Brexit: Devolved Administrations - Motion to Take Note

– in the House of Lords at 11:37 am on 25th January 2018.

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Moved by Lord McInnes of Kilwinning

That this House takes note of the role of the devolved Administrations in the process of withdrawal from the European Union and future opportunities for strengthening the union of the United Kingdom.

Photo of Lord McInnes of Kilwinning Lord McInnes of Kilwinning Conservative

My Lords, I am delighted to bring this important debate before your Lordships’ House this morning. I am especially pleased that so many noble Lords whose expertise goes far beyond mine have chosen to contribute. As I look through the speakers list, I see people from all parts of our United Kingdom, including a former Secretary of State, a former First Minister, a former Member of the Welsh Assembly, an Advocate-General and renowned legal and constitutional experts.

I hope that this debate will give my noble friend the Minister and the wider Government a feeling for the views of your Lordships’ House as we face the inevitable joys of the withdrawal Bill and, specifically, its implications for devolution and the union. I will endeavour to avoid an overdominance of Scotland in my remarks but inevitably, a little later, I may show too much interest in what I know best. However, I hope that that will be compensated for by noble Lords from other home nations.

Above all, and like many in this House, I increasingly find that my unionism drives and underpins my political opinions. Unsurprisingly, I voted no, successfully, in 2014 and Scotland remains part of the United Kingdom. I was less successful in 2016, when the UK voted to leave the EU. My decision in 2016 to vote to remain in the EU was more than influenced, like that of many others in Scotland and Northern Ireland, by my fears for the impact on the union of a leave vote. Like many others, I was genuinely concerned that the fragility of Scotland’s place in the United Kingdom post the 2014 referendum and the Scottish nationalist sweep of Scotland in 2015 would be exacerbated by a leave vote in 2016. After all, an important part of the 2014 referendum had been a discussion of Scotland’s place in the EU and the fact that an independent Scotland would not enjoy automatic membership of the EU. I should have had more faith in my fellow Scots.

My concerns failed to understand one crucial factor, which was that even for those Scots who had voted to remain in the United Kingdom in 2014 and to remain in the EU in 2016, remaining part of the United Kingdom and avoiding another divisive independence referendum was of more importance. In underestimating this feeling I was not alone. The unionist commentariat in Scotland took a similar view. No less a figure than the author JK Rowling took to social media the day after the Brexit vote to say that Scotland would now seek independence. It is of little wonder, therefore, that Scotland’s First Minister also made the same misjudgment and began her campaign for a second independence referendum within hours of the declaration The inevitability of the end of the union seemed almost to be upon us. However, the Scottish people did not, thankfully, agree with that inevitability. The First Minister was punished for this at the general election last year. Unfortunately, she has not heeded that and only last week was once again threatening to make a decision on a second independence referendum by the end of this calendar year.

It is testament to the strength of the union that there has been broad public acceptance that Brexit is going ahead in Scotland and all the evidence is that there is now very little difference between Scottish public opinion and wider UK opinion on this issue. The question on the ballot referred to the whole UK leaving the EU and it will be the United Kingdom that leaves in its entirety.

While Scottish public opinion has over the past 18 months, if anything, become more unionist, it would be easy for complacency to descend as we go through the difficult constitutional time ahead. The union is made up of four component parts and it is in Northern Ireland that we have seen a real questioning of the union in the face of a potential hard border, which of course the Government have committed not to allow. This has been particularly true among younger unionist voters in Northern Ireland. In an opinion poll in November by the Belfast firm LucidTalk it was clear that, faced with the choice between remaining in the EU within a united Ireland or a so-called hard Brexit within the UK, the result would be too close to call as to whether Northern Ireland remained part of the United Kingdom.

The situation in Northern Ireland without a power-sharing Executive makes the interaction between the UK Government and the people’s political representatives and devolved feeling much more difficult. I ask the Minister: what success are the Government achieving in including all political opinion in Northern Ireland in the process of proper engagement as we venture through the Brexit process?

As a unionist, I was pleased in December to hear my right honourable friend the Prime Minister commit to the intrinsic importance and centrality of Northern Ireland to our United Kingdom and that Brexit would not be allowed to undermine Northern Ireland’s place in the United Kingdom, while respecting the Good Friday agreement and the special requirements caused by the land border and the common travel area. The very public discussion of Northern Ireland’s place was, in retrospect, a good thing. All too often on the mainland, Northern Irish politics are given a cursory glance. It is important to recognise that we need to work across all four component parts to preserve the union as we move forward through Brexit.

As we are all aware, and as was debated in your Lordships’ House last October, we are fortunate to have had two thoughtful further reports from the Constitution Committee, on intergovernmental relations in 2015 and the union and devolution, and my noble friend Lord Boswell’s report from the EU Committee on Brexit and devolution. In that context, I very much look forward to the remarks of my noble friend Lord Lang. All these reports have pointed to the asymmetric nature of devolution and have placed before this House recommendations as to how the structures and processes should be improved. It is almost as if the juggernaut of Brexit and the constitutional upheaval coming down the line were foreseen. I hope the Minister will make this point in government. It is important that, as we leave the EU, we use that opportunity to implement the recommendations from these excellent reports from the Constitution Committee and the EU Committee.

Now is the time—over the next 15 months and through the transition or implementation period, depending on what you call it—when Brexit can give an opportunity to ensure that the intensity of the UK Government working closely with the Welsh, Scottish and, I hope, Northern Irish Administrations is used as a means to set in place processes and systems that normalise the present constitutional settlement. Every disagreement for the next 50 years cannot be allowed to become a constitutional crisis that destabilises the state and becomes an excuse for a Scottish or Welsh referendum or a border poll. The state must find a way to ensure that political disagreements between different Administrations can be absorbed in the workings and processes of good government.

The debate over Clause 11 of the withdrawal Bill in many ways offers a good example of how a mature and intense discussion can bring about agreement and consensus between the Governments, as well as Brexit creating more opportunity for framework agreements between the UK Government and the devolved Administrations. If we set aside the political rhetoric of the SNP about a power grab, it is clear that both the Welsh and Scottish Governments accept that the repatriation of powers in devolved areas cannot be allowed to undermine the single UK market, which is so important to all constituent parts of the UK, and that key policy areas require frameworks and joint working. At the same time, the UK Government recognise that repatriated powers in devolved areas that require no framework should not be held here for the sake of it.

An opportunity will come before your Lordships’ House to amend Clause 11 of the withdrawal Bill and to ensure that joint agreement between the UK Government and the Scottish and Welsh Governments gives an underpinning to that agreement to allow the Brexit process to move forward in as consensual a way as possible. It is unfortunate that the wording of the amendment required could not be drafted and agreed by Her Majesty’s Government and the Welsh and Scottish Administrations while the Bill was still in the other place on Report, as had been anticipated. I am sure we will have a thoughtful debate when any such amendment comes before us.

The real lesson from this process has been the acceptance that a legislative consent Motion in the Welsh Assembly and the Scottish Parliament is important to Her Majesty’s Government and your Lordships’ House, even if it is not a legal necessity. I believe that represents a political maturity and understanding from Her Majesty’s Government and the devolved Administrations by not allowing themselves to enter too much of an entrenched position following political agendas.

Agreed frameworks of implementation and dispute resolution will also provide institutional normality that encourages working together and the kind of stability sought by each of the reports debated in this House. As Professor Nicola McEwen pointed out in her evidence to the Constitution Committee, regular interaction and interplay is a key pathfinder to a settled constitutional position. Since the Constitution Committee’s report on intergovernmental relations of 2015, the number of Joint Ministerial Committee meetings have increased in regularity and importance. There has also been the introduction of the joint ministerial council on European negotiations. Sometimes, these meetings have become an opportunity for an angry press statement outside but, overall, the interaction of the government machines in preparation for and implementation of such meetings can only be good for the union. They have also given the Welsh and Scottish Administrations further opportunity to work together, not always to Her Majesty’s Government’s comfort.

Likewise, the repatriation of powers from the EU can only help increase the joint working required between Whitehall departments and the devolved Administrations, which has been an increasing problem because of silo-isation over the past five to 10 years. I look forward to my noble friend the Minister giving us his impression of what Her Majesty’s Government propose to do to ensure that those departments continue to work with the devolved Administrations.

An increasing problem for the union has been a failure of understanding among the general population of which powers are reserved and which are devolved. This was raised specifically in the Constitution Committee’s report. Such a lack of understanding has been a consequence of changes and reports which have been constant through all three devolved Administrations during the past 20 years. Following the implementation of the Silk and Smith recommendations, Brexit gives an opportunity for clarity to be established that demonstrates the diversity that devolution brings to the United Kingdom. For that reason, Her Majesty’s Government and the devolved Administrations cannot constantly be opposites, point-scoring against one another. Of course there will be political dispute—there has to be—but normalising devolution requires a focus on the expectations of the people affected by government. Outside England, that means accepting that people have two Governments, with agreed competencies and processes in place to ensure that disputes are dealt with properly.

While, like many Scots, I may not have been overly optimistic about the future of Scotland’s place in the United Kingdom in the early hours of 24 June 2016, I now hope to see Brexit used as a means and a catalyst for the normalisation and stabilisation of the constitutional settlement in our United Kingdom. The United Kingdom’s tradition of slow, organic change has been somewhat challenged by the past 20 years. With the extra catalyst of Brexit, we must now ensure strength and vitality for our union over the long term. I look forward to the input from many eminent noble Lords in this debate. I beg to move.

Photo of Lord McConnell of Glenscorrodale Lord McConnell of Glenscorrodale Labour 11:52 am, 25th January 2018

My Lords, I congratulate the noble Lord, Lord McInnes, on securing this debate on Burns day, which seems particularly appropriate. I know that the debate will cover the whole United Kingdom and not just Scotland, but we celebrate this day with particular gusto. It is celebrated throughout the world, because Burns was an internationalist—he never travelled further than Newcastle, but he understood the rest of the world and was able to write about it in creative and passionate ways which would shame many of the debates that have taken place across Scotland and the UK during the past two years.

I congratulate the noble Lord also on his introductory speech. It was an incredibly thoughtful and reflective speech that indicates that he will make a significant contribution to your Lordships’ House. He may not, as he said, have the same level of political experience as some other speakers in this debate, but his contribution was outstanding and I welcome the opportunity to follow him.

I have been a lifelong supporter both of home rule for Scotland within the United Kingdom and of the United Kingdom’s membership of the European Union. I have watched with despair over recent years as in both referenda the campaigns promoting the position that I adopt failed to make a positive case and focused far too much on the negative—in one case just surviving and in the other just losing. However, despite that position, which I have held all my life, it is my very strong view that the role of your Lordships’ House over these coming weeks and months is not to overturn the result of the referendum in 2016 but to scrutinise the way in which the Government are implementing that referendum result and to try to help to shape the future of the United Kingdom in this new set of circumstances.

For the two decades between 1979 and 1999, a massive debate took place, not just in Scotland but elsewhere in the United Kingdom, about the future of the principle that there should be democratic accountability for Scottish domestic affairs in Scotland within the framework of the United Kingdom. Over the course of those two decades, the debates that took place produced a national consensus—ultimately, the consent for that national consensus was demonstrated in the referendum of 1997—and a scheme in legislation that, despite all the political ups and downs of the past 18 or 19 years, has actually stood the test of time legally, not least because of the contribution of my noble and learned friend Lord Irvine, who was one of the key figures in ensuring that we had a Bill and an Act for Scottish devolution that was intellectually rigorous and would stand the test of time.

In the approach that we take to these decisions post Brexit, we need to apply the same level of rigour and principle as was applied back in 1997, 1998 and 1999. In the two decades since 1999, we have seen too many piecemeal changes, not properly thought through—compromises established because of immediate political circumstances rather than based on the principles of the original settlement. We have also seen over that time, partly because of the political ups and downs but also because of a lack of understanding at the centre of the British state, an inability or unwillingness to reform how the UK Government operate, both in relation to the devolved Governments in Scotland, Wales and Northern Ireland but in relation to its own internal affairs following the huge reform that took place in the decentralisation of power in 1999.

Not only should we in this debate address the principles of the split between devolved and reserved responsibilities post Brexit, but we should also say something about the way in which Brexit, for all its faults and for all the worries that many of us may have about it, provides an opportunity to reinvigorate and refresh the way in which the UK is governed, both at the centre and in relation to the devolved Governments and devolved responsibilities.

First, on the principles, it seems blatantly obvious that the principle at the heart of the Government’s decisions, and, I hope, the legislation that finally passes through both Houses of this Parliament, has to be that the matters repatriated from the European Union should be devolved, unless it is absolutely essential that they are reserved in the national interest. It also seems to me blatantly obvious that, within those devolved responsibilities, there are areas that, of course, the Scottish, Welsh and Northern Irish Governments will get on with and operate autonomously, but there are other areas where there have to be common frameworks. In the same way as there have been common frameworks and indeed common laws across the European Union on issues such as agriculture, fisheries and the environment and so on, over the last 40 or 50 years, we also need to have those common frameworks and perhaps, occasionally, common laws across the United Kingdom. So devolved Governments need to commit, and commit firmly, to those common frameworks.

As I said previously, if we have this debate transparently and openly, we can reach that agreement. The egos and ideologies that are getting in the way of reaching this agreement, in both the British Government and the Scottish Government and elsewhere, have got this fundamentally wrong. They need to get on with making an agreement and allowing us to move on to the next stage—and the next stage needs to include reforming the relationships and a new level of engagement, which could make a real difference to the UK post Brexit. First, the new partnership, sharing common frameworks across the UK that allow for common decision-making, voluntarily agreed by the devolved Governments but firmly agreed and implemented consistently across the UK, could be a new way of working inside the UK that would actually refresh both the UK and the method of government, including attention to detail in policy in Scotland in particular.

I also believe, however, that there is need for a new level of engagement from the Scottish Government and perhaps others in the work of the British Government at home and abroad. In the time of the noble Lord, Lord Kerr, at the Foreign Office, and his successor, the noble Lord, Lord Jay, the Scottish Government were actively involved with the Foreign Office in adding value to the work of the UK internationally, as well as representing Scottish interests. I think that has diminished over the past decade. I believe there is a real opportunity here—in international trade negotiations, representing the Scotch whisky industry, food and drink, oil and gas, in internal debates on immigration, in all these areas—for fresh engagement and a new, fresh voice for Scotland that I hope the Scottish Government will be willing to seize.

Photo of Lord Wallace of Tankerness Lord Wallace of Tankerness Liberal Democrat 12:00 pm, 25th January 2018

My Lords, I too congratulate the noble Lord, Lord McInnes of Kilwinning, on introducing this important debate. It is a great pleasure to follow the noble Lord, Lord McConnell of Glenscorrodale, with whom I worked co-operatively and productively in government in Scotland for six years.

I think I was one of those, along with the noble Lord, Lord McInnes, who believed in the union—indeed, I speak unashamedly as a member of the only party that unequivocally supports Scotland within a United Kingdom and a United Kingdom within the European Union—but I was one of those who felt fragile about Scotland in the union in the immediate aftermath of the 2016 referendum. Indeed, when the First Minister was putting forward the idea of a second referendum, which, as we all know, has subsequently produced a collective yawn, she found out that it was difficult to persuade some of her own supporters. A significant number of people who had supported independence also supported Brexit. I actually applaud the consistency of that position.

I also think that what we are now finding is that, almost certainly inadvertently, the Scottish Government are starting to make out some good arguments for Scotland remaining in the United Kingdom. Last week, they published a paper entitled Scotland’s Place in Europe: People, Jobs and Investment, which said that a failure to stay in the European Union single market or secure a free trade agreement would see Scotland’s GDP around £12.7 billion lower by 2030 than it would under continued EU membership. That amounts to a loss equivalent to £2,300 per person per annum. Our experience of the somewhat fantasy figures produced by the Scottish Government in their White Paper in the run-up to the independence referendum should perhaps mean that we take these figures with some care, but the general impact will not be doubted.

But if that is the impact of leaving the single market, what greater impact would there be of leaving the single market of the United Kingdom, which has lasted for more than 300 years with a single currency and a common language? The SNP point to the fact that the European Union market is one of 500 million, but as Mr Kevin Hague of These Islands says in his blog this week,

“Of course the EU market is much larger, but even after nearly 45 years of unfettered market access our exports there are relatively small (16%) compared to those to the rest of the UK (63%)”.

So we may perhaps suggest that leaving the single market of the United Kingdom would have an impact four times as great.

The noble Lord, Lord McInnes, said we should not be complacent. Indeed, we cannot take our union for granted; it needs careful nurturing. That is particularly so at a time of constitutional upheaval. I agree with the noble Lord, Lord McConnell, who said that as we approach the European Union (Withdrawal) Bill we must apply to it the rigour with which the initial devolution settlement was approached in 1997-98. There will be plenty of opportunities over the next few weeks to look at that Bill in general and Clause 11 in particular.

I do not believe that this Government have done the union any favours by the cack-handed approach they have adopted to the Bill, particularly their treatment of the devolution settlement in Clause 11. As the conclusion of the first report of the Public Administration and Constitutional Affairs Committee in the other place said in November:

“The overall concerns regarding the devolution aspects of the EUW Bill arise from the constitutionally insensitive nature of the UK Government’s approach in Clause 11”.

It is not fit for purpose. It turns on its head the spirit of the devolution settlement: that everything is devolved except what is expressly reserved.

We now seem to have got some recognition from the Government that they got it wrong. The Secretary of State for Scotland promised amendments in the House of Commons. I will not indulge in scoring political points that they were not produced; I think it is better to get it right than rush it. However, it is a matter of regret that the elected House will not have a proper opportunity to consider the amendments—only in ping-pong.

I very much share the view expressed by the noble Lord, Lord McConnell, that getting an agreement should not be terribly difficult. In Scotland, there are an estimated 111 instances where powers being repatriated have a devolution component. The Scottish Government agree that there are areas—not least with regard to the functioning of the single market in the United Kingdom—where UK frameworks are necessary. The United Kingdom Government agree that some elements can be directly devolved to Belfast, Cardiff and Edinburgh on Brexit day plus one, but on others we will require memorandums of understanding, working together and common agreements. Rather than political grandstanding, a bit of rolling up the sleeves and getting down to it would be very helpful.

I cannot accept that a Parliament such as this—which in the past two years devolved the whole of income tax, with one or two exceptions, to the Scottish Parliament—will find a stumbling block when it comes to issues such as chemical regulations, including pesticides, or energy performances and building directives. A good dose of common sense will sort this out. The Minister should tell the House, as we approach Second Reading, where the agreements are that have already been reached. Is it a complete stalemate, or are there areas where it has already been identified what goes into each basket, be it in terms of common frameworks, memorandums of understanding or direct devolution?

The European Union Committee, whose report, as the noble Lord, Lord McInnes, indicated, we debated in October, talked about the need to set aside differences and work constructively. That is particularly the case today. Looking to the future, we need that spirit of co-operation.

Last night, I attended a seminar by the Institute of Chartered Accountants of Scotland—I refer to my entry in the register of interests as chair of the regulation board—on what we can learn from Canada for Brexit. I learned that when CETA was being negotiated, representatives from the provinces and the territories were always in the negotiation room. I think the Government could do a lot better than they have been up to now in engaging and embracing active collaboration and co-operation from the devolved Administrations. Early on, I remember giving evidence to the Select Committee on the Constitution, where it was suggested, not only by me, that there was much merit in seconding civil servants from the Welsh and Scottish Governments into DExEU or the Cabinet Office to assist. I am not sure whether it ever happened; perhaps the Minister can tell us.

Again, looking to the future, when the UK frameworks are established—and they must be established by consent—we should look at ways in which we can entrench them, be it by statute or, as the Welsh Government have suggested, a UK council of Ministers, so that the UK Minister does not act as the English Minister in imposing a solution but that there is respect among the different nations of the United Kingdom and their Ministers. In that way, we can move forward. If it is by establishing these relationships and providing suitable mechanisms that we take the United Kingdom further down the road to federalism, then the very dark cloud of Brexit may yet have a silver lining.

Photo of Lord Hope of Craighead Lord Hope of Craighead Convenor of the Crossbench Peers 12:08 pm, 25th January 2018

My Lords, it is a pleasure to follow the noble and learned Lord, Lord Wallace of Tankerness. I too congratulate the noble Lord, Lord McInnes of Kilwinning, on the way in which he introduced this important debate, coming as it does between the disappointment of last week in the House of Commons and our engagement next week in the Second Reading of the withdrawal Bill.

As I think everybody knows, the proposals in the Bill as it stands were described by the Scottish Minsters when they first saw them as a power grab. At first hearing, one is inclined to treat an expression of that kind, especially coming from Ministers in a Government that still seem to be planning a second referendum on independence for Scotland, as somewhat overblown and exaggerated. However, on closer examination of the Bill and what it seeks to do to the devolution settlements for Scotland and Wales, which have operated successfully for many years, there is some force in the point that the Scottish Minsters were making.

Of course I must avoid going into matters which we will discuss in detail next week at Second Reading, but there are provisions throughout the Bill, not just in Clause 11, that propose giving powers to Ministers of the Crown to do things by means of regulations in connection with withdrawal which could intrude to a major degree into areas where the devolved Administrations have devolved competence, without the consent—or even seeking the approval—of Scottish and Welsh Ministers.

This is not just a complaint about Henry VIII powers; if I may say so, there is a touch of Oliver Cromwell about this, too. There are powers which, unless controlled in a way that the Bill does not currently provide for, would seriously invade and undermine the way that devolved government is conducted at present in Scotland. They appear to centralise control and decision-making in the UK Government in areas of devolved competence, in a way that would seriously limit the ability of the devolved Administrations to deal with the consequences of withdrawal as they see fit. This may not be the Government’s intention, but as the Bill stands that is how it reads, which was why the Scottish Ministers said what they did.

The Motion asks what the role of the devolved Administrations is to be on withdrawal. To some extent, this is really a matter for the UK Government, who are, after all, the architects of the withdrawal. They should answer that question and we, I am afraid, are at a disadvantage in this House in that the party in government in Scotland has no one here who is in a position to speak for it. But, from such public statements as I have seen, the position of the devolved Administrations is quite easy to understand. It has the support of all parties, particularly in Scotland, as I think was made clear in a debate yesterday. It is fairly straightforward and not really in doubt. These statements show that the Scottish Ministers—I mention them particularly—appreciate that some EU competences cut across elements of both devolved and reserved powers, so we need to find a way, by the creation of appropriate frameworks for matters of common interest, to preserve the single market for goods and services throughout the United Kingdom.

The noble Lord, Lord McInnes, said that this was a matter for mature debate, and I entirely agree. It is also a wonderful opportunity to create something new in place of the void created by the removal of the constraint on EU competences on devolution, which now goes. There is a need to create something new, but UK Ministers must appreciate that those frameworks will have to respect the principles and structure of the enactments which created the devolution settlements in Scotland and Wales, and no doubt in Northern Ireland, too. That, for the Scottish and Welsh Ministers at least, seems to be a red line which must not be crossed. For my part, I see force in the position they are taking.

The settlement for Scotland, which I know best and have worked with for quite some time, has existed since 1998. The basic principle on which that Act was based is, as the noble and learned Lord, Lord Wallace, said, that everything which is not reserved is devolved. The reserved areas are set out in Schedule 5 to that Act, which has stood the test of time. There has been no lack of clarity about it. I have been waiting since 1998 for challenges to things to come before the Supreme Court; they have not emerged, because the system works. It is to those reserved areas that the frameworks must direct their attention. The position of the devolved Administrations is quite simple: they seek to be assured that things will be done only with the consent of the Scottish and Welsh Ministers in areas which are devolved.

I have to confess to some sympathy with the Minister and the Secretary of State for Scotland, to whom he is answerable. They cannot say so, but I sense that the absence of agreement so far about the framework is due not to lack of effort on their part but to policy demands at a higher level in the Cabinet Office. I noticed that the Minister for the Cabinet Office said in debate on Report in the other place last week that he and his team are actively taking forward discussions, with a view to bringing forward amendments in this House. That is very much to be welcomed. However, those discussions must proceed on the basis that there is no point in bringing forward amendments here which do not have the agreement of the Scottish and Welsh Ministers. This is because there will be no prospect of legislative consent being given to this Bill by the Scottish Parliament unless the Scottish Ministers are able to say that it has their agreement, and I believe that the same is true for the Welsh Ministers too.

I do not detect an unwillingness on either side to continue these discussions, but I hope very much that UK Ministers will find their way to constructing frameworks that fully respect the established boundaries between devolved and reserved powers. They need to secure the agreement of the Scottish and Welsh Ministers, and they will, if they respect those boundaries. I look forward to discussing these issues further in our debates in following weeks.

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

My Lords, we are tight on time this morning. I would be grateful if Back-Bench speeches could firmly be concluded as the clock reaches seven minutes. In that way, Front-Bench speeches will have their full allotted time.

Photo of Lord Lang of Monkton Lord Lang of Monkton Conservative 12:15 pm, 25th January 2018

My Lords, I will try to be brisk but not brusque. To follow a speech by the noble and learned Lord, Lord Hope of Craighead, is always an invaluable education, and I shall read his speech afterwards, as will others, I am sure. I must comment on the undue modesty with which my noble friend Lord McInnes introduced the debate. He laid it out brilliantly for us, and we are grateful to him for opening up this subject for debate today, although with the Second Reading of the European Union (Withdrawal) Bill next week it feels a little like a Committee stage ahead of Second Reading. We are still waiting for the long-promised amendment and without it the debate is a bit like “Hamlet” without the prince.

Nevertheless, I particularly welcome the positive tone of the second part of my noble friend’s Motion, and I hope to find time to say a word or two about that. I found much to agree on with earlier speakers. There is a positive tone in this House and I hope in Parliament as a whole over how to address these negotiations, but sadly the positive tone is not to be heard much from Scotland, least of all on Brexit. The persistent calls for the unattainable are rebuffed not by the Prime Minister or by this Government but by such names as Barroso, Juncker, Van Rompuy and Tusk, because that is where they have been applying. They have made it consistently clear to the Scottish Government that Scotland is not a sovereign nation state—something that was settled firmly, again, in 2014—and therefore special deals on such things as the single market or anything else are not in the EU’s gift to the Scottish Administration.

If the Scottish Administration want something gloomy to talk about, they could focus on their record on Scotland’s economy. Rather than using a crystal ball, they could look at the past 10 years which, according to a Fraser of Allander report, show output per head in Scotland growing by only 1.2% compared with 4.2% in the United Kingdom as a whole. Forward projections remain equally poor, and in Scotland we are teetering on the edge of a recession. That is probably why the Scottish National Party prefers to talk about Brexit.

The fact is that if the Scottish Administration would but admit it, the Government’s commitment to working with them on Brexit is strong, and so is their record. On her first day in office, the Prime Minister went straight to Scotland to talk to the First Minister. In the White Paper that came out a year ago, the maintenance of all the interests of all the parts of the United Kingdom was a very high priority in the list of priorities. The Joint Ministerial Committee has found new life with the development of the European negotiations sub-committee, and in other forums there have been many meetings, so there has been a constant emphasis on consultation and working together carrying through into the withdrawal Bill next week.

In a report published last March by the Constitution Committee ahead of the publication of the withdrawal Bill, we stressed the need for consultation and co-operation between the Government and the devolved Administrations and that they would need to manage the new interfaces and potentially overlapping responsibilities between reserved matters and devolved competence in areas where the writ of the EU would no longer run. That consultation and co-operation has been happening, mainly through the use of the Joint Ministerial Committee and the EN sub-committee, with repeated comments that talks are going well and with agreement on principles for the common frameworks reached last October, so it is not all bad. It seems to me that the body of legislation returning to the United Kingdom has to come, in the first instance, to the nation state, the entity that the EU recognises and that is handling the Brexit negotiations. But it is equally clear that many of the repatriated powers should pass on as quickly as they can, if not immediately, to the devolved Administrations within whose competences the subjects lie. Equally clearly, where the national interest dictates, some specific powers should remain at Westminster.

So diverse and varied is the range of forms and status of EU legislation accumulated over the past 40 years and more, and so complex the task of absorbing them into the appropriate legislative form within the United Kingdom and for the devolved Administrations, against a looming deadline and the possibility of further last-minute amendments from Brussels, that it feels not so much like a three-dimensional jigsaw as a kaleidoscopic whirlpool. So it is not surprising that while some measures fall clearly to the sovereign Parliament to take, and others clearly to the devolved ones, a few in the middle will still pose problems.

For example, in agriculture, as has been mentioned, the possibility of trade deals inhibits full devolution at present. On the environment, some aspects will require national uniformity in the interests of all of us. There will be some pieces of delegated legislation that flow from the European Communities Act that, once repatriated, would be better placed not in delegated legislation but in primary legislation. These are the issues that can fall into place over time, but they have to be handled with understanding on both sides. It is important, however, to stress that not one of the powers the devolved Parliaments hold at present will be lost in this exercise: what they have, they will hold, with many more to come shortly. So there is no question of a power grab, and it is a pity that bogus claims of that kind should be introduced to distort the picture and poison the atmosphere.

The Motion speaks also of,

“future opportunities for strengthening the union”,

which is a welcome, positive approach to something that is still fraught with difficulty. My noble friend Lord McInnes was kind enough to refer to two reports produced by the Constitution Committee a couple of years ago on precisely this subject. They were debated last October, so clearly for two years the Government considered that we had given them food for thought. I will paraphrase them as concisely as I can.

The first report addressed the union itself and argued that any further consideration of constitutional change should include the interests of the union as paramount, and that nothing should be done to its detriment. There should be no more “help yourself” devolution, without a thought for the wider consequences. The second, on intergovernmental relations, argued that the Joint Ministerial Committee should be developed in a much more consensual and even-handed way, with numerous improvements to its use and procedures. We also called for a new mindset in the relationship between the UK Government and Parliament and the devolved Administrations, whereby United Kingdom departments would abandon the “devolve and forget” habits that seemed to have taken seed in many of them around the country and to afflict some of them, and instead introduce much closer relationships, particularly on policy development.

The Government’s response to these recommendations was less than wildly enthusiastic, although they did claim that much was already being done. I echo the thoughts of those who have urged that they have another—indeed a continuing—look at the various suggestions we made. I hope that things are improving and that that will be carried forward further in the future.

But of course, good will on both sides is needed. One has to hope that, over time, the devolved Administrations will shed their apparent resistance to the hand of friendship and settle down to make their powers work better, for the benefit of their citizens.

Photo of Baroness Humphreys Baroness Humphreys Liberal Democrat Lords Spokesperson (Wales) 12:23 pm, 25th January 2018

I too am grateful to the noble Lord for initiating this debate and for affording me the opportunity to contribute to it. My grateful thanks also go to my noble friend Lord Thomas of Gresford, who unfortunately cannot be here today and whose suggestions I have incorporated into my contribution.

So far, and despite warm words, the UK Government have denied any meaningful role to the Welsh Government in the negotiations for withdrawal from the EU. The Joint Ministerial Committee, the consultative body set up to co-ordinate relationships between Westminster and the devolved Administrations, meets only once a year. On 24 October 2016, with the Prime Minister in the chair, it agreed to set up a subsidiary Joint Ministerial (EU Negotiations) Committee, whose purpose was to seek a UK approach to, and objectives for, Article 50 negotiations.

At the first meeting of the new committee on 9 November 2016, chaired by David Davis, with the Secretaries of State for Scotland, Wales and Northern Ireland and Ministers from the devolved Governments in attendance, it was agreed to develop a work programme to ensure its connection to and involvement with the process of negotiations. Ministers agreed to meet monthly to share evidence and to take forward joint analysis that would inform that work programme.

Meetings took place monthly until February 2017, but then the committee ceased to meet for eight months. The undertakings to work constructively together were flouted. During that gap, the Government served the Article 50 notice in March and negotiations with Michel Barnier began in June. The devolved Administrations were left out in the cold. Their frustrations were expressed in a letter from the Welsh and Scottish Secretaries to Mr Davis on 15 June. They complained that from the beginning the UK Government had used the meetings of the Joint Ministerial (EU Negotiations) Committee merely as an opportunity to rehearse their own well-published positions, and that there were no meaningful discussions on key issues with a view to all-round agreement. They sought agreement as to how the devolved Administrations would be represented in the negotiations, and asked for the resumption of regular meetings to fit in with the cycle of talks with Mr Barnier. They were also deeply concerned about the lack of engagement with them on the proposed great repeal Bill. They wanted discussions on future constitutional arrangements for joint frameworks and on the vital issues of replacing the existing funding streams for EU structural and agricultural funds. Their letter was ignored.

Meanwhile, in July the European Union (Withdrawal) Bill was published. It began its stages through the Commons in September. Members of all parties in the devolved parliaments were concerned to read in the Bill that the UK Government proposed to take over from Brussels all the existing powers exercised by the EU. That included 64 areas of government that have all been devolved to Cardiff, including the environment, fisheries, agriculture and trade. The proposal was and is that only Westminster can dictate changes to retained EU law. The main mechanism for these changes is by way of ministerial diktat in the shape of statutory instruments or Orders in Council.

I turn to the future of the Welsh economy and the prosperity of Wales. Under the existing Brussels regime, decisions on funding—for example, on agricultural support or structural funds for deprived areas—have been based on need, but UK Governments base their funding of devolved Administrations not on need but on the heavily criticised Barnett formula, which is based upon a crude population headcount. Under the provisions of the withdrawal Bill in its present form, nothing will prevent Ministers changing the basis of funding from the EU model to a Barnett-type model. The balance of power at Westminster tilts heavily towards England—that is where the bulk of the voters are—and no doubt domestic English politics will become a major factor in distributing funding.

What role do the Government now envisage for the devolved Administrations in the negotiations for a trade deal with Europe that are about to start? Will the Government undertake to put the Joint Ministerial Committee and its offshoots on a statutory basis? Are they prepared to use the Joint Ministerial Committee as a forum not just for consultation but for agreement on the UK-wide frameworks which need to be put in place? Will they, finally, base their funding decisions on need?

The Motion speaks of strengthening the union, but that depends on the devolved Governments being treated with parity of esteem with the UK Government in the Brexit negotiations and what follows afterwards.

Photo of Lord Kerr of Kinlochard Lord Kerr of Kinlochard Crossbench 12:30 pm, 25th January 2018

It is a pleasure to follow the noble Baroness, Lady Humphreys, and I agree with virtually everything she said. The noble Lord, Lord McConnell of Glenscorrodale, started with Burns, and I think the text for our debate should be:

“O wad some Power the giftie gie us

To see oursels as ithers see us!”.

We do not know enough of the facts of what is going on between the devolved Administrations and the central Administration, but the perceptions around are worrying, and I want to talk about the perceptions.

I have bored the House about this before, but it is a great pity that the governing party in Scotland is not represented here in our debate to tell us what it thinks is and should be going on. I hope that if the recommendations of that other Burns—Terry not Rabbie—are put into effect, it will become impossible for the SNP not to be represented here. If, when they are democratically entitled to a finite number of seats, they choose to leave them vacant, they will be following the policy of Sinn Fein in the House of Commons, whereas the SNP Members of the House of Commons are making a very important contribution to the Brexit debate, and there should be SNP representation here. If they do not change their policy, the perception in Scotland will be that they are letting an arcane point of party theology get in the way of representing the best interests of Scotland in this debate.

I shall make three points. The first is one that the noble Baroness, Lady Humphreys, made more clearly than I could. It is absurd that the co-ordinating committee did not meet between the beginning of February and the middle of October last year. A committee set up to provide oversight of the negotiations did not meet at all. That was a mistake.

It was a mistake, in my view, that the devolved Administrations were not consulted before either the Lancaster House or the Florence speeches. It was a mistake, in my view, that central government did not focus on and take seriously the Welsh proposals for a dispute settlement procedure and the Scottish White Paper of 2016. I hope they will take seriously the economic White Paper published just the other day on the macroeconomic effects of leaving. They should at least go through the motions of taking these things seriously. The perception is that it is a little insulting if one does not have a dialogue. The perception—a silly perception, perhaps—is that Boadicea’s chariot rolls ahead and the subject Celtic races are scattered at her chariot wheels.

As for the Bill, the noble and learned Lords, Lord Wallace of Tankerness and Lord Hope, are much greater experts than me, but it seems on the face of it that Clause 11 means that in areas of devolved competence, UK Ministers are in future to be free to legislate without seeking the consent of Scottish Ministers. While the UK Government may amend retained EU law, the devolved Administrations are required to keep that constraint on their action: they are not allowed to divert from retained EU law. So the perception in Northern Ireland, Wales and Scotland is bound to be that not only are they not taking back control, they are losing a bit of the control that they already have. I do not know the facts—I can judge the Bill only by what is said in it—but this is a very dangerous perception to have.

I understand that there is a concordat that the devolved aspects of proposed legislation are meant to be squared away between central government and the devolved Administrations, if there are any devolved aspects, before Bills are published. Clearly that did not happen in this case, as all amendments to Clause 11 have been rejected, and we are told we must wait. I have a high regard for Mr Lidington; he is a skilful negotiator, and I hope he can crack this problem. Like the noble and learned Lord, Lord Hope, I do not think that should be a particularly difficult problem. If it is not cracked with sensible government amendments, we in this House will have to do our best to correct the Bill. It is dangerous that the perception is widespread—I cannot speak for Wales and Northern Ireland but certainly it is in Scotland—that Mr Davis did not care very much about the views of the devolved Administrations. Perceptions matter.

Another point, which is much more delicate and difficult—and on which I am not an expert—is that Northern Ireland voted to remain. It is represented in the other place only by a party that wanted us to leave. That party support is now crucial to the survival of Mrs May and the Government. As Stormont is suspended, there is no democratic forum in which the views of the majority, who voted to remain, can be presented and debated. That strikes me as a very dangerous situation, and I am alarmed that it runs on. There is a risk of the perception that it suits the DUP very well. I was very sorry that Mr Brokenshire had to step down. I have never met Mrs Bradley but I wish her well. I note that in the past, in the days of Mr Major and Mr Blair, it took the personal involvement of the Prime Minister to crack heads together in Belfast. I recall at least one occasion when the only thing on which Mr McGuiness and Mr Paisley agreed was that a proposal put forward by Mr Blair was absolutely and completely wrong. That is a start.

Are we sure that we are being sufficiently proactive? This stalemate has run on for a very long time. I do not know when the Prime Minister will herself conduct talks in Belfast but she will have to do so. The perception, which may be unfair, that she is staying aloof and keeping out of it is very unfortunate. As the lawyers in Brussels attempt the impossible task of turning into treaty language that absurd December formula on the frontier, “internally inconsistent” can make sense only if either the Republic elects to leave the customs union or the UK as a whole elects to stay in the customs union. Neither Mr Varadkar nor any political party in Dublin recommends the former course and the Prime Minister has shut her face right from the start against the latter course.

I do not know how the Government envisage squaring the circle. Any solution will require enhanced political dialogue with and among the political leaders of Northern Ireland. We need to avoid the perception that the London Government are interested in only the views of the minority in Northern Ireland who voted to leave the European Union.

Photo of Lord Wigley Lord Wigley Plaid Cymru 12:39 pm, 25th January 2018

My Lords, I am delighted to follow the noble Lord, Lord Kerr, who has rightly pinpointed some of the dismay felt in Wales and Scotland at the implications of Clause 11. I shall come back to that.

I welcome the timely opportunity to debate the role of the devolved Administrations in the context of the UK’s impending departure from membership of the European Union; and I thank the noble Lord, Lord McInnes, for facilitating it. I hardly need to repeat that I greatly regret that Wales will be leaving the European Union, which has been so beneficial to Wales, and I am dismayed that my country—though not my county—voted to spurn the hand which has, over the past two decades in particular, nurtured it.

The Motion refers to strengthening the union, though, as we have heard, that does not refer to the European Union but to the United Kingdom. There has of course been no great outcry in Wales and Scotland to tilt at the monarchy, but there has been widespread discussion of the changing nature of the UK as a political state. All parties have signed up to support greater devolution of power to Wales and Scotland, and to Northern Ireland, if it so wishes. The nature of the UK as a state is an evolving relationship of free and equal partners. The Scottish referendum of 2014 underlined that the people of the respective nations of the UK have a right to their independence, if they so wish. That is a freedom greatly envied in other parts of the world, such as Catalonia. We have an evolving union of the nations of these islands; that relationship between our four nations—I include the whole of Ireland in that context—is an evolution that will undoubtedly develop over the coming years. Our relationship with our fellow members of another union—the European Union—will be a significant factor in how things unfold.

We shall be discussing the EU (Withdrawal) Bill at Second Reading next week. I do not want to anticipate that debate, but we shall undoubtedly address the Bill in the light of comments—and commitments—made in the House of Commons during its passage there. It is clear that the EU (Withdrawal) Bill, in its current form, would weaken the devolution settlements that the people of Wales, Scotland and Northern Ireland have enjoyed over the last 20 years.

The Government have made it clear that Clause 11 is not good enough and have said that it will be amended. That is the clause dealing with powers repatriated from Brussels, of course. The issue, as other noble Lords have mentioned, relates to powers currently exercised on an EU level but which relate to functions devolved to Cardiff, Edinburgh and Belfast. The issues that arise in that context relate mainly to three aspects: first, whether the powers will be transferred directly from Brussels to the devolved regimes and not retained at the UK level; secondly, that there should an acceptable mechanism for ensuring that the use of those powers, whether by Cardiff, Edinburgh, Belfast, or indeed Westminster, do not distort the UK single market; and, thirdly, that all four Governments have equal standing, in their own right, in any co-ordinating forum set up for this purpose.

The Scottish Secretary made a strong commitment before Christmas that Clause 11 would be amended on Report in the Commons, based on criticisms relating to these matters made across the House in Committee. The British Government have failed to fulfil that promise. They did not table any amendments that address concerns raised by Members of all parties, across both Houses, with regard to this aspect of devolution. It is as if the UK Government have difficulty accepting that there is more than one nation and more than one Parliament within the British state.

Last Wednesday, 17 January, the National Assembly, our Senedd, rolled up its sleeves—to use the term used by the noble and learned Lord, Lord Wallace—and voted unanimously in favour of Steffan Lewis AM’s proposal for a Welsh continuity Bill, to introduce legislation to enshrine EU laws in devolved areas into Welsh law before Westminster gets its hands on them. Plaid Cymru has long advocated a continuity Bill as a means of pre-empting and mitigating the potential power grab by the UK Government. This was never the preferred option, but now that the EU (Withdrawal) Bill has passed through the Commons with no changes to Clause 11, it is widely regarded as essential. The constitutional encroachment of Westminster in the context of the Bill is so great that it is not only Plaid Cymru AMs who now support this continuity Bill to protect Welsh democracy. Last Wednesday, it was supported by every party: the Labour/Liberal Democrat Welsh Government, the Welsh Conservative Party and even UKIP. In the light of this unanimous vote of the Senedd, the Labour Government of Wales are moving towards putting forward their own continuity Bill, which they have already drafted. If they are serious in this commitment, they must do so urgently before another Westminster power grab, embodied in the Wales Act 2017, further restricts their authority.

The UK Government must also recognise this landmark vote in Wales. A decision of this magnitude cannot be ignored. Yet, when my colleague, Plaid Cymru’s parliamentary leader, Liz Saville-Roberts MP, asked the Prime Minster last week whether she would respect the decision made in the Senedd, the Prime Minister sidestepped the issue, dismissing by default the concerns of her own Conservative Party in Wales.

My party’s position in the long run is clear: we want the people of Wales to run our own affairs. In the interim, we will need a collaborative procedure for the creation of UK-wide frameworks, given that this Government are so determined to press ahead and remove us from the existing EU frameworks. These UK-wide frameworks will have a significant impact on the existing devolution settlements and therefore must be created jointly by all the sitting Governments, not dictated by Westminster Ministers. This is only the first step to ensuring that devolution is not just respected but upheld in the upheaval this Government are creating by leaving the EU single market and customs union.

The existing Joint Ministerial Committee on EU Negotiations had a rocky start. Until recently, it had been suspended, as has been mentioned, and the reshuffle took place during what should have been the opportunity for the Government to amend Clause 11, which could have addressed the concerns I have outlined. The JMC has proved better than nothing at enabling devolved Administrations to engage in decisions that have an impact on their people. The principles that underpin the JMC were agreed to ensure close working between the UK Government and the devolved Administrations on reserved and excepted matters that impact significantly on devolved Administrations. A communiqué issued by the JMC on 16 October agreed that these same principles should apply to common frameworks. It stated that the creation of any new frameworks will be a matter for “all parties to agree”. I would support the creation of a joint council of Ministers in that context, as mentioned by the noble and learned Lord, Lord Wallace of Tankerness.

We shall undoubtedly return to these matters in the context of the Brexit Bill. In the meantime, I invite noble Lords to contemplate the likely impact of the Government’s Brexit policies on the harmonious co-operation between the nations of these islands.

Photo of Lord Bew Lord Bew Crossbench 12:46 pm, 25th January 2018

My Lords, I too thank the noble Lord, Lord McInnes, for securing this debate. I listened with great interest to noble Lords who spoke about the thesis of a power grab and the argument in the Scottish and Welsh Administrations.

The tone of the debate has been subtle, conciliatory and very helpful. However, I add for the sake of balance that I think that our Library briefing would have been improved by a reference to the article submitted to the These Islands forum by an Oxford don, D H Robinson, entitled, Continuity, Devolution, and the EU Withdrawal Bill. There is a slight tendency in the briefing for quotes on all aspects of this problem to head off towards the “Oh, woe is me” tone. Therefore, perhaps a moment of balance is required.

Regarding the problems of the missing leg of devolution—the fact that there is no devolution in Northern Ireland—I wish to take up something mentioned by the noble Lord, Lord McInnes, when he referred to the LucidTalk poll. I understand exactly what drove him to comment on that at this time. Like him, I voted remain, largely because I thought that leaving would be destabilising for the union—and indeed, I think that it has been destabilising. But it has not been destabilising in quite the way that the noble Lord suggested on the basis of that poll. What it has done is enrage the most moderate Irish nationalists on both sides of the border. It is indisputably a problem. My fears on that, and my support for remaining in the European Union on that basis, have been entirely justified.

However, there is no weakening in support for the union among its supporters. In the last general election, the pro-EU Ulster Unionist Party took a terrible hit while the share of the vote for the Democratic Unionist Party—the Brexit party—went up markedly. The most reliable poll in Northern Ireland, the Life and Times Survey, taken after the referendum, shows that the numbers of those supporting the union and those opposing it remained more or less where they were previously. The LucidTalk poll asked participants, “What do you feel about a hard Brexit?”. The truth is that every citizen in Northern Ireland believes that a hard Brexit means that when they try to drive to Dublin Airport en route to their holiday in Marbella, they will be stopped by a soldier. If you ask people that question, you will get a response which reflects their nervousness. However, I do not think that that is a very likely proposition. So, if the noble Lord will forgive me, that is my comment on his remarks on the LucidTalk poll.

However, there is a point—already referred to by the noble Lord, Lord Kerr, when he talked about paragraph 49 in the progress report—which is now making the return of devolution important. The agreement made between the Prime Minister and the European Union to allow the development of talks includes an ambiguous paragraph. Until now, Stormont has not contributed to the debate on Brexit. My view is that it would have had little to say and that, until now, we have not lost so much because of this problem, but that we will start to lose out very soon unless we get a return of Stormont. That is because in the preferred solution in paragraph 49—which is ambiguous and a fudge—the UK Government promise, in the absence of wider solutions which might otherwise be negotiated, to,

“maintain full alignment … which, now or in the future, support North-South cooperation, the all-island economy and the protection of the 1998 Agreement”.

There are big arguments about what that means. As far as I can see there is no common agreement between the UK Government and the European Union about what the word “alignment” means. Some, like Andrew Neil, believe that it is purely local in its significance, for example when it refers to Ireland, while those like the well-known economist David Blanchflower believe that it is a wider understanding between the European Union and the UK. However, there is no doubt or ambiguity about the central role in this formulation of the protection of the 1998 agreement—the Good Friday agreement, which sets up Stormont. What is not in doubt is that the heart of the agreement is that the current north-south arrangements, which envisage certain points of harmonisation or alignment, or whatever word you want, by agreement between north and south, will continue and will be the core of a resolution of this question. However, if there is no Stormont, the commitment in paragraph 49 becomes ethereal indeed. There needs to be a working Stormont and there need to be the models of consent and agreement that have developed quite effectively over the last 19 years. The north-south arrangements have been remarkably uncontroversial. However, Stormont needs to be in place for this compromise to have any meaning at all.

I conclude by wishing the new Secretary of State good luck in her work in trying to bring about the return of devolution, because it is now very important. She has some cards. The promise of a reduction in corporation tax for Belfast could be significant, and the great advantage that the Irish Republic has had in this matter is now under threat from the increasing and intense militancy from France, Germany and the European Commission against the Republicans’ tax arrangements. You could also have a more level playing field in the island of Ireland. That must be an attraction for the return of the devolved Assembly.

Even in the event of a failure to negotiate, it is not just a question of saying that the British Government are against joint authority—which they are. The Government must make it clear that they do not have in their mind’s eye any form of future settlement that is a conversation between two Governments but from which unionists are excluded. Although I do not believe—for reasons that we in Westminster are all aware of—that it is in the British Government’s mind’s eye, I do not think that the Irish Government fully understand that. They have to do that for two reasons: first, so that the nationalists do not believe that they can sit on their hands and will then be rewarded by something that they can call joint authority; and secondly, because the unionist community will have to make concessions in areas such as Irish language, and they need to have the confidence to be able to do that.

Photo of Lord Suri Lord Suri Conservative 12:53 pm, 25th January 2018

My Lords, Brexit must be a moment of national renewal. Should it appear to be a moment of national stagnation, any changes that we make can be reversed by future generations with ease. With that in mind, let us turn to the future of the union.

I have been a consistent supporter of devolution in this place, and I have also been looking at the case for an English Parliament, which might strengthen the union. Brexit provides a chance to send a great number of powers to our three devolved Parliaments, especially on rural affairs, and I have been disappointed to see the ongoing tussle between the Government and the devolved Administrations.

In particular, I have grave concerns about the Scottish devolution settlement as regards legislative power. As it stands, the principle that holds the devolution settlement in place is that all policy matters are devolved to Scotland unless they are specifically reserved. The Government may choose to reserve or devolve more powers, but the reservation of additional powers ought to be done with the express consent of the Scottish Parliament. However, the withdrawal Bill, which has recently come here from the other place, seems to create a new principle.

As we heard earlier, Clause 11 of that Bill would allow the UK Government to change laws in areas currently devolved in a way that would previously have run contrary to EU law. However, the Scottish Government will not have the same power. I struggle to see how this new way of working is consistent with the principles laid out in the Scotland Act and I hope that there will be some creative thinking on it from the Government. I have worked with the new Minister for the Cabinet Office in the past, and I hope that he can find some consensus on the Joint Ministerial Committee, on which he now sits.

My second point is on Northern Ireland. I have spoken before in this place about the unfolding collapse of power-sharing and my deep regret at the current state of affairs. The Secretary of State has announced what must be at least the fifth new round of talks between parties in the Assembly, but it would be fair to say that few think that a new deal is likely to follow.

In the last round of the Brexit negotiations, the can was kicked down the road on the issue of the border. I understand why, as trade issues are closely linked to the future status of the border and both discussions need to be concluded at the same time, but this may require some unorthodox thinking. If the whole of the UK follows EU rules in the areas codified in the Good Friday agreement, that ought not to be a problem, as the Government can legislate for the whole of the UK, but if a deal is reached that agrees regulatory shadowing of EU laws, such shadowing will need to be, first, devolved and then passed by the Assembly. However, in the absence of an Assembly, what will happen?

These pressing issues of the border underline the desperate need for either the return of power-sharing or direct rule. My preference is for the least obstructive border consistent with leaving the single market and the customs union, even if it forces the whole of the UK into following some EU laws. Peace on the island of Ireland is more important than any lost trade opportunity. It is hard won, and our duty is to keep it for future generations.

Photo of Lord Eames Lord Eames Crossbench 12:58 pm, 25th January 2018

My Lords, we welcome the opportunity before next week’s extensive debate to look beyond Brexit—an opportunity given to us this morning by the noble Lord, Lord McInnes—and those of us coming from the devolved part of the kingdom are particularly grateful.

The noble Lord, Lord Kerr, has recently reminded us in a very forceful manner, based on his wide experience of such matters, of the tragedy that is at present occurring in Northern Ireland, which is an integral part of the union.

The tragedy that he has drawn to our attention with such detail and sensitivity, and which is coming before us as we approach the inevitability of the Brexit situation, can do a great deal to remind us of what happens when devolution fails and presents us with questions which do not have a pat and easy answer—particularly in Northern Ireland, where the two main parties have struggled to reach an agreement in restoring the Administration at Stormont. This has only added to a burden which those of us who have lived through the darkness of the past and have tried to make a contribution in bridge building and healing the wounds of that community feel deeply about at this time.

The noble Lord, Lord Kerr, has rightly spoken about the relationship in this situation between central government and, particularly, the devolved Administration in Northern Ireland. He has drawn our attention in a forceful manner to the tragedy, as we approach Brexit, involving the Government as a representative of us all without the co-operation and involvement of a Northern Ireland Administration. Given the past and how far we have come, and given the progress that has flown in the face of what people predicted was impossible but has in fact been achieved, this has only added to the tragedy. It has added not only to the political situation but, most importantly, it has added to the situation of ordinary people going about their ordinary lives who are asking questions of a fundamental nature without realising their significance. Those questions are to do with whether their voice will be heard in the new post-Brexit situation. Will there be in the negotiations a reassurance built more on what has been promised and can be delivered; or, as the negotiations continue and there is bound to be compromise and shifting of situations, are the vital assurances given to the devolved nations likely to be fulfilled and settled in concrete? Those are the kind of questions that the man in the street is asking and that we in this House should be unafraid to ask and seek an answer.

I urge the Minister, in his response to what has been said today, to address the issue of public confidence in central government assurances. How far will those assurances go? In my position, I liken that to the question of the Irish border. Much has been promised and offered, but they are words. Returning to the contribution of the noble Lord, Lord Kerr, again I reiterate, where is the Prime Minister? Where is the power and influence of the Prime Minister to help us to get a solution to the stalemate? In the eyes of the Government it may be a simple act of asking for her and her officials to be involved in some form in the discussions taking place, but symbolism and perception are important. Symbolism and perception have more to do with the reality of success than many hours spent round the table arguing.

Again I support what the noble Lord, Lord Kerr, has said: given the situation in Northern Ireland, there is an urgent need for greater sensitivity from central government towards the particular needs we face. I have been through this situation. A year ago I said to this House that there is no doubt that the border issue is much more than a line on the map. The border issue, which is so much a part of discussion in this House and elsewhere, has more to do with relationships, with the Irish story, with our culture and, above all else, with our divisions—which have more to do with the mind and the heart—than a line on the map. I get angry when I hear references to this issue as purely and simply a geographical extension of what is to become the border between the United Kingdom and Europe. There is much more to it than that. I hope the day is not far away when the Government will realise the utter sensitivity of issues such as the border to the future of Northern Ireland.

Another point we need to remember is that the generation which will face post-Brexit Northern Ireland has learned most about our troubles from the history books. Many have not been through what we have been through and have not had to answer the issues of human need and suffering. Therefore, when we talk about the progress that Northern Ireland as a devolved Administration has made, let us not forget that the post-Brexit generation will have learned most of these things from history. I beg the Minister to remember these sensitivities.

Photo of Baroness Smith of Newnham Baroness Smith of Newnham Liberal Democrat 1:06 pm, 25th January 2018

My Lords, like other Members of your Lordships’ House, I thank the noble Lord, Lord McInnes, and congratulate him on introducing this debate. Even though most of my ancestors were Irish or Cornish, I speak in the debate today as one of the few people from England rather than from one of the devolved nations, Although I like to think that I might be entitled to an Irish passport I believe that I am not entitled to one and I shall speak, therefore, to the second part of the title of the debate and refer to the opportunities for strengthening the union of the United Kingdom.

As my noble and learned friend Lord Wallace of Tankerness pointed out, the Liberal Democrats is the one party which is unambiguous in its support for both the United Kingdom of Great Britain and Northern Ireland and for the European Union. For us, the two unions have long been important.

In her maiden speech in the other place, the late Jo Cox MP said there is more that unites us than divides us, and yet just a week before the referendum in June 2016 she was tragically killed. The debates ahead of the referendum began to highlight some of the deep divisions in the United Kingdom, and the vote to leave the EU on 23 June highlighted many other divisions—obviously between leavers and remainers but also between the metropolitan elites and those who felt left behind. There are people for whom the idea that reducing roaming charges is a great benefit of the European Union, but how is that a benefit if you never travel abroad? There is division between the elites—those people who are seen as having a particular interest in membership of the European Union—and those for whom EU membership seems to offer very little. There are divisions between urban and rural areas and, most importantly for today’s debate, differences between Scotland, Wales, Northern Ireland and England.

When travelling to north Wales just after the referendum I spoke to someone—we were travelling to a meeting together—who said, “I am regretting coming to Wales because they all voted to leave”. I said, “That is not quite true—they did not all vote to leave”. She said, “I suppose you are one of those leavers then”. I said, “No, I am not. In fact I am a Liberal Democrat remainer but I feel it is necessary to point out that while a majority of people in Wales voted to leave it was not all the Welsh people—just as it was not all the English people voting to leave or all the Scots and people in Northern Ireland voting to remain. Occasionally we have to remember these things”. I sighed a bit and went into the dinner, where somebody sat next to me and spent the whole evening telling me why it was absolutely essential that we had to leave the European Union, rehearsing all the arguments we had had before. I thought, “This Brexit process is going to be rather long and rather tedious”. So, in many ways, it is proving.

When she became the leader of the Government, Theresa May stressed the importance of healing divisions. Then in January last year in her Lancaster House speech she stressed not just a general healing of divisions but the importance, as she put it, of,

“the preservation of our precious union”,

which was going to be put,

“at the heart of everything we do. Because it is only by coming together as one great union of nations and people that we can make the most of the opportunities ahead”.

Obviously that is what the noble Lord, Lord McInnes, thinks, yet so far we are not seeing that great coming together. How often do people in England bother to think about the interests of Scotland, Wales or Northern Ireland? It is perhaps rather less than the EU27, because one of the key issues brought to the fore in the first phase of negotiations was precisely the situation of Northern Ireland, the relationship with the Republic and the issue of whether there would be a border, or what sort of border there would be between the north and the south. We have already heard from the noble Lords, Lord Kerr and Lord Bew, and the noble and right reverend Lord, Lord Eames, of the importance of those border questions. As a non-Irish person I have no intention of getting into the detail of Stormont and the devolved Administrations, but the question of Northern Ireland is a matter not just for the United Kingdom, although it is vital for us, but for the European Union and the European Economic Area.

I was in Oslo two days ago giving a public lecture. People were asking, “What is happening about the border with Northern Ireland? What is going on? Please can you explain to me what is meant by the idea that there will not be a hard border?” There will be full regulatory alignment, which is obviously what the European Union and the Republic of Ireland want, yet it is not what Arlene Foster, the leader of the DUP, appears to want. She wants there to be no difference between Northern Ireland and the rest of the United Kingdom.

I would be most grateful if the Minister could explain to us—after so many months of negotiations, nearly two years after the referendum and rather closer to the point when we are meant to be leaving the European Union than voting on leaving it—what Her Majesty’s Government understand by having a situation where there is not a hard border, yet the United Kingdom is, we are led to believe, leaving the European Union, the single market and the customs union? If we do all those things it appears to most observers, whether in the United Kingdom, the EU27 or Norway, that we are trying to square an impossible circle. Finally, does he really believe that the Prime Minister is putting all the effort she could into ensuring that this “precious union”, as she calls it, will really be stronger in the event of the United Kingdom leaving the European Union and that the United Kingdom will not feel that its peoples are being divided and taken out in a way that damages their national interests?

Photo of Lord Bilimoria Lord Bilimoria Crossbench 1:13 pm, 25th January 2018

My Lords, in the referendum both Scotland and Northern Ireland were among the strongest supporters of remaining in the EU, with majorities of 62% and 55.8% respectively. In Wales, 52.5% voted to leave the EU and in England 53.4% voted to leave. There is no question about it: the referendum has been a huge divide in this country. Many have said that it has been a demonstration of English nationalism. In the Supreme Court Miller case, the decision of the court was that devolved legislatures did not have a veto on the UK’s decision to withdraw from the EU. I thank the House of Lords Library for its excellent briefing notes on the matter.

The Scottish and Welsh Governments have described the Bill that is coming up—this debate is very timely before the European Union (Withdrawal) Bill reaches our House next week—as a “power grab”. The Government have said that they will come back to it, as the noble and learned Lord, Lord Hope, referred to in his excellent speech.

The Brexit White Paper of 2 February 2017 was based on the Prime Minister’s famous Lancaster House speech, in which she said very clearly that she would strengthen the union by securing a deal that works for the whole of the UK, as the noble Baroness, Lady Smith, just said.

What is the role of the devolved Administrations in this? The Government have stated their intention to fulfil Brexit responsibilities in close consultation with the devolved Administrations. I ask the Minister: has this actually happened? The noble and learned Lord, Lord Wallace, gave the example of CETA. When Canada negotiated with European Union, it had members from each of its provinces at the table. Has this genuinely been the case?

We have the Joint Ministerial Committee on EU Negotiations, which I believe has met only five times between October 2016 and September 2017. Could the Minister confirm this? It has been described by a Member of the House of Commons as,

“a total and utter waste of time”.—[Official Report, Commons, 26/6/17; col. 417.]

Have they agreed the need for a common framework? What are these frameworks? Is it that between Northern Ireland and Ireland there will be only the land border, which I will come to later? The European Union (Withdrawal) Bill does not specifically mention a common framework. Could the Minister tell us why this is the case? I believe that in one of the Joint Ministerial Committee meetings they spent 45 minutes being told what the UK Government had decided, so did its members really have a say on it? Nicola Sturgeon has been very outspoken about this. She feels that the Scottish Government have been cut out of all the decision-making, which is a real shame whether you agree with her or not.

How much autonomy will the devolved Administrations continue to have over areas such as agriculture and fishing? It will be very complicated when it comes to issues such as this, especially when it comes to implementing new frameworks.

We then, of course, have Clause 11, which several noble Lords have mentioned. We are replacing that with a new restriction that devolved institutions cannot modify retained EU law. This will be a huge issue in the Bill. The reaction from Wales, which voted to leave, has been to put out, along with Scotland, a joint statement saying that this is a,

“naked power-grab, an attack on the founding principles of devolution”,

that, “could destabilise our economies”.

There is of course the convention that there is a requirement for the Government to seek a legislative consent Motion from each of the devolved legislatures for the Bill, which the Government have made it clear they will do. That is reassuring. The Welsh and Scottish Governments believe that devolved Ministers should have the same powers in respect of matters falling within devolved competencies as UK Ministers. I do not think that that is happening in this case.

In their rebuttal, the Government have said that this is not a power grab. Any durable solution will need the consent of all the nations the United Kingdom and all their elected representatives. A successful settlement cannot be imposed by the United Kingdom Government; it must be developed in partnership with the devolved Administrations.

We then of course come to the Irish border. This is absolutely ridiculous. In phase 1 of the negotiations, a joint report was prepared by the European Union and the UK that basically kicked the can down the road. It said:

The United Kingdom remains committed to protecting North-South cooperation and to its guarantee of avoiding a hard border”.

Moreover, it said:

“The United Kingdom’s intention is to achieve these objectives to the overall EU-UK relationship. Should this not be possible, the United Kingdom will propose specific solutions to address the unique circumstances of the island of Ireland”.

However, it continued:

“In the absence of agreed solutions, the United Kingdom will maintain … those rules of the Internal Market and the Customs Union which, now or in the future, support North-South cooperation, the all-island economy and the protection of the 1998 Agreement”.

That is absolute nonsense. How can we remain in the single market and the customs union and have an open border? Then, of course, the DUP has said categorically that there will be no border in the Irish Sea. It wants a commitment to preserve the integrity of the United Kingdom and for our internal union to be preserved. How will this be possible?

Theresa May has said that,

“we will maintain the common travel area throughout these islands … the whole of the United Kingdom, including Northern Ireland, will leave the EU customs union and the EU single market. Nothing in the agreement I have reached alters that fundamental fact”.—[Official Report, Commons, 11/12/17; col. 27.]

I just do not see how this is going to happen. At First Minister’s Question Time in December, Nicola Sturgeon stated that if there was a differential for Northern Ireland it should be available to other parts of the UK as well.

This is so worrying a situation, where devolution is threatened. Brexit presents a risk to these overlapping competences. Article has followed article, among them:

“How Brexit has reopened old wounds on both sides of the Irish border”.

If we look at voting by religion, we see that 85% of Catholics supported remain and 40% of Protestants. Overall, the result in Northern Ireland was to remain.

Donald Tusk met Leo Varadkar, the Indian-origin Prime Minister of Ireland, and said:

“Let me say very clearly: if the UK’s offer is unacceptable for Ireland, it will also be unacceptable for the EU. I realise that for some British politicians this may be hard to understand … This is why the key to the UK’s future lies - in some ways - in Dublin”.

One of the most worrying things about this whole issue has been leave voters saying that they were 79% English, not British. What are we doing here? Amartya Sen spoke about identity—we all have multiple identities. As a country, we are a United Kingdom first, then England, then Northern Ireland, then Wales, then Scotland. That is what comes first and this is what we are threatening. We are threatening the European Union’s integrity; we are threatening the United Kingdom’s integrity. Everyone in this debate has said, “When Brexit happens”; Brexit is not a done deal; we still have the option to remain. Times have changed and we have the option to remain and that should be considered, because divided we fall and united we are strong.

Photo of Lord Hennessy of Nympsfield Lord Hennessy of Nympsfield Crossbench 1:21 pm, 25th January 2018

My Lords, I declare my membership of the advisory council of These Islands.

As a remainer and a United Kingdom man to my last fibre, I was fearful in the gap between the Scottish and the EU referendums, as was the noble Lord, Lord McInnes, and other noble Lords, that a vote to leave would reinflame the UK question—that some might argue in Scotland that the vote not to separate in September 2014 largely, if not wholly, turned on economic factors and that the deal was now off, as the UK, thanks to the June 2016 EU referendum result, was set to build a very different kind of political economy for itself. Another referendum on the question of Scotland might therefore be justified if the thrust of this argument carried force.

If such an outcome occurred—as that great political scientist Lady Bracknell might have expressed it—to lose one union may be regarded as a misfortune; to lose both seems like carelessness. I profoundly hope that the union of the UK is not fractured in the future, for it would be a misfortune of the highest order, changing the nature of our country and the very way we imagine it and seriously diminishing thereby our place in the world.

If dealing with the consequences of Brexit turns out, as the wording of today’s Motion hints, to be a successful co-operative effort between the UK central government, this Parliament, the devolved Parliament and Assemblies and their Administrations, it would be a conspicuous enhancer, rather than a diminisher, of the union of the United Kingdom. I dearly hope that that occurs.

But some peril lurks in the devolution clauses of the European Union (Withdrawal) Bill. To my regret, I shall be away from London on one of the days when your Lordships’ House will be debating it at Second Reading, but had I been able to speak this is the area on which I would have concentrated, for here lies a mixture of delicacy and complication. Rereading recently the European Communities Act 1972, I was struck by the contrast with the withdrawal Bill shortly to come before us. Both are what one might call pipeline measures, the first pouring existing Community legislation into our islands on 1 January 1973 and the second repatriating the powers that we have pooled with our European partners since that date.

But in 1972-73, there were no devolved Administrations; they are creations of the late 1990s. If we consult the official history of the UK’s successful entry negotiations penned by that great public servant, the diplomat Sir Con O’Neill, who led the official negotiating team—it is now declassified and makes a fine and fascinating read—we find very little on Scotland, apart from a few pages on fisheries. For example, those two formidable figures of post-war Scottish politics, Jo Grimond and Lord Boothby, were eloquent about the needs of inshore fishermen seeking their harvest in the testing waters of The Minches, the exquisite seas around the northern isles and the fishing grounds within reach of the north-east coast of Scotland.

But it was a different world. Since then, for example, Section 57 of the Scotland Act 1998 bathes the whole devolution settlement in EU compatibility. As the noble and learned Lord, Lord Wallace of Tankerness, noted, as part of the withdrawal process, some 111 functions are in play that contain a devolutionary element, 80 of which are pretty non-contentious, I understand, but the 31 others might be. As we have also heard, a network of joint ministerial committees, with groups of officials supporting them, has been at work on these problems, mindful among other things of the needs of the UK’s own internal market functioning as it should.

But have your Lordships noticed the paucity of coverage of this critical process by the London-based press, certainly compared to the Scottish newspapers? Yet this is a first-order problem in multiple ways. If the process seriously bruises the internal political and institutional relationships of the Queen’s kingdom, that very kingdom, at best, will function more rancorously in the years after Brexit and, in the worst case, it might be rent asunder.

These intra-UK negotiations will test the mettle of our Ministers and officials in Whitehall and throughout the devolved Administrations, and they have my sympathy in the delicate and difficult task in which they are engaged. I would value greatly a report on the work in progress so far when the Minister winds up. May I request also, henceforth, regular updates for your Lordships’ House on the process of those joint ministerial groups? That would be of immense value to us.

The devolution clauses of the withdrawal Bill that we shall soon debate are crucial for the well-being of our people and the proper functioning of our institutions. It would be truly tragic if Brexit mutated into the eventual dissolver of the union that for more than 300 years has turned us into a most extraordinary United Kingdom atop our damp little archipelago in the cold northern seas.

Photo of Lord Bruce of Bennachie Lord Bruce of Bennachie Liberal Democrat Lords Spokesperson (Scotland) 1:27 pm, 25th January 2018

My Lords, I join others in thanking the noble Lord, Lord McInnes of Kilwinning, for opening this debate and congratulate him on the way in which he did so, which I think we would all agree was thoughtful and ranged across the issues. In general, while the tenor of the debate has been modest, constructive and reasonable, it has encapsulated some devastating criticisms of what is happening or not happening. It would be remiss of us not to acknowledge that, whatever the tone may suggest.

The noble Lord said that he was driven by his political unionism and his fear for the union as a result of Brexit. He is right to say that, at the moment, the pressure for further independence in Scotland has diminished, but that is not to say that it will not be revived in the long term. As he rightly said, in Northern Ireland and Ireland, the whole situation is so fraught that almost anything is possible. While Members from Northern Ireland have said that that they do not believe that the drift towards a united Ireland is necessarily stronger, who is to say, if we mishandle this, that the mood would not change? Nobody should be in any doubt that the future of the United Kingdom is at risk, and Brexit has demonstrated that.

While the second part of the Motion refers to seizing the opportunity to redefine the union and how it operates, frankly, we should have done that long before we got to Brexit. We have done it in a piecemeal, ad hoc and untidy way. I know that I on these Benches am perhaps a little idealistic in my commitment to federalism, but something like federalism will eventually have to be enshrined in our constitutional arrangement if the union is to hold together.

Speakers have looked at different aspects of devolution for the different, component parts, with the Irish question being the most fraught and the most unclear, and then the Scottish question and the Welsh question. Regardless of how the countries voted, there is a fundamental anger that, in spite of the statement that there is a wish to ensure that the settlement for Brexit carries the whole United Kingdom with it, it is clear that England is carrying the rest in its slipstream and that it is not a partnership of equals or even a partnership—let us be realistic that they are not equal, but there should be a partnership.

I was interested to see the dilemma, from my own point of view in Scotland, of the Scottish Conservative Party, which is fundamentally split in a very obvious way. We had a delegation from the Scottish Parliament in the last few days, including Conservative Members of the Scottish Parliament, seeking clarification on Clause 11 and encouraging the amendment that we are all looking for, which will meet the wishes and aspirations of the devolved components. Yet Conservative Members of the Westminster Parliament from Scotland have lifted not a finger in any way at all to support amendments that would have dealt with Clause 11. So the MSPs are singing from one hymn sheet and MPs, apparently, from a different one. Indeed, with one exception, it seems that all the Scottish Conservative MPs are enthusiastic Brexiteers, in spite of the will of their own constituents, and have followed the votes accordingly.

The leader of the Scottish Conservatives, Ruth Davidson, just in the last few days has pleaded with the Prime Minister to ensure that the Brexit settlement is a settlement for the whole of the United Kingdom that takes full account of Scotland’s interests. But in reality how can that be, when Scotland is quite clear that being part of the single market and being in the customs union is essential for Scotland’s economic future, and the Government have ruled both those things out? These are unscripted exchanges, but, fundamentally, they are incompatible.

In fact, it has dawned on me in the last two weeks that not only are the Government divided absolutely down the middle, with a Cabinet that is so carefully balanced that it encapsulates in equal numbers two utterly irreconcilable positions but, worse than that, the communication from the Government is two-way and, if I may say so, two-faced. They say to people who voted remain, “Don’t you worry—there will be an agreement that fundamentally maintains many or most of, if not all, the benefits that we have enjoyed as a member of the European Union”. At the same time, turning to the Brexiteers, they say, “Be assured, we are leaving the Union and all its institutions—we will not be part of the single market or the customs union”. At what point does this logjam have to be broken? We have eight months until we have to have an agreement on exactly what kind of exit arrangement we will have negotiated.

We had the noble Baroness, Lady Goldie, in this House earlier this week, for whom I have a lot of respect—and I know that the Scottish people have a lot of affection for her in her role as leader of the Scottish Conservative Party. It hurt me to see her defending a position on financial services, so important to Scotland, on the lines that it would be impossible to deliver the promised statement on the future arrangement for financial services, as this would reveal our negotiating position. My understanding of negotiations is that, while you can negotiate in secret, it is quite important that the people with whom you are negotiating are not included in the secret—that they are, in fact, a party to what your aspirations are and know what you are negotiating for. Until you do that, you actually make no progress. We are deadlocked. It seems to me that we have a few months to come to a conclusion as to what the compromise is going to be.

I mentioned financial services. There is a tendency for people to assume that this means the City of London, but it does not mean that; the City of London is about half of our financial services industry, but there are more than 150,000 jobs in Scotland in financial services, especially in Edinburgh and Glasgow, but also in Aberdeen and elsewhere—Perth, in fact, is an important centre, too. I have served on the EU Financial Affairs Sub-Committee, and we have had consistent and overwhelming evidence, including from Scottish institutions, that without passporting and without an agreement that enables us to participate fully in the single market in comparable terms to the way we do now, thousands of jobs will be lost.

Indeed, JP Morgan has said overnight, in the meeting in Davos that, if there is no agreement to maintain most of our existing arrangements, it will move more than one-quarter of its 16,000 workers out of the UK. Replicate that across the financial services sector and then add it to every other sector that has the same uncertainty and difficulty. We are talking about tens if not hundreds of thousands of jobs at risk, and we have only a few months to come up with an agreement that will resolve the issue.

Currently, the pound is on an upswing. I am told that the markets are of the view that a constructive agreement can be reached, and that is why the pound is strengthening—although some people say that, actually, inflationary pressures and the prospect of an interest rate increase may be the major factor. However that may be, it cannot go on with all these questions about how the interests of Scotland, Wales and Northern Ireland, and indeed those parts of England that voted to be part of the single market and the European Union, can be reconciled with an agreement that maintains or does not maintain the links. How is it possible for our interests to continue outside the single market and the customs union?

The issue of Northern Ireland has been particularly fraught. As the noble Lord, Lord Bilimoria, said, the can has been kicked down the road. My noble friend Lady Smith mentioned alignment, which is absolutely crucial. The Government are basically saying that everything will change and nothing will change. The border will be open, there will be no border, but we will not be inside the institutions that protect themselves by a border. It is not our decision. Indeed, the Government will say that if there is a border in Northern Ireland it will not be our fault; it will be because the EU impose it, but the EU will impose it only because we do not have an agreement that enables the border to be open.

I suggest to the Government that the letter has to go beyond to the spirit. They should listen to the devolved Governments and institutions, because it is impossible to deliver a settlement for the whole of the United Kingdom that does not take account of the wishes of Northern Ireland, Wales, Scotland and the regions of England. I agree that the Scottish Government’s plea for some kind of separate deal for Scotland to be in the single market and not the rest of the United Kingdom is preposterous, absurd and undeliverable. Indeed, as my noble and learned friend Lord Wallace said, the United Kingdom single market is far more important to Scotland than the EU single market. But they are both important and both need to be reconciled, and time is running out for the Government to go on facing both ways, keeping the negotiations secret and offering no end-point. We have to resolve this dilemma, or not only is the UK’s economic future at risk but the integrity of the United Kingdom is under threat. The Government should not underestimate that.

Photo of Lord McAvoy Lord McAvoy Shadow Chief Whip (Lords) 1:37 pm, 25th January 2018

My Lords, I join those who have thanked the noble Lord, Lord McInnes, for securing today’s debate. He has done a service to the House. My party and I are firm supporters of the union and wish to see it strengthened throughout all the challenges and opportunities that Brexit may bring. We are a union by consent, and powers have been devolved across the UK following votes, referenda, general elections, debates and Acts of Parliament. Our unique devolution settlements enhance and underpin this union of ours.

Towards the end of last year, this House had the opportunity to debate a number of excellent reports from the Constitution Committee on devolution, including its relationship to the relatively new context of Brexit. We debated issues including the lack of a government blueprint for working with the devolved institutions; the poor use of existing structures, including the JMC, which at that point had not been convened for nine months; and, as the noble and right reverend Lord, Lord Eames, so eloquently illustrated, the lack of full democratic representation for Northern Ireland. We have called many times for a unique demonstration of how important the UK Government regard the situation in Northern Ireland as being but, unfortunately, to no avail. Unfortunately, a few months further on, we must revisit some of the same issues, particularly with regard to Northern Ireland.

As of this month, it has been a full year since Northern Ireland had a functioning, power-sharing Executive in place. This must give us all pause for thought. We welcome the new Secretary of State to her post, and wish her well in her endeavours. But what we cannot have, surely, after 12 months of no movement and failed talks, is more of the same. The Government are telling us that one last push is all we have time for. We welcome the new talks that began yesterday and hope that all parties will engage in them as fully as possible. We have put on record our belief that the Secretary of State must involve all parties, including the smaller parties, in the talks, and that she should consider the appointment of an independent chair.

Noble Lords are aware that uniquely Northern Irish issues around the border and protection of the Good Friday agreement are at the heart of the Brexit process, yet there is no democratically elected Executive representing the people of Northern Ireland in these talks. These issues are also being dealt with at a time when there is no nationalist representation in either House of Parliament. As we look to the future of the UK outside the European Union, we cannot stress enough the importance of the Prime Minister and her Government engaging wholeheartedly on securing the future of Northern Ireland.

Beyond the pressing issue of Northern Ireland, the Government must concentrate on both their current and future relationship with the devolved institutions. It is not enough to firefight or untangle each individual issue as it arises; there must be a mode of working that allows the devolved Administrations consistently and co-operatively to feed into the Brexit process. Early signals from the Government have not been encouraging. Last year we had the JMC not being called from February to October; this year we have the EU (Withdrawal) Bill which has been described by Members on all Benches in this House as not being fit for purpose on devolution. It is ludicrous and inaccurate to use such descriptions as “a power grab”; nevertheless, the vacuum being created by the Government not responding positively to the devolution principles is creating an atmosphere in which that accusation can be made and can gain credibility.

The House will be all too aware that the Scottish and Welsh Governments have warned that the Bill, as currently drafted, is in danger of not receiving legislative consent. Government Ministers have accepted that their own Bill is in need of amendment. They have promised that amendments on devolved powers will be brought forward in this House, after they failed to table them during the Bill’s stages in the House of Commons. Perhaps they will take inspiration—I hope they will—from amendments tabled by Her Majesty’s Opposition in the other place, which would have removed proposed restrictions on the devolved Administrations and allowed for the collaborative creation of common UK-wide frameworks for retained EU law. The question is how these flawed proposals were put before this Parliament without meaningful discussion first taking place with the devolved institutions. The Government must surely be aware of the lack of faith in the devolved institutions that the Government are taking their concerns seriously. I would like the Minister to illustrate what steps the Government are taking to assure the devolved Administrations that their genuine concerns are being listened to.

The mistakes should not be repeated. We have had some encouraging developments in the JMC on principles to allow common frameworks, which are key to the future of the UK economy. It is a small step, but surely is the start of something to be developed along these lines. Looking to the future, I ask the Minister: what is the next step in the establishment of those common frameworks that the UK as a whole needs to thrive? How will they be consulted on, agreed and, if necessary, legislated for? What are the Government doing to build the necessary machinery of government, to ensure that intergovernmental relationships are strengthened, that simple, everyday co-operation is facilitated, and that departments across Governments are working well together? What is being done to bolster expertise in devolved issues in the Civil Service? Different departments currently work with the devolved institutions to differing degrees and with differing amounts of success. Brexit will be a success only if it works for communities, businesses and people in every corner of the United Kingdom. We must ensure that detailed understanding and expertise about issues specific to Scotland, Wales and Northern Ireland is widespread among the departments delivering Brexit.

This is a new challenge but also an opportunity for our union, and the Government must rise to it. The Government must proceed in a way that strengthens our union, respects devolution and provides the devolved Administrations with a clear voice moving forward. My final word—I appreciate that the Minister has a lot to answer so I will try to give him some more time for that—is that the Government must take on the perception that no one has a firm handle on the Brexit negotiations with the European Union. They have created the perception that they do not have a firm grip on how to handle negotiations and understandings and get co-operation from the devolved Administrations. For the sake of all our people, we wish the Government well, but they really need to start demonstrating that they have a firm grip on these proceedings.

Photo of Lord Duncan of Springbank Lord Duncan of Springbank Conservative 1:45 pm, 25th January 2018

My Lords, I thank the noble Lord, Lord McAvoy, for his generous donation of further time to allow me to answer all these questions. I also congratulate him, of course, on his elevation to Chief Whip. I look forward to hearing much more from him in that capacity.

There are, I suspect, a number of challenges that lie ahead for all of us in trying to grapple with the issues we have touched upon today. A number of noble Lords have reflected today upon the fact that our union is an extraordinary thing and in many respects we sometimes take it for granted. Indeed, all too recently it almost slipped through our fingers. Yet here we are now. We often talk about our constitution, both written—in several documents—and of course unwritten, but in fact, from 1979 through to 1997 and beyond, the sheer volume of change, evolution and, indeed, in some cases near revolution in the way we administer power within the United Kingdom was fundamental. It is important to recognise, again, how flexible our system can be to allow that sort of change to happen without there being a great deal more angst and unease.

I begin by delving straight in to the question of the repeal Bill, since many noble Lords touched upon it. Clause 11 needs to be amended: it is not going to work in its present form. The important thing to stress is that it was not for want of effort on our part—the noble and learned Lord, Lord Hope, was quite correct—to secure a form of words that would allow the two devolved Administrations and the UK Government to reach a consensus on that point. The key thing, and this is why I stress the point, is that this is part of the respect agenda: we must find a form of words with the devolved Administrations to secure progress going forward. As all have noted and accepted, if we do not secure that form of words, the legislative consent motion we will need will not be made available. Then, a constitutional crisis, to use that slightly hackneyed phrase, will be upon us. That is why every effort is being made to ensure that we can find that form of words with the Ministers from Scotland and Wales—always recognising that we are also reliant upon the civil servants in Northern Ireland—who must give us guidance on how we are going to take this matter forward. I wish I could tell noble Lords right now that we have that form of words: I cannot, but I know that discussions are ongoing and all are aware that the time for those words to be agreed is slipping gently away. I believe that on all sides there is now a recognition that we must secure these words if we are to make the progress we would like to make.

The wider question has been asked about the common frameworks and the nature of the laws, and how they will move and migrate. Is work going on to establish exactly what the common frameworks will look like and whether there will be clarity? I assure noble Lords that that is indeed happening. It is being done under the slightly euphemistic term, “the deep dive”: in each of the policy areas a deep dive involves all those involved in the devolved Administrations—Wales, Northern Ireland and Scotland—as well as the UK Government.

The purpose of those deep dives is to identify exactly the areas where there is no need for a common framework—indeed, those roles would then be fully devolved—recognising which ones must one must remain fully reserved and teasing out the complexities in the middle ground. The noble Lord, Lord Lang, mentioned that very point. This is where it becomes a little bit more complicated, but it can be resolved; that is the purpose of the deep dives. Take, for example, a subject that is very dear to my own heart and to a number of noble Lords here today: fishing. At present, fishing is wholly devolved—there is no way round that; it is a clear statement of fact—but it is devolved within the framework established by the common fisheries policy. At present, every aspect of fisheries is broadly administered by the Scottish Government, on the basis of the established framework. Going forward, the question is, what should replace that framework? In many instances, the answer is that there need not be a common framework and these matters will be fully devolved. For example, issues around what I would term technical measures, such as the mesh size of nets, will continue to be taken forward by the Scottish Government in exactly the same manner as now.

Let me revert to other, perhaps broader questions about quotas and quota management. Here, different questions must be resolved. That is the purpose of the deep dive: not to tell the devolved Administrations what the answer or the UK Government position is, but to ask what will work best for our fishermen up and down the land. No fisherman fishes simply on their own little bit. We have a much more mobile fleet; the distant water fleet fishes all across our territorial waters, as well as those of other countries, including Norway and EU countries. We need to find a way to make that work. That is why, in this instance, oddly enough, the term “deep dive” is probably appropriate. We need to find a way to make sure that we can deliver on that.

Deep dives will take place across all policy areas. In the lead, necessarily, are those that are closely connected to Defra and focus on fisheries, agriculture and the environment. However, a number of others are happening as well—though not quite in lock-step—to secure answers, because these are the key points that will allow the devolved Administrations to have confidence that we have taken their concerns on board and intend to move this forward in a manner that respects both sides.

Photo of Lord McConnell of Glenscorrodale Lord McConnell of Glenscorrodale Labour

On that specific point, we all understand that there is complexity in these policy areas and that there is a difference between the administration of policy and the agreement, implementation and legislation of that policy, whether it be in fishing quotas or anything else. Do the UK Government understand that the key point of principle is not whether there should be a common framework but whether one should be imposed from the centre—or whether the agreement to have a common framework and commit to it should be voluntary on the part of the three devolved Governments and the UK Government representing England?

Photo of Lord Duncan of Springbank Lord Duncan of Springbank Conservative

I thank the noble Lord, Lord McConnell, very much for his intervention. The respect agenda is at the heart of the answer to that question. The deep dives are vital for each of the participants to recognise that the solution needs a common framework to address the particular challenges. There will be tensions—I do not doubt they will exist—where there is disagreement, where one of the Administrations say, “Actually, in this particular area, we believe this and the other one disagrees with it”.

Part of the bigger challenge is the movement of rules coming back from the EU, where there are—as the noble and learned Lord, Lord Wallace of Tankerness, pointed out—111 laws that directly affect Scotland. For Northern Ireland, it is over 140; for Wales, it is around 60. Of course, because of the devolved settlements, the rules are different; so again, the point is to try to find areas of common consensus. In truth, representatives of the various individuals who are part of the stakeholder community will each have to be able to defend their points to the stakeholders, to explain to them why they are arguing one way or another. Those stakeholder communities must also lend their acceptance to this particular point, because upon the hearing the outcome of these discussions, they cannot—and should not—rise up in arms and say that it is an absolute travesty and a scandal. They should be satisfied that this is the best and right way of doing things. The important thing to emphasise is that this is not in any way an attempt by the UK Government to demand certain concessions from the devolved Administrations. That is not the ambition at all.

On the wider question of the institutional arrangements whereby the various parties come together and meet, there have been challenges. There is no point in pretending otherwise. I have a very helpful list somewhere. Noble Lords have asked very thorough questions so I have many pieces of paper; I am now hunting for the right one. We had a hiatus between February and October 2017 for one particular reason: the election. That slowed things down quite considerably. The important thing to stress is that for a very long period, the JMC’s arrangement had been all but moribund: it had not been a functional part of the engagement between the devolved Administrations and the UK Government. Recognising that that was no longer fit for purpose, the UK Government have sought to expand the number of forums by which we have agreement under the JMC, as well as recognising that the frequency of those must therefore be driven by the necessity of the particular issues. That is why what would have been the traditional ongoing European legislation—which was the most important forum for the focused issues before the devolved Administrations—is, if anything, the quieter forum. The negotiations forum is now absolutely critical, as is trying to make sure that there are opportunities at those meetings for a free and frank discussion. There are, and I can assure noble Lords that the discussions are very free and very frank.

There are challenges. I am reminded of the words of the noble Lord, Lord Bruce of Bennachie. At the outset, one of the challenges in this area was that it was very hard to reconcile the demands of the different Administrations because they were not bridgeable in simple terms. So, the notion and the paper put forward by the Scottish Government could not be easily reconciled with the reality of what the UK Government believed they had to deliver after the referendum. That caused a lot of the political tensions. It is very hard to meet on common ground when one party is on one side of the chasm and one is on the other; you end up falling to the bottom like Wiley Coyote, with your arms flailing in the air. We were trying to avoid that outcome. It is bridge building that gets us across the chasm, I hope.

We need to give some consideration to the situation in Northern Ireland. Many noble Lords have rightly mentioned that there is a void in Northern Ireland. We cannot pretend otherwise. I can assure noble Lords that my right honourable friend the Secretary of State for Northern Ireland is actively pursuing facilitating the dialogue required to develop a functioning Executive. On more than one occasion, I have said from this Dispatch Box that Northern Ireland is ill-served without an Executive. Although the civil service there can do a great deal to help in many different areas, they cannot do everything. That is why it is important to recognise again the need for a realistic and functional dialogue. Those talks are ongoing; we hope that those around the table will recognise the importance of securing agreement on this occasion but we recognise the challenges that we face.

On the question—again, raised by a number of noble Lords—of the agreement reached by the UK Government and the EU before Christmas, which touched on Northern Ireland and the border question, it is important to recognise that that is but one step toward a larger agreement between the UK and Northern Ireland. Without that agreement, there will be significant challenges for both sides. That is why, in this instance, the ongoing negotiations again seek to address the challenges. One would hope that through that, the negotiations will deliver the Northern Ireland question as part of a bigger settlement. Those negotiations are ongoing. I believe—this is where it becomes important—that we often find ourselves, particularly when following certain newspapers, caught up in an almost daily crisis of one sort or another, with the narrative driven forward in that fashion. However, if we step back and think about it, just before Christmas the UK Government managed to deliver on what they said they wished to do: secure agreement on these three key areas, to allow negotiations to begin shortly thereafter. They achieved that. From some of the reporting, you would have thought that they had failed, but they did not. They moved things forward in that fashion.

The time ahead will not be straightforward. I realise that we will have plenty of opportunities to discuss further the questions that underlie the repeal Bill. I am sure that many of the contributions made today will help inform the Government as they begin to think about how best to approach the investigations into the repeal Bill and its functionality. But we will have to resolve those questions here in such a fashion that we can return those amended clauses to the House of Commons to allow them to deliver upon that. I believe that we will make a difference and, indeed, do what this House always does: seek to make things better. I think the Government will appreciate the work done here in that area.

We have to recognise that the union is perhaps something larger than just the moment of Brexit and the discussions that surround it. A number of noble Lords have pointed out today that immediately after the referendum on Brexit, there was a great fear that our union would itself begin to experience some of the challenges but in truth, there has been a degree of resilience. As we witnessed through the, shall we say, unexpected general election last year, the parties that had perhaps anticipated doing better, certainly in Scotland, did not do so on the basis of what they offered the people. That should be a salutary reminder to anybody who believes that they have the people behind them: it is always worth looking over your shoulder, just to make sure they are still there. You cannot take the people for granted in this regard. The result of that election was a useful reminder to us all to focus on what the people want, whether that be the people of Scotland, the people of Wales or, I hope soon, the people of Northern Ireland.

We in this House must recognise that we have a role to play in ensuring that our union works, and works well. That is why I am indebted to my noble friend Lord McInnes for bringing before us today an opportunity to discuss and explore these issues. It is timely because next week, we will be knee deep in thorough discussions on the questions before us regarding repeal. As I try to answer the questions, I am aware how useful that will be to my colleagues in facilitating, I hope, the right sort of dialogue as we go forward. But I am also aware that there is heavy lifting to be done and we have not yet resolved these issues. On the question of Clause 11 as it affects the devolution settlement, we need to be able to bring before your Lordships a workable amendment that can deliver exactly what it says on the tin—and when we tell your Lordships that we have it, we are telling you that other people in Edinburgh, Wales and, through consultation, Northern Ireland agree that this is the way forward. That should allow us to make that necessary step.

When I began my remarks, I pointed out that in some respects we have been through a revolution, as only Britain can do, in the way that our powers have moved. But we have done so in a piecemeal fashion; again, a number of noble Lords made this point. We need now to refocus on trying to ensure that we are not making stumbling progress but have a clear objective: to make sure that the devolved Administrations fit into a sensible and workable government structure for the United Kingdom. People have to recognise that whether they are in Edinburgh, Wales or Northern Ireland, they have two Governments, not just one. It is important to stress that. Again, we need to be better at explaining to people what the Governments are doing and what their actual responsibilities are. Quite often there is sheer confusion on these points.

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

I generally agree with the point the Minister is making but, as part of that better integration, will he respond to the suggestion I made, based on the Canadian experience, that Northern Ireland officials and Scottish and Welsh Ministers might also be involved at the table in the forthcoming phase 2 negotiations?

Photo of Lord Duncan of Springbank Lord Duncan of Springbank Conservative

The noble and learned Lord, Lord Wallace, makes an important point. As a Member of the European Parliament many years ago—no, last year; time is just slipping through my fingers here—I am very conscious that the discussion was always about who sits at the top table and therefore represents the United Kingdom. I was always of the view that the table in London, where all the devolved Administrations argued these things through, was as important as the seat at that top table. Determining the UK position in this instance will be exactly the same. We must deliver a UK position which is part of the respect agenda and delivers for the peoples of Scotland, Wales and Northern Ireland that which is right, workable and appropriate. I can assure your Lordships that those will be dingdong discussions around the tables in London, where the heaviest lifting will be done. As to the point the noble and learned Lord makes, to be frank I do not know the answer, but the important table is the one where we bring together all these individuals to make sure that we are positioned to deliver on behalf of the people we represent.

I am conscious, again, that I am perhaps overstaying my welcome. On this day of Robert Burns, we are conscious that we celebrate that across the globe. So perhaps I might close with some words of Burns, which I thought were slightly appropriate:

“O let us not, like snarling curs,

In wrangling be divided,

Till, slap! come in an unco loun,

And wi' a rung decide it!

Be Britain still to Britain true,

Amang ourselves united;

For never but by British hands

Maun British wrangs be righted!”.

Photo of Lord McInnes of Kilwinning Lord McInnes of Kilwinning Conservative 2:05 pm, 25th January 2018

My Lords, I take this opportunity to thank all noble Lords who have contributed to this debate. I cannot do your Lordships justice by running through them individually in the time I am given, but this debate really has achieved what I set out for it to do. That was, first, as the noble Lord, Lord Kerr of Kinlochard, made clear, to say that perception is so important. After today’s debate, there will be a clear perception that your Lordships desperately want to see a successful settlement of the Clause 11 issue to the satisfaction of everyone involved, especially the devolved Administrations. The other clear conclusion from today is the feeling in your Lordships’ House that there needs to be urgent action and that absolutely everything needs to be done to ensure that we once again see a proper power-sharing Executive and democratic forum in Northern Ireland. We must have that to ensure not only that Brexit concludes successfully, but for the sake of our United Kingdom. I am very grateful to the Minister for the reassurances he has been able to give us on the importance of joint working and the transparency required to ensure confidence in the process. I once again thank everyone who has contributed to the debate.

Motion agreed.