145.Where matters under negotiation related to devolved competence, the devolved administrations were broadly positive about the UK Government’s engagement. They expressed concerns, however, regarding the sharing of information pertaining to areas of reserved competence—particularly where they could have a significant impact on devolved areas and their competences.
146.The Welsh Government summed up points also made by the Scottish Government and Northern Ireland Executive:
“Currently there is positive engagement between the Department for International Trade and the Devolved Governments on FTAs as they are negotiated. However, this predominately focuses on areas that are understood to be devolved. We also require access to information on reserved areas and an understanding of UK Government’s positions and red-lines before negotiations take place. This would allow us to better understand where these areas intersect with devolved areas or areas of particular interest to us and ensure that UK Government is aware of any sensitivities for Devolved Governments.
For example, one of our key interests in all FTAs relates to tariff liberalisation for sensitive agricultural goods. However, as the setting of tariffs is a reserved matter, limited information is shared with Devolved Governments and we were unable to have meaningful discussions with UK Government on this issue before an AIP … was reached. This lack of discussion makes it difficult for us to ascertain whether our interests in this area are being protected as negotiations progress.”
147.The Government’s position is that while they “recognise the importance that the DAs attach to this”, market access negotiations are highly sensitive and that sharing information on tariff liberalisation, particularly in the early stages, could “jeopardise the overall negotiations”. Instead, the Government has shared written summaries with further details on the Negotiating Objectives and encouraged detailed comments. Lord Grimstone acknowledged “I suspect it may never be possible to satisfy them for as long as trade negotiations are a reserved matter”.
148.We recognise the UK Government’s challenge in balancing the need for confidentiality with keeping the devolved administrations involved, but it is clear that more needs to be done to keep the devolved administrations apprised of progress of those sensitive aspects of trade negotiations which will have a direct impact on their devolved responsibilities.
149.We had previously raised with the Department for International Trade the need for both scoping and impact assessments to include more granular detail, particularly on the impacts of an FTA on the devolved nations. We therefore welcome the Minister telling us that:
“We do think that we have to do more work in the public impact assessments to give a more detailed picture of the potential impacts of trade agreements on the devolved nations. We did a review of our modelling techniques, and our analysts are now considering how they can improve the analysis of impacts of FTAs on the nations and regions of the UK.”
150.We look forward to receiving improved scoping and impact assessments for future FTAs.
151.We thank the devolved administrations for the evidence they submitted. In the absence of detailed information provided by the UK Government on the discussions it has had with the devolved administrations, it is vital that we hear from them directly. We reiterate our open invitation to the devolved administrations and legislatures to raise with us any issues they consider to be significant.
152.While we accept that the negotiation of trade agreements is a reserved competence, trade agreements will have a significant impact not just on devolved policy areas, but also on devolved economies more generally (even in reserved areas) and interests.
153.We remain concerned about the adequacy of the information shared with the devolved administrations regarding matters that are reserved, such as tariff liberalisation for sensitive agricultural goods.
154.We call on the Government to ensure that consultation with the devolved administrations and legislatures is comprehensive, transparent, detailed and timely, and that their views are represented throughout the negotiations, including on reserved matters that may have an impact on them.
155.We welcome that the Government has conducted a modelling review to provide a more detailed sub-national assessment of the impact of FTAs. We look forward to receiving assessments with more detailed information on the impact of FTAs on the nations and regions of the UK.
156.We welcome the Government responding to our call for evidence and for engaging with us throughout our inquiry. In particular, we are grateful to Lord Grimstone of Boscobel, Minister for Investment, and his officials for appearing before the Committee and for his written updates. The written updates could, however, have been more detailed—they covered what had been discussed, but rarely gave a flavour of the obstacles encountered and choices faced by negotiators.
157.We would like to put on record our appreciation for the work undertaken by Lord Grimstone and his officials to facilitate scrutiny beyond the limited statutory requirements set by the Constitutional Reform and Governance Act 2010 (CRAG). Constructive collaboration led to two significant developments positively impacting scrutiny of the Australia FTA, as well as any new FTAs we expect to scrutinise in future.
158.First, in respect of the Australia FTA, the Government committed to providing us (and the Commons’ International Trade Committee) with a copy of the signed agreement and draft explanatory materials at least three months before laying the agreement under CRAG. This commitment has been honoured.
159.Second, the Government agreed and implemented our recommendation for an exchange of letters to present in a single document all the scrutiny commitments made by DIT across different fora. This means we now have a clear and shared understanding of the steps the Government will take, as a minimum, to support the parliamentary scrutiny of new trade agreements.
160.We welcome the collaborative and constructive engagement we have had with DIT officials and Lord Grimstone throughout the negotiations. In particular, we welcome that our recommendation for an exchange of letters to consolidate existing parliamentary scrutiny commitments in respect of trade agreements has been accepted and implemented.
161.Whilst we are grateful for the time we had to scrutinise this FTA prior to its formal laying under CRAG, we were only able to scrutinise this agreement after all decisions had already been taken. The Government commitment to facilitate a debate on the Negotiating Objectives if requested by the committee was made too late for this particular agreement. We reiterate the recommendation we made in our Working practices: one year on report that it is important that consultation and dialogue with our committee starts before a mandate is established, so the final mandate can be informed by Parliament.
155 Written evidence from the Welsh Government ()
156 Oral evidence taken on 27 April 2022, (Lord Grimstone of Boscobel)
159 Oral evidence taken on 27 April 2022, (Session 2021–22) (Lord Grimstone of Boscobel)
160 Exchange of letters between Baroness Hayter and Lord Grimstone of Boscobel, 19 May 2022: