My Lords, it is a pleasure to follow my noble friend. Amendment 4 was ably moved by my noble friend Lord Fox, and I want to outline some further considerations based on principles and on practical considerations.
I start by reflecting on the important contribution of the noble Lord, Lord Dunlop. I first met the noble Lord when he was the adviser to Prime Minister David Cameron in Downing Street and I was chair of the cross-party Devo Plus group in Scotland, which was arguing for enhanced powers for the Scottish Parliament, which subsequently came into legislation with the Scotland Act 2016. The noble Lord considered our proposals carefully, he has been a very thoughtful contributor to our debates and I look forward to the conclusions of his review on intergovernmental relations. The fact that he has asked for a degree of pause on what could be considered a constitutional rush is important and should be taken seriously. If despite his wise counsel and the thrust of the amendment—which has been tabled sincerely—the Government insist on moving forward on their current trajectory and in their current manner, it will be the first time in a quarter of a century that a major constitutional change will have been imposed on the nations without any form of public or parliamentary consent. That will not serve the start of a new functioning internal market well. The principle of consent is therefore not
a theoretical argument; it is important at the political level for those of us who believe strongly in the continued functioning of the United Kingdom and its internal market.
That is in stark contrast with the following groups that we will be considering, where, as the Minister has heard, the frameworks process has been good and we have supported it. The fact that it has been supported across all parties and, indeed, the nations is important.
I reflected on the point indicated by the noble Baroness, Lady Neville-Rolfe, which is that we need the Bill to prevent a veto by one of the nations. That argument would have some form of justification if we had seen that approach within the common frameworks. They cover the policy areas that are being repatriated: 154 of them, of which only four remain where there is not agreement whether they are reserved or devolved. Two of them will be resolved only after we know what is the agreement with the European Union, because they concern geographical indications and state aid—we don’t know what the Government’s proposals are for those two areas because we don’t know what the agreement with the European Union is. That will leave only two. For the 18 that require legislation, it is well under way to being proposed.
So it is not the case that there will be a major gap on the statute book at the beginning of January, and nor is it the case that any of the nations that are in receipt of these powers are seeking to exercise their veto. What those nations are asking, justifiably, is whether the powers being repatriated under the Bill—not the frameworks—are being constrained in a manner that is significantly different from how they were exercised under the single market in the European Union? These are justifiable concerns. So, with the greatest respect, I do not think that the point made by the noble Baroness, Lady Neville-Rolfe, holds any water at all.
It is of concern that in the first group the Minister was not able to categorically reinforce what has been referred to so far, which was the agreement made among the Ministers of Wales, Scotland and the United Kingdom and the representative from Northern Ireland of the principles of moving forward on the framework agreement. I hope that, when the Minister responds to this, he will be more clear in supporting that. If the approach of this amendment had been followed from the outset, I believe that we would have been able to secure consensus, because it would have been consistent with the manner in which we have been approaching it so far.
The point that my noble friend Lady Randerson indicated, which I thought was a very powerful one and which I hope the Minister is not only aware of but very sensitive to, is that this Bill, probably more than most, brings into stark reality the fact that we do not have a federal Government, which means that there are not designated Ministers for England on devolved areas for England. So we will continue to have UK Ministers who will be operating both at a UK level and effectively as Ministers for England. When it comes to areas of the functioning of the internal market, which is about the four nations, and then separately a consideration at the supra-United Kingdom level, the direct conflict of interest that exists in a
Minister making the decision in the interests of England, and thus being the arbiter of the approach of Wales or Scotland as to whether they are in breach of the market principles, is a very valid concern.
We have already heard the example of a decision made on legislation in Scotland, the deposit return scheme, where the Minister himself said in the debate on the first group that, under the Bill, it could be disapplied unless UK Ministers decided that it could be within the principles. Now UK Ministers will decide on that. The Minister is shaking his head. If he is shaking his head, it is on the basis of agreement—which is my point. Consensus would be secured on agreement for that.
What is certainly the case—and the Minister cannot shake his head at this—is that the Bill states that decisions made for England by the UK Parliament cannot be bound by any successor UK Parliament. But if decisions made in Scotland or Wales are overridden by the UK Parliament, those parliaments themselves cannot subsequently legislate within those areas. That is why paragraph 88 of the Constitution Committee report asked the Government to
“explain why clause 6 treats legislation intended for England differently from that passed by the devolved legislatures.”
This is the reality—which is why there is justifiable concern. If there is such a concern, what is a better way of approaching it? A better way, as my noble friend Lord Fox and others indicated, would be to look to other countries.
Before I move on to outlining why I think we could look at international precedents, I would like to pick up a further point regarding dispute resolution. My noble friend Lord Fox and I met the Minister and the noble Lord, Lord True, and I am very grateful to the Minister for sending a long letter answering the points that we raised in the question that we asked about when these issues would inevitably arise in disputes. The Minister’s reply of 13 October was very interesting. He said that
“dispute resolution between Administrations will be managed through the appropriate intergovernmental relations fora and are interlinked with the outcomes of the review of intergovernmental relations which is due to conclude in the autumn. The Office for the Internal Market will have a role in providing independent advice in the dispute resolution process.”
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But that begs two questions. The first is that, if we are awaiting the other intergovernmental fora working that is to be concluded, would it not make sense for that work then to be put in a memorandum of understanding that is very transparent and clear, rather than progressing this Bill first? Secondly, the role of the OIM in disputes is not clear in the Bill at all; in fact, my reading of the Bill is that the OIM will have no role in such disputes. The letter from the Minister says that it will have a role in providing independent advice in the dispute resolution process—but to whom, and on what? It puts the OIM in an incredibly invidious position if it itself is now an adviser in a dispute; it is basically a UK body advising on that dispute. That begs the question of why the Government are insisting on progressing at this pace.
I mentioned that we can look to other areas for other approaches. In the Second Reading debate I referenced Canada and Australia—and I am not alone, because the Prime Minister references those countries very frequently. Both countries in the 1990s introduced an approach for mutual recognition, but both Canada and Australia had had concerns from their states and provinces, which guard their legislative competences as conscientiously as Scotland, Wales and Northern Ireland do here.
But the approach of Australia in particular was different. The then Prime Minister announced in 1990 that the Australian Government would be seeking a mutual recognition approach for goods and services within Australia. At a special premiers’ conference in July 1991, state and territory Governments agreed in principle to enact a mutual recognition scheme for registered occupations and trade in goods. In May 1992 the heads of government signed an agreement to implement mutual recognition, and this was subsequently implemented progressively by Australian Governments in their states and territories between 1992 and 1995. Furthermore, the Commonwealth established a Commonwealth and state committee on regulatory reform to oversee the scheme.
In an approach so starkly different from this Government’s approach of having a reserved body, the CMA, to oversee the single market, the Australian committee comprised officials from each jurisdiction and, for example, was chaired for a period not by an appointee of the Commonwealth Government but by the director-general of the New South Wales Cabinet Office, which also provided the secretariat. This approach is closer to the principles of the framework approach but could not be further from the way of the UK Government. It is fair to assume that it would never even have crossed the mind of a UK Minister to allow a devolved Administration to have a chair and secretariat for a body to have consideration of the overall market.
The approach in Australia established ministerial councils comprising Ministers from each jurisdiction to oversee the mutual recognition scheme. They could also agree standards that could cover all of the country, while recognising local differences—again, similar to the framework approach that we have recognised as being positive. As my noble friend Lord Bruce indicated, a voting mechanism protected the interests of the countries and states but did not provide a mechanism where one state alone could veto any approach from another.
So the approach outlined in our amendment is not novel around the world; in fact, it is the approach of a Westminster system that a Commonwealth country has adopted. Crucially, it would also provide clarity on a mechanism to resolve disputes. It would provide a breathing space in the constitutional log-jam that exists at the moment that would prevent the start of an internal market system being imposed on two constituent parts of this Government.
I hope that the Government will reflect on this very carefully. I have indicated that we do not need this rush before the end of the year, and I have stressed the importance of having consensus on the way forward. Up until now, the Government have chosen not to go
down this route, but it is not too late. I hope that they will reflect very carefully on this approach and that those on the Cross Benches and Labour Benches will work with us to ensure that there is a degree of consensus to allow the Government some space to change their course.