important point. As a Member of the European Parliament many years ago—no, last year; time is just slipping through my fingers here—I am very conscious that the discussion was always about who sits at the top table and therefore represents the United Kingdom. I was always of the view that the table in London, where all the devolved Administrations argued these things through, was as important as the seat at that top table. Determining the UK position in this instance will be exactly the same. We must deliver a UK position which is part of the respect agenda and delivers for the peoples of Scotland, Wales and Northern Ireland that which is right, workable and appropriate. I can assure your Lordships that those will be dingdong discussions around the tables in London, where the heaviest lifting will be done. As to the point the noble and learned Lord makes, to be frank I do not know the answer, but the important table is the one where we bring together all these individuals to make sure that we are positioned to deliver on behalf of the people we represent.

I am conscious, again, that I am perhaps overstaying my welcome. On this day of Robert Burns, we are conscious that we celebrate that across the globe. So perhaps I might close with some words of Burns, which I thought were slightly appropriate:

“O let us not, like snarling curs,

In wrangling be divided,

Till, slap! come in an unco loun,

And wi' a rung decide it!

Be Britain still to Britain true,

Amang ourselves united;

For never but by British hands

Maun British wrangs be righted!”.