Y Pwyllgor Materion Allanol a Deddfwriaeth Ychwanegol - Y Bumed Senedd
External Affairs and Additional Legislation Committee - Fifth Senedd12/11/2020
Aelodau'r Pwyllgor a oedd yn bresennol
Committee Members in Attendance
|Alun Davies MS|
|Dai Lloyd MS|
|David J. Rowlands MS|
|David Rees MS||Cadeirydd y Pwyllgor|
|Huw Irranca-Davies MS|
Y rhai eraill a oedd yn bresennol
Others in Attendance
|Bridget Micklem||Dirprwy Gyfarwyddwr, Marchnad Mewnol y DU, Yr Adran Busnes, Ynni a Strategaeth Ddiwydiannol, Llywodraeth y DU|
|Deputy Director, UK Internal Market, Department of Business, Energy and Industrial Strategy, UK Government|
|Bruno Williams||Dirprwy Gyfarwyddwr, Adran Fframweithiau y DU, Swyddfa'r Cabinet, Llywodraeth y DU|
|Deputy Director, UK Frameworks Division, Cabinet Office, UK Government|
|Emily Daily||Yr Adran Busnes, Ynni a Strategaeth Ddiwydiannol, Llywodraeth y DU|
|Department for Business, Energy and Industrial Strategy, UK Government|
|Gavin Baird||Yr Adran Busnes, Ynni a Strategaeth Ddiwydiannol, Llywodraeth y DU|
|Department of Business, Energy and Industrial Strategy, UK Government|
|Lord True||Gweinidog Gwladol, Swyddfa'r Cabinet, Llywodraeth y DU|
|Minister of State, Cabinet Office, UK Government|
Swyddogion y Senedd a oedd yn bresennol
Senedd Officials in Attendance
|Aled Evans||Cynghorydd Cyfreithiol|
|Claire Fiddes||Dirprwy Glerc|
Cofnodir y trafodion yn yr iaith y llefarwyd hwy ynddi yn y pwyllgor. Yn ogystal, cynhwysir trawsgrifiad o’r cyfieithu ar y pryd. Lle mae cyfranwyr wedi darparu cywiriadau i’w tystiolaeth, nodir y rheini yn y trawsgrifiad.
The proceedings are reported in the language in which they were spoken in the committee. In addition, a transcription of the simultaneous interpretation is included. Where contributors have supplied corrections to their evidence, these are noted in the transcript.
Cyfarfu'r pwyllgor drwy gynhadledd fideo.
Dechreuodd y cyfarfod am 14:13.
The committee met by video-conference.
The meeting began at 14:13.
Good afternoon and welcome to this afternoon's meeting of the External Affairs and Additional Legislation Committee. Can I apologise for the late start to the meeting? Unfortunately, we had some technical difficulties and we're now on our way. In accordance with Standing Order 34.19, I have determined that the public are excluded from this meeting in order to protect public health, and thereby we will be operating in a virtual mode. The meeting is broadcast, however, on Senedd.tv, and there is also translation available on Senedd.tv as well. In the event of my connection dropping out, we have agreed as a committee that Alun Davies will act as temporary Chair, either until I am able to rejoin the meeting or the end of the meeting, whichever comes first. We've received apologies from Laura Anne Jones. We have not been given a substitute at this point, and we would also like to welcome David Rowlands to his first meeting of the committee. Welcome, David, and we look forward to your contributions to the committee in its future meetings. Do any Members wish to declare an interest at this point in time?
Chair, my standard declaration as chairing three groups, on behalf of the First Minister, with a European dimension to them.
Thank you for that.
With that, we move on to item 2 on our agenda, which is our consideration of the United Kingdom Internal Market Bill in preparation for the consideration of the legislative consent memorandum at the Senedd, and I'm pleased to welcome Lord True, Minister of State at the Cabinet Office, to this meeting. Good afternoon, welcome, and would you like to introduce any of the officials with us, please, for the day?
Yes. I hope that I have with me Bruno Williams from the Cabinet Office, who is in charge of common frameworks policy, and Bridget Micklem and Emily Daily from the Department for Business, Energy and Industrial Strategy, and Gavin, also, from the legal department at BEIS, I haven't his surname with me, he's only just—well, you know the reason.
Yes. We can see the surname is Gavin Baird.
Thank you for that. And thank you for your time this afternoon. I understand that you've been a busy person and I appreciate why, very often. But it is important that we have a UK Government perspective on the internal market Bill, and in particular there are some questions that we wish to raise in relation to the Bill for us to be able to produce a report, which goes before the Senedd when it discusses the legislative consent motion. With that in mind, we'll go straight into the questions, if that's okay with you, and we'll start with Alun Davies.
Thank you very much. We're grateful to you, Lord True, for the time this afternoon. One of the themes that the committee has pursued over the years has been the relationship between Welsh and United Kingdom Governments, and, as a committee, we're always very concerned to ensure that the structures we have within the United Kingdom work well and work for the benefit of everybody in the United Kingdom, wherever they may well be living. I'd be grateful, therefore, if you could outline to us the relationship between the United Kingdom and Welsh Governments and the involvement of the Welsh Government in the development of the internal market Bill.
Yes, the first thing I shall obviously confess is that, although I'm a Lords spokesman in the Cabinet Office, I'm here because Chloe Smith, who is the policy lead, as you will understand, was unable, at short notice, to attend, and I know that she would apologise for that, and is always, as I am, at your service.
Our view, obviously, is that the UK Government's wish is to have the warmest and closest possible relationship with the Welsh Government. In my estimation, since I've been in the department—I'm not speaking as an external witness, but as someone who has come into the department since the process of engagement started, since long after the memorandum of understanding back in 2017. I see a great earnest in this department to foster and maintain the warmest and closest possible relations with the Welsh Government. My estimation is that the contacts at official level are extremely active and effective, and also that relations at the inter-governmental level are active and effective. And I know, for example, that Chloe Smith was able to have a useful discussion last night with Jeremy Miles, for example, on aspects of the Bill.
I do know that—. I accept that the Welsh administration argues that those consultations and those contacts could be improved—everything in life, I would estimate, could be improved. But I can assure you that it's through no lack of respect or commitment from the side of the UK Government if we have been seen, in your eyes, to fall short. And I hope we haven't.
I don't think anyone on this committee on any side of the Chamber would seek that sort of view, and I'm sure that all of us wish Chloe well with her treatment as well. I met Chloe as a Minister in a previous role and I well recognise her own personal commitment to all the matters that you've described, Lord True, and I don't have any issue with that. But what my question was, and what we'd like to understand, is the chronology, if you like, of the Bill's development and the involvement of the Welsh and United Kingdom Governments in the development of that Bill.
The UK Government accepts that all seven Parts require the consent of our legislatures in Wales, Scotland and Northern Ireland, so there's a recognition that these are devolved matters. So, I'm interested in understanding how the United Kingdom, therefore, went forward in developing the Bill, in writing the Bill. Because, usually, when policy instructions are given to lawyers, the policy decisions would already have been taken. Normally, my experience as a Minister in Cardiff, and I'm sure Huw Irranca-Davies's experience as a Minister in both Cardiff and London, would be that those conversations would have taken place, both between officials and between Ministers.
Well, it is my understanding that, obviously, the Bill was introduced into Parliament on 9 September. It is my understanding that there was a period, albeit a short period—I know that is contended—in which consultations and informatives occurred, and since then, also, the conversations have continued. There is a backstop position here, which I know may be contended between us, which is that, on 31 December, the UK comes out of the transition period and therefore there is a need in our judgment to have an overall framework for the management of the UK internal market at that date. So, I confess that matters have moved with some speed, and my understanding is that there were contacts between your administration and the Welsh Government and the UK Government before the introduction of the Bill on 9 September. And, of course, ongoing discussions that may influence the Bill are continuing.
Okay. I don't want to put you in a difficult situation if you're unaware of what those contacts actually were, and it may be a better way of resolving this if you are able to write to us, Lord True, setting out the contacts that your department is aware of between both Welsh Government officials and Welsh Government Ministers, so that we actually understand the level of contact that took place when the Bill was being developed and when the Bill was being written. I think that would enable us to understand.
I'd extremely be very happy to do that. I mean, it is an unsatisfactory position, I accept, in that I wasn't one of the policy Ministers involved, so I cannot speak from experience of what did or did not happen. I will certainly ensure that that is provided to the committee.
That's absolutely fine. I'm grateful to you for that. The purpose of this session this afternoon isn't to catch you out in any way, or to—
No, no. Also, it ought to be my purpose to try to help your committee and to help the Senedd. So—
I'm grateful to you.
—where I fall down, if any official wishes to come in and pick me up, or if we can supply it in writing, that's what we're here to do.
I'm interested, you see, because from my background as a Minister, when the UK—and I don't mean the devolved settlement, but I mean the UK as a whole—works well, it works well when you have a Minister in London and a Minister in Cardiff, or wherever they happen to be, who understand the distinctive responsibilities that they hold and execute on behalf of their Governments, and where difficulties occur is where you have a lot of grey areas where people are unsure of where those responsibilities lie. In this sense, in the development of this Bill, there's no disagreement that the UK internal market requires management. There's no issue about that, there's no issue that the Welsh Government needs to be a part of that, and there's no issue that we need to put in place the structures that enable that management to take place. I think the issue is what those structures are and how they then operate. The United Kingdom Government recognises that legislative consent needs to be sought for this Bill, which means that they recognise that these are devolved powers. How do you reassure legislators in Wales or elsewhere that this isn't the power grab, if you like, that the newspapers tell us it is, but that this is a way of managing an internal market between the Governments of the United Kingdom and within the scrutiny and supervision of the legislators of the United Kingdom?
Obviously, we don't see it as a power grab, in that, as you know, 66 powers are coming back from Europe and are going through to the Senedd, which is something that one welcomes. I think all the difficulties with the Bill, and I'm not pre-judging anybody's response to it, is that it has various facets, and there is a clear part of the Bill that I understand the Welsh administration takes exception to—for example, the treatment of financial support and the way in which the shared prosperity fund is being carried forward. We believe that is a legitimate and proper national objective, across all four parts of our kingdom, and it does not in any way cut across the ability of the devolved administrations to provide funding for projects. But there is, I understand, an intellectual difference there.
Then there is another part of the Bill—. I won't talk about Part 5 at this juncture; you may want to talk about that later. If we come to the core of the Bill, in terms of common frameworks and the interrelationship between common frameworks and the rest of the Bill, I think that, in the proceedings in the House of Lords, which I have been taking an active part in—and I very much welcome the many amendments laid on behalf of the Welsh Government, which provoked interest—I think you ask how we can persuade the Welsh administration and the Senedd that we take seriously and wish to have consent of the Welsh Senedd and the support and appreciation, it is through dialogue. I have found that there is a lot of suspicion that the internal market is intended to sweep away the operation of common frameworks, for example. But that isn't the case. I mean, the process of common frameworks is valued, is working forward. The Welsh Government has been a great contributor to it. In terms of trying to persuade and convince, in the terms of your question, I always believe that action speaks louder than words, and we have an ongoing commitment there. We are discussing and considering points that are being put forward on perhaps finding ways to incorporate the common frameworks in the Bill. That is something that is under active consideration, which might ease that concern.
Also, in parallel, obviously, the are the inter-governmental relations—the IGR discussions—which, again, I think are going forward well and better than many perhaps expected. And so, I hope that's another strand through which we'll be able to convince you of our earnest. So, the persuasion, if you like, I hope, is seen in action, but we have to candidly acknowledge between us the one or two areas in the Bill that the Welsh Government is finding difficult.
The commitment on behalf of all Welsh Government Ministers—I know them all, as you can imagine—would be to seek agreement. There's no issue there; nobody in the current Welsh Government wishes to dismantle the United Kingdom, but we worry it's being done for us. That's the concern.
But, to go back to the example of the financial powers area of the Bill, I was a Minister at the time of the last EU budget negotiations and the last legislative framework for structural funds in different ways. Welsh Government contributed secondments to the UK Government and to UKRep, and worked with the Commission in the development of those frameworks and the legislation that underpinned them. I attended a general affairs council, alongside UK Ministers, to debate and discuss the budget, as it affected us. I met many times with Kim Darroch, who was at UKRep at the time, to discuss these matters. We had very good interaction with UK departments, and we worked as a UK team together in order to deliver the sort of frameworks that were then enacted through the European Council and structures. The shared prosperity fund is being announced on 25 November, as I read in the newspapers today, with no consultation, no discussion, no debate, no opportunity for Welsh Government to contribute to it, no contribution from any aspect of any part of British life, except within the United Kingdom Government itself. It is difficult to see how that, in any way, equates to the open, transparent conversations, negotiations and discussions we had nearly a decade ago. And it appears to me—I hear what you say about actions speaking louder than words—that the UK Government says one thing but does another.
I'm sorry to hear you saying that. Again, it's not particularly helpful to the committee, but it's not a strand of discussion internally that I've personally been involved with. I can only reiterate what I believe I said earlier, that the creation of the new power is in addition, it's a complement to the devolved administrations' existing powers. It isn't a threat in any way, as we see it, to the operations of the devolved administrations. It relies—
Can I just clarify that before you move on? I'm sorry. So, your response and what you're saying is that there are 66 new powers being transferred to Cardiff as a consequence of Brexit, but there are no new powers contained in this particular piece of legislation.
I'm not contending there are no new powers in this piece of legislation. Indeed, I said earlier that, clearly, the United Kingdom Government's intention to spend, for the purposes and for the benefit of people in all parts of the United Kingdom, in the same way that the European Union was going to—used to—is obviously not a new power, but it is something that is reserved and to be undertaken by the United Kingdom Government. What I am saying is that it doesn't elbow out the way, it complements the existing role of the devolved administrations. I understand that Mr Williams wants to come in and amplify this point, if that's possible.
Thank you, Lord True. If I may—and I'm sorry for being late to the session; I'm Bruno Williams and I'm the deputy director for the UK frameworks division in the Cabinet Office—I wanted to just expand, really, on what Lord True said about the returning powers point, which is, in terms of the overall numbers here—. So, there are, at the end of the transition period, a number of powers returning to the Welsh Government from the EU. These are going to be taken forward, as you're aware, I think, through 66 framework policy areas. Those are the latest figures, as set out in the publication that we laid in front of Parliament back in September—the 2020 frameworks analysis document. As I'm sure the committee will know, this document sets out the details of those areas where there are common frameworks that intersect with the competence of the Welsh Government. So, I just thought—
I'll interject here, if you don't mind, for a minute. Just for clarification purposes, I think it's important we understand this and people understand this. My understanding is that this Bill does not give us any more powers. The fact that we are leaving the European Union at the end of the transition period returns those powers to the Welsh Assembly that were given to us as part of the devolution settlement but we did not use because we were part and members, as a nation, of the EU. So, in a sense, it's not this Bill that gives us these powers, is it? It's actually the end of the transition period and the departure from the EU that allows those powers to return within the power of the Assembly. If I'm right, that's the case, isn't it? You're nodding, so I assume that's the case.
I find it curious that the UK Government is arguing that the financial subsidy powers are reserved, because I exercised those powers, and I have negotiated, alongside other UK Ministers as part of the UK ministerial team, on the creation of European law in these matters. Now, anybody would know that that wouldn't have happened if those were reserved, or seen to be reserved in any way at all. They didn't form a part of any of the legislation that we've seen amending the Wales Act over the last two decades. It was always perceived to have been a devolved responsibility, and the last Wales Act, which created the reserved-functions model, was silent on these matters, and that, legally, does therefore devolve those matters. And I find it a very peculiar argument to make now, when we're in the face of these timescales. But I don't want to—I know other people will want to question you further on these issues.
My final question to you, Lord True, is that one of the concerns about this Bill is not simply that of legislative competence, and I recognise what you're saying on that. If I'm quite frank with you, I'm not sure you've been overly convincing on it, but I recognise what you're saying on it. Do you, in any way, acknowledge that legislative competence is defined not simply by the competence existing in a particular place, but that place, that legislature's ability to exercise that competence? And what this Bill does—you're absolutely right, it doesn't say these areas are no longer devolved and the rest of it; it doesn't seek to overturn the referendum in that sense—but what it does say, frankly, is that if you do exercise those powers, there's this range of issues that mean that those powers are actually pretty limited in their extent and their ability to be exercised. And it is that area that really concerns me, because it breaks the faith of the people of Wales who voted, by a very, very significant majority, for these powers to rest in Wales. And that wasn't a close referendum at all; it was nearly 2:1 in favour of these powers resting in Cardiff and not in London, and it is stealing those powers by the back door.
Well, I don't agree with that, and I'm disappointed to hear that's your view. I respect it, obviously, and I'll study very carefully, when I look at the transcript of this discussion, the contentions that you're making. I'm afraid, when you get to my age, you are used to the fact you're not always the most convincing person at all times, but I am trying to address some points. Obviously, there is an issue, and I acknowledged that candidly at the start, in relation to state aid and your perception of the way in which the shared prosperity fund will operate. I've tried to suggest that that wasn't a challenge.
In terms of the common frameworks, equally, I think, because there is an issue here of stuff that is non-legislative, partially legislative, and the suspicion, at the end of the day, that the UK Government is trying to put in a legislative framework that cuts across work that is good and voluntary and creative, and that really isn't the intention of the UK Government, as I see it. We believe that the base of the area of co-operation between the four institutions—the UK Government and the devolved administrations—that remains, if you like, the base of all our common work going forward. And it's the one thing I do want to leave with you, and I don't believe there is a hidden power grab here. Again, action will prove whether what I'm saying is true or not, but it's very much our intention to go forward. And, indeed, the food and feed safety and hygiene common framework has only just this week, I think, taken a further significant step forward, and we very much hope that that will happen. So, it's my conception of things that the devolved administrations will play a major part, and we are looking at the Bill, obviously, to try and assuage some of these concerns in the light of comments that you and others have made, and I hope we'll be able to make a constructive response.
Thank you very much for your time.
Before I go on to the next questions, since you've mentioned common frameworks, I just want to highlight, perhaps, a couple of points you may want to think about. In relation to a response by Lord Callanan to Baroness Finlay, in a letter regarding points, we noted that there could be areas that were used as examples that, in fact, are not examples. He highlighted construction as an area of example where divergence may occur, but construction actually is not part of the single market and it has always been allowable in Wales. We've always been able to do building regulations that apply to Wales, for example, and that's never been contentious before this Bill. Similarly, in the same letter, the examples of pesticides and the mutual recognition of qualifications were discussed. Again, that's part of the common frameworks agenda. If there is a common frameworks agenda, which has been agreed—that was part of the common frameworks concept—again, I don't understand why these examples are being used as a reason for divergence when they are part of a framework structure that has been agreed and therefore there should be no divergence. I think this highlights the possibility that there's a lack of understanding exactly within Government of how this impacts upon the devolved nations and the discussions of common frameworks. I suppose there's a very big question: do you still believe the Government is committed, or are you still committed, to the common frameworks? Because that has been the main thrust for the last three years of trying to get commonality without an internal markets Bill.
'Yes' is the answer to that. I've given some long answers; let me give a short one.
That's okay, but I hope you take back those notes and those points that those examples that are being used, actually, are misleading examples because they are incorrect examples. I think that's the biggest question.
I'll tell my good friend and colleague, Lord Callanan, that, obviously. I don't know if anybody from his department would want to comment on the specific examples. If they want to come in, they may.
Certainly, when I go to Parliament, as when you go to the Senedd, my job is to tell the truth to Parliament, and everything that I've said in the course of the Bill is to affirm the Government's commitment to this process of dialogue. I know that that is chaired by Michael Gove, who is obviously the principal in this department, very strongly, and by Chloe Smith. As I say, we are in active discussion, not only on the basis of—. I can't promise that everything that we come forward with at Report Stage or at later stages will please you fully, but we're clearly looking at, in the frameworks area, ways in which we can perhaps restate the commitment, because I know it's doubted and I've felt that in the course of the debates on the Bill. This is one thing I have been involved with and I have been struck by. The voice of Wales, by the way, is very strong in the House of Lords—very strong, very well put and very well heard. Whatever Bill I am discussing or business I am discussing, there is a powerful challenge in the most positive way from Wales and from Welsh voices, which is always improving. But we are exploring ways, if we can get that commitment in the context of the Bill, and we're very willing to listen to the proposals on the table for achieving this. That includes, actually, Lord Hope's amendment as being part of the considerations. We don't see the Lord Hope amendment, at the moment, necessary as a specific response, but I hope we'll be able to come forward with further and better particulars before too long.
Diolch yn fawr, Gadeirydd. Dwi yn ymwybodol o amser, ac mae nifer o'r cwestiynau roeddwn i'n mynd i'w gofyn wedi cael yn rhannol eu hateb yn barod. Ond prynhawn da i chi, yr Arglwydd True.
Thank you very much, Chair. I am aware that time is against us and a number of questions that I was going to ask have been partly answered already. But good afternoon to you, Lord True.
Mae'n bwysig—. Swyddogaeth y pwyllgor yma ydy ei fod yn craffu ar beth sydd yn digwydd er mwyn i ni allu darparu'r wybodaeth i'n cynulleidfa fyd-eang sy'n gwrando ar y pwyllgor yma ac yn ei wylio fe, yn wir, ar hyn o bryd. Felly, mae gen i gwpl o gwestiynau bach ychwanegol. Yn mynd nôl i bethau sylfaenol, efallai, ac yn mynd i olrhain y rhesymeg dros gael Bil y farchnad fewnol yn y lle cyntaf, beth yw'r rheswm dros ei gael e? A allaf i holi i chi, yn eich barn chi, ydych chi'n credu taw Bil economaidd yn unig ydy'r Bil yma?
It is important—. The function of this committee is to scrutinise what is happening so that we can provide the information to our global audience that's watching this committee at the moment. So, I do have a few additional questions to ask. Going back to the fundamentals, perhaps, and the rationale for the internal market Bill, in the first instance, what is the reason for the Bill? May I ask you, in your opinion, whether you believe that this is purely an economic Bill?
Well, that's a difficult question. I've never thought of it in that sense. I've thought of it as a practical Bill, aiming to achieve a common purpose that is shared by all people of goodwill in this nation, or these nations, which is that we should, in the interests of consumers and in the interests of business and in the interests of our common weal, in a sense, have a functioning market that encourages investment and sustains business. So, in one sense, you could say that it's an economic Bill, but in my view it runs wider than that, because the fundamental thing that sustains our kingdom is that there's a sense of harmony and common purpose within our four nations.
Diolch yn fawr am hynna. Allaf i ofyn i chi yn bellach, allwch chi esbonio pam mae Llywodraeth y Deyrnas Unedig yn dymuno i'r Bil yn ei gyfanrwydd fod yn Ddeddf warchodedig?
Thank you very much for that. May I ask you, further to that, whether you can explain why the UK Government wishes to make the Bill in its entirety a protected enactment?
Well, it's a protected enactment on the basis that obviously, within the Bill, there are powers that are United Kingdom powers with an United Kingdom role. The internal market is a common market, in the same way as the European single market was, that runs across the composite nations, and there are, obviously, matters within it that are reserved matters.
But I think we get, in some ways, back to—. I understand the sensitivity of some of these questions, but one gets back to this kind of interface, which is a sensitive one, and, as I say, coming fairly new to this and not having been the policy Minister—and, indeed, still not being the policy Minister—I'm acutely aware of the delicacy of the interface between arrangements that are voluntary and co-operative and what then seem to be potential, if you like, interfering involvements. It is difficult, and people look at it in different, opposite ways of a telescope. What I would like to say to you is that, certainly, from—. You know, as parliamentarians, and I know that you gain from discussion in Parliament, and I do understand the sensitivities, but the Government believes it's justified that it should be a protected enactment simply because of the range of national things that it does cover.
Diolch am hynna. Allech chi yn bellach esbonio pam mae—ac, wrth gwrs, mae cwpl o'r cwestiynau wedi cyffwrdd â hyn yn barod. Pam ydych chi'n credu bod Llywodraeth y Deyrnas Unedig yn credu bod y fframweithiau cyffredin, ynghyd â'r pwerau presennol sydd gan Weinidogion y Deyrnas Unedig drwy Ddeddf yr Undeb Ewropeaidd (Y Cytundeb Ymadael) 2020—pam fod hynna yn annigonol o'u cymharu efo'r Bil i reoli'r farchnad fewnol? Hynny yw, o gysidro bod gyda ni fframweithiau cyffredin a phwerau o dan y Bil ymadael, pam fod angen y Bil yma yn y lle cyntaf i reoli'r farchnad fewnol? Onid yw'r fframweithiau cyffredin yn ddigonol?
Thank you for that response. Could you further explain—of course, a few of the questions have touched on these issues already. Why do you believe that the UK Government believes that the common frameworks, combined with existing powers provided to UK Ministers through the European Union (Withdrawal Agreement) Act 2020—why are those, taken together, an insufficient alternative to the Bill for managing the internal market? Considering that we do have the common frameworks and the powers under the withdrawal Act, why do we need this Bill to manage the internal market? Aren't the common frameworks sufficient?
I think that that, of course, is one of the absolutely core and fundamental questions that we're all grappling with. We're searching for more transparency all the time, but, of course, part of the transparency that we already have is that we report on the progress of the frameworks and also the use or, I'm pleased to say, the non-use of the section 12 freezing powers. But alluding to that eludes the fact that the frameworks cover returning EU law, and the UK market broadly is obviously wider than that. And frameworks: there are other arguments, contentions, beliefs that you will have heard put forward, which we think are correct, that frameworks are primarily sector specific and, obviously, don't cover always cumulative issues, because you could have a small divergence in one area that is agreed and then another and then another. In a complex supply chain, you could find problems arising.
Another area, obviously, is that the frameworks programme is not futureproofed. There could be the emergence of new technologies, new professions and so on that we may need to address. The other side of the coin of their great virtue, which is that they're voluntary, is that ultimately they're not certain, and I candidly acknowledge that, at the end of the day, there is a bedrock rather than, I would say, an oversetting stone that could provide certainty to investors. But I think, with your permission—I don't know, Chair, if there's time, but I think that Mr Williams may want to add something as the lead director on this policy, but I'm in your hands. That's my answer.
If Mr Williams wants to add something—we definitely will go on to common frameworks, but, if you want to add anything now, Mr Williams.
Thank you, yes. First of all, I completely agree with Lord True's characterisation of the frameworks—[Inaudible.] I would just add a bit more detail on the point about transparency. So, as Lord True has said, we report regularly on the way in which common frameworks are being developed. There are a couple of publications, one of which I alluded to earlier. There is also, of course, a strong element of parliamentary scrutiny as part of the development of common frameworks, and indeed a good deal of stakeholder engagement. But I think—just on the subject of transparency, I thought it was worth drawing attention to one of the amendments that the Government has introduced to the UK Bill in terms of the financial assistance power, which concerns a requirement to report annually to Parliament on the use of the financial assistance power. That's a statutory duty, which I think also helps in terms of making the point about the Government's commitment to transparency. That was the only thing I wanted to add.
Okay, thank you for that. I suppose I can take the point that transparency is wonderful, but, if the powers actually are having the wrong effect, it doesn't matter how transparent they are, they're still making the wrong effect. I think that's what we're trying to identify—whether we consider that the powers are actually making the wrong effect. Dai.
Ie, gwnaf jest ddod i ben, achos dwi'n ymwybodol o'r amser. Felly, i orffen y darn yma, Arglwydd True, allech chi esbonio pam mae'n rhaid i'r Bil ddod i rym erbyn 1 Ionawr flwyddyn nesaf, a hefyd bellach esbonio pa dystiolaeth sydd gan Lywodraeth y Deyrnas Unedig y bydd y Llywodraethau datganoledig yn ceisio dilyn llwybr gwahanol yn awtomatig ar 1 Ionawr 2021?
I'll just conclude with my questions, because I am aware that time is against us. So, to conclude this part of the questions, could you explain why the Bill needs to be enacted by 1 January next year, and can you further explain what evidence the UK Government has that the devolved Governments will seek to diverge significantly automatically on 1 January 2021?
Well, I think I've partly answered that, in the sense that the transition period does end. We are out of the EU single market, and the internal market is broader than the areas that are covered in returning EU law.
So far as malintent or malign intent on the part of the devolved administrations is concerned, which is almost the implication of your question, I don't think in any sense one is imputing that at all. I don't believe that any sensible politician—and who are we as politicians but public servants, working for our masters, the Welsh people, the British people, however you want to look at it—no-one would set out to disrupt, no-one that's well intended would set out to disrupt, the market. So, it is not a sense that something terrible is going to happen on 1 January that is forcing this, but I think when you make policy—and you will understand, because of the responsibilities that you have in your legislature—there is always a prudential element here. So, something that is not immediately necessary, if it might become necessary one day, it is often better to make provision for that beforehand rather than wait for a crisis to arise, when you're chasing the crisis.
So, the short answer is that I don't expect any sudden divergence—I certainly see no desire—but there will be areas where divergence will be agreed, as has been the case in the past. But 31 December does mark a major change in the history of our nation, and, as we're coming out of the single market, we do have to provide broadly a framework overall for the market, and we also have to be ready should something none of us anticipate now happen one day. But certainly the British Government doesn't expect disaster in terms of people rushing off and causing trouble for us on day 2, and, when I say 'us', I mean all of us in Ireland, Wales, England or Scotland. That's not where we're coming from.
Diolch yn fawr.
Thank you very much.
Thank you. Before I move on to the next set of questions, two points. I think you mentioned that the Government has plans to amend the Bill in relation to common frameworks; I just wonder whether you could give any further information to this committee as to when these amendments may be submitted and what the intention is.
Yes, I would like to. I had hoped that it might have been possible to have reached a more advanced stage at the moment, but, as I said before, we're keen to reaffirm our commitment to co-operation. We have had discussions in the House, including with the Labour Party, with the liberal party and other parties in the House, and with peers involved, including Lord Hope and a range of peers, and we're discussing ways in which we might be able to—. And I can't wholly satisfy you in giving my answer, because obviously you will understand there has to be policy discussion and consent, but the timescale, obviously, is not going to be particularly long before we have to show our colours.
But one of the tricks that we have to take—and there's never been a great demand from the devolved administrations to have common frameworks put on a statutory basis, precisely because of the value of their capacity, that they're voluntary and the flexibility that they can allow, and, indeed, divergence. One thing that statute doesn't very readily allow for is divergence. So, what we want to do is, if we're able to get something on the face of the Bill that gives, if you like, common frameworks a clear public understanding in black and white on the face of it—well, it's not any more a piece of parchment in Victoria Tower, but it used to be—in black and white on a Bill—. What one doesn't want to do is to constrict the structure too much. The long answer. The short answer is that I hope, in the next few days, our intentions one way or another will become clear. We expect—the first stage of Report is next Wednesday, and I think Ministers will be duty bound to give some clear guidance to the House, at least on the direction of travel, by then.
Thank you. But, as I say, one of the strengths of the common frameworks from our point of view when they were first talked about was obviously the agreement and the involvement of all four devolved nations or devolved parties. And I think that was a very strong part of it, and we would not like to see that agreement concept being taken away and things being enforced. And I was a little bit concerned when you talked about the cumulative effect of the common frameworks, which you highlighted, which could have a wider scope than you anticipated. But then, to me, that says that you want to cap common frameworks, to an extent, and I wouldn't want that to happen either, because each common framework I understand focuses on its sector and cumulatively needs to be thought of, but I would hate to see it being capped, simply because there could be important things in that framework that need to be discussed.
No, exactly. I very much hope, Chair, that there would always be discussion on these matters, and I certainly wasn't positing any kind of quantitative theory that, if there are two types of divergence that affect one industry, suddenly that sets some sort of light going. I was simply saying, obviously, in the longer term evolution of a market, divergence can grow to a point that it interferes with the operation of the market. And obviously it's extremely important for Welsh industry, obviously, to be able to—well, to all industries in all parts—have access to the other parts of the kingdom. But, Wales being a slightly smaller economy, we have to particularly protect the interests of the smaller economies.
Thank you, Chair, and good afternoon, Lord True. I'll try and take us on to some areas of questioning, but it's just worth pointing out at the beginning that, on this committee of ours, we've got people who took different positions on Brexit and who have different positions politically on devolution, independence and so on. But what we have done as a committee is watched intently the debates going on in the House of Lords and the House of Commons, and we've also taken evidence, which we've all heard, from constitutional and legal experts. So, when we ask these questions in advance of this appearing on the floor of the Senedd, they are genuinely to try and get clarity.
Let me just begin by asking why, in everything we've heard, including by those interested parties in the House of Lords and the constitutional committee and so on, as well as their own experts, the scope of the Bill, in Parts 1 to 3, extends beyond the scope of EU retained law, and why the exemptions provided for in the Bill are narrower in scope than those provided for under the rules of the EU single market. And the reason we ask that, Lord True, is because, when the arguments were going on, whichever side you sat on it, in the debate of getting our country back, what we don't want to have is a situation is where we get back something that diminishes what we got back in Wales, quite frankly. That's what our concerns are. So, those two issues. Parts 1 to 3 extend beyond the scope of EU retained law. The exemptions provided are narrower in scope. Why is that? We're worried.
Well, on the first part, I think I had tried to at least give some answer on that. It's simply because the operation of the market runs wider than the ambit of retained UK law. And I won't weary the committee by stating that at great length, but the market is, in a sense—the broad market is an unknowable. It's unknowable now, and it's certainly unknowable in the future. And retained UK law is fixed in a point of time when things come down from, return from Europe. We are where we are. In the future, the market may evolve, and will evolve. My ancestors worked in the fishing industry for generations, and, sadly, there are only about—not many boats fishing out of Lowestoft these days. So, markets evolve. The common frameworks will cover most of the ground; I think that is conceded and in common. But there will be future developments that are not covered by the retained EU powers, and areas that evolve forward.
So far as the point on exemptions is concerned, I wasn't actually present at the original policy discussions when the issue of exemption was discussed, so I'm perhaps not the most authoritative person to answer that question. I don't know if there's anybody on the line who would like to address the exemption point, or if it's—[Inaudible.] I'm prepared—I agreed we would go over time because we started late. We can certainly address that point in writing if you want to, but it's not one on which I can speak authoritatively at the moment.
That might be helpful, if you, or officials on the line, were able to communicate this to us in writing, because I think you've been very clear that the market might evolve; the UK Government has decided it's going to take a precautionary approach, because things might evolve. But, from those answers, let me put it to you that, as things evolve, the, what would you call it—we won't call it the whip hand, but the power resides with the UK Government going forward as things evolve.
I think, if you were to write to us, it would be helpful to seek your confirmation or otherwise that the narrowing of exemptions will actually reduce the ability of devolved legislatures to diverge from the UK Government position, as compared to the freedoms we currently have under the single market. I think you've explained why that is. It would be helpful to have that confirmed, because, for us, I think you can probably understand why that would be a worry, because all the discussions we've had about things like common frameworks and partnership working and development of various protocols, that's a very different model from now bringing down a statutory set of rules that inhibit devolved Governments from doing what they've been allowed to do before.
I do understand—
Bridget Micklem has indicated and I wonder whether she wanted to come in on this point.
Well, if Lord True is happy for me to do so, I can—
Yes, please do.
I think it's something probably that is easier to write on. But one of the things that I would say is that the EU system is only one sort of inspiration for the design that we have here. So, a straightforward comparison—it's not like adding up the exemptions and saying, 'Is the list of this and the list of that the same?' So, the design is different, that is true, and there are some things where we think the design is clearer than what you might have in terms of ability to do things under the EU system. For example, in the EU, administrations could exercise their right to derogate, for sure, for specific reasons, but those derogations could always be challenged, sometimes over months and years. And we know, for example, the Scottish Government had to fight a court battle to introduce minimum unit alcohol pricing under the EU system. But under the design that's in the Bill, it is much clearer that that just could be done, so long as it's not discriminatory, because minimum unit alcohol pricing is a manner of sale requirement. So, I think the answer I would like to suggest to you is that it's quite a subtle analysis. It is not straightforward, adding up and comparing lists. But I think if we can write to you, that would probably be helpful.
That would be helpful.
If I could just add also—. I think that would be helpful. Obviously, there are philosophical discussions that go on in relation to exemptions, and I know those contend that matters that are matters of agreed common frameworks might or might not be exempted. I'm giving no signal here, but we are aware of the sensitivities around this subject. But as Bridget has promised to write, and I've also set out my not full authority in this area, we will write. But it's something we are aware of, I can assure you of that.
Okay. Chair, I'm really aware that we're running out of time here, but I've got two questions I'd like to put, and perhaps, Lord True, we could write with some other points subsequently. In terms of our general discussion, but particularly in terms of oversight and dispute resolution, how would you respond to our Counsel General's concerns here in Wales that this Bill will lead to further legal challenges to the devolution settlement?
Dispute resolution within the internal market or dispute resolution generally, inter-governmental?
Inter-governmental as well.
Obviously, our belief is that dispute resolution should sit at the lowest possible level, which is, in principle, with the principle of devolution. So, hopefully, many areas of dispute should be resolved without having to be escalated up. But I think, as you will know, there's very active discussion about the broader framework and structure for dispute resolution. The Joint Ministerial Committee structure I think is widely contended, needs to be examined. We hope very much that we will be able to arrive at broader inter-governmental arrangements, which will provide clear structural and effective mechanisms for dispute resolution. And I think, as you will know and the Welsh Government knows, those discussions are ongoing, and we're very open to trying to find common solutions there.
Okay. Thank you. One final question, Chair, if I may, and it's on the Northern Ireland protocol. And I say this as somebody who's sat either in the privileged or the burdensome position of being a UK and a Welsh Minister at various points. Welsh Ministers have a duty, as do UK Ministers, to comply with the law—it goes without saying. But that includes international law and treaty obligations. What is your assessment of a situation, under the Bill's provision, where Welsh Ministers could be directed by UK Ministers to act in a manner that their legal advice would say to them would be incompatible with international law when implementing the protocol in areas of devolved competence? Can you foresee that situation arising and how would you deal with that?
Well, I haven't foreseen that situation arising, because I didn't really see the particular role of the UK Government as to direct Welsh Ministers in the conduct of their duties. I do understand the sensitivities about the points of the protocol. How could I not, being the person who's responsible for taking Part 5 of the Bill, theoretically, through Parliament? It seems to be somewhat stalled at the moment. Our answer is that the provisions in Part 5, to which the House objected, which could, potentially, be in breach of international law—our contention is that the rule of law is not in any sense undermined or contradicted by presenting Parliament with proposals to defend what we see as the national interest. Our hope is that the national interest, that being the undertakings given in the protocol and outside to unfettered access to Northern Ireland goods, to Wales and to England and to Scotland, should be maintained.
We hope still, in the joint committee, that we will avoid this situation and that there'll be a rational outcome that will mean that there wouldn't be any kind of degree of potential interference with movements that the defaults in the protocol might allow. I think, when the withdrawal agreement was made—we all know the circumstances in which it was made, with a very difficult Parliament—the EU and the UK agreed to leave certain matters to be resolved, which is why we have a joint committee. I hope the joint committee can do its work and that the potential power that the UK Government is trying to put on the statute book, but the House of Lords hasn't cared for very much—. I have said in terms in Parliament that we hope that that would never have to be invoked, and that's the position of the British Government.
That's helpful, Lord True. But you have just reiterated a position that's been put by other UK Government Ministers—that you would hope that it could be avoided, it would be regrettable if it had to happen. But there are situations that are envisaged within the approach of the UK Government where they might say, 'We are going to have to jeopardise international treaties and international legislation'. A Welsh Minister might well say, 'It is not my role to be told by a UK Minister that I need to break international law.' That would be an unprecedented situation, but the Bill allows that to happen, potentially. Much as I accept you say, 'We wouldn't want that to happen; it would be regrettable if it did', the Bill contains the power to direct Welsh Ministers to actually follow what the UK Ministers are telling them to do on this.
All right; I accept your concerns. I repeat that we don't believe that this outcome should be necessary. The British Government has made clear that we do collectively have a responsibility to our fellow countrymen and women in Northern Ireland to maintain the Belfast Good Friday agreement. I think we all have to understand that part of the terms on which our friends in Northern Ireland agreed to come together, thank goodness, and reform the Northern Ireland Executive—an explicit part of that was unfettered access for Northern Ireland goods to Wales, Scotland and England. There are tensions—I candidly acknowledge that—between international law and between UK domestic law, as it might be put into effect, and there are tensions between different interpretations of the protocol. But our judgment is, in the interests of the Good Friday Belfast agreement, that there is an overriding national interest to secure unfettered access. But I appreciate what you're saying, and I understand your concerns about it, and let's hope for a reasonable outcome in the negotiation, and please can we have negotiation completed as soon as possible, because that is one of the areas that is causing uncertainty for businesses and for many people in the public weal. Let's all say 'Godspeed' to those negotiations.
Thank you, Chair. Thank you, Lord True.
Thank you. We've come to the end of our allocated hour, Lord True, and we've still got a lot of questions to ask. I appreciate that you've offered time, but we've gone 15 minutes beyond where we were scheduled to be. So, I'm going to take the Chair's privilege and ask one final question, but there are still many questions on common frameworks that still need to be resolved in relation to the internal market Bill and how they will work beyond that. But one question I want to ask is on the office for the internal market. I understand that, obviously, the request for information that can be made—you can request information, and it's been said that you will not penalise the Welsh Government in any sense if they do not provide that information. But what we're concerned about is the Commission of the Senedd. Devolved administrations are one part of devolution, but devolved institutions are the other part of devolution, and I would hope that you will look very carefully at the Bill to ensure that, when you talk about devolved administrations and protections for the devolved administrations, you also look at devolved institutions as well to ensure the commissions—or the Scottish Parliament rather than the Scottish Government—are also given the same protections as well. I'll just leave that with you to think about and to look very carefully at.
I certainly take note of that and I know that my officials—Bridget, who's on the line—are particularly interested in it. Not to prolong too much—and I apologise, as some of the fault for the late start was at our end—I'm glad we've been able to go on and help the committee, I hope. I do hope that there will a greater clarity on the common frameworks position vis-à-vis the legislation by next week, as I did say to the committee earlier.
So far as the office for the internal market is concerned, it will absolutely not be empowered to overrule individual measures introduced by the Welsh Government or indeed any other administration. The Bill doesn't give the OIM advice and reports any binding character, and that is certainly my understanding of the position. But we will, as you request, respond to you on that in writing.
Thank you. Time, actually, has gone past. We very much thank you for your time. Please convey our best wishes to Chloe Smith. We understand the reasons as to why she wasn't with us today, and we wish her all the best. She has been a friend, in a sense, to this committee—she's attended this committee on more than one occasion, and that's been appreciated.
I thank you for those kind words. I'll certainly convey them, and I'd reiterate what I said at the start—being, in some ways, a bystander, her commitment and indeed Michael Gove's commitment to making the relationship between the UK Government and the Welsh Government operate well is clear. I see it daily, and it's very profound. And I sense, very strongly, that having had the privilege of talking to your committee—. I knew it before, but I sense very much that same commitment on your side of the partnership. If I use the word 'side', it sounds as if it's a conflict. It's not; it's a partnership. Thank you very much—
And please convey to Mr Gove he's always welcome to come before the committee as well.
Thank you very much for your time. You will receive a transcript as usual, to check for any factual inaccuracies. Please contact the clerking team as soon as possible if you find any.
Okay. Thank you so much. Thank you all.
Thank you and thank you to your officials.
We move on into business, and to item 3, which is papers to note. The first one is a supplementary legislative consent memorandum on the Trade Bill. The Business Committee has asked us to report on the supplementary LCM by 18 December. We will note the paper and we will discuss that in future meetings, because we have already submitted a report on the original LCM, and this is simply to add to that. Are Members content?
The second paper to note is the correspondence from the Counsel General and Minister for European Transition regarding the UK-Japan comprehensive economic partnership agreement. Again, are Members content to note that? And we'll have a more substantive discussion on that UK-Japan agreement next week in our meeting. Are Members content to note?
And the third one is from the Minister for Mental Health, Well-being and Welsh Language regarding the nutrition labelling composition and standards provisional common framework. And, again, are Members content to note that in readiness for a future discussion? Thank you for that.
bod y pwyllgor yn penderfynu gwahardd y cyhoedd o weddill y cyfarfod yn unol â Rheol Sefydlog 17.42(vi).
that the committee resolves to exclude the public from the remainder of the meeting in accordance with Standing Order 17.42(vi).
Cynigiwyd y cynnig.
Item 4 on our agenda is a motion under Standing Order 17.42(vi) to resolve to exclude the public from the remainder of today's meeting. Are Members content to do so? I see they are. Therefore, we will now move into private for the remainder of this meeting.
Derbyniwyd y cynnig.
Daeth rhan gyhoeddus y cyfarfod i ben am 15:20.
The public part of the meeting ended at 15:20.