United Kingdom Internal Market Bill

Lord Russell of Liverpool Excerpts

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

Regarding the question asked by the noble and learned Lord, Lord Morris, about spending power in Wales, the Government believe that reserving subsidy control is the best way to guarantee a single unified subsidy control regime which could be legislated for in the future and that meets the needs. A UK-wide subsidy control regime will ensure that subsidies do not unduly distort competition within the UK’s internal market. Importantly, this power is in addition to the devolved Administrations’ existing powers. We intend to work with them to ensure that this power is used to best effect, augmenting their existing powers to support citizens in Scotland, Wales and Northern Ireland. As always, we will address the Welsh Government’s concerns. My colleague Chloe Smith, the Minister for the Constitution and Devolution, met with Jeremy Miles AM on 13 October and has committed to further talks in due course. For all these reasons, the Government cannot support this amendment. I hope that the noble Lords, Lord Fox and Lord Purvis, can withdraw it.

[The Deputy Chairman of Committees (Lord Russell of Liverpool) (CB)]

I have received three requests to speak after the Minister: from the noble Lord, Lord Wigley, the noble Baroness, Lady Neville-Rolfe, and the noble Lord, Lord Purvis of Tweed.

[Lord Wigley (PC) [V]]

My Lords, the Minister cited the example of pesticides, a subject on which there will almost certainly be unanimity. But on matters such as subsidy control, where there may be a justifiable difference in approach, does the Minister not accept that unless the Government are willing to accept a mechanism such as this to secure consent from the devolved Administrations, he is in effect imposing his solution on them, and cannot in any way claim that this Bill is agreed by the devolved nations—with all the consequences that flow from that unfortunate situation?

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Clause 1 agreed.

[The Deputy Chairman of Committees (Lord Russell of Liverpool) (CB)]

My Lords, we now come to the group beginning with Amendment 5. I remind noble Lords that anyone wishing to speak after the Minister should email the clerk during the debate. Anyone wishing to press this or any other amendment in this group to a Division should make that clear in debate.

Amendment 5

Moved by

United Kingdom Internal Market Bill

Lord Russell of Liverpool Excerpts

Committee stage & Committee: 2nd sitting (Hansard) & Committee: 2nd sitting (Hansard): House of Lords
Wednesday 28th October 2020 Lords Chamber

Clause 15 agreed.

[The Deputy Chairman of Committees (Lord Russell of Liverpool) (CB)]

We now come to the group beginning with Amendment 68. I remind noble Lords that anyone wishing to speak after the Minister should email the clerk during the debate. Anyone wishing to press this or anything else in this group to a Division should make that clear in the debate.

Amendment 68

Moved by

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[The Deputy Chairman of Committees (Lord Russell of Liverpool) (CB)]

The noble Lord, Lord German, is not taking part in this group, so I call the next speaker, the noble Baroness, Lady McIntosh of Pickering.

[Baroness McIntosh of Pickering (Con) [V]]

I will speak briefly to several amendments in this group. Regarding Amendment 70, again I raise the question of substantial change, and whether that means a “significant amendment”. I am seeking clarification on the part of the Bill to which this refers.

Amendment 81 would delete “of no effect”, as would Amendment 84. Can the Minister say what that means when replying? It is very unclear. I am again grateful to the Law Society of Scotland for its help in putting forward and drafting these amendments.

In Amendment 92, what is meant by “less attractive”? In my view, to put a service provider at a disadvantage is a serious matter in a Bill such as this. Using a phrase such as “less attractive” as part of the assessment of disadvantage is subjective and lacks clarity. I would be very grateful if, when summing up, the Minister could just clarify what his understanding of “less attractive” is.

I turn to my Amendments 103 and 103A. Amendment 103, which would take out “mainly” and insert “substantially”, is a probing amendment to understand the meaning of “mainly” in connection with the gathering of experience—for example, in relation to Clause 23(7). In my view, Clause (23)(7)(b) requires further definition. How should “mainly” be measured? Will it be by the time spent as a proportion of the whole qualifying experience or by some other measure? How will this experience be recorded and verified?

The same questions arise in regard to that aspect of the experience obtained elsewhere than in the UK. The purpose of my Amendment 103A is to ask whether we are excluding all other experience than that obtained in the UK. I pray in aid my own experience, where I practised law in Brussels in two different situations. Would that experience, and the experience of others as well, qualify for the purposes of the Bill? I am grateful for the opportunity to move these probing amendments and I look forward to the Minister’s clarification of these points.

[Baroness Neville-Rolfe (Con) [V]]

My Lords, I want to speak to this group of amendments for two simple reasons. First, services are incredibly important to the UK and to all four nations within it. As I said on Amendment 4, they are vital to the success of our economy, making up more than 80% of GDP. They range from financial services, mentioned by the noble Baroness, Lady Hayter, which I believe now provide more jobs outside London than in the City, to arts and entertainment of every kind. Invisibles, including legal and accountancy services where we have world-leading expertise, represent more export value than goods.

Secondly, I am mystified by the clauses on services, which are the subject of these amendments. The arrangements seem to work well currently. No doubt some protection is provided by the carryover of EU rules under the withdrawal Acts, which are relatively light touch because attempts to align local rules within the EU on services were also light touch.

We are forcing on to the service industries apparently new rules and new exemptions linked to the principles of mutual recognition and non-discrimination. There could potentially be a whole load of bureaucracy and regulation associated with this activity, which business, the service sector and regulators will need to understand. Lobbyists may try to secure new rules that benefit narrow interests, as they do in Brussels now. Moreover, as someone who takes a morbid and forensic interest in these things, I find the impact assessment—welcome though it is in principle—extremely disappointing. These are usually very helpful to Committee discussions, but the assessment asserts on page 2 that

“the cost savings to businesses, consumers and the wider UK economy would be expected to significantly offset any costs imposed by this legislation, translating into a net benefit to the UK economy.”

The small and micro business assessment on page 37, a section to which I always pay the greatest attention as small business is the lifeblood of this country and key to its dynamism, says:

“Due to a lack of historical need, there is a shortage of data on businesses trading between different parts of the UK. It has therefore not been possible to identify the volume of such businesses who operate across borders, nor the extent to which they benefit because of the hypothetical nature of the future regulatory regimes.”


So we have no evidence to justify the new powers, nor an assessment of their consequences. We almost seem to be creating borders for services where none existed before, which is surely the opposite of what we want.

We need to understand better how this part of the Bill will work, but the material presented so far has stumped me, as a business operator who has worked in various industries across the UK and the world. In that connection, let me ask a simple question on marketing activity, which is not listed in the schedules: would I be permitted to discriminate in favour of a company that was Welsh to help with the marketing of Welsh products or would I have to take time to listen to pitches from English-owned—or, indeed, US or Canadian-owned—companies?

In response to a number of understandable probing amendments in this group, can my noble friend the Minister kindly justify the provisions simply, with some good worked examples relating to significant service sectors, and assuage my fears? I must say, at this point in time, I am confused and therefore concerned.

[The Deputy Chairman of Committees (Lord Russell of Liverpool) (CB)]

Both the noble Baroness, Lady Noakes, and the noble Lord, Lord Liddle, have withdrawn from this group so I call the noble Lord, Lord Purvis of Tweed.

[Lord Purvis of Tweed (LD)]

My Lords, the Minister will no doubt be pleased to hear that I will not ask questions about whisky even though, after nine hours on this Bench, it seems to be at the forefront of my mind right now. I do not know why but a nice glass of whisky would be rather welcome.

I want to follow on directly from the noble Baroness, Lady Neville-Rolfe, and expand on her very good second point about organisations that are not within the Schedule 2 exclusions but may, for example, seek services that have a specific characteristic of one of our home nations or additional requirements—such as having the capacity to speak the Welsh language, which would be important for the provision of certain services in parts of the United Kingdom, or, in the highlands of Scotland or certain parts of Glasgow, proficiency in the Gaelic language. Given that these were covered in the European Union elements, which the Minister argued previously were restrictive but which are actually broad and allowed this trade to be conducted properly, I hope that the Minister can respond as to why those elements would not be covered in this Bill and whether there would be the ability to have some of the specific requirements with regard to regulatory requirements that have specific characteristics.

Aside from language and other conditions with regard to equality legislation, which would be covered under putting services to contracts, I notice that transport services are excluded but water services are not. As the Minister knows, the provision of water services is distinct in our four nations. There are separate industries and these will not be excluded. I would be interested to know whether the current contractual arrangements are out of scope of this legislation because they are current. On the non-discrimination principles in the services sector, I have a concern about the distinct nature of the legislation for the Scottish water industry, which is a public body with one shareholder—the Scottish Minister—and whether an English service provider would be able to challenge the provision of Scottish water services because they are not excluded from this legislation. I would be most grateful if the Minister could allay my concern about that.

Similarly, the provision of water in Wales is a different legal entity—it is a mutual approach. Many private enterprises in the provision of services, as we know, are of an international nature. There is an even greater concern that if, for example, an American service business, through a trade agreement with the United Kingdom, had a brass plate enterprise in the City of London with American shareholders, that might be the gateway for it to challenge the mutual model in Wales or the approach in Scotland. I hope that the Minister can allay my fear about that.

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[The Deputy Chairman of Committees (Lord Russell of Liverpool) (CB)]

I have received one request to speak after the Minister from the noble and learned Lord, Lord Falconer of Thoroton.

[Lord Falconer of Thoroton (Lab)]

I go back to the very interesting answer that the Minister gave on the coal example. Let us assume that the coal example, which he described as being a prohibition on sale but not use, did not come in a pre-existing requirement and that it had been entered into after this Bill became law. I would be right, would I not, in assuming that such a requirement would offend against the non-discrimination principle under Clause 8? It is obviously a disadvantage to be able to sell coal to people who cannot use it. In those circumstances, it is valid only if that was a provision entered into after the Bill became law if such a provision was justified by one of the legitimate aims identified in Clause 8(6). Would I be right in assuming that? Would I be right in assuming that the question of whether the ban on the use of coal survived would depend upon a private law action between the supplier of the coal and the buyer of the coal?

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Clause 17 agreed.

[The Deputy Chairman of Committees (Lord Russell of Liverpool) (CB)]

We now come to the group beginning with Amendment 79. I remind noble Lords that anyone wishing to speak after the Minister should email the clerk during the debate. Anyone wishing to press this, or anything else in this group, to a Division should make that clear in debate.

Schedule 2: Services exclusions

Amendment 79

Moved by

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[The Deputy Chairman of Committees (Lord Russell of Liverpool) (CB)]

The noble Lord, Lord Liddle, has withdrawn from this group, so I call the noble Lord, Lord German.

[Lord German (LD)]

My Lords, I thank the noble Baroness, Lady Bennett, for raising this issue. It is of significance, and the Government will need to make some clear statements in order to avoid a very large flaring up of problems as a result of this matter.

Professional teacher registration is a devolved matter. The General Teaching Council for Scotland was established in 1965 and has ownership of the standards for teachers seeking registration and employment as a teacher in Scotland. The Education Workforce Council for Wales, Cyngor y Gweithlu Addysg, was established by the Education (Wales) Act 2014 to register schoolteachers who wish to work in schools in Wales. Teachers in Wales have to have qualified teacher status and be registered with the body in order to work in the profession. In England, since the introduction of the Teaching Regulation Agency, there is no longer a register of teachers.

Access to the teaching profession differs greatly between England, Wales and Scotland—and there are different qualification entry levels. The General Teaching Council for Scotland has an auto-recognition process for UK teachers who possess adequate qualifications for registration in Scotland. However, that does not mean that all teachers who teach in England or Wales can teach in Scotland. As such, teachers in Scotland should hold a qualification that is the equivalent of Scottish qualifications to enter the teaching profession in Scotland.

Teachers moving to Wales have to have equivalent standards. FE teachers, who are recognised by the National College for Teaching and Leadership in England and who are qualified to teach in England, are not recognised in Wales, and that means that they cannot be registered. Both Wales and Scotland have set different qualification levels to be able to work in the teaching profession.

There is an additional factor in Wales because of the bilingual nature of our education system. I know that noble Lords are aware that the Welsh language has equality status, and teachers have to be able to manage aspects of the school curriculum where they intersect with that language requirement. That does not mean that they have to speak Welsh, but they have to be able to manage aspects of the curriculum in English-medium schools.

Any flattening of qualification requirements would have a detrimental impact on the education provided in schools in Wales and Scotland and would dilute the standards that each country has set. I cannot think of any pressure to change these structures that has an impact on the internal market. The teaching profession should be excluded from this Bill as a result.

United Kingdom Internal Market Bill

Lord Russell of Liverpool Excerpts

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

Relevant documents: 24th, 36th and 29th Reports from the Delegated Powers Committee, 17th Report from the Constitution Committee, 8th Report from the Joint Committee on Human Rights

[The Deputy Speaker (Lord Russell of Liverpool) (CB)]

My Lords, I should inform the House that, on Monday, Amendment 34 was agreed in error. It was pre-empted by Amendment 31.

Clause 39: Enforcement

Amendment 62

Moved by

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Clause 43: Financial assistance: supplementary

[The Deputy Speaker (Lord Russell of Liverpool) (CB)]

My Lords, Amendments 66 and 67 have been pre-empted.

Amendments 66 and 67 not moved.

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Amendment 68 agreed.

[The Deputy Speaker (Lord Russell of Liverpool) (CB)]

We now come to the group consisting of Amendment 68A. I remind noble Lords that Members other than the mover and the Minister may speak only once, and that short questions of elucidation are discouraged. Anyone wishing to press this amendment to a Division should make that clear in debate.

Amendment 68A

Moved by

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[Lord Wigley (PC) [V]]

I support this amendment, the remarks of the noble Baroness, Lady Bowles, on these matters, and the need to have the OIM and CMA working at arm’s length. I have spoken several times on the need to have an office of the internal market that is at arm’s length from all government and is responsive to the needs and reservations of every nation—Wales, Scotland, Northern Ireland, and, yes, England. I would prefer the OIM to be required to obtain the consent of all four nations, but I accept the wording in this amendment as a significant step in the right direction. I am very happy to support it and to vote for it if a vote is taken.

[The Deputy Speaker (Lord Russell of Liverpool) (CB)]

The noble Lord, Lord Flight, does not appear to be present in the Chamber and the noble Baroness, Lady McIntosh of Pickering, has withdrawn from this group, so I call the noble Lord, Lord Naseby.

[Lord Naseby (Con)]

My Lords, I cannot support this amendment. We had a considerable debate on the OIM in Committee. There are already too many examples in the United Kingdom of where a service can be challenged, one way or the other, particularly in the financial services area, where there is the Financial Services Authority and the appeal mechanism of the Financial Ombudsman Service.

My experience is in the area of what are called doorstep loans. There is, of course, a rogue element, and that must be dealt with, but genuine operators have been servicing that market for decades, including the credit unions and two or three other companies of the highest repute. However, at some point the FSA may say that what they are doing is absolutely right, while five minutes later somebody has appealed and the ombudsman says the opposite.

We must have a uniform, single agency to deal with. The decision made by the Government to put the OIM underneath—for want of a better phrase—the CMA is absolutely right. This amendment would be a retrograde step that would confuse everybody.

United Kingdom Internal Market Bill

Lord Russell of Liverpool Excerpts

Consideration of Commons amendments & Ping Pong (Hansard) & Ping Pong (Hansard): House of Lords
Wednesday 9th December 2020 Lords Chamber

[The Deputy Speaker (Lord Russell of Liverpool) (CB)]

My Lords, hybrid proceedings will now resume. If the capacity of the Chamber is exceeded, I will immediately adjourn the House.

Proceedings on consideration of Commons reasons and amendments on the United Kingdom Internal Market Bill will follow guidance issued by the Procedure and Privileges Committee. When there are counterpropositions, any Member in the Chamber may speak, subject to the usual seating arrangements and the capacity of the Chamber. Any intending to do so should email the clerk or indicate when asked. Members not intending to speak on a group should make room for Members who are. All speakers will be called by the chair. Short questions of elucidation after the Minister’s response are permitted but discouraged. A Member wishing to ask such a question, including Members in the Chamber, must email the clerk.

The groupings are binding. Leave should be given to withdraw. When putting the Question, I will collect voices in the Chamber only. Where there is no counterproposition, the Minister’s Motion may not be opposed. If a Member speaking remotely intends to trigger a Division, they should make this clear when speaking on the group. Noble Lords following proceedings remotely, but not speaking, may submit their voice, content or not content, to the collection of the voices, by emailing the clerk during the debate. Members cannot vote by email. The way to vote will be via the remote voting system. We will now begin.

Motion A

Moved by

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A balance needs to be struck here, if devolution is to be respected. We want this to be a United Kingdom internal market, after all. That means that it needs to suit the needs and aspirations of all parts of the UK, which may differ greatly from one part to another. This is particularly the case for the smaller nations, which are part of our United Kingdom family. That is why the common frameworks process is so important and why it deserves support. Ministers still say they support it, but they have to do what they say. The two approaches to the creation of the internal market need to be reconciled if that process is to remain alive. That should not be beyond the Government’s reach, if they are willing to put their minds to it. I very much hope that they are, and that discussions on these important issues can continue before it is too late. I beg to move.

[The Deputy Speaker (Lord Russell of Liverpool) (CB)]

The following Members in the Chamber have indicated that they wish to speak: the noble Lords, Lord Moylan and Lord Naseby. I call the noble Lord, Lord Moylan.

[Lord Moylan (Con)]

My Lords, I recognise that the noble and learned Lord, Lord Hope of Craighead, and many other noble Lords who have spoken on this subject burn with a passion for their interpretation of the rule of law, but I ask them to reflect that statute needs to have more than principle; it needs to have practicality in its application as well. The effect of these clauses resubmitted in lieu would be to tie the Government’s hands completely in response to any emergency that might arise in Northern Ireland which might need to be addressed. I look in vain in these clauses for any exception that says, for example, “in an emergency”, “if the food in the supermarkets runs out” or “if there is a shortage in supply of medicines”. In such cases, those matters, as I understand these clauses, would need to be addressed through the joint committee, and if the European Union was not willing to accept them, it would need to go through a lengthy process of arbitration. I do not believe that that is acceptable.

My second point relates to devolution and democracy in Northern Ireland. The effect of these clauses is to privilege a particular interpretation of a particular international treaty, the withdrawal agreement.

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[Lord Naseby (Con)]

My Lords, the news that my noble friend from the Front Bench gave us this afternoon is encouraging. Clearly, discussions have been taking place and issues have evolved from them. I do not think that any of us in your Lordships’ House expected every single one of the agreements necessarily to be in a state to be written in and accepted in toto. To hear that 30 agreements have been agreed in broad principle is very encouraging news.

As someone who had a commercial life before coming into the political world, I wonder sometimes whether all your Lordships really understand. A chief executive—such as I was for a division of Reckitt and Colman Group—needs to know, as a certainty, what is happening. They cannot call in the company lawyer and say, “Well, it’s no good, George, you telling me on the one hand this and on the other hand that.” They have spent 15 months producing a new product—or whatever it may be. I sat as MP for an industrial town, Northampton, and I know the industrialists there. I spoke to them on Zoom only yesterday morning, and they are deeply concerned. I then read that the reason why the Commons have disagreed with our Amendments 1, 19 and 34 is

“Because they will create legal uncertainty, which will be disruptive to business.”


I also reflect that I had the privilege—as some of my noble friends in the Chamber did—of being in the other place. They are elected by the people. They have close contact with industry and commerce. When I am told, in writing, that it will be disruptive to business and that is why these Motions A and A1 are before us, I accept it. We have done our part. We are a Chamber that asks people to reflect. We have done that bit and we have done it well. The time comes, at a certain point, when you have to decide one way or the other. In my judgment, Her Majesty’s Government have got it right at this point.

[The Deputy Speaker (Lord Russell of Liverpool) (CB)]

Two other Members in the Chamber have indicated that they wish to speak—the noble Lords, Lord Adonis and Lord Foulkes, and I will call them in that order. I call the noble Lord, Lord Adonis.

[Lord Adonis (Lab)]

My Lords, in respect of the point made by the noble Lord, Lord Naseby, that because the Commons has given a view we should therefore immediately defer, the proposition is shown to be totally absurd by what is happening with amendments we will consider later. Between the Commons itself expressing a view on Monday and your Lordships meeting today, the Government have changed their mind. We have the unprecedented situation where a Minister of the Crown will move from the Dispatch Box in this House—maybe it will be the noble Lord, Lord True; I cannot wait to watch this performance take place—that this House do insist on its amendments when, 48 hours ago, a Minister of the Crown in the other House moved that the Commons should disagree with the House of Lords. If the noble Lord, Lord Naseby, is concerned that we should respect the will of the House of Commons, since its will appears to change every day at the moment—in response to the invitation of Her Majesty’s Government to take stock of negotiations in Brussels—I think our duty to the Government is to send back everything at the moment. This will give them maximum flexibility to disagree with themselves over the remaining four days of this week. Then let us see how the cards fall next Monday.

These are not trivial matters; they go to the fundamental integrity of the United Kingdom and our relationship with the European Union. I strongly urge your Lordships, in respect of all these amendments, that we obey the precautionary principle. If we are not sure whether there is an impediment to the proper conduct of negotiations or the flexibility that we wish to give the Minister and his colleagues in these negotiations with the President of the European Commission, we should send everything back so that the Government have the maximum opportunity to disagree with themselves over the next week. Let us see where we are thereafter.

The House holds the noble and learned Lord, Lord Hope, in extremely high regard—there is nobody who has a greater grasp of the technicalities of the issues we are addressing. We pay huge tribute to him and his colleagues, and the assiduous attention that they have given to the Bill’s passage in this House. He made a very good technical response to the Minister. In his Amendment 1B, the words at the end of his proposed new subsection (1),

“and states that its purpose is to give effect to that agreement”

make it absolutely clear that any divergence will be within the framework of the common frameworks process. Therefore, it cannot be outside it under the terms of the noble Lord’s own amendments. The only issue—which I think the Minister raised; we are all very fair-minded on this side of the House and give full credit to the noble Lord where he makes persuasive arguments—is what happens if the discussions, during the conduct of which it is not possible to make regulations under the terms of the amendment from the noble and learned Lord, Lord Hope, do not come to a conclusion. The noble and learned Lord’s proposed new subsection (2) says that:

“No regulations may be made by a Minister of the Crown with regard to a matter that is under consideration”.


I hope that the noble and learned Lord can respond to that point when he replies. As a non-lawyer—I fear to tread in this territory—my reading of this is that all parties to these discussions would have to behave reasonably. It would not be open to a devolved Government to keep these discussions going interminably purely for the purposes of avoiding a Minister of the Crown making a regulation. I say that with some trepidation, because I am surrounded by former Supreme Court judges and Lord Chief Justices who will no doubt correct me on that, but if that is the case, then I think that would give a response to the Minister.

I make no apology for speaking on this as a non-lawyer, because behind all this is a very important political point, which comes shining through the words of the Minister. The basic, fundamental political point is whether devolution is a reality or a sham. If it is a reality, then it is absolutely right that the devolved Governments exercising powers conferred by Parliament—these are no small matters—should have the right to engage in discussions about a proper level of divergence that meets the market access principles and common frameworks process. Indeed, I am amazed at how restrained these amendments are because, under their terms, it is not the case that devolved Governments can simply diverge, even if their opinion of the law is that they have the power to diverge. They can only do so with the consent of the United Kingdom Government, because there has to be consensus between them. The amendment from the noble and learned, Lord Hope, in fact gives a very narrow scope—but proper scope, it seems to me—for the devolved Governments to engage in discussion with the United Kingdom Government to meet the United Kingdom market access principle on a level of divergence that would meet their judgment of what is appropriate for their own territories. The noble and learned Lord gave the example of higher food standards. This seems be the absolute minimum, consistent with the proper operation of devolution.

The big underlying point, which we might as well flush out, because it is right to be frank about this, is that the Prime Minister believes—he has told us this—that devolution was Blair’s biggest mistake. He does not believe in these devolved institutions at all; we know that because he has told us. It is always a good idea when people tell you what they think that you take them at their word. He has said that setting up the Scottish Parliament and Welsh Assembly was Blair’s biggest mistake. If we take the view that the establishment of the institutions was itself a fundamental mistake, then of course we would not want to give them any power—even to discuss divergence—because we would think it was a mistake. If on the other hand we take the view that devolution is a beneficial part of the arrangements for the governance of the United Kingdom—which I take to be the official policy of the Government as opposed to the unofficial view of the Prime Minister—without which that governance might well collapse, then it seems to me that the provision that noble and learned Lord, Lord Hope, sets out, for a proper level of divergence to reflect the judgment of devolved governments on what is appropriate for their territories, is absolutely right. We should therefore insist on these amendments.

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In contrast, the amendment would, above all, strengthen the union. Not only would it stop the hollowing out of the devolution settlement, it would show that the UK Government and the devolved Governments were acting together in a union that was working for each of the four nations and for the four nations together—the UK as a whole. For those reasons, I beg to move.

[The Deputy Speaker (Lord Russell of Liverpool) (CB)]

One Member in the Chamber has indicated he wishes to speak. I call the noble Lord, Lord Adonis.

[Lord Adonis (Lab)]

My Lords, I do not wish to cover the ground that the noble and learned Lord, Lord Thomas, has just covered so compellingly. He has made absolutely compelling arguments for why we should send this matter back to the Commons again. As he says, it goes to the heart of the devolution settlement: you just need to read the wording of his amendment to Clause 48 to see why it is so compelling.

What the Government are proposing is a provision that says they should make financial arrangements in respect of spending in the devolved territories of the United Kingdom without consultation with the relevant authorities, whereas the noble and learned Lord’s amendment says that it should take place only with consultation with the relevant authorities. So the noble Baroness would need to explain to us why it is appropriate that these arrangements should be entered into with no consultation with the devolved authorities to which they apply. That is an absolutely fundamental point about whether devolution is for real.

The point I want to add, which is so important and why it is a vital that we send this back to the other House, is that what is essentially going on here is an attempt by the Prime Minister to undermine and make as weak as possible the existing devolution settlement. He said, and we should take him at his word, that devolution was the worst mistake of the Blair Government; he does not agree with the setting up of the Scottish Parliament; he does not agree with the Welsh Assembly; he has played very fast and loose with the role of the Northern Ireland Assembly in the way he has conducted policy in respect of Ireland over the last year.

We have a constitutional duty to see that that the devolution settlement, as constructed by Parliament in successive Acts, all of which have represented consensus settlements between the territories concerned and the United Kingdom Parliament, is safeguarded. This Bill is deliberately intended to cut across and undermine the devolution settlements because the Prime Minister does not agree with them, and it is therefore vital that we send this matter back to the House of Commons again.

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[The Deputy Speaker (Lord Russell of Liverpool) (CB)]

Does any Member in the Chamber wish to speak? No? Then I call the noble Lord, Lord Fox.

[Lord Fox (LD)]

My Lords, this has been, again, a short but important debate. I thank the previous speakers and I thank the noble and learned Lord, Lord Thomas of Cwmgiedd, for his detailed proposal.

First, I will address the comprehensive and well-laid out response by the Minister on why your Lordships’ amendment has been knocked back. I will not come between the noble and learned Lord and the Minister when it comes to deciding whether it is a financial issue; I shall leave those two to have that argument. However, I will pick up on the second issue. The Minister painted a genuinely exciting picture of all this wonderful investment that will happen across the country—I am not being ironic—and I agree that there needs to be a response to what we have seen this year, and it needs to be comprehensive, co-ordinated and well organised. This cuts to the point made by the noble and learned Lord, Lord Thomas, and the noble Lord, Lord Adonis: without working with the devolved authorities, the efficiency and the effectiveness of any investment are massively undermined. Leaving aside the devolution issue for now, the efficiency issue raised by the noble and learned Lord, Lord Thomas, is absolutely called into question here. The measures from the noble and learned Lord in Motion K1 bring the devolved authorities back into this process. It recognises the importance of the devolved settlement, as set out by the noble Lord, Lord Adonis, and makes sure that this investment, which will be so important to the future prosperity of this country—if indeed there is enough of it and it is delivered properly—can be made efficiently and in keeping with the needs of the people of that particular country.

As someone who comes from Herefordshire, which is a far-flung part of England, I wish that we had similar regional structures in England, whereby the same level of consultation that should be coming through this amendment could also be offered to the regions of England. While some parts of England have unitary mayors and some parts have negotiations directly with Government, places such as Herefordshire that are in as much need as some of the worst-affected places across the United Kingdom, do not have the benefit of that access. This is not the place, but going forward, I ask that when these proposals are brought, an approach towards the English regions that the Government have towards the devolved authorities would be appreciated.

With that, we look forward to supporting the noble and learned Lord, Lord Thomas, when he presses this.

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I have addressed the point of the noble Lord, Lord Stevenson, about the potential shortfall in the funds. I have reassured him on that, and that this power is intended to be additional to those powers of the devolved Administrations. I also reassure him that the powers and the shared prosperity fund will be different from Barnett; they will be based on a different understanding of needs and therefore separate from that formula. I can also reassure him that the fund will be open to the whole country, which was a theme of his. On the governance of the fund, I am not sure whether we have been so specific as to say that there will be a board; as I have said, there will be governance structures and the devolved Administrations will have a place within them. That is part of the further work we need to do, in consultation with the devolved Administrations and others, as we work to set out the framework that we will publish in the spring.

[The Deputy Speaker (Lord Russell of Liverpool) (CB)]

I have received a request to ask a short question of elucidation from the noble Lord, Lord Fox.

[Lord Fox (LD)]

The Minister will be aware that the current structural fund does not reach many regions across the United Kingdom, compared, I think, to the planned extent of the new shared prosperity fund. Can the Minister confirm whether that is true? If it is, and the money put into the shared prosperity fund is only—I use the word advisedly—as much as that put into the structural fund, it will be spread more widely. There will be losers among those who have been able to take advantage of the structural fund, because the money they would bid for will be spread to other regions and countries. Will the Minister acknowledge that? Is that perhaps one reason that the Government are rather reluctant to allow the devolved authorities any more involvement in this, because they know there will be issues around losing out on money that would have come through the structural fund but is now to be spread more widely across the United Kingdom?