Clause 28 - Functions of the CMA under this Part: general provisions

Part of United Kingdom Internal Market Bill – in the House of Commons at 5:30 pm on 15th September 2020.

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Photo of Paul Scully Paul Scully Parliamentary Under-Secretary (Department for Business, Energy and Industrial Strategy), Minister of State (London) 5:30 pm, 15th September 2020

As I say, the office will put forward non-binding reports to each devolved Parliament, but then there are the existing provisions for working intergovernmentally. We also have the common frameworks arrangement, as has been described, which has already provided good collaboration and co-operation, which I will come back to in a second. Ultimately, yes, the courts are there as a last resort, but if we have the inter- governmental relationships and build on those, as trusted partners, we will not have to resort to that.

Neale Hanvey said that minimum alcohol pricing, procurement, health and tuition fees would be undermined or constrained by the OIM’s functions. That is just not true. None of the clauses set out in part 4 precludes the devolved Administrations from introducing policies in any of those areas. The OIM will not be empowered to bind Administrations or veto regulations. It will only be concerned with assessing the economic impact of regulation, never its merit.

When not acting at the request of an Administration for reporting or advice, the OIN would only ever be concerned with monitoring the health of the UK’s internal market, such as the flow of trade, the impact of regulations on intra-UK competition and investment, or the ready availability of goods and services for all our citizens. The CMA, which the OIM will be established within, already operates at a strict arm’s length from the Government and all devolved Administrations. It has built up a wealth of expertise and experience, and has a global reputation for promoting competition. That is why it is a natural fit. As my hon. Friend the Member for Stone mentioned, the Bill clearly sets out that the OIM would be required to provide access to its reports and advice to all four Administrations on an equal basis, enhancing transparency and accountability.

Amendment 29 seeks to constrain the Office for the Internal Market, operating within the Competition and Markets Authority, from taking forward any independent review without the prior approval of the legislatures in Scotland, Wales and Northern Ireland. We cannot support this amendment, as it would insert significant political intrusion into a necessarily independent role for the Competition and Markets Authority.

Clause 30 supports the fair and open functioning of the CMA in providing technical, non-binding advice on regulatory proposals that could have a potential economic impact for the UK internal market. This provision could be requested by any Administration on a voluntary basis for a proposal made in that part of the UK to support policy development and better regulation. The advice or the report will examine the potential economic impact of the proposal in areas such as competition or trade distortions, or the impact on prices, choices and the quality of goods and services for consumers. To ensure transparency, all advice will be published and shared with the Administrations in all parts of the United Kingdom.

Clause 31 is vital in that it provides the CMA with the ability to produce independent reports on relevant regulatory provisions that have already been passed or made into law in order to support the ongoing development of the UK internal market. The request must concern a regulatory provision applying to that Administration’s part of the UK and within its legislative competence. A request may be made by one Administration or more, which will ensure that expert technical evidence can be provided by the CMA upon request by an Administration from any part of the UK. To ensure transparency, the CMA will publish the report soon after it is provided to the requesting Administrations.

Clause 32 sets out the reporting procedure that the CMA will undertake for regulations that are already enacted in any part of the United Kingdom, and are considered to have actual or anticipated detrimental impacts on the UK internal market.

Clause 33 sets out the process that the CMA, the UK Government and the devolved Administrations must follow once the report under clause 32 has been produced by the CMA and laid before the legislatures. It requires the Minister in the Administration responsible for implementing the regulatory provision that was the subject of the CMA’s report and the Minister in the Administration that requested the report to make a written statement in the relevant legislature. This provides transparency and parliamentary oversight on UK internal market matters, as well as the opportunity for legislatures to determine the most appropriate subsequent course of action.

The purpose of clause 34 is to allow the CMA to exclude some categories of information from its published reports. It can exclude information if it believes that: it is contrary to the public interest to disclose that information; it contains commercial information that might significantly harm the business interests of another person; or it contains information about an individual’s private affairs, the disclosure of which might significantly harm the individual’s interests. Such discretion is obviously necessary in specific circumstances to provide assurances for businesses’ and individuals’ interests.

Clause 35 sets out that the CMA must publish general advice and information about how it expects to approach the exercise of its monitoring, advisory and reporting functions under clauses 29 to 32. This is necessary to ensure that the way it approaches its functions is visible and clear to the public.

Amendment 21 seeks to include a duty on the CMA to consult the devolved Administrations prior to publishing guidance on the exercise of its internal market functions. It is not necessary or helpful to put a duty to consult into statute. Across its existing functions, the CMA maintains constructive working relationships within all three devolved Administrations. Both the Government and the CMA itself believe that those relationships will continue to be vital in delivering new internal market functions.