United Kingdom Internal Market Bill

Duke of Montrose Excerpts

Committee stage & Committee: 3rd sitting (Hansard) & Committee: 3rd sitting (Hansard): House of Lords
Monday 2nd November 2020 Lords Chamber

The machinery for the CMA is set out in Clauses 28 to 35, which are all very detailed. We are putting into legislative effect the fruits of detailed negotiations between the four Governments since 1997. Those involved should be congratulated on what they have been achieving, and nothing should be done to undermine those achievements. In all these clauses there are detailed provisions regarding reports, regulations and default provisions. I may have missed something but I see no reference to consultation. Consultation is the essence of the amendment moved by the noble and learned Lord, Lord Mackay. The Joint Ministerial Committee will represent all four nations. They will know where the shoe pinches and what is of concern in their own countries. In fact, they will be the better means by which to ensure the smooth working in the future to which the noble and learned Lord referred.

[The Duke of Montrose (Con) [V]]

My Lords, I support my noble and learned friend Lord Mackay of Clashfern on this group of amendments, particularly Amendment 114. Having the correct dispute resolution mechanism is extremely important. If the Government can find a better one than what has been suggested, I would be interested in the Minister giving us a clue as to what it might be.

The Government have found that the Scottish Administration object to the Bill, particularly the internal market element. My noble and learned friend has drawn on many years of legal and parliamentary experience in trying to find a way for the devolved Administrations to have a forum for formal comment on the arrangements for reinforcing the single market and any SIs.

The Joint Ministerial Council on EU Negotiations has already received wide acceptance in its role of setting up the conditions for negotiating market frameworks. I declare my family interest, which is in a livestock farm in Scotland and in the Scottish agricultural industry. As the noble and learned Lord, Lord Morris, pointed out, the industry as a whole in Wales and Northern Ireland is desperate to see a properly functioning single market across the UK, let alone within the EU. It finds the framework concept so far very reassuring, but it appears that the Scottish Government are looking for more.

I have a reason to declare an interest of another kind in this whole process, in that the dukedom that I represent in your Lordships’ House derives from the role that my six-times-great-grandfather played in promoting the negotiations for the Act of Union. This of course was a desire to get a single UK market at that time, as there were so many areas where Scotland had previously had no way of gaining benefit. The settlement that they agreed left Scotland with much lesser constitutional powers than currently exist; none the less, they were determined that certain characteristics of Scottish life should remain, and they do so to this day. Therefore, I have always watched these developments with care.

Several of your Lordships were here when we debated the Scotland Bill, sometimes quite late into the night. At that time, it seemed incredible that all the items necessary for the administration of the UK could be defined in a schedule, with Scotland having jurisdiction over everything else. We were assured that this was not a worry, because Westminster always retained the final say. Noble Lords—my noble friend the Minister is probably conscious of it too—may remember, during the progress of the Scotland Bill in 1998, a slightly bad-tempered evening in Committee, which was asked to begin sitting at 6 pm and spent some time on the future relationship between Westminster and the new Administration. I was never quite sure if this was a formally prepared answer, but when trying to bring the argument to a head, Lord Sewel uttered the familiar words:

“Clause 27 makes it clear that the devolution of legislative competence to the Scottish parliament does not affect the ability of Westminster to legislate for Scotland even in relation to devolved matters … However, as happened in Northern Ireland earlier in the century, we would expect a convention to be established that Westminster would not normally legislate with regard to devolved matters in Scotland without the consent of the Scottish parliament. If problems do arise the solution is for the Scottish executive and the United Kingdom Government to resolve the matter through political dialogue. That is what differences between mature parliaments and Executives will be concerned with.”—[Official Report, 21/7/98; col. 791.]

This is where we find ourselves today. Any formal reiteration of this power always recognises the full content of this text, but the element that receives much more exposure—to the point where people begin to think that it is the only part of the legislation—is the need for legislative consent Motions whenever uncertainty arises. The encouragement to progress to political dialogue is most certainly relevant to where we are at the present time. In the present circumstances, it would not be ideal for the Government simply to implement UK legislation. Perhaps the Minister can tell the House what stage discussions with the Scottish Government have reached? It seems to me that these amendments are suggesting a form in which the Government’s proposals can be formally conveyed, with a chance that the final positions of both sides can be opened for scrutiny.

[Lord Fox (LD)]

My Lords, I am grateful for the quality of this relatively short debate on a really important issue. In his speech, the noble and learned Lord, Lord Morris, emphasised the need to avoid a threat to the devolution settlement. When the noble and learned Lord, Lord Mackay of Clashfern, stirs, and tables amendments, it is important for us all to listen. Clearly, he is very concerned about the route that this Bill is taking, as is the noble Duke, the Duke of Montrose, who articulated strong reasons for a consultative and consensus approach to regulating the internal market of the United Kingdom. I am also grateful to him for bringing up again the Act of Union, because this is a live treaty; it still exists and reflects on the issue which we are discussing. We should always remember that.

The noble and learned Lord, Lord Mackay, talked about the need for the devolved authorities, or the Joint Ministerial Committee, to be involved in the nitty-gritty of the market. My noble friend Lord Purvis of Tweed set out the dangers and the discontinuities within the current state of the Bill that make that process impossible. Therefore, it is important for the Minister to explain how this will work, because there are so many missing pieces in a jigsaw puzzle which, frankly, still does not have a picture, and which make it very difficult for us to understand what the Government are seeking to achieve and why.

My noble friend Lord Purvis asked many questions and he raised the issue of triggering disputes. The issue of when a dispute is triggered is central, as is the one which has surfaced in many different debates: the mechanism for resolving disputes. The noble and learned Lord, Lord Mackay of Clashfern, suggested one way; perhaps the Minister can comment on that.

My noble friend Lady Humphreys and other noble Lords have pointed out that the JMC, and its variety of committees, seem to have stalled, not because of any lack of faith from the devolved authorities but because of the Prime Minister not convening a meeting of the Joint Ministerial Committee (Plenary). Can the Minister explain the delay and say when the next meeting will occur? My noble friend Lord Purvis also raised the important question of structure. Where does this all fit in with the JMC’s current operations?

It is the Government who have sought to drag the CMA out of its current area of reserved issues and focus it on devolved issues. I say to the noble Lord, Lord Naseby, that it is not this amendment, but the Government, that have decided to do that. They are pulling the Office for the Internal Market into an as yet undefined dispute role. It is very clear, as the noble and learned Lord, Lord Mackay, set out, that if advice and reports are being submitted, then the JMC must be party to the same information that the UK Government are getting. It is also clear that we have no real idea of the Government’s intention for the operation of this Bill.

--- Later in debate ---

[Baroness Finlay of Llandaff (CB) [V]]

My Lords, these amendments are part and parcel of the approach that my noble and learned friend Lord Thomas and I, and indeed the Welsh Government, have advocated. It seems essential to ensure that the office for the internal market is genuinely independent and accountable, on a basis of equality, to institutions in all four parts of the UK.

I want to take this opportunity to seek clarification on some of the powers that the Government propose to give the office. I understand that it would be able to compel persons to provide information and impose financial penalties on those who do not. I can see why these powers are necessary for the Competition and Markets Authority when it investigates matters of anti-competitive practices which possibly violate the criminal law. However, can the Minister please explain why the powers are necessary in the very different circumstances of providing independent advice on the potential internal market implications of measures proposed by a Government?

More specifically, one point in particular needs clarification. It is my understanding that devolved Ministers could not be compelled to provide such information, as, like UK Ministers, they are covered by Crown immunity. However, I am informed that such immunity does not extend to the devolved legislatures, meaning that the Senedd Commission could be compelled to provide information and fined if it did not. This seems wholly unacceptable, and I seek clarification.

[The Duke of Montrose (Con) [V]]

My Lords, I am pleased to be able to contribute to this stage of the debate, and to offer my support to my noble friend Lady McIntosh of Pickering, and particularly to her Amendment 134. Just recently we have heard much discussion, even by the noble Baroness, Lady Bowles, about the suitability of the CMA for this role. But there is no doubt that we need a body, and what we are discussing are the functions it would need to perform. I have sight of the briefing provided by the Law Society of Scotland, which supported some of these amendments, and it has been pretty forensic in striving to ensure, in particular, that this Bill contains enough representation and consultation.

I also support Amendment 135; it seems to me very appropriate that the CMA should have powers to decide what is a matter of importance, because the general idea that anybody could ask it to produce a report is a recipe for overenthusiastic demand from all sorts of people.

Moving on to Amendment 146, Clause 35 deals with who gets to receive the reports that the CMA produces, before, during or after measures that are being introduced, and who will present that report. Subsection (4) excuses the Secretary of State from being the one who gives the report in person. Surely most of the reports will actually be initiated by the devolved Administrations, and reports on the initiative of Secretary of State will be far fewer, so why should the Secretary of State be excused from speaking to the report that he has asked for?

[The Deputy Chairman of Committees (Baroness Garden of Frognal) (LD)]

The noble Lord, Lord Naseby, has withdrawn, so I now call the noble Lord, Lord Razzall.