United Kingdom Internal Market Bill

Baroness McIntosh of Pickering Excerpts

Report stage & Report: 3rd sitting (Hansard) & Report: 3rd sitting (Hansard): House of Lords
Wednesday 25th November 2020 Lords Chamber

[The Deputy Speaker (Lord Lexden) (Con)]

The next speaker on the list, the noble Baroness, Lady Neville-Rolfe, has withdrawn. I call the noble Baroness, Lady McIntosh of Pickering.

[Baroness McIntosh of Pickering (Con)]

My Lords, I am delighted to follow the noble Lord. Like him, I was surprised at the level of the penalties for these infringements. I join noble Lords who congratulated and thanked my noble friend the Minister for listening to concerns expressed at an earlier stage of proceedings and bringing forward Amendment 62. I will just ask: what form will the consultation by the CMA with the devolved Administrations take? How long will be allocated to it generally, along with the other bodies that are to be consulted?

Has the CMA taken a policy decision not to have on its board currently, as I read it, any representatives of the devolved Administrations? I notice that Jo Armstrong, for whom I have the highest regard, is represented. She is currently a commissioner with the Water Industry Commission for Scotland with whom I have had the pleasure to work for four or five years. But I do not see that any specific representatives of the devolved Administrations are there. Given the thrust and context of this Bill, it will be interesting to know if there is any policy principle as to why there are not. I know that my noble friend will say that that is a matter for the CMA, but it works under the guidance of the Secretary of State and the department, so I ask him to comment in that regard.

I echo the concerns raised by other noble Lords and I thank the noble Baroness, Lady Bowles, for her Amendments 62A, 63A and 63B. I ask my noble friend to consider to what extent the ask under Article 39 goes much wider than is currently envisaged in, I think, the Enterprise Act that forms the basis for these provisions. Against the background that these are quite substantive penalties, will the Minister be mindful of the debate that we have had, noting, in particular, the comments made by the noble Baroness, Lady Bowles, my noble friend Lady Altmann and the noble Lords, Lord Vaux and Lord Liddle? Will my noble friend have regard and perhaps pause at this stage and come forward with a further government amendment at Third Reading?

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[Baroness McIntosh of Pickering (Con)]

My Lords, I preface my remarks by saying that what will replace the European structural funds is a matter of interest not only to the devolved Administrations but to the regions, such as Yorkshire, as well. I was fairly agnostic about this group of amendments before the debate commenced but now I think that the noble and learned Lord, Lord Thomas of Cwmgiedd, and the other noble Lords who tabled these amendments have done the House a great service.

In the briefing on the spending review, the emphasis now appears to be much more on UK-wide spending. It states:

“The Spending Review takes advantages of our departure from the EU to benefit the union. We will ramp up funding, so that total domestic UK-wide funding will at least match EU receipts … for the introduction of the UK Shared Prosperity Fund, we will provide additional UK funding to support our communities to pilot programmes and new approaches. We will also deliver £1.1 billion to support farmers in Scotland, Wales and Northern Ireland, £20 million to support fisheries—and we will build one freeport in each part of the UK.”


It goes on to say that the spending review is UK-wide and refers to the UK shared prosperity fund and the shared rural network. Although I welcome the funding that has been announced, it is incumbent on us today to find out whether, in the words of the noble Baroness, Lady Finlay, the Government are now working around the devolved Administrations rather than with them.

I am particularly concerned with one aspect relating to economic development, which I hope is relevant to this group of amendments. England and Defra have clearly stated that they are committed to phasing out direct payments to farmers from 2021, but the new system involving an environmental land management scheme will not be in place until 2024. As I understand it, however, the Scottish Minister has announced that direct payments to farmers will be retained for the foreseeable future. That begs the question of what the impact on economic development will be for English farmers as opposed to Scottish farmers and whether that will potentially distort the market between England and Scotland. That would seem to flout the principles of mutual recognition and non-discrimination, which we have heard so much about during the Bill’s passage.

I welcome this debate. I am particularly supportive of Amendments 64 and 67, both of which have been spoken to so eloquently by their authors. I urge my noble friend the Minister to say how the payments under the shared prosperity fund will be distributed. Obviously, I would add a rider that Yorkshire would like to have its fair share of that fund, but it is incumbent on my noble friend to state whether we are departing from what we have become accustomed to under devolution or whether this is simply a red herring.

[Baroness Humphreys (LD) [V]]

My Lords, I support Amendment 64, which seeks to remove Clause 42 from the Bill. I thank the noble and learned Lord, Lord Thomas of Cwmgiedd, for tabling such an important amendment and for his excellent explanation and analysis of its intent.

Clause 42 empowers the UK Government to provide financial assistance for economic development in any area of the UK. At the outset, I want to make it clear that I have absolutely no objection to the UK Government making investments for economic development in Wales—nor, I believe, would anyone else in Wales. It is the intrusion into devolved powers that is so offensive. Those of us who live in the Objective 1 area of West Wales and the Valleys understand that our economy is weaker than those in other areas of the UK and that we live in one of the poorer regions of Europe. We have appreciated the EU’s investment in the past 20 years; for example, the investment in the A55, which provides such a vital transport link across north Wales, and the projects that we have seen come to fruition under the rural development fund.

In my contributions on Second Reading and in Committee, I said that investment in our region is desperately needed—it was before we received Objective 1 funding and it will be when it ends—but this clause gives the Government extraordinary powers to act in areas of devolved competence and in areas where the EU structural funds have never operated. It is extremely disappointing that, throughout this clause, there is no mention of consultation, joint planning of schemes, joint programmes of work or joint management of projects—all examples of the collaborative approach to investment programmes initiated by the EU that we have become used to. There appears to be no clear setting of objectives, other than, I suspect, that the Government’s prime objective is to see projects in the UK—in the Prime Minister’s words—emblazoned with the union flag. I have no problem with that either. In West Wales and the Valleys we are used to seeing EU blue flags or plaques on projects. They are an indication that the needs of our area have been recognised, and so it would be with the union flag.

There is, however, still no clarity on how needs will be determined and recognised in the UK under the shared prosperity fund, whether projects will be imposed or applications sought and, crucially for us in Wales, what impact there would be on our financial settlement. We still do not know whether a UK Government investment in a road-building programme, for example, would lead to a reduction in the Barnett allocation, or whether projects imposed on us would be financed by loans that require repayment by the Welsh Government. All this curtails the Senedd’s ability to deliver on its objectives and will have an impact on its ability to deliver on its manifesto commitments.

Of all the attacks on the devolution settlements in this Bill, this is probably the most blatant—so much so that the powers and responsibilities of our Parliaments do not even merit a mention. It is another example of the introduction of a new constitutional settlement by stealth, as I referred to in my speech on Monday. It is another item to add to the list of examples fuelling the interest in independence, which, under this UK Government, is reaching a level never seen before in Wales. People are witnessing the performance of an almost colonial Government emanating from Whitehall and comparing it with the more progressive Government and Senedd we see in Wales—a progressive Senedd that voted last week to allow councils to change the electoral system for local elections by introducing the STV system and open up the franchise for local elections to 16 and 17 year-olds in addition to their existing rights to vote in Senedd elections; importantly, it supported voter participation by paving the way for automatic voter registration.

I must admit, I am surprised that, after listening to concerns expressed by the noble and learned Lord in Committee and hearing the support for his stance from other noble Lords, the Government have not come back on Report with an amendment of their own that recognises and ameliorates the impact of this clause on the devolved Parliaments.

In a Bill about the regulation of the UK internal market, this clause and its assault on the devolution settlements has no place, and I support Amendment 64 to remove it. I hope that the noble and learned Lord will be minded to call a Division on the amendment. If he does, he will have the support of these Liberal Democrat Benches.

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[Lord Wigley (PC) [V]]

My Lords, I am glad to have the opportunity to speak in this group of amendments and to follow the noble Baroness, Lady Bennett, who has made a massive contribution to our work on the Bill. As I have stated in previous debates, the House would be well advised to listen to the words of the noble and learned Lord, Lord Mackay of Clashfern. Time after time, he has alerted the House to the need to find an acceptable compromise on these matters. In particular, Amendment 75, in the name of the noble Lord, Lord Fox, to which I have added my name, serves that purpose. The amendment addresses the need to have a coherent framework for the work of the Joint Ministerial Committee and to provide a mechanism for when there may be disagreements. The noble Lord, Lord Purvis, stated that this amendment provides for any opportunity to achieve a consensus where that is possible—an excellent aspiration.

Likewise, the noble Lord, Lord Cormack, stressed tonight, as he has before, the need to find ways of co-operating. As I am sure he would be glad to hear, I add that my main objective in seeking greater powers for Wales is not primarily to demolish the union, but to change it into something that better serves the interests of our respective countries. That means giving greater power and being prepared to be flexible, something that has not been entirely apparent in the Government’s attitude to the Bill.

There clearly has to be some mechanism for dealing with situations where there is a disagreement among our four nations. It should have been the duty of the Government to find an acceptable solution, but they have failed to do so. I therefore believe that we should give MPs in the other place an opportunity to address this matter again by writing an amendment along these lines into the Bill.

[Baroness McIntosh of Pickering (Con)]

My Lords, I am delighted to follow the noble Lord, Lord Wigley. I endorse everything that my noble friend Lord Cormack said about our noble and learned friend Lord Mackay of Clashfern.

I have not spoken in general terms about the union. Suffice it to say that, as a Scot by birth with a Scottish father, who made her maiden speech next door on the Scotland Bill, I care passionately about this area. I lend my support to the terms of the amendment as set out by my noble and learned friend. I urge my noble friend Lord True to show the same spirit as our noble friend Lord Callanan when he accepted many of the areas, identified by the Law Society of Scotland in earlier parts of the Bill, on which we felt that the Government should consult. I am just disappointed that those fell to the terms of consent being sought. I am not sure that is appropriate in all those circumstances.

We must not lose sight of the fact that the Scottish Parliament withheld its consent to this legislation. It behoves the Government to move as far as possible and to consult. I am mindful of the old BT advert: it is good to talk. By talking and consulting, many misunderstandings are removed. It also behoves the Government to ensure that the common frameworks are allowed to reach their natural conclusion in the areas that are already well advanced. I wish my noble and learned friend Lord Mackay and his amendment the best, and hope that our noble friend Lord True might be magnanimous and come forward with something similar at the next stage.

[Lord Bruce of Bennachie (LD) [V]]

My Lords, I am speaking in support of Amendment 75, and I recognise the constructive intentions behind Amendments 73 and 76. I want to be clear that I have not been persuaded in any way of the case for this Bill. It is wrong in almost every respect, and that is why it has been substantially amended: I think the House takes a similar view. Of course, I have supported amendments that mitigate its worst effects, but I view with growing despair the failure of the Government to grasp just how negative and dangerous is the thrust of this Bill.

The Bill is clearly driven by an ideological and deluded belief that the UK Government can negotiate trade deals more far-reaching and radical than have been achieved within the EU and that, in doing so, they do not wish to allow the existing devolution arrangements to account for any friction in the process. Of course, however, Part 5 of the Bill destroys the negotiating capacity of the Government, who have had no experience of negotiating trade deals in more than 40 years, by advertising in advance their preparedness to set aside unilaterally any agreements that they might sign. The trouble is that the Government seem completely oblivious to the friction that will result from unilaterally overriding decision-making under the devolution settlements.

It has been argued repeatedly that decisions involving the devolved Administrations should be based on seeking agreement. The principles behind the common frameworks have been met with wide support and approval, and I welcome their inclusion in Amendment 76 in the name of the noble Lord, Lord Stevenson of Balmacara. However, there is still a serious lacuna in the process for reaching agreements across the four nations, and Amendment 75 addresses this. The amendment also seeks to utilise the joint ministerial committee, which, in practice, has not been used enough, but which could be an effective means of producing a dispute-resolution process.

The problem at the moment is that the default position leaves it to UK Ministers—who, of course, are also English Ministers—to have the final say. It is not desirable for any one of the four nations to have a veto on achieving agreement. We are quite clear about that. That is why a premium should be placed on seeking agreement wherever possible. Where it is not possible, however, there needs to be a mechanism that is seen to be fair and collaborative and not one-sided. That might involve qualified majority voting, which I have advocated on a number of occasions. However, this amendment proposes not a solution but a mechanism for finding one. My noble friend Lord Purvis, in previous contributions, alluded to the Australian example where the mechanism was unanimously agreed by all the state premiers, but decisions relied on qualified majority voting.

This Bill will do immense damage to the union and to what is left of Britain’s good standing in the world, which this Government seem determined to destroy. Amending it is only damage limitation, but Amendment 75 would go a long way to help. I support it: it is a mechanism by which we can find solutions to disagreements among our four nations that do not allow for veto but do seek consent and will have the support of all the component parts of the union, apart from those who have no desire to maintain it. Many of us want this union to survive and to be effective: this kind of amendment is a way to try to ensure that.