Chapter 6: A new devolution settlement?
The impact of Brexit upon devolved competences
211.In previous chapters we have outlined the evidence received in relation to each of the devolved nations. In this chapter we seek to synthesise that evidence, drawing conclusions for the UK as a whole. We consider where existing EU competences (whether devolved or reserved within the UK’s existing devolution settlements) will be exercised in future, and outline some of the risks and opportunities that will arise as this process unfolds.
212.It is important to emphasise that the division of competences between the UK Parliament and the devolved legislatures is already set out in full in successive Acts of Parliament. Thus a statutory framework exists, which will automatically apply at the date of Brexit unless the Westminster Parliament in the meantime enacts further legislation. What this means in practice is that any areas of policy that in the relevant Acts are not explicitly reserved to the Westminster Parliament will, at the moment the UK ceases to be an EU Member State (00.01 on 29 March 2019, unless another date is set in the withdrawal agreement), become devolved competences. There is no intermediate step: any EU competence that is reserved (such as employment law) will revert to Westminster, while any EU competence that is devolved (such as animal health) will revert to the devolved legislatures.
213.This has profound political and constitutional implications. On the one hand, any attempt to amend the existing devolution settlements to ‘re-reserve’ powers to Westminster would be highly controversial. The Welsh Government Cabinet Secretary for Finance and Local Government (with responsibility for Brexit-related issues), Mark Drakeford AM, described the issue as “fundamentally important”, and we quote his words at length:
“Devolved powers in relation to agriculture, environment and regional policy, for example, have since 1999 been in Cardiff, Belfast and Edinburgh, and they will stay there throughout this process. We choose at the moment to exercise those competencies through our membership of the European Union. When the European Union is no longer there, these powers do not somehow come back to London to be handed on. They just remain where they have been for nearly two decades now at the devolved level …
“I sometimes think that some UK Ministers, certainly, believe that, when the European Union is not there, these powers will somehow be free-floating and that if they grab them first they will be able to make decisions and the devolved Administrations will have to live with those decisions. That is absolutely not the way that we see it … The point I make to UK Ministers is that, if they wish to operate in that way, they will have to legislate to take powers away from the devolved Administrations.”218
214.In a similar context, Mark Durkan highlighted the impact of the requirement for cross-community support in the Northern Ireland Assembly:
“Clearly, there would be sensitivity on the part of the devolved Administrations that there was a temptation for Whitehall and Westminster essentially to keep powers in a holding pattern, and maybe dilute rights and standards first and then devolve. That could be a particularly sensitive issue in Northern Ireland … If prior to devolution there was dilution of what people regarded as EU rights on labour law and employment law, because that is devolved in Northern Ireland, or environmental standards, you could top up to EU standard again only with cross-community support, whereas if on day one the EU powers went straight to devolution, and did not pass go and did not collect £200, those standards could be diminished only with cross-community support.”219
215.On the other side of the equation, we recall the conclusion of the Constitution Committee, in its 2016 report on The Union and devolution:
“There is no evidence of strategic thinking in the past about the development of devolution. There has been no guiding strategy or framework of principles to ensure that devolution develops in a coherent or consistent manner and in ways which do not harm the Union. Instead, successive Governments have responded individually to demands from each nation. Devolution has thus developed in an ad hoc fashion, with different constitutional conversations taking place separately in different parts of the country.”220
The absence of any “guiding strategy” for devolution creates a real risk that the acquisition by the devolved legislatures and administrations of substantial new powers, already devolved but in reality exercised in Brussels, could fundamentally disrupt the UK’s constitutional settlement.
EU competences that already fall to the devolved legislatures
The environment, agriculture and fisheries
216.As Professor Tomkins noted, the most substantial EU competences that are currently devolved competences within the UK are “agriculture, fisheries and the environment.”221 Although Professor Tomkins was speaking about the Scottish Parliament, the National Assembly for Wales and the Northern Ireland Assembly exercise similar though less extensive competence in these areas. As Environment Links UK and Greener UK noted, in a joint submission, areas that would, by default, revert to the devolved legislatures include “at minimum … agriculture, fisheries, and at least some elements of environmental policy (e.g. nature protection)”.222
217.Yet even in these three areas, the full exercise of devolved competence, without the guiding hand of the EU, will not necessarily be straightforward. Professor Douglas-Scott raised “the question of how a common UK agriculture policy, and for fisheries and so on, would be worked out”,223 while Dr Lock commented: “If you had different agricultural policies throughout the United Kingdom with different levels of subsidy, provided the money comes with it, which is quite important, you might create different markets, or some sort of market disruption within the UK.”224 Sir Emyr Jones Parry gave a specific example: “If you have four different sets of animal health, you do not have a single market and freedom to move cattle without restriction across the United Kingdom.”225
218.With respect to fisheries, there is the specific issue of negotiating quotas with third countries—hitherto an exclusive EU competence. As we noted in our report on Brexit: fisheries, following Brexit the UK will become “an independent coastal state under the UN Convention on the Law of the Sea”, and will therefore be required under international law “to manage the living resources and fishing activities within its Exclusive Economic Zone in a sustainable way”. If it is to do this, the Government, acting on behalf of the UK, will need to respect the legitimate interests of the devolved administrations, and we therefore concluded: “It is vital that the UK Government develops a unified negotiating position that represents the interests of the Devolved Administrations and industries prior to engaging in international fisheries negotiations, both in the context of Brexit and beyond.”226 In marked contrast, the Scottish Government Minister for UK Negotiations on Scotland’s place in Europe, Michael Russell MSP, commenting on the strong views of fishing communities in Scotland, believed that a coordinated UK approach to negotiating fishing quotas “may not be possible”.227
219.Lord Hain raised a further complication, namely the “external element between the nations [of the United Kingdom]”228—in effect, the risk that the nations of the United Kingdom might end up competing to get the best share of UK fishing stocks, including in shared waters such as the Irish Sea or the Bristol Channel. Environment Links UK and Greener UK noted remarks by both the Welsh and Northern Ireland Ministers highlighting the need to secure what the Welsh Government has called “a fairer rebalancing of UK fishing quotas”.229
Other devolved competences
220.We also received evidence on four other areas of EU competence that are already devolved. The first is justice: both Scotland and Northern Ireland have their own legal systems, which long predate the devolution settlements of the late 1990s, and several witnesses mentioned justice and home affairs as an area of EU competence that was currently devolved, particularly in the Scottish context.
221.The extent to which the Scottish Parliament may seek to use its devolved competence to develop a bespoke approach to Brexit, and the implications for the rest of the United Kingdom, are unclear. Although, as we have seen, Lord Wallace of Tankerness raised the possibility that “Scotland could have an arrangement with the European Union countries with regard to the arrest warrant”,230 our report on Brexit: future UK-EU security and police cooperation concluded that “the most promising avenue” for the Government would be “to seek a bilateral extradition agreement with the EU that mirrors the EAW’s provisions as far as possible”.231 Even though criminal justice is a devolved matter, it is difficult to see how Scotland could either remain bound by specific provisions of EU law post-Brexit, or, without legal personality, negotiate a separate agreement with the EU.
222.A second area of devolved competence is education. The EU’s competence in education is limited, and primary responsibility rests with the Member States. The EU does, though, sponsor programmes such as Erasmus+, which seeks to improve the employability of young people, and it is a major funder of research—UK higher education centres benefit substantially from the Horizon 2020 programme, worth a total of close to €80 billion over seven years.
223.A third area is health. Health is in part a shared competence at EU level, and the EU has legislated to set EU-wide standards for certain medical products (such as medicines) and services. This is supported by an EU regulatory and enforcement regime (notably the European Medicines Agency, which is currently located in London). There are also reciprocal health rights, such as those exercised by citizens moving freely in both directions across the Irish land border,232 and these are reflected in the European Health Insurance Card (EHIC), which entitles EU citizens to access state-provided healthcare in other EU Member States. The future regulation of medicines and other medical products falls outside the scope of this report, though we note that, along with areas such as animal health, intra-UK divergence could have significant implications for the UK single market.
224.The final area is regional policy. As Professor Gallagher pointed out, before joining the European Economic Community, “the UK used to have regional economic development policies, but they were all replaced by the EU framework”—a framework that is financed by European Structural and Investment Funds, and which provides vital support to regions across the nations of the United Kingdom. Responsibility for regional policy (in other words, for securing and disposing of EU funds to support regional development) is devolved, and, as we have seen, the Chancellor of the Exchequer has undertaken to match any EU funding agreed prior to the point at which the UK leaves the EU, up until 2020, from central UK funds.233 While this commitment has been broadly welcomed, Professor Gallagher commented that this switch from EU to UK funding could be used to build a case for the UK Government taking a more prominent role going forward:
“That, on the face of it, is a devolved matter but, of course, go back to resource. The money, to the extent that there is any, will reside in Westminster and Whitehall, and there is a good argument for saying that the UK Government at the centre should be able to allocate money to those parts of the UK that are the poorest. That is what regional economic policy is about.”234
Replacement of EU funding
225.Professor Gallagher’s comments highlight the possibility that the movement of budgets from Brussels to London could, in effect, lead to the rolling back of certain elements of the devolution settlements. It would also, as we have noted several times in preceding chapters, raise significant questions over the current funding model for the devolved nations.
226.Figure 1 sets out the distribution of European Structural and Investment (ESI) Funds across the UK within the current 2014–2020 Multiannual Financial Framework. While England receives the highest amount in absolute terms, it receives the lowest amount per capita (€28 per person, per year). By contrast, Wales receives €142 per person, per year, reflecting the fact that 63% of the population of Wales lives in an EU-designated Less Favoured Area. While Scotland and Northern Ireland receive less per person than Wales, the figures are still well above that for England.
Figure 1: Distribution of ESI funding across the UK, 2014–2020235
227.Figure 2 sets out the distribution, in percentage terms, across the nations of the UK of direct payments (pillar 1) under the Common Agricultural Policy, as announced in 2013, compared to their share of population.236 It can be seen that Scotland and Wales receive, almost double the share of UK CAP payments as compared to their population share, while Northern Ireland receives over three times the share of CAP payments as compared to its population share.
Figure 2: Distribution of direct payments (pillar 1) under the Common Agricultural Policy 2013 compared to share of UK population237
228.In its response to our report on Brexit: agriculture, the Government stated that it would “continue to commit the same cash total in funds for farm support until the end of the parliament and will work closely with the Devolved Administrations to develop future policy for farming”.238 This echoed the terms of the confidence and supply agreement between the Government and the DUP, which stated that “The parties agree to continue to commit the same cash total in funds for farm support until the end of the Parliament. Further discussions will take place on the future framework for farming support.”239 It is notable that this agreement modifies the Chancellor’s previous guarantee: although the duration of the Parliament is unclear, it means that UK Government could potentially underwrite farm support up to 2022, whereas regional and structural funds are guaranteed only until 2020.
229.EU funding (both agricultural subsidies and structural funds) is needs-based, and witnesses were clear that farmers and deprived regions in the devolved nations would lose heavily were UK subsidies, once the UK Government’s guarantees to match EU funding have run their course, to be granted in accordance with the population-based Barnett Formula. The complexities of the Barnett Formula have defied reform for many years, but we note the comment of Dr Winckler, that thanks to Brexit it is now “time to bite the bullet” and address this issue.240 We also recall the words of the House of Lords Select Committee on the Barnett Formula, which reported as long ago as 2009:
“A new system which allocates resources to the devolved administrations based on an explicit assessment of their relative needs should be introduced. Those devolved administrations which have greater needs should receive more funding, per head of population, than those with lesser needs. Such a system must above all be simple, clear and comprehensible. It must also be dynamic: able to be kept up to date in order to respond to changing needs across the United Kingdom.”241
New devolved competences?
Migration
230.We heard several suggestions for areas of EU competence that, though not currently devolved, could be devolved post-Brexit.
231.It will be clear from previous chapters that migration is the most complex and controversial area. At present immigration is a reserved matter under the devolution settlements, but this is subject to the crucial caveat that, as an EU Member State, the UK is bound to respect the four freedoms that support the EU Single Market, including the free movement of persons. Thus while Westminster is responsible for migration policy in respect of non-EU citizens, the movement of EU citizens is in practice governed by EU rather than national law.
232.As we discussed in our report on Brexit: UK-EU movement of people, Brexit is an opportunity for the UK to devise a new immigration policy covering all non-UK citizens, EU and non-EU alike. Under the current devolution model, responsibility for devising that policy will reside with the UK Government and the Westminster Parliament. Yet, as our evidence has made clear, views on EU migration vary widely across the UK, and the reliance upon EU workers, both to satisfy the needs of the labour market and to cope with demographic change, is particularly acute in the devolved nations.
233.Against this backdrop, we note the precedents for differentiated arrangements within the UK. As we have already noted, there is a separate list of job specifications for Scotland with regard to Tier 2 visas for skilled workers from non-EU countries. Lord Wallace of Tankerness also cited the ‘Fresh Talent—Working in Scotland Scheme’, which until its replacement by Tier 1 in 2008 granted foreign student graduates of Scottish universities visas for two years to enable them to work or set up a business. Building on these precedents, the UK Government could in principle implement a UK-wide immigration policy for EU nationals that included sufficient flexibility, and operational autonomy, for the devolved nations to be able to meet their economic and demographic needs. The alternative, suggested by some of our witnesses, would be to devolve responsibility for immigration policy fully to the devolved governments. Both options present significant challenges.
Other areas
234.We also heard suggestions for other areas of policy that could be devolved post-Brexit. Dr Lock noted that the Scottish Government, as part of its proposal, examined in Chapter 5, for Scotland to remain in the Single Market, had called for Scotland “to have powers over employment law and consumer law”. He suggested that the devolution of consumer law “would not be a big deal”, given that Scots law is already devolved, but warned that devolving employment law could create problems for the UK’s “common labour market”.242 Professor Tomkins agreed, noting that the Smith Commission had decided not to recommend the devolution of employment law, and concluding: “It is better for Scotland to be part of a single United Kingdom labour market.”243
235.Professor Tomkins also suggested that VAT should be added to the list of devolved competences in Scotland:
“The Smith commission agreed to assign a share of VAT receipts in Scotland to the Scottish Government but not to devolve VAT, for the simple reason that the devolution of VAT within a single member state is contrary to European law. As we are leaving the European Union, that may very well no longer be an aspect of European law that we need to stick with.”244
Conclusions and recommendations
236.We heard much evidence both on existing devolved competences that should remain with the devolved legislatures, but the exercise of which needed to be coordinated at UK level, and on new competences that could potentially be devolved post-Brexit. In this context, we recall the words of the House of Lords Constitution Committee, in its report on The Union and Devolution, that hitherto “There has been no guiding strategy or framework of principles to ensure that devolution develops in a coherent or consistent manner and in ways which do not harm the Union.” Thanks to Brexit, it is now more important than ever that reform of the devolution settlements should be underpinned by a clear and agreed framework of guiding principles.
237.We note also that the Acts of Parliament establishing the devolution settlements set out in full those competences that are in each case either reserved or devolved. On the day of Brexit, competences currently exercised at EU level will, by default, be exercised in accordance with these pre-existing statutory provisions. It follows that without any change in UK law, Brexit will lead to a significant increase in the powers and responsibilities of the devolved institutions.
238.Any attempt to amend the devolution settlements ahead of Brexit would be complex and politically controversial, and we doubt that either the UK Government or Parliament has the capacity to undertake such a task at the same time as achieving a successful Brexit. On balance, we therefore conclude that, for the duration of the Brexit process, the statutory balance of competences between the UK Parliament and the devolved legislatures should as far as possible be unchanged. This is not the time to embark on controversial domestic constitutional reform, either by conferring additional competences upon the devolved institutions or by ‘re-reserving’ competences previously devolved.
239.But while we do not recommend devolving additional competences upon the devolved institutions, we endorse the weight of evidence heard in this inquiry, that the specific labour market and demographic needs of the devolved nations should be accommodated in the context of Brexit. We therefore call on the UK Government, in bringing forward its forthcoming Immigration Bill, to look for opportunities to enhance the role of the devolved institutions in managing EU migration. Local and regional economic and demographic needs, rather than central targets, should drive decision-making. There is already differentiation in respect of non-EU migration, for instance in the provision of Tier 2 visas to meet sectoral requirements, and we urge the Government, in devising a post-Brexit immigration policy for EU nationals, to ensure that maximum flexibility is granted to the UK’s nations and regions.
240.The issue of powers and competences is inextricably bound up with the allocation of funding. We welcome, as far as it goes, HM Treasury’s assurance that existing EU funding commitments (including structural and agricultural funding) made under the current Multiannual Financial Framework until 2020 will be met from domestic funds. But at the same time we note that each of the devolved jurisdictions receives significantly more EU funding per capita than England. This has led to acute concern from across the UK that in the longer term farmers and deprived regions in the devolved jurisdictions would lose heavily were needs-based EU funding to be replaced by UK subsidies granted in accordance with the population-based Barnett Formula.
241.We therefore reiterate the central conclusion of the 2009 Select Committee on the Barnett Formula: “A new system which allocates resources to the devolved administrations based on an explicit assessment of their relative needs should be introduced.” This will be a complex task, but the prospect of Brexit means that reform of the Barnett Formula can be delayed no longer.
The need for coordination and partnership
242.One of the themes of this inquiry has been the interaction between devolved and reserved competences—an interaction that will intensify in the wake of Brexit. For instance, as we noted in our report on Brexit: agriculture, the evolution of agriculture policy across the devolved nations will be heavily influenced by the terms of any free trade agreements that the Government, exercising a reserved power on behalf of the whole United Kingdom, can negotiate, either with the EU or, post-Brexit, with other countries.245 This interaction works both ways: if England (represented by Westminster), Scotland, Wales and Northern Ireland were to pursue divergent agricultural policies (for instance, adopting different standards on the use of pesticides), both the free movement of agricultural produce within the UK single market, and the ability of the Government to negotiate free trade agreements with third countries on behalf of the UK, could be compromised.
243.We therefore reached the following conclusions in our report on Brexit: agriculture:
- Farming landscapes vary significantly across the UK, and agriculture is rightly a devolved policy area. Though implementation of CAP policies already varies, Brexit will allow the devolved administrations to tailor agriculture policies even more closely to their farmers and land.
- But the UK has an internal single market, in which agri-food plays a significant role. It is in the interest of all in the agri-food sector, as well as of consumers, that the integrity of the UK market be preserved. This will require either a UK-wide framework or the negotiation of co-ordinated agricultural policies by the UK Government and the Devolved Administrations. We encourage the Government to pursue dialogue on this issue as a matter of urgency.
- Trade policy is a reserved matter, so the sum of agricultural policy across the UK must respect the UK’s external trade commitments. The UK Government will need to work closely with the Devolved Administrations to ensure that this is the case.246
244.In this inquiry we have considered more broadly the means by which an appropriate level of coordination could be achieved—one that respects the diversity within the UK while not undermining either the integrity of the UK single market or the UK Government’s ability to represent the UK internationally. Such coordination will require good will, in the spirit of what in EU law is called ‘sincere cooperation’.247 It cannot simply be dictated by the UK Government. As Professor Gallagher stated: “The mistake that my former colleagues in Whitehall sometimes make is thinking that UK co-ordination means that they decide it, which is not the same thing.”248 Sir Emyr Jones Parry also emphasised the need for all parts of the UK to work together in identifying priorities for free trade agreements:
“I submit that the trade negotiations externally … cannot be done if the impact on Wales is disproportionate and there is no consultation and no account is taken of … the interests of Wales. It is fairly obvious what people should be doing; they should be sitting down together and working out what is the best policy overall for the Kingdom. You will not be able to accommodate all the Welsh interests or all the English interests, but in the end, if you cannot accommodate an interest, what will you do to mitigate the disadvantage of something else?”249
Lord McConnell of Glenscorrodale made a similar plea for a collaborative approach: “There … needs to be a positive approach by both Governments to describe how they will use those new and additional powers in a co-operative way.”250
245.Such collaboration will be needed not just during the Brexit process, but beyond. To take another example, in our report on Brexit: environment and climate change we noted that environmental pollution does not respect national boundaries, and highlighted the need for continued cooperation between the UK and the EU: “The transboundary nature of most environmental pollution means that failure to co-operate with the EU post-Brexit could have significant consequences for both the UK’s and the EU’s natural environment.” The principles that justify international cooperation apply equally strongly to intra-UK cooperation, and we therefore welcomed the acknowledgement by both devolved administrations and the UK Government of “the increased need to achieve an appropriate level of policy coordination, while allowing for some variation to reflect local or regional circumstances”.251
246.This begs the question of whether either the UK Government or the devolved governments are ready for what Professor Scully, in an answer from which we have already quoted, called “shared rule”, or whether the UK Government will, through the Westminster Parliament, simply legislate to prescribe the level of coordination that it deems necessary to maintain the core interests of the United Kingdom. Professor Scully continued:
“Who defines and decides what is right? That is a fundamental question. Under the concept of self-rule I spoke about, maybe Westminster and Whitehall can decide which powers to grant. If we have a more genuinely co-operative arrangement, maybe there could be a broader attempt to discuss and agree the allocation of powers, but at the moment this Parliament essentially can pass legislation that can change those divisions. Doing that in an ungenerous way, as was recently seen with Wales, could cause some problems for Welsh devolution. It could cause far greater political problems for Northern Ireland and Scotland.”252
Legislating for Brexit: legislative consent
247.The previous Government’s approach to the repatriation of EU competences was set out in its White Paper, Legislating for the United Kingdom’s withdrawal from the European Union, published in March 2017.253 The White Paper was clear that certain frameworks, currently operating at EU level, will need to be maintained post-Brexit. It gave two examples, namely frameworks “to protect the freedom of businesses to operate across the UK single market and to enable the UK to strike free trade deals with third countries”. It stated the Government’s intention to “replicate the current frameworks provided by EU rules through UK legislation”, and continued: “In parallel we will begin intensive discussions with the devolved administrations to identify where common frameworks need to be retained in the future, what these should be, and where common frameworks covering the UK are not necessary.”
248.Finally, the White Paper noted that “Legislation that is within the competence of the devolved legislatures or ministers giving effect to EU law will also need to be amended as we leave the EU”. It therefore proposed that ministers in the devolved administrations should be granted a delegated power to enable them to make technical amendments to such legislation, in line with the power that will be conferred upon UK Ministers.
249.In outline, therefore, the Government’s intention appears to be to enshrine in UK legislation the ‘common frameworks’ that it regards as necessary to protect people’s ability to live and do business freely within the United Kingdom. What those frameworks are is still unclear: of the two examples given, one (the ability to negotiate free trade deals) is currently an exclusive EU competence, and will naturally fall to the UK Government; the other (protecting the freedom of businesses to operate across the UK single market) is, as we have seen, open-ended, and could potentially overlap with many aspects of what are currently devolved competences, such as agriculture and environment.
250.Indeed, in an earlier paragraph the White Paper stated: “In areas where the devolved administrations and legislatures have competence, such as agriculture, environment and some transport issues, the devolved administrations and legislatures are responsible for implementing the common policy frameworks set by the EU.” Read alongside the other passages we have quoted, this might imply that the Government will invite the Westminster Parliament to take on the coordinating role of the EU and set ‘common frameworks’ for what are currently devolved competences.
251.The White Paper therefore appeared to reflect the top-down approach described by Professor Gallagher, where UK coordination means that Westminster decides. There is no formal bar to such an approach—indeed, the Westminster Parliament has often legislated on devolved matters in recent years. Indeed, the 2013 revision of the 2001 Memorandum of Understanding between the UK Government, the Scottish and Welsh Ministers, and the Northern Ireland Executive Committee states in terms that “The United Kingdom Parliament retains authority to legislate on any issue, whether devolved or not.”254
252.Such authority is, though, conditioned by the Sewel Convention, that Parliament will not normally legislate with regard to devolved matters without the consent of the relevant devolved legislature. That convention has now been codified in statute, in section 2 of the Scotland Act 2016 and section 2 of the Wales Act 2017. However, the Supreme Court in Miller concluded that it remained a convention, and that “the policing of its scope and the manner of its operation does not lie within the constitutional remit of the judiciary”.255
253.The Secretary of State for Exiting the EU, Rt Hon David Davis MP, when asked on 30 March, the day the White Paper was published, whether the Repeal Bill would require legislative consent motions, responded:
“At this stage we do not know, because we do not know the final format of the Bill. That is the simple truth.”256
It was only early in the new Parliament, on 26 June, that Mr Davis clarified the Government’s position, telling the House of Commons: “Given that the Bill will affect the powers of the devolved institutions and that it legislates in devolved areas, we will seek the consent of the devolved legislatures for the Bill.”257
254.This belated clarification confirmed the weight of the evidence heard in this inquiry, that legislative consent would be required in respect of the Repeal Bill, insofar as it seeks to set common frameworks for the exercise of what are currently devolved competences. Professor Douglas-Scott spoke for the majority in stating: “It is clear that Westminster could not legislate a great repeal Bill including environment and agriculture without asking for consent.”258 Lord Wallace of Tankerness agreed: “The great repeal Bill—or the great re-enactment Bill, as it is probably more accurate to call it—will deal with issues that are unequivocally devolved … and that triggers the legislative consent Motion.”259 Michael Russell MSP, giving evidence to the Scottish Parliament Culture, Tourism, Europe and External Relations Committee on 11 May, put the point still more forcefully: “It is inconceivable to me that there would not be a legislative consent process, given that the bill will cover areas in which we legislate. We must have a legislative consent process, but it is not clear that that will be the case, because the UK Government has not said whether it will be.”260
255.Lord Forsyth of Drumlean, in contrast, while emphasising that he did not speak “as a lawyer”, warned that a requirement for legislative consent would be used by the Scottish Government to “wreck the Brexit process”, and therefore concluded: “The Bill that will basically put all European legislation extant into position post our leaving the European Union cannot be described as normal … I do not believe that a legislative consent Motion is required in this case.”261
256.Lord Forsyth’s comments raise the further, political question of how and whether, if legislative consent is required, the Government will obtain it. This in turn begs the question of how much legislation will be enacted by Parliament in Westminster, and how much by the devolved legislatures. Lord McConnell of Glenscorrodale did not believe that a single Repeal Bill could cover the entirety of devolved responsibilities, and also envisaged “a great repeal Bill in the Scottish Parliament”.262 Michael Russell MSP, though, told us that the Scottish Government had “reserved [its] position” in respect of legislative consent, highlighting a number of unresolved issues, in particular around the amount of secondary legislation, and whether that secondary legislation would take place in Westminster or in Holyrood.263
257.So far as Wales is concerned, Lord Hain told us that “I do not think the Government should proceed without legislative consent Motion agreement from the Welsh Assembly”. Securing such agreement would require “a process of negotiation”.264 Lord Wigley believed it was the UK Government’s “political duty to respect the Sewel convention to uphold whatever decisions have been taken by devolved institutions”. He drew attention to Plaid Cymru’s proposal for a Welsh ‘EU Continuity Bill’, to enshrine EU law relating to devolved matters in Welsh law. Mark Drakeford AM expressed the Welsh Government’s determination “to make the [Repeal] Bill a success”, but expressed frustration at the “lack of engagement” from the UK Government. In the absence of such engagement, the Welsh Government was “having to plan on the basis that we will need Welsh primary and secondary legislation and that legislative consent Motions … will undoubtedly be a feature of the great repeal Bill”.265
258.As for Northern Ireland, Mark Durkan was clear that the Assembly “would have to indicate its assent in any area affecting its powers”. He saw this as a positive: “I see it as the Assembly assenting to take on those wider powers. I see it as part of incentivising the parties as well.”266 Sammy Wilson MP, while questioning whether the Northern Ireland Assembly would be in place in time, agreed that, if it were, there would be “no great difficulty in [legislative consent] being granted”.267 Professor Tonge, in contrast, was “fairly sure that the requirement for cross-community consent would not be fulfilled for such a Bill”.268
259.Unsurprisingly, the Secretary of State’s statement to the House of Commons on 26 June, confirming that legislative consent would be sought, did not explain the consequences that would follow, were that legislative consent to be refused. Giving evidence on 11 July, he refused to go down “hypothetical routes”, noting that “we will not get to that point until, I would have thought, early next year”.269 In the absence of any indication from the Government, we underline the conclusion reached by the Supreme Court, in Miller, that the consequences of a refusal by a devolved legislature to grant legislative consent, and of a decision by the UK Government to legislate on devolved matters notwithstanding, would be political rather than legal.
Capacity in the devolved institutions
260.Both the process of repatriating EU powers and absorbing them into devolved competences, and the exercise of those powers post-Brexit, will place demands upon the capacity of the devolved institutions. These demands will come on the back of recent extensions of devolved competence, thanks to the Scotland Act 2016 and the Wales Act 2017, at a time when Northern Ireland has no Executive, and when public spending generally is constrained.
261.With respect to Scotland, Professor Gallagher, while acknowledging that “institution-building” was under way, expressed some concern: “We have had an avalanche of new powers in a short period … I watch with some concern the capacity of my former colleagues in St Andrew’s House to cope with them.”270 Lord McConnell of Glenscorrodale also noted “a need for additional new capacity and skills”, and expressed concern that the regular interchange between the UK and Scottish civil services, which could help in building capacity, had been undermined by “the breakdown in relations between the two levels of government in the last 10 years”.271
262.So far as Wales is concerned, Leanne Wood AM was confident: “I do not think that would be a major issue.”272 For the Welsh Government, Mark Drakeford AM described it as “a significant challenge but not a step change”.273 Andrew RT Davies AM, on the other hand, while agreeing that Wales had a “very strong Government”, was concerned that the Assembly was “not necessarily a very strong legislature”.274 Professor Scully went further: “The National Assembly for Wales is preposterously under-resourced in its elected membership275 and its support staff. There simply will not be the capacity in terms of specialism, expertise and person hours to do a proper job of scrutinising all the many Welsh dimensions of Brexit.”276
263.As for Northern Ireland, Dr Viviane Gravey, Dr Katy Hayward and Professor Dagmar Schiek, in a joint submission, observed that administrative capacity was a UK-wide issue, but argued that “administrative capacity issues are particularly acute in Northern Ireland”, noting that Northern Ireland had “struggled to roll-out existing European policies at the same pace as Great Britain”.277 Professor Tonge said that reducing the size of the Northern Ireland Assembly from 108 to 90 members was “a mistake” in the wake of Brexit, and predicted that its workload would increase significantly.278 Sammy Wilson MP said that the issue was not the capacity of the Assembly, but rather that of the Northern Ireland Civil Service.279
Arbitration
264.We have noted that, under the EU system of ‘shared competence’, the Court of Justice of the European Union (CJEU) acts as umpire. It both determines whether EU legislative acts are lawful (whether they are consistent with the principles of conferral, subsidiarity and proportionality), and also whether the Member States (including any sub-national authorities) have implemented them properly. The CJEU has thus, since the devolution of responsibility for policy areas such as agriculture and the environment, held the ring between the constituent parts of the United Kingdom, by ensuring that they all act in those areas in a manner consistent with EU law.
265.One of the Government’s fundamental objectives in delivering Brexit is to end the jurisdiction of the CJEU, but it is not yet clear whether, in the wake of Brexit, any new mechanism will be established to resolve potential disputes between the UK Government and the devolved institutions in the exercise of overlapping or shared competences. The UK Supreme Court already acts in some cases as ‘umpire’, having “jurisdiction to hear and determine questions relating to the powers and functions of the legislative and executive authorities established” under the devolution settlements.280 In this context, the Supreme Court can overturn legislation enacted by the devolved legislatures. But, as we noted in Chapter 2, within the UK constitution the Westminster Parliament is sovereign: in determining such questions the Supreme Court is interpreting and applying the law enacted in Westminster. It has no authority to strike down that law, though it may, by means of judicial review, overturn the acts of UK Ministers. The Supreme Court’s ability to act as an impartial umpire, therefore, is more constrained than that of the CJEU.
266.Lord Wigley suggested therefore that there might be a need for “mechanisms of discussion and even arbitration”281 post-Brexit, while Lord McConnell of Glenscorrodale proposed that “where there is a dispute, there should be some form of independent adjudication over the allocation of powers within that settlement”.282 We note, however, that the establishment of a body possessing authority to arbitrate or adjudicate between the devolved institutions and the Westminster Parliament would be a constitutional change of the first order of magnitude.
Conclusions and recommendations
267.We agree with the Prime Minister’s statement, in her speech on 17 January, that certain “common standards and frameworks” will be needed to maintain the integrity of the UK internal market post-Brexit. It is regrettable that the Government has hitherto failed to explain clearly and coherently how it will work with the devolved governments to achieve this desired outcome.
268.Any durable solution will need the consent of all the nations of the United Kingdom, and of their elected representatives. We are encouraged by the openness to dialogue and to compromise of the Welsh Government and, while the current political crisis in Northern Ireland is a grave concern, we hope, as we outlined in our report on Brexit: UK-Irish relations, that the over-riding need to preserve the peace process, and to defend the economic and social interests of communities on both sides of the land border, will contribute to achieving an outcome commanding cross-community consent.
269.We are concerned by the apparent deterioration of relations between the UK and Scottish Governments. Statements by Ministers, and in the Government’s White Paper on Legislating for the United Kingdom’s withdrawal from the European Union, seem to imply that the UK Government is considering a top-down approach to establishing the necessary frameworks and standards in law at UK level.
270.The Scottish Government, in contrast, is seeking substantial additional powers post-Brexit, including powers that the Smith Commission, established after the 2014 independence referendum, concluded should continue to be reserved. It seeks these powers with a view to implementing its preferred approach to Brexit for Scotland, which would involve continuing membership of the EU Single Market. In the absence of any agreement on this approach, it holds out the possibility of a further independence referendum.
271.We call on the UK Government and the devolved Governments to work together to put in place the frameworks needed to ensure consistency at UK level, thereby preserving the integrity of the UK single market, while respecting national, regional and local diversity, and the autonomy of the devolved institutions. We note the suggestion of some witnesses that, in the long term, some form of impartial internal arbitration between the constituent parts of the United Kingdom may be required to ensure the integrity of the UK single market.
272.A successful settlement cannot be imposed by the UK Government: it must be developed in partnership with the devolved Governments. We welcome the Secretary of State’s belated confirmation that the legislative consent of the devolved legislatures will be sought in respect of the Repeal Bill. The political and constitutional consequences, were legislative consent to be withheld, while unclear, are likely to be serious. We therefore call on the UK Government and the devolved governments to engage positively in developing solutions that work for the whole of the UK and all its constituent nations and territories.
273.The Brexit process, and the new powers and responsibilities to be exercised by the devolved institutions post-Brexit, will place extra demands on their time and resources. We call on the UK Government and the devolved administrations to work together to ensure that the devolved institutions are properly resourced and equipped for this vital work. This should include more regular interchange between civil servants in the devolved administrations and Whitehall.
220 House of Lords Constitution Committee, The Union and devolution (10th Report, Session 2015–16, HL Paper 149), para 99
226 European Union Committee, Brexit: fisheries (8th Report, 2016–17, HL Paper 78), paras 33 and 82
229 Written evidence from Environment Link UK and Greener UK (DEV0012); the words quoted are drawn from the Welsh Government/Plaid Cymru White Paper, Securing Wales’ Future (January 2017) p 30: https://beta.gov.wales/sites/default/files/2017–01/30683%20Securing%20Wales%C2%B9%20Future_ENGLISH_WEB.pdf [accessed 12 July 2017]
231 European Union Committee, Brexit: future UK-EU security and police cooperation (7th Report, Session 2016–17, HL Paper 77), para 141
232 See European Union Committee, Brexit: UK-Irish relations (6th Report, Session 2016–17, HL Paper 76) and Q 141 (Lord Alderdice)
233 HM Treasury and Department for Exiting the European Union, ‘Further certainty on EU funding for hundreds of British projects’ (3 October 2016): https://www.gov.uk/government/news/further-certainty-on-eu-funding-for-hundreds-of-british-projects [accessed 20 June 2017]
235 House of Commons Library, UK Funding from the EU, Briefing Paper, Number 7847, 29 December 2016
236 Department for Environment, Food and Rural Affairs, Northern Ireland Office, Scotland Office and the Office of the Secretary of State for Wales, ‘UK CAP allocations announced’, (8 November 2013): https://www.gov.uk/government/news/uk-cap-allocations-announced [accessed 10 July 2017]
237 Department for Environment, Food and Rural Affairs, Northern Ireland Office, Scotland Office and the Office of the Secretary of State for Wales, ‘UK CAP allocations announced’, (8 November 2013): https://www.gov.uk/government/news/uk-cap-allocations-announced [accessed 5 July 2017]and Office for National Statistics, ‘Population Estimates for UK, England and Wales, Scotland and Northern Ireland: mid-2016’, (22 June 2017): https://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/populationestimates/bulletins/annualmidyearpopulationestimates/latest [accessed 5 July 2017]
238 Letter from George Eustice MP, Minister of State for Agriculture, Fisheries and Food to Lord Teverson, dated 29 June 2017: http://www.parliament.uk/documents/lords-committees/eu-energy-environment-subcommittee/Brexit-agriculture/Gov-response-Brexit-Ag.pdf [accessed 12 July 2017]
239 Prime Minister’s Office, ‘ Confidence and Supply Agreement between the Conservative and Unionist Party and the Democratic Unionist Party’, (26 June 2017): https://www.gov.uk/government/publications/conservative-and-dup-agreement-and-uk-government-financial-support-for-northern-ireland/agreement-between-the-conservative-and-unionist-party-and-the-democratic-unionist-party-on-support-for-the-government-in-parliament [accessed 10 July 2017]
241 Select Committee on the Barnett Formula, The Barnett Formula (1st Report, Session 2008–09 HL Paper 139), Summary
245 European Union Committee, Brexit: agriculture (20th Report, Session 2016–17, HL Paper 169)
246 European Union Committee, Brexit: agriculture (20th Report, 2016–17, HL Paper 169), paras 189-191
247 See article 4(3) Treaty on the Functioning of the European Union, OJ C 326 (consolidated version of 26 October 2012)
251 European Union Committee, Brexit: environment and climate change (12th Report, 2016–17, HL Paper 109), paras 132 and 187
253 Department for Exiting the European Union, Legislating for the United Kingdom’s withdrawal from the European Union, Cm 9446, March 2017: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/604516/Great_repeal_bill_white_paper_accessible.pdf [accessed 12 April 2017]
254 Memorandum of Understanding between the United Kingdom Government, the Scottish Ministers, the Welsh Ministers, and the Northern Ireland Executive Committee, October 2013, para 14: https://www.gov.uk/government/publications/devolution-memorandum-of-understanding-and-supplementary-agreement [accessed 14 April 2017]
260 See Scottish Parliament Official Report, 11 May 2017: http://www.parliament.scot/parliamentarybusiness/report.aspx?r=10941 [accessed 15 June 2017]
275 The National Assembly for Wales currently has 60 members.
280 Supreme Court, ‘Practice direction 10’, para 10.1.1: https://www.supremecourt.uk/procedures/practice-direction-10.html [accessed 23 June 2017]