United Kingdom Internal Market Bill

Lord True Excerpts

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

[Lord Stevenson of Balmacara (Lab) [V]]

My Lords, I join the noble Lord, Lord Thomas of Gresford, in thanking the Scottish Law Commission for its contribution to this debate; it keeps an eagle eye on issues in front of your Lordships’ House and from time to time delivers material that is very useful to us as we go through our duties.

As the noble Baroness, Lady McIntosh, said, these are probing amendments. They are about the possible uses of super-affirmative procedures and, as she says, relate to issues in the Bill that might well qualify under her heading for a higher degree of scrutiny.

The noble Lord, Lord Thomas, gave us a useful tour d’horizon of the available ways of doing super-affirmative. I agree with him that there is a case to be made here for looking at them in more detail to make sure that they are picked up and looked at regarding their best purpose, but that perhaps is not for today; there are bigger issues here and they should be looked at, but not in this Bill.

My noble friend Lord Judd asked whether the Government really welcome scrutiny or are simply pursuing their normal process—which seems almost inevitable for any Government—to try to obtain absolute control over the legislation they are bringing forward. I suspect the answer to that question is not to be found in providing for better scrutiny. This is a Bill with deeper problems. I do not think that these proposals, although they have their merits, are the right way forward in trying to unscramble those deeper difficulties. I look forward to hearing the Minister respond.

[The Minister of State, Cabinet Office (Lord True) (Con)]

My Lords, I thank my noble friend for tabling her amendments, which relate, as she explained to the Committee, to the implementation of a super-affirmative resolution procedure. This debate is something of a coda to the previous group. It teases at the questions that many of your Lordships raised there and to which my noble friend Lord Callanan responded in some detail, so, if the House will forgive me, I will not repeat those general arguments in relation to these matters, although I repeat that the Government believe that these powers are important for our internal market. As my noble friend Lord Naseby said, we are dealing with trade matters. I repeat that the Government will not take lightly our responsibility in administering these powers.

I thank all those who took part in this debate for the interesting speeches we heard. On a personal note, I always welcome seeing the noble Lord, Lord Judd. I agree with his expression of admiration for noble Lords and Baronesses on the Front Benches opposite for their work on this Bill. Perhaps he will allow me to extend that sentiment to my noble friends Lord Callanan, Lady Scott and Lady Bloomfield and my colleagues.

Pleasantries apart, of course we acknowledge that the Bill gives the Secretary of State the ability to amend the list of legitimate aims, relevant requirements and schedule exclusions through a draft affirmative statutory instrument, with just one time-limited made-affirmative power, which relates to the services exclusions in Clause 17(4). We are fully committed to ensuring that the use of these powers is subject to effective oversight and consultation. That is why any use of the power would require an affirmative regulation to be passed in both Houses of Parliament. This will ensure that Parliament would be able to scrutinise and vote on any changes.

Turning to the substance of my noble friend’s amendments, if we were to accept Amendments 14, 29, 40, 76, 77, 101, 133 and 176, to which my noble friend spoke in this group and which call for the super-affirmative resolution procedure, it would cause unnecessary delay when a change was urgently needed. That point was very forcefully made by my noble friend Lord Naseby in a compelling speech made from the standpoint of his immense experience in chairing the proceedings of the other place.

Although your Lordships’ Delegated Powers Committee had many observations on this legislation, it did not propose the super-affirmative resolution procedure. I repeat: there is a risk of undue delay in a situation that may arise where it appears necessary to act swiftly to prevent undesirable outcomes. My noble friend Lord Callanan gave a number of examples on the previous group. The Government may need to respond quickly and effectively to maintain the status quo after the transition period has ended.

We believe that the draft affirmative resolution procedure—noting that the made-affirmative power is time-limited—offers sufficient parliamentary scrutiny while enabling the Government to act quickly. I therefore ask my noble friend to withdraw the amendment. While I think her amendments attracted the interest of the Committee, and I am grateful to her for bringing them forward, I think it would be fair to say they did not carry the support of the Committee.

As my noble friend has acknowledged, Amendment 24 is consequential so I will not address it in detail. Amendment 25 seeks to probe the Government’s understanding of what is meant by “substantive change” in Clause 4. I can tell my noble friend that it means that any changes that re-enact regulation in a way that changes its outcome count as substantive. Where existing legislation receives technical or minor amendments that do not alter its substance, that does not count as a substantive change.

I hope these responses address the concerns of my noble friend and therefore ask her to withdraw her amendment.

[The Deputy Chairman of Committees (Baroness Morris of Bolton) (Con)]

My Lords, I have received a request to speak after the Minister from the noble Lord, Lord Purvis of Tweed.

[Lord Purvis of Tweed (LD)]

My Lords, I am grateful for the Minister’s comments on Amendment 25. It was a question linked to the previous group that the noble Lord, Lord Callanan, did not respond to, so I am very grateful that he did.

The Minister talked about how “substantive change” is now defined. We are now in the realm of what the Minister said is a Pepper v Hart moment because what is said on the record at the Dispatch Box is very important, and these measures require a different outcome. The policy outcome intentions of many of these measures might remain the same, but some elements would be different. If the Minister is saying—on minimum unit pricing, for example, or on environmental or public health considerations—that if the intended outcome of the re-enacted or updated requirement remains the same, would that continue to be exempt? That is important because, in both the legislation and the Explanatory Memorandum, that is not so defined. If minimum unit pricing changes the level of the price, or if tuition fees continue but their level changes, if the policy intent is the same, the exemption will carry on—is that the correct understanding?

[Lord True (Con)]

My Lords, I note and hear what the noble Lord has said, but I think he would allow me not to enter into speculative discussions. I have put to the Committee a response to a question—a response provided to me to advise the Committee. As for its application, that is a matter that would be speculative and could be considered further. I will stand by the words that I put before the Committee.

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

I thank all noble Lords who have spoken in this debate. I was grateful for the opportunity to probe the extent to which this procedure of super-affirmative resolution may be more appropriate.

My noble friend Lord Naseby might not think that this is a matter of life and death, but if you are dealing with perishable goods—particularly animals and their movement over what will be internal borders—that might be the case. I part company with my noble friend on the EU-Japan agreement; it actually does not go that far. My understanding is that what was heralded as a bigger market for cheese, which will be very welcome, relies on the EU allowing us to use what is left of its quota that it does not wish to use. It is the leftovers—the crumbs under the table. It could be very helpful to our cheese producers, but it is not quite as straightforward as one might first think.

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I turn finally to Amendment 48, which seeks to amend the regulatory powers in Clause 10 to amend Schedule 1. It covers similar ground, requiring the Government to seek the consent of the devolved authorities before any changes to the schedule of exclusions from market access principles. These currently include unsafe foods, for example—although sadly not public health. The key issue again is the need for any changes to this schedule to be made only after consultation, and hopefully agreement, with the devolved authorities. The issue is dealt with in more detail in a subsequent group. Here, as my noble friend Lord Liddle and others have said, we are talking about moving forward within our devolved system, not undermining it and not taking powers back to London. That is why the amendments in this group are so important.

[Lord True (Con)]

My Lords, I am grateful to all those who have spoken in what has been a thoughtful debate absolutely in the proper traditions of your Lordships’ House, both in the spirit of inquiry and in the main—I will come to that point in a minute—in manner. I am of course sorry that the noble Baroness, Lady Finlay, was unable to be here, but I was delighted to hear the noble Lord, Lord German, move the amendment so ably. I was also glad to learn that he is an assiduous reader of the words of my right honourable friend Jacob Rees-Mogg. I can tell him that that is a very improving activity and I heartily commend it to him. I would say in response to his point that this legislation has collective agreement and therefore it is subscribed to by all members of the Government.

Having mentioned the noble Baroness, Lady Finlay, and having in mind the remarks of the noble Lord, Lord Wigley, I would like to thank the Welsh Government, who had an involvement in some of these amendments, for what has been their positive engagement on this Bill to date at both ministerial and official levels. I have had the privilege of being present at discussions on this matter.

When I talked about taking exception, I was thinking about tone. People have asked what the Government’s intention is and what the exceptional circumstances are. Like it or not, the exceptional circumstances are that, after a lengthy period of being a member of the European Union, which effectively controlled our internal market, the British people have elected to leave the European Union and the British Government—and British Governments collectively—have a responsibility to provide for successor arrangements. I do not believe that this should be the occasion for a great set of conspiracy theories. I do not agree with the noble Lord, Lord Liddle, that the Government are making a meal of the system, and I reject what he said about the Government abandoning the frameworks. We have discussed that at length in this Chamber and I have set out the continuing commitment of this Government to the framework process.

So, as we discuss this, it is important that the process of respect goes all ways, and this Government have a profound respect for all the peoples of these islands and all those involved at every level in the difficult process of governing effectively and responsibly the people they have the honour to represent. The Government seek to go forward co-operatively with the devolved Administrations and all other people in our democracy. I do not believe—with great respect to my noble friend Lord Cormack—that it is helpful to use words such as “domination” as an aspiration of the Government, and nor is it helpful for the noble Baroness, Lady Bennett, to talk of dictatorship. That is not the way in which this Government think, behave or intend to go forward. They hope to go forward with respect and co-operation.

The Bill attempts to ensure a smooth transition for businesses, as they are no longer subject to EU constraints, and to maximise certainty through the Covid recovery and the end of the transition period. It does not remove powers from the devolved Administrations. What the Bill does do is ensure that no new barriers to intra-UK internal trade will be created following the end of the transition period, and that companies from all parts of the United Kingdom will be able to trade seamlessly with one another. That is an objective that everybody in this House genuinely shares. I agree with what the noble Lord, Lord Purvis of Tweed, said: I believe that everybody in this Chamber—or, at least, almost everybody—is committed to maintaining the union of the United Kingdom. We intend, and obviously hope, to perpetuate and protect the system where companies from all parts of the United Kingdom are able to trade with each other.

Following the end of the transition period, devolved Administrations will see an increase in their powers in multiple devolved policy areas, as the role of the EU institutions falls away. They will include areas where the EU has previously set regulatory standards. The Bill seeks to strike a balance between respecting devolution and ensuring that UK companies can continue to trade unhindered in every part of the UK. Hearing some of the things that have been said, one would not think that it was this Conservative Administration who, as recently as 2017, extended so profoundly the role of the Welsh Senedd. It is vital that legislation introduced by the Bill should act across the whole of the UK, providing all of our businesses and consumers with the same degree of certainty. That is important in whatever corner of the four parts of our kingdom businesses and consumers live, just as there must be the same protection from discrimination and the same opportunities for prosperity and well-being. We owe that to every corner of this kingdom.

Yes, the driving principle of the Bill—maintenance of the internal market—is captured by Amendment 109, in the name of the my noble and learned friend Lord Mackay of Clashfern. The purpose of the Bill is as he set it out, but I do not see how it could be used for any other purpose, and I do not believe that to restate it on the face of the Bill could be anything other than potentially confusing. But I do take the spirit and the letter of what my noble and learned friend said: this is the purpose of the Bill, and it certainly is not to be set in the context of conspiracy theory. It provides for a new system that is both ambitious and necessary and, as I have said, it is a pivotal moment for the United Kingdom to develop its own bespoke regulatory system and we must make sure that this offers benefits to businesses in every part of the United Kingdom and to the devolved Administrations.

The noble and learned Lord, Lord Hope of Craighead, made a typically thoughtful opening speech. I hope that I misheard him when he said that he regretted the provisions in the Bill as a whole; I believe he was referring to the nature of the regulatory powers. In his remarks, he put forward some ideas that obviously—as my noble friend Lord Callanan said in an earlier debate—we will read carefully.

I can answer directly on the Sewel convention, about which the noble and learned Lord asked a second question. It was addressed earlier by my noble friend Lord Callanan but, for those who were not here, I repeat that the United Kingdom Government continue to demonstrate respect for and commitment to the convention. As such, they have sought the consent of each devolved legislature for the Bill through the established practices and procedures.

However, the convention envisages situations whereby the UK Parliament may need to legislate without consent; the noble Lord, Lord Purvis of Tweed, referred to such a situation. The Government have continued to hold positive discussions with the Welsh Government and the Northern Ireland Executive at both official and ministerial level. The door remains open to the Scottish Government, should they wish to re-engage on internal market matters. It is regrettable that the Scottish Government walked away from discussions on the internal market in March 2019; we urge them to return to the table.

We consulted extensively on the UK internal market White Paper, and received more than 300 responses and overwhelming support from businesses and industry to maintain the status quo and avoid new trade barriers emerging. The consultative nature of that work does not end there. I understand the undertone of what Members have sought in these amendments. We will of course monitor the implementation of the provisions in the Bill and speak to stakeholders and the devolved Administrations to ensure that it works as well as possible within our constitutional setting. The system requires effective and clear governance to provide the necessary certainty for business. Where the system is not working, the Government need to be able to act quickly and effectively to fine-tune the system for the benefit of everyone. That matter was discussed earlier today.

It is suggested by your Lordships that some of the provisions in the Bill should be subject to the prior consent of the devolved Administrations. Amendments 15, 16, 30, 41, 42, 48, 49, 75A and 100A would require this, meaning that, as a pre-condition, Ministers from Scotland, Wales and Northern Ireland would all have to agree with any change before it could be given effect. A number of noble Lords alluded to difficulties that might arise in certain circumstances. Clearly, such a provision could undermine the Government’s ability to act rapidly and decisively to make any changes necessary to reflect the interests of all parts of the United Kingdom, although noble Lords will, I know, have different views on the likelihood of that.

However, there is also a matter of principle at stake: attaching a requirement to obtain consent from the devolved Administrations would undermine the responsibility of Parliament with regard to the internal market. My noble and learned friend Lord Mackay of Clashfern referred in his excellent and thoughtful speech to the importance of the central role of Parliament. The Government believe that this is a fundamental issue. There may at times be a need to legislate effectively for the whole of the UK and only Parliament is capable of doing that. It is a responsibility that we take seriously; we should not resile from or compromise it in any way.

We are fully committed to ensuring that the use of the powers in the Bill are subject to effective oversight and consultation. First, any use of the powers would require an affirmative regulation to be passed in Parliament. This will ensure that MPs from all parts of the UK can scrutinise and vote on any changes.

Secondly, consultation with colleagues in the devolved Administrations is required for any change to the relevant requirements in Clause 3. It is true that a legislative consultation requirement would not be appropriate for the powers relating to exclusions from the market access principles or the list of legitimate aims for non-discrimination. In this case, the Government may need to make a swift decision in the interests of all parts of the United Kingdom, should there be an emergency or an unforeseen issue in future. In these instances, there may be no time to have a consultation period to seek consent. However, for all powers, UK Government officials will engage with the devolved Administrations in the spirit of the devolution memorandum of understanding. This system has worked well for 20 years and continues to do so.

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Moved by

[Lord True]

18: Clause 4, page 3, line 38, after first “a” insert “particular”
Member’s explanatory statement
This amendment would clarify that Clause 4(1)(a) relates to a specific sale of goods (the word “sale” being defined broadly in Clause 14). This is for consistency with Clause 3(1) as proposed to be amended by my amendment to Clause 3 at page 2, line 21.

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Moved by

[Lord True]

23: Clause 4, page 4, line 12, leave out from “have” to “place” and insert “had the same effect in relation to the sale (if it had taken”
Member’s explanatory statement
This amendment would bring the wording of Clause 4(5) into line with Clause 4(2).