United Kingdom Internal Market Bill

Baroness Randerson Excerpts

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

Certainly, the unhappiness of the Welsh Government is clearly expressed in their document. We should have—and I hope the Minister will be able to promise as much—a document setting out where they agree and disagree with the specific points made in the document which has been circulated.

[Baroness Randerson (LD) [V]]

My Lords, I regret that I was unable to take part at Second Reading, but that does not mean that I am not deeply concerned—[Inaudible.]

[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

We seem to have a technical problem.

[Baroness Randerson (LD) [V]]

[Inaudible]—needed at all, certainly at this stage. The earlier parts of the Bill, which deal with the establishment of new rules to maintain the internal market now that we have left the EU, have received much less publicity than Part 5. However, these parts are just as constitutionally significant because, under the cover of Brexit, the Government are attempting to slip through the unravelling of devolution. They have claimed that this Bill will increase the powers of the devolved Administrations, which is akin to President Trump claiming that the virus is waning in the USA: the facts demonstrate its falsity, as the clauses in this Bill demonstrate multiple ways in which it undermines current devolved powers.

The UK’s internal market appears to function perfectly well at the moment. The barriers cited by the Government as the reason for this Bill are hypothetical and unlikely to materialise because they are clearly against the interests of the devolved Administrations. There is no clamour to diverge from existing standards set by the EU because they are both high and universally recognised. Therefore, taking the Bill at face value, it seeks to solve a problem that does not exist, but that judgment is rather too kind because the details betray the Government’s real purpose.

Until now, devolution in the UK has functioned under the umbrella of EU legislation. Most of the fundamental devolved powers have operated in that way, and EU regulation has been accepted with noticeably little argument because it operates on such a large scale that there is little perception of party-political bias. The new arrangements set out in this Bill will be very different. Obviously, England will dominate, come what may, but the Government are not content with relying on size alone. This Bill steals all the remaining cards from the devolved nations.

We have a ragged devolution settlement—lopsided, confused, and already under huge strain. Leaving the EU has destabilised it further. Because there is no proper devolution in England, UK Government Ministers are effectively hybrid Ministers. One minute they are acting as Ministers for England and the next they are UK Ministers. Indeed, in some cases, such as agriculture, the Secretary of State is largely just the Minister for England, so it is essential that there is a strong dispute resolution mechanism: there will be problems if that fell back on the Secretary of State alone. This Bill itself will become a protected enactment, which devolved Administrations cannot repeal or modify. However, the UK Parliament will, in practice, be able to override the market access principles when legislating for England. Hence it will have an inherently asymmetrical effect.

Looking at how the market access principles will be enforced, we see a much tighter definition than allowed under EU law. It narrows the territorial scope of devolved legislation, which will no longer be able to apply to all activity within that nation. The Senedd could still vote to ban a wide range of single-use plastic items, for example, but that ban could no longer be applied to products entering Wales from the rest of the UK, nor could it ban sales of those goods. Such a ban would therefore be pretty meaningless. Amendment 4 applies the Government’s own market access principles, but with a framework of respect for the decisions and views of the devolved nations. With all due respect to the noble Baroness, Lady Neville-Rolfe, the UK is not a supermarket. The nations of the UK have individual and proud heritages and identities.

The Government’s regulatory impact assessment recognises that the broad application of the market access principles will limit the ability of the devolved Administrations to introduce distinct approaches to environmental and social policy, which will of course undermine the fundamental purpose of devolution. In the interests of centralisation of power, the Government are attacking innovation. The freedom provided by devolution has encouraged new approaches, such as plastic bag pricing, in Wales and minimum alcohol unit pricing in Scotland and Wales. There is an insidious pattern in many of the controls in the Bill. It allows the status quo to stand in some instances, but removes the right of devolved Administrations to change regulations in the future. This looks like the path to a stagnating economy.

Amendment 4 seeks to strengthen the hand of the devolved Administrations so that their voice can be heard. It replaces the very weak duty to consult with a much stronger principle of consent. That would force the Government to return to a normal approach of partnership and respect. The Bill scythes its way through devolved powers, and the amendment attempts to tackle some of that. The Government have lately reminded me of a drunk in a bar, who swaggers around aggressively challenging the other customers over imagined insults and picking unnecessary fights. This really is an unnecessary fight with the devolved Administrations. Devolution was always incomplete and uneven, and UK identity has been stretched pretty thin recently. Throughout the Bill there is a thread seeking to reverse devolution and recentralise the state, and this Government simply must not be allowed to get away with it.

[Lord Dunlop (Con) [V]]

My Lords, I want to comment on some of the issues raised by the amendment. It is useful in that, so far as this Bill is concerned, it draws attention to—if I may put it this way—the dog that did not bark. The dog in this case is the agreement reached at the Joint Ministerial Committee in October 2017, between the UK Government, the Scottish and Welsh Governments and the senior civil servant representing the Northern Ireland Executive, on the principles to guide the work on common frameworks. There will be an opportunity to debate in more detail how common frameworks intersect with the Bill’s provisions in the next group of amendments, but looking at the JMC principles is a good starting point.

In its report on the Bill, your Lordships’ Constitution Committee, of which I am a member, concluded:

“We consider that adhering to the principles agreed for formulating common frameworks would improve the likelihood of reaching agreement on how to progress the Bill. We are not convinced that the opportunities for managing the UK internal market through the common frameworks have been exhausted”.


The JMC principles embody what can reasonably be assumed to be core UK Government concerns: the effective functioning of the UK internal market; compliance with international obligations; the ability to negotiate, enter into and implement new trade and international agreements; the management of common resources; and cross-border justice and security. They also address those issues likely to be of most concern to the devolved Administrations: respect for the devolution settlements; devolved competence not normally adjusted without consent; and equivalent flexibility for local tailoring of policies as is afforded by current EU rules, as we have heard.

One of the witnesses from whom the Constitution Committee took evidence— Professor Nicola McEwen from Edinburgh University—contrasted the approach adopted for common frameworks, which she characterised as a co-operative and co-owned process, with the provisions of the Bill, which she described as more top-down. It is fair challenge to wonder whether a top-down approach might be necessary because one of the participants in the common frameworks negotiations is often seen as provocative and difficult to deal with, and of course committed to the break-up of the United Kingdom. The introduction this summer in the Scottish Parliament of a second continuity Bill, designed to give Scottish Ministers powers to maintain dynamic alignment with the EU, might well have been seen by the UK Government in this light. However, I would make three observations about this:

First, the Welsh Government, who, unlike the Scottish Government, gave their legislative consent to the European Union (Withdrawal) Act 2018, are a unionist Government but nevertheless as concerned as the Scottish Government about the implications of the internal market Bill for devolution. Secondly, we have now had eight of the statutory quarterly common frameworks reports from the UK Government mandated by the 2018 Act. Each has confirmed that common frameworks are making progress and that the Government have not felt the need to exercise their power to freeze devolved competence to counter any imminent risk of policy or regulatory divergence. Thirdly, even at a time when relations between the UK Government and the Scottish Government are at a low ebb, and the Scottish Government initially insisted that they would withhold legislative consent as a matter of principle for all Brexit-related Bills, the Scottish Government have in recent months recommended legislative consent—albeit with some qualifications—to the Fisheries, Agriculture and Trade Bills.

In conclusion, the amendment in the names of the noble Lords, Lord Fox and Lord Purvis, seeks to inject into the Bill the spirit of the JMC principles—here I am concerned more by its spirit than its precise terms—and to provide a more co-operative intergovernmental architecture for taking forward the UK internal market, which is currently missing from the Bill. I therefore hope that Ministers—despite the challenges, which I do not underestimate—will not give way to pessimism about the governance of the union, nor give up on a collaborative “four nations, one country” approach to protecting free trade within the UK. As such, I hope they will work constructively to address the concerns raised about the Bill during this debate.

--- Later in debate ---

[Lord Morris of Aberavon (Lab) [V]]

It has been a most interesting debate. I do not think I have anything to add. I await the Minister’s reply with great interest.

[Baroness Randerson (LD) [V]]

My Lords, the concept of common frameworks is notable for its absence from this Bill, as many noble Lords have said. For three years, they have been accepted as the way forward, on which the future operation of the UK internal market would be built. Now, they have been silenced.

I, along with a number of other noble Lords who have spoken on this and previous groups, am a member of the Common Frameworks Scrutiny Committee, ably chaired by the noble Baroness, Lady Andrews. I can report that common frameworks are alive and well and that a great deal of work has gone into them. There is general agreement from stakeholders, the devolved assemblies and UK Government representatives that they can provide a sensible and effective way forward. Amendment 6 seeks to flesh out the principles of co-operation on which they should work. That common frameworks process should be exhausted before the market access principles come into place.

The Government respond by saying that there is no need for common frameworks, as a concept, to be enshrined in legislation. I am sceptical. There are already signs that the Government are attempting to sidestep common frameworks—for instance, on the emissions trading scheme, where they have announced their intention to consider replacing it with a carbon tax, which would be a UK responsibility and would effectively take away the devolved powers. That is despite the fact that the common framework on this issue—emissions trading—has just about got to the final point. Despite the Minister’s assurances, I fear that the Government are poised to put the principles in the Bill into effect with the excuse that common frameworks have not proved workable.

Amendment 6 has cross-party support. Noble Lords have emphasised that it has been designed in consideration with the Welsh Government and reflects the well-founded concerns of the devolved assemblies. As with a number of issues, there is a lack of clarity on how common frameworks will link with the market access principles. Common frameworks set up a system—a framework—for the operation of markets, complete with dispute mechanisms. They allow for changing standards over time. So, I ask the Minister: how does this fit in with the provisions in the Bill that remove the right of devolved Administrations to introduce new standards in many circumstances? If the Government genuinely support common frameworks as the fundamental building blocks of the way forward, will the Minister agree to accept Amendment 6, which states that the Bill’s market access principles apply only after the common frameworks process has been exhausted? Will she clarify the relationship of the Bill to common frameworks? Will she accept our assurances that the Welsh Government, for instance, want common frameworks in the Bill?

Will the Minister also explain precisely how the measures in the Bill will guarantee that the devolved Administrations will be able to experiment and develop novel approaches, as they have in the past? That is how a great deal of social and environmental progress has been made in the last two decades. I give the example, used earlier in the debate, of single-use plastic bags. Wales experimented with the concept of paying for single-use plastic bags and was dramatically successful in reducing their use. The English approach to this, taken by the UK Parliament, was very sceptical, but Parliament saw that it worked and, in due course, England followed suit. Wales is an ideal size as an experimental sounding board.

Amendment 44 to Clause 9 refers to the non-discrimination principle. For clarity, can the Minister spell out to us where the requirement for the provision of, for example, labelling in the Welsh language would stand in relation to that principle? There is a legitimate reason for the need for Welsh labelling in certain circumstances, and as policy in relation to the Welsh language matures, it is fairly certain that there will be increasing demand and need for labelling in the Welsh language. How will that fit with the Bill?