Devolution (Constitution Committee Reports) - Motion to Take Note

– in the House of Lords at 3:58 pm on 9th October 2017.

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Moved by Lord Lang of Monkton

That this House takes note of the Reports from the Constitution Committee Inter-governmental relations in the United Kingdom (11th Report, Session 2014-15, HL Paper 146) and The Union and devolution (10th Report, Session 2015-16, HL Paper 149).

Photo of Lord Lang of Monkton Lord Lang of Monkton Conservative

My Lords, thanks to the courtesy of my successor as chairman of the Constitution Committee, the noble Baroness, Lady Taylor of Bolton, I welcome the opportunity to introduce the debate on two reports published by the committee during my tenure.

I also welcome to the House, and to the Dispatch Box for his first appearance there, my noble friend Lord Duncan of Springbank. I am sure that the House much looks forward to his maiden speech and to further contributions, particularly given his knowledge of agriculture, especially fisheries, and his experience in the European Parliament. We wish him all success as he takes up his new role.

Our committee has waited quite some time for the opportunity to debate these two reports. The Union and Devolution report was published over a year ago and that on intergovernmental relations two and a half years ago. Since then there have been two general elections, one election in Scotland, another in Wales, the constitutional crisis in Northern Ireland and the referendum on our membership of the European Union. We are nevertheless grateful for this opportunity to debate the reports. Despite that heady brew, I believe that our reports remain valid—indeed, perhaps even more so—and relevant to present circumstances. I particularly welcome the fact that the European Committee’s admirable report on Brexit and devolution is to be debated alongside the report of the Constitution Committee, adding topicality and focus to our proceedings, and I look forward to hearing the noble Lord, Lord Jay of Ewelme, introduce his committee’s report shortly.

If Europe has been one unsettling force upon our nation’s constitution over the past half century, devolution has been another. It is one that has cast a shadow over my entire career in politics, as it has over those of others who have consistently resisted it, because we believed that it could not form a new or stable settlement that would improve government but would, instead, generate an inexorable process of demanding ever more powers with no obvious stopping point and, ultimately, would put in jeopardy the unity of the United Kingdom. And so it has proved. This is not the time to dwell on the past but it is why our committee decided that there was a need to address the subject in a positive way, accepting that what was done is done, and trying now to find ways of bringing stability and balanced decision-making to what has become a dangerously fragile situation.

For years, the approach of central government was one of instant concession to the inevitable demands from the new territorial Administrations for ever more powers. What was piously called “incremental devolution”, when a “settlement” became a “process”, was in fact open house for a succession of ad hoc, piecemeal, demand-led giveaways. I know that those involved in the successive tides of further devolution tried hard to rationalise their packages—I say that particularly because I see my noble friends Lord Lindsay and Lord Selkirk present today; both of them will speak after me and both were active in seeking to develop successful packages—and it is always possible to do so because you can rationalise anything if you try hard enough.

However, I blame central government because it offered little, if any, resistance. In the case of the Smith commission, for example—I am delighted to see the noble Lord, Lord Smith of Kelvin, in his place, unless he has just slipped out, because his was a heroic achievement in attaining any kind of outcome from the commission’s deliberations—the Government promised at the outset to accept in full whatever the committee of MSPs might demand. This was a wholly reactive process that gave no thought either to the role of Parliament or to the implications of such changes for the integrity of the nation as a whole. That is where we are now, but at long last in the case of Scotland, where the threat is most acute, the Government of the day, in the person of my right honourable friend the Prime Minister, has said, politely but firmly, “No, now is not the time”. For that, she deserves great credit—it has changed the weather.

Dwelling on Scotland for a moment, if I may—for it is important as part of the background to our recommendations—despite the clear verdict of the Scottish people in the 2014 referendum to remain in the United Kingdom, the Scottish Government, instead of getting on with governing, have continued to pursue separation to the exclusion of all else. It is my belief that they prospered in the subsequent 2015 general election not because of a sudden belated rush of converts to separation but precisely because the electorate thought that the referendum had already settled that matter “for a generation”. They failed badly in 2016 and 2017 because it had by then become clear that they intended to break that pledge.

In Edinburgh, the administration of Scottish government has been neglected—almost no legislation has been laid before the Scottish Parliament—so it comes as no surprise that in a recent Scottish opinion poll fewer than half of voters were reported to believe that Scotland’s health service, education service or economy had been improved by 20 years of devolution. Perhaps the First Minister should remember the words of Alexander Pope:

“For forms of government let fools contest;

Whate’er is best administer’d is best”.

It is with “whate’er is best administer’d” that our reports are concerned.

But the Scottish experience reveals that the destabilising threats persist. The constitution needs continuing careful attention. Enoch Powell’s dictum that power devolved is power retained may remain true in theory, but in recent years we have come close to ceding sovereignty not just de facto but even in legislation. The 2016 Scotland Act, with its ill-advised declaratory first two Sections, has already led to a hazardous encounter in the Supreme Court.

Our committee’s reports have tried to set out a new way forward. Their central messages are: put the United Kingdom first in constitutional matters, and make no change that could undermine the core United Kingdom Parliament, where all the countries of the union are well represented. At the same time, central government should work proactively and sympathetically at all levels with its devolved Administrations, recognising the different needs in each and, above all, dispelling the despairing criticism we heard in evidence from both Wales and Northern Ireland of “devolve and forget”.

These three words should send a strong signal to central government that a new approach is needed. Our report on intergovernmental relations sought to outline that approach. We recognise that there would need to be continuing reappraisal, which, since we published it, the Scotland Act 2016, the Wales Act 2017 and now the European Union (Withdrawal) Bill will inevitably bring about. This makes it more important than ever that the right mechanisms are in place to govern relations between Governments in all parts of the United Kingdom.

Of course, it seems hard to make headway when all approaches from the centre are met with hostility in some quarters, but consultation may eventually achieve progress where confrontation never will. We made a large number of recommendations but I will confine myself to some of the main ones. In particular, we called for a major overhaul—reinforced, I am glad to say, by the EU Committee’s recent report—of the Joint Ministerial Committee. We called for more transparency of its meetings, agendas and minutes, and for more frequency of meetings, allowing the devolved Administrations to initiate policy proposals. We sought reforms to the committee’s structure, including more formal bilateral mechanisms to manage intergovernmental relations and more co-operation between central government and the devolved Administrations. We welcome such changes as have followed, and especially, of course, the establishment of the European negotiation sub-committee. We expressed deep concern at the lack of co-ordination and oversight of the devolution settlements and called for the identification of a senior Cabinet Minister with specific responsibility for oversight of the constitution as a whole.

After publication, we waited for almost two years for a response from the Government. When it came, they agreed with some of our recommendations, disagreed with others—including one that we had not made—ignored a few and in six cases claimed that they were already doing them. After two years, I suppose we should be grateful for small mercies. However, there has been no sense of enthusiasm for our proposals, still less of urgency. I sense that the Government have not yet fully engaged with the need to devise and articulate a vision for the future of the state and its devolution settlements. We now have to weave those Administrations into the fabric and processes of the nation’s governance. The drive must come from the centre, and that requires a new attitude and mindset.

The essence of our report, The Union and Devolution, was broadly similar: we must stop taking the union for granted. We could find no evidence of strategic thinking about the cumulative impact of devolution upon the union as a whole, so we tried to set out how the needs and interests of the union, as well as of its nations and regions, can be protected in the event of any further devolution in the future.

Photo of Lord Garel-Jones Lord Garel-Jones Conservative

Is it not the case that, in the increasingly interconnected global world in which we live, it is important for both Scotland and Wales to be part of a United Kingdom that is able to exercise serious influence in international fora, given that, on their own, they would be mere spectators?

Photo of Lord Lang of Monkton Lord Lang of Monkton Conservative

My noble friend makes a very fine and highly relevant point, with which I agree.

Successive British Governments have failed to adapt to devolution. Again, it has seemed to be a case of devolve and forget. With so much now devolved, so much asymmetry, so much potential for playing catch-up and leap-frog among the different Administrations, and so many overlapping and shared competences between devolved and central government, it stands to reason that there must be a new mindset, on all sides, of co-operation and mutual understanding. That is not easy, I acknowledge, where separatism is the predominant, even the only, motivation, but in the interests of good government it is essential.

In an attempt to disaggregate the problem, we identified some key elements that underpin the union. These include the economic union, the social union, the political union, the cultural union and the security and defence union. Any weakening of those would, in our view, cause grave damage to the nation state. We urged the Government to identify which public responsibilities were, in their view, essential to the effective functioning of the union, so that they could be protected in any future consideration of devolution; and we identified a number of underlying principles that might assist that. Unfortunately, the Government in their response, published almost a year later, declined to do so beyond the headline areas of defence, foreign policy and, ironically, the constitution.

We called for a devolution impact assessment to accompany any future proposals in order to measure any negative effect that they might have on the UK’s core responsibilities and to measure any planned benefit to the relevant devolved Administration and any impact, good or bad, that might be felt in other Administrations. Again, regrettably, the Government declined to commit to those proposals. Will my noble friend the Minister now bring a fresh eye to what we seek and perhaps persuade his colleagues in government to have another look at all of this?

Among our other recommendations we called, yet again, for the replacement of the inadequate and inequitable Barnett formula with a new needs-based system. It is a continuing disgrace that the distribution of resources from the Treasury should take no account of the relative needs of the countries and regions that it is intended to help. We expressed our strong opposition to full fiscal autonomy, which would break the union apart. My personal view is that although the need is obvious for fiscal accountability, we may already have gone too far in the forms chosen for fiscal devolution and indeed with the scope of welfare benefits. We recommended that if there should ever be a future independence referendum, provision for it and its proposed terms should be set out in primary legislation and laid before this Parliament for proper scrutiny by all parts of the United Kingdom.

We recommended that in future, UK government services should be clearly branded throughout all parts of the United Kingdom in order to make sure that the electorate understand where they came from and in case the devolved Governments should by chance forget to tell them. We emphasise the vital importance that the BBC, as the national public service broadcaster, should continue without qualification to provide a common UK-wide service, particularly on news and current affairs, in addition to whatever regional and local services it may provide.

I could go on—in combination, our two reports contained 115 paragraphs of conclusions and recommendations—but I feel that I have already detained the House too long and I hope that other noble Lords will choose to bring out any important points that I may have missed. I therefore conclude by saying that the problems that the Constitution Committee sought to address are still with us. The threat of those who would tear Scotland out of the union may be in abeyance, but it has not dissolved. I am conscious that Northern Ireland is beset by serious problems. Its condition is fragile and I leave it to other noble Lords, better informed than I, to address them should they choose. Similarly, Wales, originally lured into devolution by the slimmest of margins, has its own distinctive subtleties and priorities that others may wish to draw out. My purpose is to emphasise the welfare of the union on which we all depend. Devolution is not a casual throwaway matter. We are all a part of the main. It is time to acknowledge the failings of the past and the problems and dangers that they have brought and, with care and persistence, to resolve them. I beg to move the Motion in my name.

Photo of Lord Jay of Ewelme Lord Jay of Ewelme Chair, EU Home Affairs Sub-Committee 4:14 pm, 9th October 2017

My Lords, I too am glad to welcome the Minister to the House and to the Dispatch Box, and I look forward to working with him over the months ahead. It is also a great pleasure to follow the noble Lord, Lord Lang of Monkton. I am delighted to pay tribute to the eloquence and passion, if I may say so, of his speech and to his committee for its series of thought-provoking analyses of devolution.

When the European Union Committee launched its inquiry into the impact of Brexit on the devolution settlements, we were acutely aware of the risk that we might stray into areas that are properly the domain of the Constitution Committee. We are therefore enormously grateful to the noble Lord, Lord Lang, and the members of his committee for sharing their thoughts with us. I hope that our report is not guilty of any constitutional faux pas.

The bewildering pace of events since the referendum means that many of us have found it hard to keep up. The noble Lord, Lord Lang, spoke of that, and the European Union Committee is no exception. We took the bulk of our evidence in February and March, but our plan to publish a report in the spring was forestalled by the general election. While the committee was considering its draft report in June and July, negotiations started in Brussels, and just two days after we agreed our report, on 11 July, the European Union (Withdrawal) Bill was published. Since that time, we have had position papers from both the Welsh and Scottish Governments, along with innumerable political interventions, and who knows what will happen in the coming weeks. Given that, rather than describing our report in detail, I shall concentrate on one or two key points before turning to more recent events, in particular the EU withdrawal Bill.

The first point I wish to make, on which we are at one with the Constitution Committee, is that EU membership has, since the devolved institutions were established in the late 1990s, been part of what the committee called the,

“glue holding the United Kingdom together”.

We have a free and open internal market within the United Kingdom largely because all parts of the UK fall within the European Union single market and are subject to the same European Union rules. Once we are out of the European Union, we will need, as the Government have stated and as our report acknowledges in paragraph 210, common frameworks to ensure that the United Kingdom internal market continues to function. I think we are all agreed on that. But the fundamental basis of the devolution settlements was an acknowledgement that the different nations of the United Kingdom have different needs and that they should be entitled to develop differentiated policies and laws to take account of those needs. As we set out in chapters 3 to 5 of our report, each of the devolved Administrations faces different challenges: Wales’s hill farming sector, for example, and its reliance on manufacturing; Scotland’s specific demographic needs; and the close integration of Northern Ireland’s economy with that of the Republic of Ireland. The common frameworks needed to maintain the integrity of the United Kingdom internal market after Brexit therefore also need to allow for differentiation, and the challenge which the Government seek to address by means of the European Union (Withdrawal) Bill is to maintain that balance to ensure both that the frameworks are in place to uphold the United Kingdom internal market and to respect the diverse interests and priorities of the different nations and regions that make up the United Kingdom.

There is huge complexity here, so in chapter 6 of our report we outline the interaction between the competences currently exercised by the European Union and those which are either devolved or reserved within our domestic devolution settlements. We note that some EU competences are already devolved, notably those relating to the environment, agriculture and fisheries. Many other EU competences are reserved, such as those relating to competition and state aid.

The central point underlying our analysis is that the domestic balance of competences is fully set out in the various Acts of Parliament which have established the devolved institutions. Parliament has thus taken a view in successive devolution Acts on what should be devolved and what should be reserved. For instance, Parliament decided that competition should be a reserved matter, but that environment should be devolved. That is why, in paragraph 237 of our report, we concluded:

“On the day of Brexit, competences … will, by default, be exercised in accordance with these pre-existing statutory provisions”.

The Government’s response to the committee’s conclusion, which we received last month and for which the committee is grateful, states:

“The UK Government is responsible for ensuring that the internal market within the UK operates freely and openly. Previously, European legislation has set the frameworks to guarantee that a consistent approach is taken across the UK … The powers currently held by the EU that provide that guarantee on the internal market are not, and never have been, within the competence of the devolved administrations”.

I find that rather opaque. I assume that the Government are referring to the acquis of single market legislation; but within that acquis, there is the bulk of EU environment legislation, which plays an important part in ensuring that the UK’s internal market operates freely and openly—yet responsibility for the environment has been explicitly devolved to Scotland, Wales and Northern Ireland by Parliament. So on what basis do the Government claim that such legislation has never been within the competence of the devolved Administrations? I do not fully understand the Government’s position.

That takes us to the heart of the current disagreement between the UK Government and the Scottish and Welsh Governments. I find much with which I agree in the Welsh and Scottish Governments’ memoranda. For instance, the Welsh Government state:

“Legislative competence for devolved matters which are currently subject to EU restrictions would remain with the devolved legislatures post-exit”.

That is essentially the same point that our report makes. I have yet to hear a convincing counterargument. Rather, the difficulty is with the Government’s position. As Mark Drakeford of the Welsh Government told us,

“some UK Ministers … believe that, when the European Union is not there, these powers will somehow be free-floating and that if they grab them first they will be able to make decisions and the devolved Administrations will have to live with those decisions”.

Mr Drakeford’s fears seem to have been realised in the EU withdrawal Bill, which not only confers extensive delegated powers on UK Ministers but proposes that once Ministers have used those powers to convert retained EU law into domestic law, the devolved legislatures will not be able to amend that law, even in areas that fall within their competence. The Government response to our report describes this as,

“a temporary measure that provides the necessary time and space for detailed discussion on whether common frameworks are needed and how they might operate”.

There is nothing temporary about the relevant clause, Clause 11, which, as the Welsh and Scottish Governments have pointed out, contains no sunset provision. As I understand it, Clause 11 of the EU withdrawal Bill will permanently curtail the power of the devolved legislatures to amend a vast array of laws affecting areas that Parliament has determined should fall within devolved competence. Instead, those laws will be made by UK Ministers, using delegated powers and potentially with little parliamentary oversight. If I have got that wrong, I am sure the Minister will put me right.

As I said at the outset, the committee agrees with the Prime Minister that common standards and frameworks will be needed to support the integrity of the UK internal market after we leave the EU; but we also believe, equally strongly, that:

“Any durable solution will need the consent of all the nations of the United Kingdom”.

That means dialogue, compromise and mutual respect.

The key conclusion in our report is that contained in paragraph 271:

“We call on the UK Government and the devolved Governments to work together to put in place the frameworks needed to ensure consistency at UK level, thereby preserving the integrity of the UK single market, while respecting national, regional and local diversity, and the autonomy of the devolved institutions”.

Of course time is short, but even if the Government were simply to add a sunset provision to Clause 11, all sides would have time to come together and reach a lasting agreement on the common standards needed to protect the UK’s internal market, which could then be implemented by the legislatures in London, Edinburgh, Cardiff and Belfast.

I do not know why the Government have not pursued that approach. Any attempt to use the EU withdrawal Bill to impose common frameworks on the nations of the United Kingdom against their will would contradict the principles that underpin the devolved settlements. Of course the politics, particularly between Whitehall and Edinburgh, are difficult. I will not pretend that securing agreement will be easy, but so much is at stake that all sides—led, I hope, by the Government—must surely make the effort. The Brexit negotiations are complex enough. The last thing we want is to create unnecessary difficulties, too, for the make-up of the United Kingdom.

Photo of Lord Desai Lord Desai Labour 4:25 pm, 9th October 2017

My Lords, I very much welcome the debate—we have three substantial reports to discuss. I also welcome the Minister to his new position. He has been thrown in at the deep end and I hope that he manages to survive this ordeal.

Given the two speakers who will follow me, I think that I have to speak for England, because no one is here doing that yet. I point first of all to the very useful table provided in the report, Brexit: Devolution. Noble Lords will see from the numbers there that the devolved regions together voted to remain; it is England which voted to exit. The margin in England was larger than the total margin in favour of exit—I have said this before in your Lordships’ House.

We have to understand that one reason for dissatisfaction in England—it may have been reflected in terms of Europe—is that it is the only undevolved region of the United Kingdom. As the noble Lord, Lord Lang, said, the problem with devolution is that we have done it in a piecemeal fashion. I was told when I had my colonial education in India that that is the way we do things: we do not do things systematically; we do them one at a time. Suddenly, Brexit, among other things, has shown us the shortcomings of this approach. We have this great conflict between what the union is, what the devolved powers are and where the gaps in the arrangements are. One problem which will come up again and again in the months ahead is that, if we are to preserve the union—as, quite eloquently, the noble Lord, Lord Lang, said—we will have to do something about the problem of England. English votes for English laws was tried in a very gingerly fashion and I think that it has sunk without trace.

I do not think that it will happen but I will say it anyway: a constitutional convention or—God forbid—a royal commission will have to take on afresh the issue of the constitutional structure of the union after powers have been devolved to Scotland, Wales and Northern Ireland, with the situation of England left anomalous in that respect. We have toyed with the idea of regions of England having their own devolved governments or assemblies or something like that, but that went nowhere. In piecemeal fashion, we have now created some powerful mayors in large metropolitan areas, and there is now a movement in Yorkshire to have an independent Yorkshire or whatever it is. However, as a result of all these reports, I think that we have to come to terms with deciding what we are going to do about England. Are we going to have Westminster as a parliament for England and for the UK, or are we going to have a separate parliament for England and then have Westminster as the federal or the union parliament? It looks like an academic question, but I think it will come up again and again, because of dissatisfaction in England about lack of devolution.

The Barnett formula is one indication of this: every time the Barnett formula comes up, there is resentment in England that the same amount of money is not spent, per capita, in England as in Scotland. It may be a perfectly valid thing, because needs are different in different regions, but then you need to set an entire budget for each region, including England, on the basis of needs and then explain to people that, because the needs are dealt with equally and because they are different in different areas, this is why the Barnett formula exists; but nobody has ever done that. We have done the Barnett formula in an ad hoc fashion and it has long been reformed in an ad hoc fashion, without any reference to England.

I think it is very important that, as a result of these very important reports, we decide that now would be the best time, because Brexit is posing some very big challenges to us and when we are out, we will have problems. I was impressed by what the noble Lord, Lord Jay, said about the problem of re-establishing the single market. We are all old enough to remember that we had a single market before we went into Europe—what happened to that? Apparently it disappeared because, along the way, we have devolved power. How did that happen without anybody finding out? That kind of question is very important. We had the Kilbrandon commission, as some noble Lords will remember, back in the 1970s, but I think we need another commission, or some serious thinking as to how we will deal with dissatisfaction in England about the constitutional arrangements. It has not come up in a big way except in the Brexit world.

One problem we will have is that if the union is to be preserved, and I think that is a very important issue, we have to ask what kind of federation the union will be. Will it be one large region, England, and the three devolved regions? We see the asymmetry of that in the Brexit vote results: we may think that four units voted, but one unit overwhelmingly cast 28 million out of the 34 million votes cast for Brexit, and it was England which carried the result. Given that, are we going to have just four devolved regions, including England, or are we going to break England up into 10 separate independent regions with their own assemblies, or whatever it will be? How will we decide the question of the single market or the questions identified by the noble Lord, Lord Lang, of the social union, the defence and foreign policy union, the economic union?

Such questions have to be posed in an abstract way at the beginning and then we have to discuss the practical arrangements, instead of doing the practical arrangements in a piecemeal fashion and then finding that we have anomalies in the arrangements we have made. We will have anomalies because we have not thought about these things systematically. I do not think I can go on much longer like this, in an abstract fashion, but the problem I see being raised by the reports of both the Constitution Committee and the European Union Committee is that something will have to be done about England. The only way to do something about England is to approach the question of the nature of the union formally, and decide once and for all how we are going to include the devolution of England within the overall framework of the union.

Photo of Lord Wallace of Tankerness Lord Wallace of Tankerness Liberal Democrat 4:34 pm, 9th October 2017

My Lords, I thank the noble Lords, Lord Lang of Monkton and Lord Jay of Ewelme, for introducing the debate, and their respective committees for giving us the opportunity to consider some very substantial reports containing some very important recommendations. I welcome the noble Lord, Lord Duncan of Springbank, to the Front Bench. We look forward not only to his maiden speech replying to this debate—what a challenge—but his subsequent contributions to your Lordships’ House.

There is probably no better place to start than the opening words of the European Union Committee’s report, which sum up the situation quite succinctly:

“The impact of UK withdrawal from the EU on the UK’s devolution settlements is one of the most technically complex and politically contentious elements of the Brexit debate”.

If anything, that may even be an understatement. As has already been referred to, the architecture of the devolution schemes fully reflected—almost took for granted—our membership of the European Union. Section 29(2)(d) of the Scotland Act 1998 indicates that an Act of the Scottish Parliament is outwith the competence of that Parliament if it is incompatible with Community law; there is similar provision for executive actions. I think the noble Lord, Lord Jay, said that the European Union was the glue that held our union together. In addition, the structure of devolution has been such that everything is devolved unless it is expressly reserved. Devolution includes agriculture, fisheries and the environment—all devolved issues but which hitherto have had a very important European Union component. Logic would certainly indicate, as the noble Lord, Lord Jay, did, that following Brexit these would become the responsibility of the Scottish Parliament and the other devolved bodies.

It is right to say that the Scottish Parliament, in exercising its powers over a number of these areas, has done so within frameworks established by the European Union. Who knows, if we had not been an EU member in 1998—we can speculate but it would be somewhat academic—what further exemptions might there have been in Schedule 5 to the Scotland Act? But that is not where we are. There are some very good reasons why we should be pragmatic and apply common sense in suggesting that there must be frameworks which should be discussed and applied at a UK level. I do not believe it is anti-devolution to say so. The committee itself recognised that some things would be best done at a United Kingdom level when we are outside the European Union. Indeed, paragraph 19 of the Scottish Government’s legal consent memorandum on the European Union (Withdrawal) Bill states:

The Scottish Government has made clear … its willingness to negotiate UK frameworks in certain areas previously covered by EU law. This could be, for example, to support the functioning of UK markets, or to facilitate the management of common environmental resources”.

The Scottish Government themselves accept that there is a need for United Kingdom frameworks. It is important, therefore, that we address how we best tackle this and the European Union Committee is absolutely right when it emphasises the,

“need to set aside … differences and work constructively together to achieve an outcome that protects the interests of all parts of the UK. No durable solution will be possible without the consent of all the nations of the UK”.

One of the Select Committee’s recommendations reflects some of the earlier reports from the Constitution Committee about the importance of Joint Ministerial Committees. The noble Lord, Lord Lang of Monkton, welcomed the establishment of the Joint Ministerial Committee (EU Negotiations). It was announced by the Government, with much fanfare, last autumn. I received during the most recent Recess a Written Answer from the noble Baroness, Lady Sugg. I had asked how many times that Joint Ministerial Committee had met in 2017. The answer was twice, on 19 January and 8 February. I have no doubt that the Minister will tell us that there is a meeting scheduled for next week and there have been umpteen, or several, bilateral meetings. But the mechanism established by the United Kingdom Government was to have a Joint Ministerial Committee. The recommendation of the European Union Committee was very practical and the Government’s performance to date has fallen well short of this very reasonable recommendation. It is a test of how seriously the Government take their responsibilities towards achieving an outcome that will be satisfactory to all parts of the United Kingdom.

If we look at how we would establish which should be the areas for common frameworks, it would be wrong for the Government to determine that this should be done on a top-down basis. The concerns expressed by the noble Lord, Lord Jay, with regard to the European Union (Withdrawal) Bill betray a certain attitude that this would be done in a top-down way.

A body or a commission should examine these issues. It should be transparent and constructive, in a way that commands support from all parts of the United Kingdom and from all parties. The timescale of a royal commission would probably be too long. However remarkable the work done by the Smith commission, it was far too short and done with a degree of relative secrecy—it was not particularly opaque. We need something that is transparent and engages people, for example by taking evidence from the fishing industry, the agricultural industry and environmental groups as to what they think it important that we should do on a United Kingdom basis. After that the respective Administrations could, as they do now under European frameworks, produce detailed policies within that framework to meet the needs of particular areas.

Even when these United Kingdom-level frameworks are agreed, it would again be wrong if it were purely the United Kingdom Government who set the agenda. We should look for a balance of competences that is both devolved and shared. For example, the Joint Ministerial Committees could be put on a statutory footing. They would no longer be the talking shops which they often have been and could be invested with executive powers. For example, it may be necessary to consider whether they should operate with the possibility of weighted voting. Having made that agreement, the respective devolved Parliaments and Administrations—and the Westminster Parliament, as far as England is concerned—could then be allowed to work out how these agreements would be implemented in detail. That might in some ways be seen as a derogation from the sovereignty of Parliament but I believe David Cameron’s Conservative Government went down that path with their English votes for English laws. We now have a situation where one subset of Parliament, the English Members, can veto a measure that has been passed by the Lords and the Commons.

Photo of Lord Forsyth of Drumlean Lord Forsyth of Drumlean Chair, Economic Affairs Committee

The noble and learned Lord is making a very sensible and careful speech but could he just explain to me how agricultural subsidies would work under his scheme of things? Most of the money spent by the European Union is on the CAP and before we joined the European Union, we had a common system set by the United Kingdom Parliament. I find it quite difficult to envisage different subsidies for sheep on either side of the Scottish or Welsh borders, or how a market would operate under those proposals. I am thinking of the politics of it, where we have a Government in Scotland who wish to break up the United Kingdom. I just do not see how it could be practical. Is it not a little hypocritical of those who argue that we should remain in the European Union, and that these powers should therefore remain in Brussels, to say that they cannot possibly be exercised by the United Kingdom Parliament?

Photo of Lord Wallace of Tankerness Lord Wallace of Tankerness Liberal Democrat

My Lords, the noble Lord, Lord Forsyth, makes an important point about the distribution of funds but that point should be agreed. It should not be done, as it were, on a top-down basis by the United Kingdom Government. I would point out to him that when there was a change in the basis for European Union agricultural payments in the early years of this century, Scotland went down the route of historic payments whereas England certainly went down that of payments based on area—I am not sure about Wales. So even under the present arrangements, there are differences in how these things are dealt with north and south of the border.

I will not detain the House on other issues relating to migration, on which the committee made important recommendations. Having looked at the Government’s response, it makes the word “banal” sound exciting—there was no response at all. The Government should have second thoughts on that and address the very important points made by the committee.

If we had a ministerial group setting out the framework, as I have proposed, we would also need some body to overlook it. That could well be done through an inter-parliamentary body, trying to bring the different Parliaments of the United Kingdom together—in Scotland, Wales, Northern Ireland and the Westminster Parliament—to provide that kind of oversight. If that is a step towards federalism, then certainly from these Benches I do not apologise.

Photo of Lord Wigley Lord Wigley Plaid Cymru 4:44 pm, 9th October 2017

My Lords, some people may wonder why there is a somewhat sparse presence of Peers with Welsh links participating in this debate. One factor is undoubtedly an event taking place in Cardiff, where there is an important international football match in which Wales faces the Republic of Ireland. The outcome will probably determine whether Wales, for the first time since 1958, participates in the World Cup finals. Incidentally, my condolences to my Scottish friends.

I hope that I will gain a few brownie points from colleagues by my presence here tonight. I bought tickets for my son, my grandsons and myself a year ago, and my heart is there, but noble Lords will perhaps recognise that the supreme importance of tonight’s subject dictates that I should participate in this debate concerning the implications for devolution and Brexit. I thank the two noble Lords who introduced the important reports before us today.

Let me first refer to other events which may have a tangential significance for the subject at hand—namely, the constitutional developments in Catalonia. Without trespassing into matters outside the reports which we are considering, I shall put two issues on record. First, my Plaid Cymru colleagues and I utterly abhor the heavy-handed tactics used by the Spanish Government, which have been condemned around the world, although only belatedly and half-heartedly by senior figures of the European Union. For those of us who have been strongly committed to the European ideal and devolution, this serves to remind us that the construct of Europe is still not a Europe of the people, but a Europe which is largely orchestrated to meet the needs of 19th-century imperial states and which can still tolerate actions reminiscent of 20th-century fascist dictators. For the first time in 50 years, my faith in the European dream has been badly shaken.

Secondly, noble Lords may have noticed pictures of David Cameron being paraded by Catalan voters in Barcelona. The experience in Spain allows a new, favourable view of the events surrounding Scotland’s independence referendum in 2014. Certainly there were aspects of that event which dismayed many of my friends in Scotland but virtually everyone, I believe, accepted that if there had been a 55% to 45% vote for independence, the UK Government, while greatly saddened by such an outcome, would have respected the democratic decision of Scotland and would have worked with Scotland’s Government to secure a sensible transition to a new form of partnership in these islands.

For those of us who are sometimes critical of aspects of the British state—justifiably in some matters, such as the iniquitous Barnett formula and the impact it has on Wales, which has been mentioned tonight—there has been a salutary lesson. There are positive aspects of British democracy which we should rightly recognise, and respect for people’s views, and their right to express them through referenda, is something we should cherish. There may come a day when, once again, Scotland, Northern Ireland or Wales vote on their constitutional future. They will do so knowing that, unlike the experience of the Catalans, their voice will be respected and the outcome of the referendum delivered.

That brings me to the Brexit issue. As I have already stated in this Chamber, while I bitterly regret the outcome of last year’s referendum on the UK’s membership of the European Union, I have to recognise that the result has to be respected, although I also recognise that Scotland and Northern Ireland voted to remain in the EU, and that is why the subject of tonight’s debate is additionally significant. These differences and the need to accept that the UK voted in total to leave underline the requirement to secure a form of Brexit which takes on board the diverse demands and expectations of the four nations of these islands and their elected Governments.

The referendum determined that the United Kingdom state will leave the EU, but it did not determine what would be the relationship of the UK as a whole or its constituent nations with the residual EU of 27 member states. The choice which the UK Government should be seriously addressing is whether there will be one overarching solution addressing the diverse needs and considerations of all four constituent nations of the UK, which would inevitably mean that either there has to be large-scale compromise or that the needs of some nations are subjugated to the needs of others. In other words, can we formulate a solution involving multiple geometry and a flexibility which allows a different interplay with Europe among the constituent nations of the UK? That is where consideration of the role and, indeed, the extent of devolution comes centre stage.

The report of the European Union Committee on Brexit and devolution has identified many of these problems. I congratulate the committee on its work; I was fortunate in being invited to give evidence and I thank it for that courtesy. In its conclusions, the report states, on page 4:

“No durable solution will be possible without the consent of all the nations of the UK”.

It recognises that common standards, which may be needed for the integrity of the UK single market,

“cannot be imposed top-down by the UK Government”.

It recognises that the UK Government will need to secure the consent of the devolved legislatures to the withdrawal Bill.

I also highlight the European Union Committee’s criticism of the working—or should I say the non-working—of the Joint Ministerial Committee (EU Negotiations). It notes that that committee, which should have a key co-ordination function as the Brexit negotiations move forward, had only ever met twice, and not since 8 February. I also noted the emphasis placed on this by the noble Lord, Lord Lang, when he introduced the debate and indeed by the noble and learned Lord, Lord Wallace of Tankerness, a moment ago. It is difficult to see how the Prime Minister can claim, as she did at the start of her tenure of office, that she would be “fully engaging” the devolved Administrations in the Brexit process. Indeed, in her Lancaster House speech, she saw the question of what powers should be passed to the devolved Administrations from Brussels as a matter solely for the UK Government to decide.

This brings us to the heart of the issue, concerning which Plaid Cymru has commissioned legal advice from Fflur Jones of the leading Cardiff solicitors Darwin Gray, to provide a legal analysis of the withdrawal Bill and its constitutional implications for Wales. Her paper explains why, in her opinion, the Bill is in breach of the current devolution settlement. Indeed, she goes as far as to state that, in the present form, the withdrawal Bill is,

“an existential threat to the current devolution settlement in Wales”.

The advice states that the Sewel convention, since it has been enshrined in statute,

“is a powerful political mechanism whereby all legislative changes that will affect the devolution settlement in Wales, or the introduction of any framework agreements within the UK, should be introduced by way of consultation and agreement between the UK Parliament and the National Assembly”.

Any other kind of imposition of changes would mean the UK Parliament considers it right to impose changes that affect the devolution settlements without the Assembly’s consent and which may well countermand the constitutional settlement which has been approved by the people of Wales in two devolution referendums.

This is not just a question of legal niceties, it is an issue which will impact on all aspects of Welsh life. It is true, regrettably, that Wales voted by a small margin to leave the EU. In doing so, many Brexit voters may have been motivated by the case for “taking back control”. Passing power from Brussels to London over matters such as agriculture, which are almost wholly devolved to Wales, does not in any way constitute bringing back control to Wales.

In fact, all three current devolution settlements are framed in the context of the UK’s pre-existing EU membership and reflect the supremacy of EU law. This is highlighted in the EU Committee report before us, where, in paragraph 36, it is stated,

“the European Union has been, in effect … the glue holding the United Kingdom together since 1997. The supremacy of EU law, and the interpretation of that law by the Court of Justice of the EU, have in many areas ensured consistency of legal and regulatory standards across the UK, including in devolved policy areas, such as environment, agriculture and fisheries. In practice, the UK internal market has been upheld by the rules of the EU internal market”.

How is this now to be replicated within an UK-only context? The European framework is not the plaything of one member state, nor even of the EU Commission itself. The European Court of Justice is an independent judicial body. If after Brexit we are to have a set of rules for the UK single market, laid down by just one of the four parliaments of these islands, it is, as the committee itself asserts, a development which,

“presents a risk that the complex overlapping competences within the UK could become increasingly unstable”.

In the concluding words of this report, the UK Government must work,

“in a spirit of partnership and cooperation with the devolved legislatures and governments”, as was emphasised earlier by the noble Lord, Lord Jay of Ewelme. I wait with interest to hear how the Government intend to discharge this most fundamental of duties.

Photo of Lord Dunlop Lord Dunlop Conservative 4:55 pm, 9th October 2017

My Lords, I thank the noble Lords, Lord Lang and Lord Jay, for the way in which they introduced the debate. I welcome my noble friend Lord Duncan to the Front Bench and I look forward to his maiden speech. He has certainly been busy in the last four months, consulting groups across Scotland. As his immediate predecessor, I did the same thing. My progress across Scotland was always forensically—one might say obsessively—tracked on social media by a cybernat called the Tartan Hippo. I grew quite fond of the Tartan Hippo, although he seemed to imagine that ministerial visits to Scotland represented some sort of extended holiday. So, notwithstanding my noble friend’s doctorate in palaeontology, if he encounters the Tartan Hippo on his travels I can only wish him the very best of luck.

We are debating today three important reports. The common thread running through all of them is how the UK manages a period of unprecedented constitutional change to provide constitutional stability and protect the integrity of the UK. The greatest existential threat to the integrity of the union has come from Scottish independence. That threat takes two forms: the direct fundamentalist threat that nationalists will seek, by stirring up grievance, to engineer the circumstances in which Scotland votes to leave the UK; and the indirect, gradualist threat that powers are indiscriminately devolved to the Scottish Parliament to an extent that the UK becomes so hollowed out that it can no longer function as a viable nation state.

No one can doubt the significance of Brexit to our territorial constitution. Handled badly, Brexit risks exacerbating the threats to the UK’s constitutional stability. Handled well, it provides a unique opportunity to strengthen the union between our four home nations. So I want to set out grounds to be hopeful and thoughts on the repatriation of powers from Brussels. The most obvious reason to be hopeful is that the threat of a second independence referendum has receded although, I hasten to add, not gone away. Campaign fatigue is doubtless a factor but there are three other important factors: grievance denial, accountability and the SNP’s independence paradox.

On the first of those, grievance denial, the way in which the devolved Administrations are handled is often criticised, and I would be the first to admit that the UK Government sometimes do not help themselves—for example, by unnecessarily being slow to share information and not holding regular meetings of the Joint Ministerial Committee. However, I know from personal experience what efforts are made to behave reasonably and to be seen to do so. The Edinburgh agreement, which has been referred to, is seen as an example of how reasonably and successfully to hold an independence referendum. It gave force and legitimacy when the Prime Minister came rightly to refuse to concede a second independence referendum. Similarly, in this 20th anniversary year of the Scottish devolution referendum, despite well-publicised tensions, the business of managing areas of shared competence has continued to be conducted successfully. City deals and the joint ministerial group on welfare are current examples of effective intergovernmental co-operation. It has become commonplace for UK and Scottish government Ministers jointly to meet with Scottish business and civic society. So while Scottish devolution was not stress-tested at the outset for the possibility of an SNP Government in Holyrood and a Conservative Government in Westminster, it is being now and is proving remarkably resilient because most people in Scotland want the two Governments to work together.

Brexit is further testing the arrangements, with the Scottish Government insisting that they will not give legislative consent to the European Union (Withdrawal) Bill, but let us remember that the Scottish Parliament threatened until the last minute to withhold consent for both the Scotland Acts 2012 and 2016. Indeed, many was the time that I stood at the Dispatch Box waiting, in the memorable phrase of my noble friend Lord Forsyth, for Billy Bunter’s postal order to turn up. Well, it turned up in the end in the form of legislative consent for the Scotland Act 2016, and there are sound reasons for the Scottish Government to reach agreement this time, too: to achieve more powers and ensure that Scots law continues to work.

That brings me to accountability. At its heart, the Scotland Act 2016 is about strengthening the accountability of the Scottish Government by increasing their financial responsibilities and reducing their reliance on the UK block grant. I accept that it is still early days, but the 2016 Holyrood and 2017 general elections suggest that the Smith package is having a positive effect on Scottish political debate, with less focus on what more powers Scotland needs and much more on how those powers are being used. This can only be healthy.

My final ground for hope is the paradox at the heart of the independence proposition. Brexit has not proved the recruiting sergeant for independence that Nicola Sturgeon expected it to be, and it is not hard to see why. For those who want Scotland to have more control of its own destiny, the paradox is being asked to leave a long-standing union where power is being dispersed to stay in a more recent union where the clear direction of travel, as recent speeches of Presidents Juncker and Macron make clear, is towards more integration, not less.

A similar paradox applies to the SNP’s claim that the UK Government are seeking to hoard at Westminster powers repatriated from Brussels. Not only does this defy the Government’s recent devolution record and commitment to devolve more powers post-Brexit, it is also hard to square with the SNP’s apparent preference for powers to remain concentrated in Brussels instead. Voters have a keen ear for justifications and arguments that sound fake or phoney.

Against this backdrop, the government approach set out in the European Union (Withdrawal) Bill to the repatriation of powers is broadly to confer on the devolved Administrations power to correct technical deficiencies in repatriated EU law in order to provide a workable devolved statute book on exit day; to replicate for retained EU law the existing requirements prohibiting devolved Administrations from legislating contrary to EU law; and to establish a mechanism for releasing, by mutual agreement of the UK Government and the devolved Administrations, powers to the appropriate level of government from what is, in effect, intended as a temporary holding pattern. This makes possible an orderly process for establishing and agreeing where common UK frameworks are required, because all three devolution settlements assume the UK’s membership of the EU and, as the noble Lord, Lord Jay, and others have already said, EU law is the glue holding together the United Kingdom’s single market. Without common UK frameworks to replace this, there is a real risk of undermining the UK home market as we exit the EU.

The Government’s intentions are sound and sensible. Without that approach, powers currently exercised at EU level could flow back by default to the devolved Administrations. This would be contrary to one of the central conclusions of the Constitution Committee’s report on the union and devolution: that proposals for further devolution must take into account,

“the needs of, and consequences for, the entire Union”.

That said, moving forward, the Government will need to demonstrate that the process for agreeing how repatriated powers are allocated is both fair and robust, and there are two areas where action could be taken to build greater confidence in the process. The European Union (Withdrawal) Bill is currently asymmetrical between the constraints imposed on the devolved Administrations and the extensive delegated powers conferred on UK Ministers. I am not arguing for the constraints on the devolved Administrations to be removed. If, however, as the Government say, the delegated powers in the Bill are not intended to effect major changes of policy but technical changes to make the law work, this should be reflected in stronger safeguards in the Bill against their misuse. I commend to the House the Constitution Committee’s proposals in its most recent report for achieving this. A better balance of constraints would have the virtue of providing the UK Government and devolved Administrations with similar incentives to reach early agreement on substantive policy issues.

The second area of risk is the risk of reservation by default, to which the noble Lord, Lord Jay, has already referred. The power to fix deficiencies is time limited, but the mechanism in Clause 12 of the European Union (Withdrawal) Bill for releasing powers from the holding pattern is open ended. There needs to be clarity, therefore, about where the competencies repatriated from Brussels will be exercised if there is no agreement between the UK Government and devolved Administrations. The Government have said that they will seek the legislative consent of the Scottish Parliament for the European Union (Withdrawal) Bill; they therefore have the strongest possible incentive to get this right, which underlines the importance of having in place a clear route map and timetable for reaching agreement. I hope that my noble friend will say more about this in his speech.

In conclusion, the great strength of the UK’s unwritten constitution is its flexibility and resilience, which has been tested often and increasingly questioned. In the face of these challenges, the temptation is to propose statutory solutions for constitutional arrangements governed by convention and practice. However, we should be careful not to reach for judicial adjudication, excellent though it is, when what is required is political negotiation and agreement. It was the late Garrett Fitzgerald who asked, in relation to a public policy proposal:

“I can see that it works in practice, but does it work in theory?”.

It is unfashionable to say it, but I believe that the daily management of the Scottish devolution settlement has worked better in practice than theory and theorists would suggest. I am confident that in handling the issue of repatriation of powers, the Government will demonstrate that that remains the case—so no pressure.

Photo of Lord Morgan Lord Morgan Labour

My Lords, I begin by apologising to the House. I was told that the debate was beginning two hours later than it appears to have done—

Photo of Viscount Younger of Leckie Viscount Younger of Leckie Lord in Waiting (HM Household) (Whip)

I apologise for interrupting the House, but I understand that the noble Lord has withdrawn from speaking, as he was not here for the opening speech.