United Kingdom Internal Market

Part of the debate – in the Scottish Parliament on 18th August 2020.

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Photo of Willie Rennie Willie Rennie Liberal Democrat

I start by endorsing the view that the House of Lords Select Committee on the Constitution expressed last month in its letter to Lord Callanan on the white paper, in which it said:

“We are not convinced about the need to legislate for the UK internal market and we are unsure precisely what problems the white paper is seeking to solve.”

The white paper is a confusing jumble of proposals that chases around problems that do not really exist in the current internal market and refuses to take the opportunity to establish a modern system of joint decision making between the four Administrations to protect the market going forward.

It is disappointing that the UK Government has not been able or willing to give joint ministerial decision making the place that it should have under the decentralised constitution. That was one of the constructive proposals from the Smith commission—which I recall included Conservative members—back in 2015, when it said:

“the Joint Ministerial Committee … structures … must be reformed as a matter of urgency and scaled up significantly”.

Scotland should not be left with a choice between a UK Conservative Administration that is intent on centralising decision making in Whitehall and a nationalist Government in Edinburgh that is prepared to erect formal trade and business borders between Scotland and England. Each of those approaches will harm Scottish and UK interests. There is an opportunity for us to do better than that. I urge the UK Government to withdraw the current white paper and enact a federal-style approach to future decisions on the UK internal market.

The white paper quotes the examples of Australia and Switzerland, which are both constitutionally federal states. In Australia, the different Governments of the states and territories agreed in the early 1990s to adopt a mutual recognition system, and they all passed legislation to allow that to happen. In the UK, all Administrations should be involved in taking the decisions. Working together, we would be able to protect the workings of the UK single market from what would, in effect, be unilateral action by a single Administration. That is a federal idea of co-operation, and it contrasts with the proposals in the white paper, which appear to give control of those issues entirely to UK ministers.

I am grateful to NFU Scotland—hardly a bastion of nationalism—for writing such a clear and distinct case against the white paper. It sets out the damage that the current white paper proposals will bring. NFU Scotland is clear that it wants no new barriers to trade in the UK, and that it wants collaboration across the United Kingdom. Neither the Conservatives’ centralisation plans nor the SNP’s independence plans can achieve both of those things. People and businesses in Scotland deserve better than a choice between those two unpalatable and destructive options.

My amendment offers a way forward. I want overarching frameworks to be progressed and agreed between the four Administrations, and I want joint ministerial committees to be up and running, with a dispute-resolution process to keep things moving. Once the frameworks have been agreed by all four Administrations, the detailed implementation can be left to the individual Administrations, safe in the knowledge that the fundamentals of the internal market are protected. My former colleague Tavish Scott proposed amendments to support that style of working in Scotland as part of the continuity legislation back in spring 2018. There was some support from Conservative members at that time.

SNP ministers, however, were less keen. They would clearly prefer to take unilateral decisions within Scotland, and they do not prioritise the continuation of an internal UK market. Their plans for independence bring an automatic border that will damage trade and business in all parts of the United Kingdom.

The Conservatives need to recognise that the United Kingdom has changed, that authority and power rests in the nations and regions of the UK, that not all power should or must rest in Westminster and Whitehall, and that there is a legitimate voice in all parts of the United Kingdom. That voice must be heard.

I move amendment S5M-22437.2, to insert at end:

“; urges that the current proposals be replaced with proposals to assist a smooth-running UK internal market through agreed frameworks and joint decision-making between the four UK administrations in a federal arrangement in order to recognise the development of devolution since 1999, and believes that an internal market without unnecessary borders is good for business and consumers across the UK, and that joint decision-making will protect people in Scotland and the rest of the UK from lower standards being imposed by the actions of a single administration.”