Devolution and Exiting the EU and Clause 11 of the European Union (Withdrawal) Bill: Issues for Consideration Contents

2Concerns relating to Clause 11

A power grab?

11.Without the inclusion of Clause 11 on the face of the EUW Bill, the powers currently held at EU level, to legislate in areas of devolved competency in Northern Ireland, Scotland and Wales, would return to the devolved legislatures and Governments.15 Professor Alan Page states that concerns had been raised that the EUW Bill “was drafted without a proper understanding of devolution law”, which raises questions about the mechanisms used in Clause 11.16 He explains that the requirement for devolved administrations to act compatibly with EU law is rooted in the obligation not to put the UK in a position where it is breaching its obligations as an EU Member State. But if that requirement is rooted in the UK’s membership of the EU, he adds, then when the UK has exited the EU, that requirement “ceases to have any justification”.17 Professor Page therefore poses the question: “Why would you expect Scotland, Wales and Northern Ireland to be bound after the UK has left? Surely you would expect the exact opposite, and I think that was the starting point for the devolved institutions’ response to the Bill”.18

12.Immediately after the publication of the EU Withdrawal Bill on 13 July 2017, the First Minister of Wales Carwyn Jones AM, and First Minister of Scotland, Nicola Sturgeon MSP, issued a joint statement calling the Bill a “naked power grab”.19 They stated that the Bill does not deliver on the promise to return powers from the EU to the devolved administrations, but rather returns them solely to the UK Government and Parliament, imposing new restrictions of devolved legislatures. This concern, Professor Richard Rawlings, Professor of Public Law at the University College London, explains, “goes to the heart of the controversy over the Bill from a devolved perspective”.20

13.Professor Page and Professor Rawlings explain that this controversy comes down to the “difference of view between what is and what is not devolved”.21 The Secretary of State for Scotland David Mundell maintains that “there is no Power grab as the “Bill will maintain the scope of devolved decision making powers immediately after Exit–the Scottish Parliament and Scottish Government will not lose any of their current decision-making powers”.22

14.From the perspective of the devolved administrations, however, powers coming back from the EU in areas of devolved competence should be devolved. Instead, Scottish Minister for UK Negotiations on Scotland’s Place in Europe Michael Russell argues that the EUW Bill is:

a blatant power grab which would take existing competence over a wide range of devolved policy areas, including aspects of things like agriculture and fishing, away from Holyrood, giving them instead to Westminster and Whitehall.23

Professor Rawlings suggests that “the very fact… that you can give [at least] two answers… tells you a lot about the controversy surrounding this Bill, because it shows that it is possible here to have different constitutional perspectives”.24

15.Professor Nicola McEwen, Professor of Territorial Politics at the University of Edinburgh, argues that while Clause 11 is clearly intended to ensure continuity and certainty, other clauses in the EUW Bill provide a functional statue book on exit day “Clause 11 is about what comes next”.25 Professor McEwen identifies that Clause 11:

is fundamentally a problem of trust. The UK Government doesn’t trust the devolved Governments to refrain from using repatriated powers to create policy and regulatory divergence that may harm the UK’s internal market and create problems in trade negotiations. This rather overlooks the considerable constitutional authority that the UK Parliament already retains over market regulation, trade and the making and implementation of international treaties. For their part, the Scottish and Welsh Governments don’t trust the commitment of the UK Government to devolve repatriated powers after Brexit and/or to agree and govern UK common frameworks on a genuinely cooperative basis.26

16.Professor Page suggests that the label ‘power grab’, is unhelpful as it distracts from “understanding what the key or most important points about the legislation and the process of leaving the European Union or the implications of that [are] for the devolved institutions”.27 Professor Page notes that at the heart of the debate surrounding Clause 11, is the question of “how are we going to appropriately allocate those powers [returning from the EU] around the UK constitution? [and] What is going to be the appropriate balance between the centre and the devolved administrations?”28

17.In written evidence, Nigel Smith, former Chair of Scotland Forward, the official “Yes” campaign in the 1997 Scottish devolution referendum, is no less critical of the Government for their handling of the devolution issues in the EUW Bill, but is less troubled by the substance of Clause 11:

His [Mike Russell MSP] initial remarks, as is typical of him, were very firm. He was right to say that the manner in which the Bill and Clause 11 emerged from Whitehall showed it was still rooted in pre-devolution Britain. It should have been better done. But I do not subscribe to his view that the approach of the UK Government is an ‘attack on the very foundations of the devolution settlement’ or that the ‘reserved powers’ model solves all. Nobody who voted for the Scottish Parliament exactly twenty years ago need worry - there is no ‘power grab’ underway.29

Nigel Smith sets out how it was the Scotland Act itself which effectively reserved the 111 EU framework powers in respect of Scotland, while the UK was an EU Member State, in Section 29 (which requires the Scottish Parliament to “observe EU law”), and explains why it is the “absence of a British devolution framework” which is what needs to be addressed.30

Constitutional balance

18.Professor Rawlings highlights that a central concern of the devolved administrations was that “Clause 11, when it comes to that negotiation… is essentially stacking the cards in favour of the centre”.31 Dr Tobias Lock, Senior Lecturer, Edinburgh Law School, said that:

the European Union (Withdrawal) Bill will result in a shift in balance between the powers Westminster has in practice and the powers Holyrood has in practice with Westminster’s powers being augmented and Holyrood’s staying the same.32

19.Professor Rawlings and Professor Page raise three related concerns in relation to this unbalance. First, while there is a promise on the part of the UK Government that Clause 11 is described as a transition arrangement, there is no provision for this on the face of the Bill. As Professor Rawlings explains:

Legally-speaking, suggested ‘transitional’ elements could so easily become permanent features. Nor need one be an expert in game theory to appreciate the way in which Clause 11 stacks the cards in favour of the centre when negotiating the different design choices with common frameworks: ‘when’, ‘how’, ‘what’, etc. Though the devolved authority has a veto power, in the absence of an agreed ‘release’ plan the default position is bar on competence.33

20.Second, Professor Page highlights the suspicion within the devolved administrations “that the real purpose of Clause 11 is not to secure legal continuity but to strip the devolved institutions of any bargaining power that they might have when it comes to the discussion of common frameworks and all the rest… [ and that] Whitehall Departments will find it convenient to hang on to these powers rather than to pass them on”.34

21.Third, Professor Rawlings highlights the concern over what he describes as the double hatted nature of the UK Government, meaning it is both simultaneously the UK wide Government and the government of England. This raises not only a concern of conflict of interest, but also that the subcultures, networks and assumptions of large departments like the Department for Environment, Food and Rural Affairs, which are focused on England. Professor Rawlings identifies that there is inevitably a concern in the constituent parts of the UK that their interests will tend to get lost because of that, “not necessarily because of some sort of conspiracy thing; it is just subconsciously about how institutions operate in practice”.35

Reserved matters and conferred powers

22.The devolution statutes operate on a reserved matters model, where certain matters are listed in the devolution statutes as matters that are reserved to the UK Parliament.36 This means that matters not explicitly reserved to the UK Parliament are in the competence of the devolved legislatures. The advantage of the reserved powers model, Professor Page explains, “is that it allowed the devolution of discrete, meaningful, sensible policy areas”.37

23.In its Legislative Consent Memorandum on the EUW Bill, the Scottish Government states that Clause 11 “creates further complexity in the devolution settlement by effectively grafting a “conferred powers” model, solely in retained EU law, onto, and across, the Scotland Act’s reserved powers model”.38 There is a consensus in the evidence we received that Clause 11 has this effect. Professor Page suggests that trying to work out what the devolved legislatures can and cannot do is going to be “an extraordinarily difficult task”.39 He also suggests that it would have the “effect of hamstringing the devolved legislatures so that they will not be able to do that which is sensible”, because instead of having discrete policy areas that belong to them, these areas will be legislated for by a mixture of the UK Parliament and the devolved legislatures.40 Professor Rawlings agrees, and emphasises the importance of considering the “end user’s perspective” as it will not just be governments, but business, consumer groups and individuals that will have to work with this system.41

24.Referring to the Welsh experience of previously having a conferred powers model, Professor Rawlings and Professor McEwen highlight the lack of clarity over where the National Assembly of Wales had power or even the extent to which it has competence produces litigation.42 This uncertainty has resulted in Supreme Court litigation around the conferred powers model.43 Professor Rawlings explains:

The discussions about meanings in the Bill become very sharp when we get to the devolved Administrations because it is a question for them as to whether or not they actually have powers. The Government lawyers have to be able to advise, the Presiding Officers of the National Assembly and the Scottish Parliament will have to make rulings as to whether something is within competence, and again they will be open to challenge in areas where, frankly, challenge is very likely. Of course, we are talking about market regulation, and where there is market regulation there is money involved, and where there is money involved there are lawyers involved. We have to be very aware of that.44

Professor Rawlings suggests that a clear end point in order “to avoid, or at least get past this problem” was to include in the reserved powers model, reservations covering common frameworks. Such a reservation could be worded: “the subject matter of such and such common framework”.45

Legislative consent

25.The explanatory notes to the EUW Bill explain that several of the provisions of the Bill fall within the legislative competence of the devolved Legislatures.46 Under the Sewel Convention there is a requirement for the Government to seek a Legislative Consent Motion (LCM) from each of the devolved Legislatures for the EUW Bill, and the Government has made clear its intention to seek LCMs.47

26.On 12 September 2017, the Scottish and Welsh Governments simultaneously published Legislative Consent Memoranda in relation to the EUW Bill. Both Governments made it clear that they would not present Legislative Consent Motions (LCMs) for the Bill in its current form.48 The decision to state that Legislative consent will be withheld has raised speculation surrounding the Sewel Convention. As the Supreme Court’s decision in Miller v. Secretary of State for Exiting the European Convention highlighted, the convention, even though placed in statute, is not legally enforceable. The Supreme Court, however, also emphasised that this decision does not diminish the “importance of constitutional conventions, some of which play a fundamental role in the operation of our constitution”.49

27.It is clear from the evidence we have heard that while the Convention is not justiciable, if “Parliament were to legislate notwithstanding the opposition of devolved legislatures, the argument would undoubtedly be made that that was a constitutional outrage; it was unconstitutional”.50 Professor Page says that placing the convention into statute even though it was not legally binding was a constitutionally binding commitment that is “the most solemn expression of intention that you can provide under our constitution”.51

28.While there is a consensus that discussions around legislative consent and the Sewel Convention have served to reinforce Parliamentary Sovereignty within the UK constitution, questions have been raised about how Parliamentary Sovereignty is best deployed as a legislative and political tool in the context of Clause 11. Professor Rawlings suggests that, as currently drafted, Clause 11 treats Parliamentary Sovereignty as a “legislative blunderbuss” to be waved in the faces of the devolved administrations. He states that, regardless of what the Government has said about its intention, this is not a good way to build trust.52 Instead, Professors Rawlings and Page both suggest that Parliamentary Sovereignty be used as a “backstop or reserve power to require common frameworks and common decisions, as at the end of the day if they are not reached Parliament would have the power to pass legislation”.53 Such a model would be based on negotiation, cooperation and agreement, and could serve to build trust amongst the Governments and Legislatures of the UK.

Common frameworks

29.Following the UK’s departure from the EU, the power to make the decisions previously made at the EU level will return to the UK. Through EU common frameworks, which created and maintain the EU wide policies to support the EU internal (single) market, all parts of the UK follow the same rules and laws in areas such as the EU Common Agriculture Policy, Common Fisheries Policy or mutual recognition of professional qualifications. The UK Government’s overriding aim to have the same rules and laws apply after exit day is intended to ensure that common EU frameworks remain common UK frameworks. The concern is that, as some of these frameworks are in areas of devolved competence, differing policy focuses could lead to policy divergence, which could, unintentionally or not, threaten the UK’s internal market, and potentially lead to difficulties with conducting trade agreements with other countries.

30.In evidence to the Committee, Professor Page makes clear that common frameworks will be required, but that “it is also important not to exaggerate the threat to the integrity of the UK single [internal] market posed by the repatriation of EU competences to devolved areas”.54 While there are a few areas where powers returning from the EU intersect with devolved settlements, the reserved matters dictate that most powers fall to the UK Parliament.55 Even if the former EU powers, in areas such as agriculture, were devolved, this would be unlikely to result in devolved autonomy as there are areas under strong influence of international law and agreements, a competence that rests entirely with central Government.56 Former Speakers Counsel, Michael Carpenter has in this regard described Clause 11 as an unnecessary “blanket provision” that amounts to a “proverbial steam hammer”.57

31.The devolved statutes currently contain provisions which could have the effect of preserving the UK internal (single) market outside of the EU. There are already provisions for the relevant Secretary of State to require action by devolved legislatures and governments to comply with UK international obligations.58 Evidence to the Committee highlights that it is in the clear mutual self-interests of Scotland, Wales, Northern Ireland and England not to take actions which may imperil a UK internal market. As Professor Page highlights, the EU is still trying to create a single (internal) market, but “we already have one. [The task in front of us is to] prevent damage to that market”.59

32.The UK Government’s analysis of the existing EU competences that interact with the devolved statutes, identify 111 areas for Scotland, 64 for Wales and an estimated 149 for Northern Ireland.60 (These are listed in Appendix 1). Of these areas Professor Page suggests that only a small number of areas are likely require common frameworks.61 Michael Carpenter has suggested that what is required is a “compromise position whereby such modification would be lawful for so long as it did not affect, or seriously affect, other parts of the United Kingdom, or fragment the UK’s internal market”.62 The first steps towards agreeing these common frameworks, were taken at the Joint Ministerial Council (European Negotiations) (JMC(EN)) on October 16 2017, where the principles that will underpin the how common frameworks will be considered, was agreed.63 (As set out in Box 1 below).

Box 1: JMC Common Frameworks: Definition and Principles

Definition

As the UK leaves the European Union, the Government of the United Kingdom and the devolved administrations agree to work together to establish common approaches in some areas that are currently governed by EU law, but that are otherwise within areas of competence of the devolved administrations or legislatures. A framework will set out a common UK, or GB, approach and how it will be operated and governed. This may consist of common goals, minimum or maximum standards, harmonisation, limits on action, or mutual recognition, depending on the policy area and the objectives being pursued. Frameworks may be implemented by legislation, by executive action, by memorandums of understanding, or by other means depending on the context in which the framework is intended to operate.

Context

The following principles apply to common frameworks in areas where EU law currently intersects with devolved competence. There will also be close working between the UK Government and the devolved administrations on reserved and excepted matters that impact significantly on devolved responsibilities. Discussions will be either multilateral or bilateral between the UK Government and the devolved administrations. It will be the aim of all parties to agree where there is a need for common frameworks and the content of them. The outcomes from these discussions on common frameworks will be without prejudice to the UK’s negotiations and future relationship with the EU.

Principles

1.Common frameworks will be established where they are necessary in order to:

  • enable the functioning of the UK internal market, while acknowledging policy divergence;
  • ensure compliance with international obligations;
  • ensure the UK can negotiate, enter into and implement new trade agreements and international treaties;
  • enable the management of common resources;
  • administer and provide access to justice in cases with a cross-border element;
  • safeguard the security of the UK.

2.Frameworks will respect the devolution settlements and the democratic accountability of the devolved legislatures, and will therefore:

  • be based on established conventions and practices, including that the competence of the devolved institutions will not normally be adjusted without their consent;
  • maintain, as a minimum, equivalent flexibility for tailoring policies to the specific needs of each territory as is afforded by current EU rules;
  • lead to a significant increase in decision-making powers for the devolved administrations.

3.Frameworks will ensure recognition of the economic and social linkages between Northern Ireland and Ireland and that Northern Ireland will be the only part of the UK that shares a land frontier with the EU. They will also adhere to the Belfast Agreement.

33.One suggestion made to the Committee by Professor Page was that a “standstill agreement” would maintain the EU common frameworks and would address the difficulties around the mechanism provided in Clause 11. He argues that:

… the UK Government’s ‘guiding principle’ can be more felicitously secured by a combination of the existing reservations and a ‘standstill agreement’ whereby the UK Government and the devolved administrations agree not to introduce, in the Prime Minister’s words, ‘new barriers to living and doing business within our own Union’ while the business of common frameworks - and, no less importantly, the necessary revisions to retained EU law - are being worked out. As well as preserving the integrity of the UK single market, reliance on the combination of reserved matters and a standstill agreement would avoid the undeniably damaging consequences of Clause 11.64

34.Professor McEwen notes that a number suggestions have been put forward for how to resolve the impasse between the UK Government and the devolved Administrations, including “a sunset to Clause 11, narrowing its scope to focus on the internal market or international obligations, or replacing it with extensions to reserved powers”.65 She suggests that the standstill provision proposed by Professor Page is the most persuasive,

especially if given statutory underpinning in the Withdrawal Bill. Provided the form of words could be agreed, it could help to provide both parties with the reassurance they need. Standstill provisions would allow powers to lie where the fall under the existing allocations of constitutional authority, while securing the time and trust needed to negotiate, agree and implement new frameworks.66

Inter-institutional relations in the UK

35.In the previous Parliament, our predecessor Committee published a report, Future of the Union, part two: Inter-institutional relations in the UK, which noted the potential of the UK’s departure from the EU to complicate and further test the current inter-institutional arrangements within the UK. The Committee concluded that Brexit “offers both risk and a fresh opportunity, and, therefore, an incentive, to develop more effective inter-governmental relations in the UK”.67 The report highlighted the inadequacy of the current inter-governmental arrangements and made several key recommendations highlighting the starting points for establishing solid inter-governmental relations foundations. Our predecessor Committee highlighted the need to establish “formal inter-governmental machinery” and the importance of developing an atmosphere of trust and good-will among the four Administrations.68 For this atmosphere to be established the Committee concluded, with a clear eye on the post exit constitutional settlement, that “the UK Government must show a genuine receptiveness to the concerns and suggestions put forward by the devolved administrations”.69

36.Witnesses to our inquiry agreed unanimously that “one immediate problem, starkly revealed by the return of EU powers, is the lack of adequate inter-governmental arrangements capable of dealing with the developing situation”.70 Professor Page notes that there is need for a “fresh start”. He continues:

If anything comes out of this, it is the recognition that inter-governmental relations is every bit as important a part of the devolution settlements as the powers possessed by the individual devolved Administrations. That cannot simply be left to happenstance, chance or the inclination and instinct of individual Administrations. Therefore, … the basic machinery has to be put on a statutory footing so that the Parliaments are making it clear, “This is our expectation as to the way these relations will be conducted,” rather than leaving it to the discretion of individual Administrations.71

37.Nigel Smith, argued that the absence of a strong inter-governmental devolution framework is the major weakness of the otherwise “excellent” Scotland Act 1998.72 He argues that after the UK has left the EU there will be a third important area of shared policy in addition to the reserved and devolved competencies. Such shared areas, he argues, will require an inter-governmental institutional framework. This “is integral to the success of the return of EU powers - not an optional addition”.73

38.There appears to be a consensus in the evidence we received of the desirability to place the UK’s inter-governmental machinery on a statutory footing. The current inter-governmental system relies on a series of ad hoc meetings between Ministers, and on central Government to adhere to the agreements set out in the Memorandum of Understanding, to convene JMC meetings when requested, which recently it has failed to do.74 At the most basic level, placing inter-governmental machinery on a statutory footing would make clear the “expectation as to the way these relations will be conducted, rather than leaving it to the discretion of individual administrations”.75 This would have the effect of guaranteeing a basic level of communication and dialogue, by getting people in a room they will be “talking about common frameworks, and what can work for them or what may be their sticking points”.76 This would mark a very important step forward as it would help generate the trust that has been hitherto lacking in inter-governmental relations in the UK.

39.It has also been suggested to the Committee that the relations between the four Legislatures in the UK should be supported by more formal machinery. The Committee’s previous report, Future of the Union, part two: Inter-institutional relations in the UK, suggested that steps should be taken to allow committees of the House of Commons to meet jointly with committees of the devolved legislatures; that written notice and summaries of the Speakers and Presiding Officers quadrilaterals are published; and that there be greater interworking and training of the staff of both the Houses of Parliament and the devolved legislatures.77


15 Q4 ( Page); Michael Keating, To Devolve or Not to Devolve,17 July 2017; Page, Alan, The implications of EU withdrawal for the devolution Settlement, 2016, p 3

16 Professor Page (DEU0008)

20 Q4 (Rawlings)

21 Q4 (Page)

22 Scottish Parliament’s Finance and Constitution Committee, Correspondence from the Secretary of State of Scotland to the Convenor, 13 July 2017

23 Brexit Bill talks: Scottish Government to recommend consent is rejected, Scottish Government press release, 9 August 2017.

24 Q4 (Rawlings)

25 Professor McEwen (0020) para 3

26 Professor McEwen (0020) para 15

27 Q4 (Professor Page);

29 Nigel Smith (DEU0007)

30 Nigel Smith (DEU0007)

32 Dr Lock (0001)

33 Rawlings, Richard, Brexit and the Territorial Constitution, 2017, p 26

36 The Wales Act 2017 made provision for a reserved matters model for Wales. In Northern Ireland it is a reserved or excepted matters. In the Northern Ireland Act reserved matters cover areas which could be devolved at a later date, such as postal services, financial services, the national minimum wage. Excepted matters covers areas not to be considered for further devolution, such as the Crown, Parliament, international relations, defence.

38 Legislative Consent Memorandum European Union (Withdrawal) Bill, Scottish Government, LCM-S5–10, Session 5 (2017)

42 Q23; Professor McEwen (0020) para 8

46 Explanatory Notes to the European Union (Withdrawal) Bill [Bill5 (2017–19)], paras 68–70, Annex A

47 The Sewel Convention is now enshrined in statute in the Scotland Act 2016 and Wales Act 2017 and the mechanisms of consent set out in the Memorandum of Understanding and Supplementary Agreements.

48 Legislative Consent Memorandum European Union (Withdrawal) Bill, Scottish Government, LCM-S5–10, Session 5 (2017) para 25

50 Q7

51 Q6; Q7; Q8; Q9; Q10

54 Professor Page (DEU0008); Q22

55 Page, Alan, The implications of the EU withdrawal for the devolution settlement, paper prepared for the Scottish Parliament Culture Tourism, Europe and External Relations Committee, 4 October 2016

56 Dr Lock (0001) para 8–9

57 Michael Carpenter (DEU0009) para 5

58 Q30 (Rawlings); Scotland Act 1998, sections 35, 58; Government of Wales Act 2006, sections 82, 114; Northern Ireland Act 1998, sections 14, 26.

60 Q32 (Page)

61 Q43 (Page)

62 Michael Carpenter (0009) para 5

63 Joint Ministerial Committee (EU Negotiations) Communique, 16 October 2017

64 Professor Alan Page (DEU0008);

65 Professor McEwen (0020) para 15

66 Professor McEwen (0020) para 15

67 Sixth Report from the Public Administration and Constitutional Affairs Committee of Session 2016–17, The Future of the Union, part two: Inter-institutional relations in the UK, HC 839, 8 December 2016. Para 4

68 Sixth Report from the Public Administration and Constitutional Affairs Committee of Session 2016–17, The Future of the Union, part two: Inter-institutional relations in the UK, HC 839, 8 December 2016. Para 65

69 Sixth Report from the Public Administration and Constitutional Affairs Committee of Session 2016–17, The Future of the Union, part two: Inter-institutional relations in the UK, HC 839, 8 December 2016. Para 67

70 Nigel Smith (DEU0007); Unlock Democracy (DEU0004); Professor Alan Page (DEU0008)

71 Q56 (Page)

72 Nigel Smith (DEU0007) para 19

73 Nigel Smith (DEU0007) para 9

74 Q56 (Rawlings)

75 Q56 (Page)

77 Sixth Report from the Public Administration and Constitutional Affairs Committee of Session 2016–17, The Future of the Union, part two: Inter-institutional relations in the UK, HC 839, 8 December 2016. Paras 95–98




29 November 2017