All 9 Baroness Noakes contributions to the United Kingdom Internal Market Act 2020

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Mon 19th Oct 2020
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2nd reading & 2nd reading (Hansard) & 2nd reading (Hansard): House of Lords
Mon 26th Oct 2020
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Committee stage & Committee stage:Committee: 1st sitting (Hansard) & Committee: 1st sitting (Hansard) & Committee: 1st sitting (Hansard): House of Lords
Wed 28th Oct 2020
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Mon 2nd Nov 2020
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Mon 9th Nov 2020
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Wed 18th Nov 2020
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Mon 23rd Nov 2020
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Wed 25th Nov 2020
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Mon 14th Dec 2020
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Consideration of Commons amendmentsPing Pong (Hansard) & Consideration of Commons amendments

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Baroness Noakes Excerpts
2nd reading & 2nd reading (Hansard): House of Lords
Monday 19th October 2020

(3 years, 8 months ago)

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Baroness Noakes Portrait Baroness Noakes (Con)
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My Lords, I support the Bill because it is an essential element of our preparations to be an independent nation again. Before we joined the EU we did not need special internal market arrangements for trade in goods and services within the UK, but devolution has changed that. We need the Bill to ensure that the different parts of the UK can continue to trade with each other as at present without incurring costs or negotiating regulatory hurdles.

The beating heart of the Bill is about protecting the devolved nations. The Government’s UK Internal Market White Paper of last summer showed that Scotland, Northern Ireland and Wales export more to other parts of the United Kingdom than to outside the UK. There are similar patterns for imports. Keeping the ability to trade within the UK on a barrier-free basis should be at the core of the belief set of each of the devolved nations. I have been surprised that they have not grasped this basic economic fact but have instead been focused on working up grievances about the Bill. The economic imperative is not the same for England, which trades goods and services outside the UK more extensively, but nevertheless, intra-UK trade is important for England too.

The Bill is also strongly pro-business. The plain fact is that most businesses in the UK do not export goods or services outside the UK. Roughly 90% of SMEs trade only within the UK. Keeping that intra-UK trade going without friction is of massive importance for the health of the UK economy and for the devolved nations.

Other sensible provisions in the Bill include ensuring that any subsidy control regime is UK-wide in order to avoid distortions in intra-UK trade. We simply cannot have an efficient and fair UK internal market unless subsidy control is exercised on behalf of the whole of the UK. I also welcome the new role for the Competition and Markets Authority.

I know that most of today’s debate will be taken up with the provisions of Part 5 of the Bill and the power that it creates to modify the European Union (Withdrawal) Act. The Government have been clear that they would use such a power only if it really were necessary to protect the position of Northern Ireland within the UK, that they would use it only as a last resort having exhausted all other routes, and, of course, that they would not put the issue of peace in the island of Ireland at risk. I am also clear that the other place would not let the Government do otherwise.

I hope that it is not necessary to breach international law, but we should remember that such breaches are not without precedent. Sometimes countries, and different Governments in our own country, have concluded that, faced with competing evils, the least harm is done by taking that decision. I hope noble Lords who have concerns about this part of the Bill will see that it has the best interests of the UK at its heart.

Lastly, I regret the highly political intervention today by the most reverend Primate the Archbishop of Canterbury and his fellow Anglican primates. Disestablishment is starting to look rather attractive.

United Kingdom Internal Market Bill

Baroness Noakes Excerpts
Committee stage & Committee: 1st sitting (Hansard) & Committee: 1st sitting (Hansard): House of Lords
Monday 26th October 2020

(3 years, 7 months ago)

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Lord Hope of Craighead Portrait Lord Hope of Craighead (CB) [V]
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My Lords, I want to add a few words in support of Amendment 2. Proportionality and subsidiarity are part of the language of EU law which, while relatively new in historical terms, we are now very familiar with. It would be a mistake to think that as we reach the end of the transition period, we should leave these concepts behind. Proportionality, after all, is deeply embedded in our own public law, and has been for decades. It has long since been recognised that black-letter law alone is not a good guide to the way in which public law and public affairs should be administered. One simple example can be found in the civil litigation rules, where the word appears to make it clear that the courts should seek to obtain a just result with appropriate speed and expense in giving effect to the rules that are set out in the document. The point is that individual facts and circumstances vary greatly across the spectrum. Proportionality allows them to be taken into account and avoids blunt decisions where a greater need is to fit the facts together with the rule to find a suitable result that will achieve the desired object.

Subsidiarity too is now deeply ingrained in our constitutional arrangements. It is part of the thinking behind devolution, and the word is used with reference not only to Wales, Northern Ireland and Scotland but to devolution throughout England. The great advantage of this is that local decisions are best taken with regard for local circumstances. For them to be taken centrally sometimes misses the point and leads to solutions that are inappropriate given the local circumstances. It is a useful tool best used in the administration of our affairs to make sure that things are properly organised across the whole of our United Kingdom, which, after all, is what our new internal market is all about.

Both these principles are sound and appropriate guides as to how the two basic principles which are set out in Clause 1 should be administered. I support the argument that, somehow, these principles should find a place in the Bill. Quite how that is done I leave to the draftsmen, but Amendment 2 is at least an important start to make sure that the significance and relevance of these principles are appropriately recognised.

Baroness Noakes Portrait Baroness Noakes (Con)
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My Lords, I offer a few comments on these amendments. It seems to me that Amendment 1 has the effect of confining the concept of the internal market to consumers and the environment. That completely misses the point. If we go back to the Government’s White Paper in July, we see they were clear that the policy objectives were economic opportunities across the UK, increasing competitiveness and making the UK the best place to do business, thereby supporting the general welfare, prosperity and economic security of all UK citizens. The amendment in the name of the noble Baroness puts the cart before the horse, trying to make that an overarching requirement when it should be a consequence of achieving all the other things.

I emphasise that this is about frictionless business—about making it easy to do business across the UK. In all our debates, we should not lose sight of the importance of this to the devolved nations. About 60% of the exports of Scotland and Wales go to the rest of the United Kingdom; for Northern Ireland, it is a fraction below 50%. They are important to those economies. We are trying to create an environment in which trade can prosper and grow within the UK, without barriers, which will in turn allow the other objectives to be achieved—for example, the protection of consumers and supporting the general welfare of the country.

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Baroness McIntosh of Pickering Portrait Baroness McIntosh of Pickering (Con) [V]
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My Lords, I am delighted to speak to and support the amendments in this group. The debate demonstrates that it is not just Part 5 of the Bill that has created concern. In particular, I support Amendments 5, 11 and 53 in the name of the noble and learned Lord, Lord Hope of Craighead, and Amendment 170 in the name of my noble and learned friend Lord Mackay of Clashfern.

The House owes a great debt of service to the two noble and learned Lords for so clearly identifying the problems with the Bill and its complete oversight and omission of the common frameworks. In particular, they identify the problem of future common frameworks and their relationship to the Bill. But my concern is that, as there has not yet been agreement on the 18 common frameworks that may require legislative decisions, there may be some uncertainty. I note in passing that, of the 18, a large majority relate to issues being dealt with by Defra. They primarily concern agriculture, food and, to a certain extent, the environment, and that is a source of concern.

I express a concern over Schedule 1 and the impact on movements of animals and farm goods, in the event of threats to human, animal or plant health. The noble Baroness, Lady Andrews, referred to the default position appearing to be mutual recognition. Paragraph 2(2) of Schedule 1 refers to the “first condition” that would form an exclusion:

“the aim of the legislation is to prevent or reduce the movement of unsafe food or feed into the part of the United Kingdom in which the legislation applies … from another part of the United Kingdom”.

As the noble Lord, Lord Rooker, set out in some detail—I entirely endorse what he said—it is all very well when the Food Standards Agency in England and Food Standards Scotland take a similar view. I put to the Minister, for his reply when summing up the debate, my view that Schedule 1 indicates the need for common standards of human, animal and plant health to ensure free movement between England, Scotland, Wales and Northern Ireland. I thought that was the whole purpose of the Bill.

What will happen in future if the Food Standards Agency in England and Food Standards Scotland take different views on food, animal feed or a product from either state? Will Scottish produce be blocked from entering other parts of the United Kingdom, under Schedule 1 and other parts of the Bill? That would cause me great concern.

Finally, I endorse and support Amendment 170, in the name of my noble and learned friend Lord Mackay. He has identified the problem that there is simply no statutory basis for common frameworks. If so, would it not be better to have a common frameworks statutory basis to deal with all the problems that have been addressed during the debate?

Baroness Noakes Portrait Baroness Noakes (Con)
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My Lords, it seems that most of the noble Lords who have taken part in this debate have looked at the Bill through one end of a telescope, which focuses on the powers of the devolved Administrations and the threats or perceived threats to them. There is another end of the telescope you could use to look at the Bill, which shows that businesses in all parts of the UK need the certainty of knowing how they will be able to trade within the UK, going forward. That is important for those businesses trying to build a successful economy, particularly coming out of the Covid pandemic.

United Kingdom Internal Market Bill

Baroness Noakes Excerpts
Committee stage & Committee: 2nd sitting (Hansard) & Committee: 2nd sitting (Hansard): House of Lords
Wednesday 28th October 2020

(3 years, 7 months ago)

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Lord German Portrait Lord German (LD)
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My Lords, I have added my name to Amendment 21 to which the noble Baroness, Lady Finlay, has spoken. It seems to me that the clarification that the amendment is seeking is to understand whether, where a statutory regulation, rule or law is passed in a devolved Administration, that would exist until such time as the UK Government decided something different. Whether or not that is the intention of the Government, I do not understand.

The difficulty that I face in trying to work out the logical progression and the sequencing of what is happening in this Bill is correlated with the issue that we had on the common frameworks. It seems to me that the Government are moving down a dual carriageway in which one road is the internal market Bill and the other is the common frameworks progression, and between them is a brick wall. I do not understand how you can cross over between one and the other. That is the understanding that I got from the discussion we had in the earlier days in Committee.

The problem is that by the end of this year—I will use this as an example, which I would like the Minister to respond to at the end, if he would—the framework on emissions trading, which is a legislative framework, will be completed. I understand that it is with Ministers for final sign-off, but it has been agreed. If that emissions trading legislative framework is agreed, presumably there will then be legislation. I would like to understand where that legislation fits within the context of this Bill. Clearly, that has been reached by agreement—it has been agreed by all parts, including the United Kingdom Government, that there will be a legislative approach to this particular area of work. Then, of course, there will be a piece of legislation that sits either within this Bill or without it. I would like to know where that legislation will occur: will it be stand-alone legislation or will it be an amendment to the Bill we are discussing today?

There are two other frameworks—one on nutrition and one on hazardous substances—that are also virtually complete. They are non-legislative, and I understand that they will be agreed by Christmas. Take those three areas: on one side we have a legislative proposal and on the other we have a non-legislative proposal that the Government have agreed will be a non-legislative proposal and will therefore not require other legislation. And it will not require this legislation, because that is what the Government have agreed. Perhaps the Government could explain how the two are interconnected.

I understand that the reason for turning down a frameworks-only approach is because there are gaps, but we are yet to find out what the Government have established is a gap. We have asked for a current example that we can use, and I hope that, over the past few days, the Minister has found a current example that he can give us.

It seems to me that the fundamental principle that Amendment 21 is trying to establish absolutely is that, where there has been a legislative agreement or legislation that has been passed by either Wales, Scotland or Northern Ireland, when the Government introduce new legislation or regulations on the back of this legislation, such legislation will look only at the future and not the past and will have no retrospective effect.

Baroness Noakes Portrait Baroness Noakes (Con)
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My Lords, I would like to remind the Committee of two things about this Bill. First, the Bill is to facilitate trade between all parts of the United Kingdom, not make it harder. Secondly, businesses favour barrier-free trade. That was the very clear message that came from the consultation on the White Paper during the summer. We should be trying to minimise the possibility of barriers being put up to trade within the United Kingdom.

If we allow exclusions of goods from mutual recognition, that will inevitably lead to higher costs. This is analysed in quite considerable detail in the internal market White Paper. Costs generally end up being borne by consumers. Excluding goods can also result in businesses deciding to withdraw from certain markets, which can in turn restrict consumer choice. I know the noble Baroness, Lady Hayter, is keen on consumer protection; she reminded us of that on the first day of Committee. Restricting trade tends to operate against consumer interests, so we should be very careful in trying to put amendments to the Bill that make trade more difficult. I also remind noble Lords that restricting trade is more likely to hit the devolved Administrations’ economies because of their greater dependence on exporting to the rest of the United Kingdom.

I want to comment on a couple of the amendments in this group, Amendments 7 and 8. The noble Baroness, Lady Hayter, said that Amendment 7 was a probing amendment, but by seeking to exclude imports into any part of the United Kingdom we are reducing the internal market rules to a very parochial interpretation. It seems to ignore the plain fact of commercial life, which is that there are complex supply chains and complex distribution logistics. It is of course the way we have been living in the EU; at the moment, we are quite accustomed to importing in one place and those imports being accepted throughout the rest of the community.

It also seems to me that the noble Baroness’s amendment would, in effect, impact exports between different parts of the United Kingdom. For example, if something was exported to Wales and imported to England, it would stop it then being imported into Scotland with the protection of the internal market Bill. That does not seem to make any kind of sense. It is pretty clear from the impact assessment that Wales and Scotland in particular are reliant on intermediate goods coming from other parts of the United Kingdom.

The noble Lord, Lord Rooker, spoke to Amendment 8. I did not follow what he said about pig semen because I do not think that, by any definition, pig semen is an animal feedstuff. I did have a chance to check the definition of “animal feedstuff” while he was speaking, and it is not. Perhaps we can put that to one side. We have to understand that if we try to exclude food and animal feedstuffs from the UK internal market mutual recognition rules, this will again potentially impact the devolved Administrations the most, given their import and export profiles. For example, if you look at Wales’s agri-food chain, you will see that 48% of agricultural inputs to Welsh food manufacturers come from the rest of the UK and 31% of food and drink sold in Wales comes from the rest of the UK. We should be thinking really hard about who we are likely to hurt when we put amendments such as this in the Bill, which restrict barrier-free trade.

Lord Hope of Craighead Portrait Lord Hope of Craighead (CB) [V]
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My Lords, I support Amendment 7 in the name of the noble Baroness, Lady Hayter, and Amendment 21 in the name of the noble Baroness, Lady Finlay.

I shall start with Amendment 7. First of all, I entirely agree with the noble Baroness, Lady Noakes, that importing and exporting goods is part of the commercial life of this country. That applies across all parts of the United Kingdom, and one can well understand the point that she makes about the importance for the devolved Administrations of maintaining that system with as little interference as possible. However, the point to which Amendment 7 draws attention is a matter of real concern to the devolved Administrations. As she explained, its effect appears to be to deny them any involvement in decisions on the importation of goods from overseas, to which they might wish to take objection. Various horror stories are of course passed around as one discusses this issue, but I am not concentrating on them so much as I am on the simple lack of ability to contribute to a discussion as to whether or not these goods should be imported.

If one was talking about legislation, I suppose one would say the Sewel principle would apply and consultation would take place, but there appears to be nothing that allows for that. The effect of the way the provision is worded is that something that comes in can take the benefit of the principles and pass without any kind of control to the devolved Administrations, without their having any say. That is of real concern. This is a probing amendment, but it requires some explanation of what place, if any, the devolved Administrations have in trying to resist the importation into, and transmission across borders within, the UK of goods to which, for one reason or another, they might wish to take exception.

That covers Amendment 7. As for Amendment 21, I was attracted by what the noble Lord, Lord German, said about the dual carriageway—the parallel lines—for a particular reason, which I have not mentioned before but must be emphasised. The common frameworks are living arrangements. There is no point at which one can strictly say that a framework has come to an end, although I confess that my own amendment suggests that it could happen. These frameworks are open to subsequent discussion and revisiting as things change. For example, much of the UK emissions trading system is based on EU law and treaty arrangements that could change. If that happened, the framework would be revisited, and, no doubt, different policy decisions may need to be taken. The same is true of the hazardous substances framework.

One has to bear in mind these are two living instruments working side by side: the UK internal market and the common frameworks system. The fact that, as the Bill has it at the moment, there is no means by which they can communicate with each other, is a matter of real concern, because it affects the whole structure of how these things co-operate and will co-operate in the future, in ways we cannot yet predict. That underlines the importance of trying to find a solution to the point I drew attention to on Monday of making some arrangement whereby the decisions taken, based on common framework decisions, to legislate in the devolved Administrations are protected against the effect of the market principles, particularly the non-discrimination principle, which has very broad reach indeed.

The great value of the amendment of the noble Baroness, Lady Finlay, is that it has drawn attention once again to that very real problem. It requires some response from the Minister so that we can have some idea of how he thinks these two parallel carriageways, stretching out into the future, will ever meet and co-operate with one another.

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Baroness Boycott Portrait Baroness Boycott (CB)
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My Lords, it is a great pleasure to follow the noble Lord, Lord Teverson. I thank him and the noble Baroness, Lady Jones of Moulsecoomb, for supporting this amendment. I very much agree with what the noble Lord, Lord Young of Cookham, said. I also agree with the noble Baroness, Lady McIntosh, when she said that, if this internal market Bill does not align with the Agriculture Bill, then something is wrong and we are missing a trick.

I have tabled Amendment 52, which seeks to introduce a derogation from the market access principles to allow all four nations to put in place proportionate measures to protect the environment, support the progressive improvement of environmental standards and tackle climate change. My concern is that, in the absence of an agreed common framework, we will not be able to protect existing high regulatory standards in cases where one nation wants to introduce something new and higher, in the environmental sense, for a particular good or service—although not legally prohibited from doing so, it could be disincentivised from doing so. Under the market access provisions in the Bill, goods from other parts of the UK would not have to meet those requirements if standards elsewhere were lower. Other Peers have spoken about this. It is about protecting us against a race to the bottom in setting environmental standards or measures to tackle climate change.

At Second Reading, the Parliamentary Under-Secretary of State, the noble Lord, Lord Callanan, said of the Bill:

“It will protect our common causes, such as the setting of high standards in our economy”.—[Official Report, 19/10/2020; col. 1285.]


But the Bill does not give legislative effect to these commitments. It fails to create the proper framework and fails to deliver the safeguards and assurances needed to ensure that all four nations of the UK can legislate ambitiously, progressively and effectively to protect the environment. Currently, the Bill provides for exceptions only in a limited range of circumstances, such as preventing the spread of diseases or pests. Even then, this is only under very strictly controlled conditions.

Environmental matters generally fall within devolved competence. Regulatory divergence already exists within the UK and there have been a number of examples of really innovative policies which have delivered legitimate public policy objectives—and specifically progressive environmental rules. I know that this has been mentioned before, but Wales was the first country in the UK to introduce a charge on carrier bags. It is atrocious to think that that could somehow have been denied.

Amendment 52 would allow an individual nation to refuse mutual recognition on the grounds of measures protecting the environment or tackling climate change. To give a practical example of why this is so important, there have been mounting calls to ban the sale of horticultural products that contain peat. This is obviously to protect biodiversity, but also to avoid the extraction of peat and the release of high levels of soil-based carbon. If one of our four nations’ Governments decided to ban the sale of products containing peat, this could potentially be undermined by the failure to match those efforts in other jurisdictions, where producers could continue to actively sell these products in a market where they would otherwise be banned.

My amendment would require suppliers to comply with these devolved rules where they relate to the protection of the environment or tackling climate change, meaning that even if regulation in England were to fall behind, say, that found in Wales, those supplying the Welsh market would still have to comply.

At Second Reading, the Minister, the noble Lord, Lord True, responded:

“commerce, services and professions must be enabled to operate freely across the whole United Kingdom. That is … demanded … by business”.—[Official Report, 20/10/20; col. 1426.]

However, business coalitions such as the Aldersgate Group have commented that the objectives of frictionless trade and encouraging a race to the top for environmental standards do not contradict one another. A fully functioning and innovative internal market should strive to both reduce unnecessary costs and uncertainty and protect all four nations’ right to regulate in the public interest.

Finally, protection of our environment and tackling climate change really are not an option anymore. If you listen to Christiana Figueres, who set up the Paris Agreement, you will know that we have 10 years in which to try to get ourselves to 50% of carbon emissions. That means reducing by about 7% to 8% a year. Not to do this is a complete abdication of our rights as legislators because, if we do not put policies in place in this Government and this Parliament, then we will be left pretty legless in the fight ahead.

As the noble Lord, Lord Teverson, said, we cannot do business as usual; we have to do business in a new way. We have many excellent Bills before us that can make this happen, and I commend my amendment to the House.

Baroness Noakes Portrait Baroness Noakes (Con)
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My Lords, as noble Lords who have attended this Committee to date know, my role is occasionally to get up and give a minority perspective on the amendments before us. There are 20 amendments in this group and, one way or another, each of them would allow barriers to trade to be erected by one or more of the devolved nations. The effect of the amendments is to restrict the amount of trade to which the market access principles will apply and thereby reduce the extent to which barrier-free trade can take place throughout the UK’s internal market. I say to the noble Lord, Lord Anderson, that that is not an argument against devolution; it is an argument for trade and economic success, which I hope that we all want to achieve for the United Kingdom.

I will not repeat all of what I said on the earlier group, but the more that laws relating to trade in goods and services diverge between the component parts of the UK, the more likely it is that costs will rise and choice will diminish for consumers. Barriers to trade are also likely to result in lower GDP, as the impact assessment analysed, and we need all the GDP that we can get at the moment, given the impact of lockdown and similar anti-Covid measures. I am sure all those noble Lords who support and voted for devolution did not vote to become poorer through devolution.

The amendments give very considerable cover to the devolved Administrations to erect trade barriers under the guise of higher standards but, actually, on grounds of protectionism. At the very least, I predict that there will be massive scope for lawyers to argue for a very long period and to mount legal challenges. That may well be good for the fees of the legal profession—and for the noble and learned Lord, Lord Falconer of Thoroton—but the important thing I want to stress is that it will result in uncertainty for business. If there is one thing that is bad for business, it is an uncertain business trading environment.

Therefore, while I understand the desire for higher standards—and many noble Lords have spoken to this in respect of the particular varieties of relaxation that they are seeking in the Bill—at the end of the day, they can result in trade barriers. We really should be very careful not to wreck the UK’s internal market before it has even started.

Lord German Portrait Lord German (LD)
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My Lords, I shall address Amendment 54 in my name. As the noble Baroness, Lady Finlay, said in moving her amendment, it harks back to debates we have had on the mysterious absence of common frameworks from the Bill. As your Lordships will know, common frameworks are a way of doing business that is supported by the CBI. The amendment would insert a new schedule into the Bill. It may look arcane, or like an obscure pub quiz question, so perhaps noble Lords would like to answer the question: what unites ozone-depleting substances and Caerphilly cheese? The answer is that the list in the schedule is the list of subjects where all four Governments in this country have agreed that legislative common frameworks are necessary. However, this is not intended as an exhaustive list. It would be possible to add to this by secondary legislation if new areas emerge that require a common framework.

I concede that it would not have been necessary to have such a schedule if the dual carriageway with the brick wall in between the two approaches that the Government are taking—this Bill and the common frameworks—were guaranteed to coincide and meet. Both approaches are progressing and have the enthusiasm of the Government behind them. This amendment would be a way of ensuring that those approaches coincided and met. The amendment would help, since it identifies common frameworks without using the name.

One of the more striking aspects of the Bill, as noble Lords and Ministers keep telling us, is that common frameworks on their own cannot guarantee the integrity of the entire UK internal market. They are sector-specific and not intended to address the totality of economic regulation. In answer to every question asked, there has been a real silence from the Government, who have failed to identify any areas where the integrity of the internal market might be threatened that are not covered by common frameworks. We had reference to the threat to the sale of barley from English farmers to Scotland, which has proved an issue already resolved by the common framework. There is also the wholly hypothetical example of a devolved Government wishing to legislate for additives to flour, which is already in one of the common frameworks on nutrition.

We therefore have to manage this problem of having two-track approaches to the internal market. The amendment proposes a way of creating that gateway between the two and ensuring that there is a link between them, so that we know that we are on the same course for a functioning internal market.

United Kingdom Internal Market Bill

Baroness Noakes Excerpts
Committee stage & Committee: 3rd sitting (Hansard) & Committee: 3rd sitting (Hansard): House of Lords
Monday 2nd November 2020

(3 years, 7 months ago)

Lords Chamber
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A great deal needs explaining, without which the powers provided later in this part are disproportionate and unjustified. Although this is early in our debate on this part of the Bill, I am prepared to return to this matter on Report.
Baroness Noakes Portrait Baroness Noakes (Con)
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My Lords, I have added my name to my noble friend Lady Neville-Rolfe’s amendment. Like her, I am concerned that the CMA has been chosen as the home for the office for the internal market with very little substantive discussion and certainly no proper consultation. The White Paper the Government consulted on in the summer did not even mention the CMA, and the best the Government could report in their September policy response was that

“a few respondents suggested that the UK Internal Market functions would be a natural fit with the CMA”.

When I say that I do not believe the CMA is the right home for the internal market functions, I hope that will not be taken as a criticism of the CMA. It has done good work over the years, building on that of its predecessor bodies, and its work is respected here and abroad. However, it is not a body that has won universal acclaim. The time it takes on some of its market studies and the lack of impact of some of its findings are often cited against it.

I have three main grounds for seeking a different solution, of which my noble friend’s amendment is one constructive suggestion. First, the CMA’s existing functions are adjacent to the issues that will arise in the UK’s internal market, but they are by no means coterminous. The CMA is fundamentally about competition impacts, whether through mergers and acquisitions or market behaviour. It is also about the protection of consumers. The UK’s internal market is about trade and the avoidance of unnecessary barriers to trade. These are quite different things. The danger is that the CMA could move from being a focused competition and consumer organisation to one that is more diffuse and less targeted. Many organisations have lost their way when they have sought to expand their footprint and have ended up as a jack of all trades but master of none. We cannot afford to take that risk.

While it is planned for there to be a separate panel for the office for the internal market within the CMA, it is inevitable that the functions of the office, and the resources to deliver them, will be intermingled with the CMA’s other functions. It is also clear from the Bill that it is the CMA, and not the office for the internal market itself, which will carry responsibility for the various functions set out in the Bill. We run a very serious risk of the office for the internal market disappearing into the CMA’s back room.

My second reason is that the CMA really has too much on its plate at the moment to contemplate adding such an important new area of responsibility as oversight of the UK’s internal market. There are aspects of its current workings that are not beyond criticism, as I have already mentioned. Importantly, it is about to take on a number of additional activities as we finally exit the EU at the end of the year. If anyone doubts the extent of these additional responsibilities, there are 50 pages of draft guidance on these new activities which the CMA is currently consulting on. These competition functions have already led to a very significant increase in the CMA’s resources and I believe that it was expected that overall staff numbers would increase by 40% as a result. Against that background, it would be crazy to add on significant additional responsibilities. There is only so much change that any organisation can safely accommodate in a given period.

A final reason for wanting to see the office for the internal market set up outside the CMA is to ensure that it has a real presence in our internal market as a respected source of impartial data, analysis and advice. These seem to be the things that the Government want, as set out in this Bill, but setting it up as a mere panel of a much larger, differently focused quango cannot be the right way to achieve that.

Lord Palmer of Childs Hill Portrait Lord Palmer of Childs Hill (LD) [V]
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My Lords, my purpose in speaking today is to support Amendment 111, which I have signed, and the detailed comments made by my noble friend Lady Bowles. Amendment 111 aims to clarify that the role of the CMA and the office for the internal market is not the resolution of disputes. We already have common frameworks; we do not need a topdown resolver of disputes.

Last week, the Minister said clearly that the office for the internal market is to provide “monitoring, advice and reports”. He said that it will

“have no direct role in dispute resolution”—[Official Report, 26/0/20; col. 70.]

which will be discussed by the Joint Ministerial Committee. There is no reference to a dispute resolution in the Bill. I hope that, for clarity, the Government will accept Amendment 111, which states clearly that the CMA and, thus the new office for the internal market,

“must not engage in dispute resolution”.

The important role of dispute resolution can realistically be achieved only by discussions and compromises between the nation states of the UK. The amendment seeks to make clear what the OIM can and cannot do. In responding to this debate, will the Minister clarify these powers, or lack of them? Clarification, along with dealing with complaints and inconsistencies, is what is needed. That is what your Lordships’ House is set up for and does so well. The various explanatory documents only confuse even further and imply some resolution powers for the CMA and OIM.

Amendment 111, which puts the CMA and its plethora of civil servants back in the box, is necessary if the Bill is to be approved. The Bill is a mistake; the noble and learned Lord, Lord Falconer, summed it up when he said that it was “unthought-out”. I support the amendment.

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Baroness Bennett of Manor Castle Portrait Baroness Bennett of Manor Castle (GP) [V]
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My Lords, it is a great pleasure to follow the noble Baroness, Lady Finlay, and the noble Lords, Lord Wigley and Lord Hain. I agree with much of what they have said. The noble Baroness was particularly clear in setting out the issues that arise with this group. I have attached my name to, and will speak to, Amendments 119 and 126, in the name of the noble Baroness, Lady Hayter of Kentish Town, who I thank for originating them.

They share the purpose of many amendments in this group: to ensure that the devolved nations have a voice in the operation of the internal market—the market that will govern much of what they can regulate and what protections they can provide to their peoples, as the Committee discussed last week in the group starting with Amendment 15.

As the noble Baroness, Lady Hayter, has not yet spoken, I will briefly address the detail. I interpret Amendment 119 as something of a back-up to Amendment 118, which would ensure that the Government have to obtain the consent of devolved Administrations before appointing the chair and members of the CMA’s office for the internal market panel. Amendment 119 says “seek consent”. I prefer Amendment 118, but it is important that at this stage we offer a range of amendments to the Government.

Amendment 126 refers to the membership of the OIM panel, saying that it should include representatives from each of the four nations of the United Kingdom. The purpose of these two amendments, as in so many of the amendments in this group, is—to adapt the well-known phrase— to ensure that there is no regulation, or deregulation, without representation or democracy.

In briefly making the case for these amendments, I go back to the first group debated today, which, as your Lordships will recall, related to professional qualifications. I quote the words of the noble Lord, Lord Callanan, in that debate:

“There is the whole world of artificial intelligence or gene editing—there is a massive range of new and potential professional areas, bodies and qualifications that may come forward … in the case of new professions, it is entirely possible that the individual nations of the UK might seek to regulate them differently, and we want no new barriers to trade to emerge”.


In that one short statement, the Minister managed to sum up the disturbing intention of the Government to centralise in Westminster decision-making on extremely important areas of public policy that are currently devolved; the reasons for the objections to this Bill held by many, particularly those concerned with defending the devolution settlements; and the case for these amendments. Even if the protections that the still relatively new institutions of the nations have been able to create for their peoples stay in place, they will not be able to react to social, economic or technological changes, or strengthen existing protections.

To go back to the single-use plastics example that was discussed extensively under Amendment 15, if the Welsh Government want to provide extra protections for their people and environment from these deeply damaging products, they can rush to get measures under the wire now, before the internal market replaces the single one. For what happens after that, I cannot think of better examples than those provided by the noble Lord, Lord Callanan—gene editing and artificial intelligence, where different regulations might be applied by the devolved Administrations in their areas of competence. That would include areas ranging from agriculture to education, from food safety to transport. We need to ensure that the devolved Administrations can keep control.

Baroness Noakes Portrait Baroness Noakes (Con)
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My Lords, I listened carefully to noble Lords who spoke before me. The devolved Administrations are failing to recognise that both the CMA and the office for the internal market are fundamentally UK-wide bodies working on UK-wide issues. They are not bodies where territorial interests will be played out. The devolved nations are part of the United Kingdom, which exists and is not just a federation of four independent nations. There are clear United Kingdom functions, which is why we have UK Ministers looking out for the interests of the whole United Kingdom. We should not regard the UK as somehow morphing into an equivalence with England, which the noble Lord, Lord Hain, came close to saying, even if he did not actually say it, when he spoke earlier.

Furthermore, these significant independent public bodies should not be seen as having nominees or representatives on them: it is important that you get the best people to contribute to the functions given to these bodies by statute. Those people will require qualifications and experience. It does not matter where they come from: the most important thing is to get the right quality of individual on those bodies to carry out their functions. Any sense that those individuals become the possessions of devolved Administrations could take them into political alignment, which would have a very negative influence on the effective operation of the independent bodies.

Schedule 3 already requires consultation with the devolved Administrations over the appointment of the chair and panel of the office for the internal market. That is the normal formulation. I do not think that there is a precedent for what is proposed, for example, in Amendment 117: direct appointments by devolved Administrations to independent UK-wide bodies. That would take us in a direction that could undermine the independence and coherence of those bodies. I hope that noble Lords will not pursue their amendments.

United Kingdom Internal Market Bill

Baroness Noakes Excerpts
Committee stage & Committee: 5th sitting (Hansard) & Committee: 5th sitting (Hansard): House of Lords
Monday 9th November 2020

(3 years, 7 months ago)

Lords Chamber
Read Full debate United Kingdom Internal Market Act 2020 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 135-V Fifth Marshalled list for Committee - (4 Nov 2020)
Baroness Noakes Portrait Baroness Noakes (Con)
- Hansard - -

My Lords, I am speaking today because I believe that the clauses that the noble and learned Lord, Lord Judge, and other noble Lords oppose are wholly in the United Kingdom’s national interests and, importantly, wholly in the interests of our fellow citizens in Northern Ireland.

Part 5 of the Bill represents a sincere attempt by the Government to protect the Good Friday agreement and peace on the island of Ireland. If the way in which Northern Ireland has to operate within the United Kingdom is harmed, it would follow that peace and reconciliation within Northern Ireland will itself be harmed. The Northern Ireland protocol explicitly recognised that Northern Ireland would remain within the UK’s customs territory and internal market. This is crucial for Northern Ireland, as nearly 50% of its exports go to the rest of the United Kingdom. This is more than double the amount exported to the Republic and four times the amount exported to the rest of the EU. Trading within the UK’s internal market is not an optional extra for Northern Ireland. An east/west trade border in the Irish Sea is bound to have an adverse impact on the Northern Ireland economy, and economic weakness would not take long to translate into political tensions.

The practical issues of trade with Northern Ireland—for example, how the risk of goods entering the EU via Northern Ireland will work—have not yet been agreed in the Joint Committee. There is no guarantee that an agreement will be reached and, if there is no agreement, a number of harmful consequences—for example, in relation to third-party listing of agricultural products—could well follow. I understand that these have been threatened by the EU. Faced with this uncertainty, I believe that this Bill is a responsible approach by the Government to protect the interests of the United Kingdom, particularly the interests of Northern Ireland.

The Government could have waited until real harm was done in Northern Ireland, economically and politically, but that would be to court disaster. The Government have not waited until they on a burning platform. Instead, they have taken the pragmatic approach of providing a contingent power in the Bill to be activated only with the consent of Parliament and used only if the dispute resolution procedures fail.

I ask noble Lords whether they would still oppose Part 5 of this Bill if the Government sought to legislate in the face of actual, rather than prospective, harm. Would concerns about the rule of law really stop noble Lords voting through whatever was necessary to protect the UK’s economic interests and peace in Ireland at that point? I do not think so. I do not think that the rule of law is the relevant point. I am not sure that what the noble Lord, Lord Pannick, said really answered the challenge on this from my noble friend Lord Lilley. If noble Lords can accept that the national interest might require us to break an international agreement in the face of actual harm, in logic they ought to support this proportionate approach to protecting the union, as well as stability and prosperity in Northern Ireland.

Lastly, I ask the opponents of Part 5 to answer one simple question: would noble Lords object to a similar power if it allowed a breach of a treaty with a state which was now an international pariah, or is the heart of opposition to Part 5 intimately linked to the fact that the EU is the counterparty to the treaty which we might need to break? I urge noble Lords to avoid unconscious bias, whether or not driven by remainer nostalgia, and put the protection of the UK, the union and peace in Ireland first.

Lord McCrea of Magherafelt and Cookstown Portrait Lord McCrea of Magherafelt and Cookstown (DUP)
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My Lords, like the noble Baroness, Lady Hoey, I have no claim to being a lawyer, nor the son of a lawyer, but I come with 50 years of experience as a minister of the gospel in the thriving congregation in Northern Ireland and 42 years as an elected representative of the people of Northern Ireland. I have been with the people of Northern Ireland through very difficult and trying times, as well as times of joy.

I was not one of those who negotiated the Belfast agreement, nor, truthfully, did I support those who did. However, I accept the reality of its existence. Throughout the internal market Bill’s progress through this House, much has been made of certain clauses’ breach or a threatened breach of international agreement. However, it is interesting to note that those who negotiated it, some of whom are Members of your Lordships’ House and were its chief architects, do not believe that these clauses do so.

The withdrawal agreement, as it was introduced, was bad for Northern Ireland economically and constitutionally. In the other place, my colleagues repeatedly pressed the Government for change; they focused attention on the flaws and the importance of protecting Northern Ireland’s interests, as I am sure noble Lords would expect them to do. This Bill is a step forward, a recognition by the Government of the defects of the Northern Ireland protocol and its impact on the internal market of the whole United Kingdom. However, more work has to be done.

The party I belong to has been focused on ensuring that consumer choice and costs are not impeded as a result of the protocol. It is vital that Northern Ireland businesses have unfettered access to the market of Great Britain, which is so important for the Province, and this Bill sets out potential helpful steps in that respect. However, I noted the noble Lord, Lord Newby, saying “Let us not hear of unfettered trade—there will be none”. That will certainly have serious implications in Northern Ireland, if it is true.

I recently read with interest that several right reverend Prelates and other bishops wrote to the Prime Minister stating that this legislation would set a disastrous precedent and that:

“If carefully negotiated terms are not honoured and laws can be ‘legally’ broken, on what foundations does our democracy stand?”


I found that somewhat interesting, because several times in this debate I have heard about “moral responsibility” and “morality”, and how this is “immoral”. I must remind this House that I stood here some months ago where, whenever we talked about the moral issue of same-sex marriage, the Benches of the right reverend Prelates were empty. Whenever we discussed the moral issue of the most liberal abortion laws that were forced on the people of Northern Ireland against their democratically expressed will, where was morality talked about then? I do not know of any letters being written to the Prime Minister on the importance of this moral imperative.

We know that those changes were made to placate Sinn Féin as a pay-off to get them back into the Northern Ireland Assembly. When we talk about such issues, I would like such letters to be written to the Prime Minister in the midst of our present national crisis with Covid-19 to encourage him to call for a national day of repentance and prayer, acknowledging our need of God’s help and deliverance in our time of great distress, as I did in March at the beginning of the pandemic.

However, returning specifically to these groups of amendments, the EU is failing to honour its own commitments as set out in the withdrawal agreement. The Northern Ireland protocol states in Article 1 that it is

“without prejudice to the provisions of the 1998 Agreement in respect of the constitutional status of Northern Ireland”.

It also states that it

“respects the essential State functions and territorial integrity of the United Kingdom.”

I remind Members of this House that, for the majority of the people of Northern Ireland, the integrity of the United Kingdom is of paramount importance.

Indeed, yesterday, across the United Kingdom, we remembered the fallen of two World Wars. In Northern Ireland, we also remembered all those innocent people across the community who were slaughtered by a vicious and callous murder campaign. Over the years, thousands of our citizens have died—yes, British citizens have died—and tens of thousands have been injured because Northern Ireland’s ordinary law-abiding people refused to be terrorised out of the United Kingdom. That is what we believe is precious to us.

Those who are beholden to the Northern Ireland protocol ignore its threat to the household prosperity of every corner of Northern Ireland. The Freight Transport Association estimates that 70% of some 425,000 lorry crossings every year are destined for so-called dead-end hosts—that is, supermarkets, retail outlets, car showrooms et cetera in Northern Ireland. If those movements are subject to checks, these businesses will feel real pain and real financial loss, but I wonder whether people really care.

Free access to the internal market is a foundation block of the union. The 1707 articles of union between England and Scotland and those between Great Britain and Ireland in 1800 abolished all customs duties between the different parts of the United Kingdom. They also declared that citizens of all parts should be on the same footing in respect of trade and navigation and in all treaties with foreign powers. Does not the withdrawal agreement breach this? A single, unified internal market is therefore a key block in the constitutional foundations of the United Kingdom.

In my opinion, for the EU it was never about protecting peace in Northern Ireland. It has been using Northern Ireland to punish the United Kingdom, as was stated by Monsieur Barnier. Sadly, many others, whether willingly or without realising it, are being used in that cause. For those who support the protocol, the destruction of the UK’s internal borders and household prosperity is simply collateral damage.

Amendment 161 would require the Secretary of State to

“publish a statement on the impact … on … peace and reconciliation in Northern Ireland”

through the exercise of Clause 44. From whom would a threat to peace come? Those of us who have lived under the threat of IRA terrorism for over 30 years—personally—and our families do not want to see terrorism rise again. However, we must not be held to ransom because of the threat from those who have lived all their lives to make Northern Ireland a failed political entity. They made no apology for that being their belief and carried out their terrorism on that basis.

I want to see every part of Northern Ireland bear the fruits of prosperity—prosperity enjoyed by every section of the community. I believe that that is best served within the union of Great Britain and Northern Ireland. Surely those proposing Amendment 162 are speaking out of both sides of their mouths. On the one hand, they want to avoid barriers to trade between Northern Ireland and Great Britain, yet in several other amendments, they would dictate that the Government must not use the powers set out in the Bill if they counteract the protocol. In effect, that requires customs entry and exit declarations. They ought to come clean and stop being disingenuous. If this amendment is to be acceptable, surely there is a need for continuity throughout the Bill.

United Kingdom Internal Market Bill

Baroness Noakes Excerpts
Report stage & Report stage (Hansard): House of Lords & Report: 1st sitting & Report: 1st sitting: House of Lords
Wednesday 18th November 2020

(3 years, 7 months ago)

Lords Chamber
Read Full debate United Kingdom Internal Market Act 2020 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 150-II Second Marshalled list for Report - (18 Nov 2020)
Lord Liddle Portrait Lord Liddle (Lab)
- Hansard - - - Excerpts

My Lords, first of all I say how much I agree with what the noble Lord, Lord Cormack, has said about how we should organise our affairs. We have to bring back genuine debate to this Chamber, and I hope that those responsible will take on board what he has just spoken about.

Secondly, I had prepared what I thought was an extremely well-argued speech on the subject before us today. However, having listened to far more eminent figures than me talk about the need for these common frameworks, I am not going to deliver it. All I will say is that the noble and learned Lord, Lord Hope, in opening the debate, spoke with a sharpness, a forcefulness and a logical directness that the Government would be well advised to take into account.

I have a couple of questions for the Minister because I think political questions arise from this discussion. First, does he acknowledge that the Government have changed their policy on these common frameworks since 2017-18, and why? It is clearly the case that there has been a change of policy and that Theresa May, in her commitment to “our precious union”, as she put it, saw the dangers that Brexit would pose to the devolution settlement and tried to find a consensual way of resolving them. David Lidington, with the help of people such as the noble Lord, Lord Dunlop, came up with this concept of common frameworks as a way of doing this.

Why, in this Bill, if the Government have not changed their policy on these common frameworks, can they not find a place for them in the legislation? What is the objection to actually acknowledging their existence to balance the abstract principles of mutual recognition and non-discrimination, which every single lawyer in this Chamber tells us will override the practical effect of these common frameworks? Why do the Government not come clean about this? Why do the Government not admit that what they actually want is to take power to the London Government to get their way on whatever they want in this area, rather than using the bottom-up, consensual approach that David Lidington and the noble Lord, Lord Dunlop, put together in the passage of the EU withdrawal Act? I think the Government should do that because we are marching into very dangerous territory for the future of our United Kingdom.

I remember that the noble and learned Lord, Lord Hope, in his speech in Committee, argued that common frameworks were consistent with the principles of subsidiarity and proportionality that had been underlying principles of the European Union in this area of law. The noble Lord, Lord Callanan, said in response, “Well, those are European principles. We have now left the European Union; we don’t have to follow them anymore”. What principles are the Government following? What is the Government’s vision for the future of the United Kingdom now that the Prime Minister has described devolution as Tony Blair’s biggest disaster? Will he please set out to us what is his vision of the balance of relationships between the devolved nations? We are really getting into very dangerous territory.

I hope that we can somehow rescue the situation by getting these common frameworks back. If we do not, I hope that my party will press the case hard for a major constitutional convention on the future of the United Kingdom. It seems to me that unless we provide that credible alternative, the nationalists in Scotland will break up what has been one of the greatest ventures in history.

Baroness Noakes Portrait Baroness Noakes (Con)
- Hansard - -

My Lords, I start by saying how much I agree with what a number of noble Lords have said about the nature of debate in this sterile House, and I hope that we can certainly move on. I think it is important to say that because, as noble Lords might expect, I am not going to be saying much else which will find favour with other noble Lords who have spoken in this debate.

I respect the concerns about protecting the powers of the devolved Administrations which lie behind the amendments in this group, but I believe that these amendments would not be helpful in the context of the internal market and might well be very harmful. There is no exact correlation between what the common frameworks cover and the UK’s internal market covered by the Bill. Indeed, the functioning of the internal market is only one of six objectives of the common frameworks programme. Not every common framework will have a UK internal market dimension, and not every aspect of the UK internal market is included in the common frameworks programme.

So if Amendment 1 is agreed to, we will have uncertainty from day one about which bits of the common frameworks would override the market access principles. Uncertainty kills businesses. Uncertainty might be resolved only by the courts, and that could take five, maybe 10, years to bring to conclusion. Businesses cannot in general cope with timeframes of that nature, and that is especially true in today’s lockdown-harmed business environment.

The common frameworks are by their very nature detailed and specific. They are practical solutions to well-defined problems, such as compliance with international obligations. They do, however, have two big weaknesses. First, they have no guiding star, or no guiding principle, and they cannot, by their nature, cope with future change. By contrast, the internal market enshrined in the Bill is based on the overarching and enduring principles of market access, namely, mutual recognition and non-discrimination.

I am very clear that businesses want the Government to deliver an internal market which has as few barriers to trade as possible. They do not want to have to master thousands of pages of common frameworks, which may or may not impact the internal market, just to do business 10 miles away if that is over one of the UK’s internal borders. I have to say to the noble Baroness, Lady Randerson, that I have never even heard of the Aldersgate Group she referred to as representing business opinion, and I do not believe it represents the opinion of the whole business community.

In Committee, I urged noble Lords to consider the provisions of the Bill through the lens of businesses and individuals who will be trying to live, work and trade within the United Kingdom—that is what the Bill is about. By viewing the Bill through the lens of what the devolved Administrations think they might lose in terms of devolved competence, I believe that they may end up inflicting acts of self-harm on the people and businesses in their own territories.

I remind noble Lords of the high degree of dependence of the devolved nations on trade with other parts of the United Kingdom. This is an issue for Scottish businesses and residents, Welsh businesses and residents and Northern Ireland businesses and residents. It is important but not such a big issue for English businesses and residents. If trade is made more difficult, the result, as night follows day, will be higher cost and less choice for consumers. At a time of economic stress, that does not seem a sensible route to follow.

I have heard many arguments of principle adduced by the supporters of the amendments, but I have heard less about the practical issues. We heard about Scottish concerns on minimum alcohol pricing, but that was debunked in Committee. I believe that building regulations are a new red herring that has been introduced and will not conflict with the Bill. The Bill does not outlaw every variation within the UK, as some have tried to suggest. More importantly, I am still waiting to hear what will make life better for the businesses and residents of the devolved nations if the amendments are passed.

More than 90% of UK small and medium-sized enterprises, and nearly 60% of large businesses, trade only within the UK. That is the scale of the issues we are facing with the amendments. I hope that noble Lords will not jeopardise the aims of an internal market which works for the whole of the United Kingdom by pressing the amendments.

Lord Fox Portrait Lord Fox (LD)
- Hansard - - - Excerpts

My Lords, the noble Baroness, Lady Noakes, is right: I found cause to agree with her opening statement, as I did with the noble Lords, Lord Foulkes and Lord Cormack, and others. The need to have proper debate—not least to allow the noble Lord, Lord Foulkes, to go back to his heckling—would add to the debate.

Congratulations should go to the proposers of the amendments and to the noble and learned Lord, Lord Falconer and my noble friend Lord Newby, who have managed to create a debate which gives your Lordships a proper choice. That choice centres around the words “mutual respect”, because the Bill as it stands, unamended, is disrespectful to the devolved authorities and to the process of devolution. The amendment gives your Lordships a chance to build that respect back into the Bill.

On many occasions, Ministers have freely used the word “complement” and expressed the view that the common frameworks complement the process devised by the Bill. Unless those common frameworks can be built into the Bill, and unless the Minister can explicitly explain how they complement, there is no complementary process; there is replacement, which I believe is sought by the Bill. The noble Lord, Lord Naseby, spoke of the common frameworks as if they were some Bolshevik plot. I remind him that they were the policies of a Conservative Government whom he probably supported and voted for at some point in the recent past.

The amendments give an opportunity to put respect back into the Bill, but there is also a practical element to them. We should remember, as we were reminded by, I believe, the noble and learned Lord, Lord Mackay, that trade and the internal market are flexible: they move, they change. The common frameworks are designed to be a flexible, living document. As many Peers have pointed out, they are also there to manage divergence. The common frameworks are there to manage divergence and, as we have heard from a number of speakers, not least my noble friend Lady Randerson, that divergence delivers innovation, progress and better things for this country.

My noble and learned friend Lord Wallace brought up something very important. In the words of the Minister, the Bill seeks to do that which the common frameworks do not do. The common frameworks do that which is being transferred from the European Union. Therefore, the Bill is trying to do more than was being transferred from the European Union. This is a zero-sum game. Where is that power coming from? It is being reserved by the Government from what was previously devolved. My noble and learned friend showed that that is the clear plan that sits underneath the Bill.

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Baroness McIntosh of Pickering Portrait Baroness McIntosh of Pickering (Con) [V]
- Hansard - - - Excerpts

My Lords, I am most grateful for this opportunity to follow the noble Lord, Lord Teverson, who chairs our EU Environment Sub-Committee so expertly and courteously.

I take this opportunity in supporting Amendments 10 and 11—I would marginally prefer Amendment 10, but presumably they are for debating purposes—briefly to ask my noble friend Lord Callanan whether our understanding of the Bill as currently drafted is correct, in that it appears to be very tightly and prescriptively drawn, as so expertly indicated by the noble Lords, Lord Stevenson and Lord Anderson. Would protection of the environment or the labelling provisions proposed by my noble friend Lord Young of Cookham be permitted? Is my noble friend Lady Neville-Rolfe correct that, for example, the labelling provisions set out by my noble friend Lord Young would already be allowed?

My understanding is that member states such as Denmark can already provide additional information for consumers, such as the calorie content of beers and other foods, and that we have not gone that far yet. Would that be permitted under the Bill as currently drafted, or do we need the amendments in this group to be moved? That would greatly assist me understand how exactly the provisions in the Bill as drafted are to be interpreted.

Baroness Noakes Portrait Baroness Noakes (Con)
- Hansard - -

My Lords, I am sure that the supporters of these amendments are motivated only by the desire to enable the devolved Administrations to do the right thing in environmental protection and all the other fine things mentioned in these amendments, though I must say to the noble Lord, Lord Stevenson, that I have absolutely no idea what “cultural expression”, as mentioned in Amendment 21, has to do with the internal market.

I appeal to noble Lords to remember that the aim of this Bill is to ensure that the UK’s internal market operates on a frictionless basis and allows businesses to trade in the UK with the minimum of barriers as they do now. This helps businesses in all parts of the UK operate successfully and profitably, which supports the aim I hope we all share of a healthily growing economy. More importantly, it delivers for consumers because trade barriers tend to increase costs and reduce consumer choice.

I have to say that this is not a question of whether a particular regulatory rule will itself increase costs. We can argue all day about whether, say, increasing environmental regulation will increase or reduce costs for consumers. That is not the point; the point is about having different environmental regulations in one part of the United Kingdom compared with other parts and whether that will work in the interests of consumers or against them. The answer to that is clear. If such regulations have the effect of erecting further trade barriers, the consumer takes the hit.

United Kingdom Internal Market Bill

Baroness Noakes Excerpts
Report stage & Report: 2nd sitting (Hansard) & Report: 2nd sitting (Hansard): House of Lords
Monday 23rd November 2020

(3 years, 7 months ago)

Lords Chamber
Read Full debate United Kingdom Internal Market Act 2020 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 150-III(Rev) Revised third marshalled list for Report - (23 Nov 2020)
Lord Liddle Portrait Lord Liddle (Lab)
- Hansard - - - Excerpts

My Lords, I will speak briefly in favour of both these amendments, particularly Amendment 22 on the question of public procurement. When I was Europe adviser in Downing Street, I formed a view that the British authorities—in Whitehall and the Government Legal Service—took a more legalistic approach to implementing the state aid rules, the non-discrimination rules and so on of the European single market than did most other member states. It was quite an effort to get the system to think differently about these questions.

One of the most notable achievements where we thought differently was towards the end of the Labour Government, when my noble friend Lord Adonis, who is not in his place, insisted that the award of a big contract for railway carriages and new trains would go to Hitachi but on condition that it built a plant to construct them in Shildon, County Durham. That was a success in breaking the established orthodoxies; it came rather late in the day, but there we are. Then when my noble friend Lord Mandelson was trying to bring back the concept of industrial policy, also towards the end of the Labour Government, one of the big questions was that of public procurement. I really am not a protectionist; I believe in open markets and that, on the whole, the benefits of free trade are very considerable. But there are circumstances in which public procurement can be used to support local business in a way that is justified.

One of the ways of doing this, of course, is that if you have innovative local firms with a lot of potential to grow, they can easily be squeezed out of the market by competition from big companies which can produce at much cheaper prices. I believe that one reason why we have not been as innovative as we should is that we have not used public procurement to support small and medium-sized enterprises with great potential for growth. This was one of the things we were trying to do towards the end of the Labour Government.

However, I also believe that that kind of policy is difficult to run from London. That makes this kind of public intervention, which is about not spending subsidies on lame ducks but trying to grow the economic potential of a local area, one that is best decided upon as close as possible to that area. That is why it is a terrible mistake to try to limit the powers of the Welsh and Scots on these matters. In fact, I would like to see proper devolution in England so that English authorities could do this outside London. This amendment has my wholehearted support, and I hope that the Government will give it a very considered response.

Baroness Noakes Portrait Baroness Noakes (Con)
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My Lords, I have spoken in several debates on Report about the impact of further restrictions on the scope of the UK’s internal market for goods covered by the market access rules. The plain fact is that, the more that is taken out of the ambit of the rules on mutual recognition and non-discrimination, the more likely it will be that consumer detriment will follow, whether by way of increased costs or reduced choice. With that background, let me turn briefly to the two amendments in this group.

In respect of the amendment of the noble Lord, Lord Wigley, on procurement, I have to confess that I am not an expert on procurement rules—unlike the noble Lord, Lord Liddle—so I will have to tread carefully not to display the extent of that ignorance. But my instinct is that if we try to take procurement out of the UK’s internal market rules, we will end up harming the UK’s internal market, which would be harmful for all parts of the United Kingdom.

The noble Lord, Lord Wigley, explained what had been happening in Wales in entirely reasonable terms, but it seems a relatively short step from that to applying discrimination in an unreasonable way—and for no reason other than to support nationalist views. I am sure that would not happen in the Welsh Government, but I can think of somewhere else where it might.

In addition, when we talk about benefits for one nation, we have to see the disbenefits to that nation’s businesses if they in turn are locked out from public procurement markets in other parts of the United Kingdom. In particular, we have to understand that Scotland, Wales and Northern Ireland export more goods into other parts of the United Kingdom than England does into the other three nations. If we have an internal market that works on parochial or nationalist principles, that is likely in the long run to harm Wales, Scotland and Northern Ireland, as much as it may appear to give them gains in the short-term, so I do not support his Amendment 22.

I turn briefly to Amendment 23, which I am not sure would work in practice. Paragraph (b) of the proposed new clause refers to

“a proportionate means of achieving a legitimate aim”—

but the term “legitimate aim” has no definition here. It is defined in Clause 8, but that deals only with indirect discrimination, so I do not think that the amendment would work on its own terms. In addition, we had a good debate on the substance of these issues in the group of amendments that we discussed on the first day of Report, and this amendment does not take us any further than that, so I hope that the noble Baroness, Lady Boycott, will not press it.

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Baroness Bowles of Berkhamsted Portrait Baroness Bowles of Berkhamsted (LD) [V]
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My Lords, I thank the noble Baroness, Lady Neville-Rolfe, for drawing this clause to our attention, and I agree with the comments that have been made. In particular, I agree with the question about how you distinguish between goods and services when, nowadays, many things are never sold but rather licensed or rented and must sit either with one foot in each camp or, possibly, goods become services and vice versa.

Other confusions also arise around things that originally can be excluded but then are not when there is a substantive change to their regulation. There was some discussion, in which I was not involved, on this in Committee. What constitutes a substantive change? If you have authorisation requirements and a list of 10 things, does it mean that five have to be changed or does it mean a significant change to one? If you had to add on another one because there are some changes in circumstances, who is to know whether it is then out or in?

There are certainly a lot of things that are not yet clear and, if it does—as the noble Baroness, Lady Neville-Rolfe, has said—interfere with our services, which are the majority of our trade, then we will be in a very difficult situation. I would welcome further clarification, or indeed amendments, to make matters clearer. I am not sure whether removing the clause actually helps because the knock-on effect elsewhere would of course be substantial, but I think that there is something that needs to be fixed.

Baroness Noakes Portrait Baroness Noakes (Con)
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My Lords, I am glad that my noble friend Lady Neville-Rolfe’s Amendment 30 is only a probing amendment. I very strongly believe that the UK’s internal market will be more robust as a result of this Bill and that it needs to cover all aspects of trade and professional activity occurring between the four parts of the United Kingdom.

However, like my noble friend, I have been struggling to work out just how important Part 2 is to businesses throughout the UK at the moment, and I also understand that there is relatively little current data on trade in services across the four nations. Given the exemptions that will apply to Part 2, the Government presumably do not think that the Bill will have very much real-world impact, at least in the short to medium term. I can see that it may be necessary to protect service providers in the future, if one or more of the devolved nations chooses to make it difficult for out-of-nation services providers, and, to that extent, I can see why we may well need Part 2 of this Bill. It would be good to hear from the Minister what he sees as the biggest problems that this Bill is trying to tackle.

Lord Naseby Portrait Lord Naseby (Con)
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My Lords, I think the House should be very grateful to my noble friend for putting this probing amendment down. All of us who have worked in the services industry, as I did before going to the other place, understand it very well. However, despite this, it is very difficult to comply with this part of the Bill.

The underlying problems I have are that, first, the services industry is a real growth market for the UK and shows every sign of continuing to be so. We must be very careful not to undermine it. I note my noble friend’s mention of consultation, which I am a great believer in; I have probably spoken about it on more amendments than anybody else. At any rate, consultation of only one month is not acceptable in any industry, particularly not at this crucial point.

I have two technical questions, having read and thought about this. First, what happens to those service industries that have no regulator, which would be a fair number of them? Sometimes they are in a licensed area, and sometimes they are not in any particular area, so it is not clear to me what happens to them. Secondly, will the register, when it appears, automatically approve every existing business in the services industry and transfer them across? If not, is there to be an appeal mechanism? Again, I ask these questions on a probing basis and look forward to my noble friend giving us some guidance.

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Baroness McIntosh of Pickering Portrait Baroness McIntosh of Pickering (Con)
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My Lords, I welcome government Amendment 52, in the name of my noble friend the Minister. In particular, I am looking at its proposed new subsection (2B), which states:

“The CMA must also, in carrying out its functions under this Part, have regard to the need to act even-handedly as respects the relevant national authorities.”


Would my noble friend the Minister not agree that this seems to dovetail completely with Amendment 54, in the name of the noble and learned Lord, Lord Thomas of Cwmgiedd? This seems very attractive because this dovetails entirely with, and supports, the Government’s call for there to be one board member from each of the Administrations. I would like to hear from my noble friend a very good reason for why it would not be the case that those appointments would be made as set out in Amendment 54.

Baroness Noakes Portrait Baroness Noakes (Con)
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My Lords, I thank my noble friend the Minister for the Government’s amendments in this group, which are very welcome. However, I will focus on Amendment 54, in the name of the noble and learned Lord, Lord Thomas of Cwmgiedd. Any chairman of a board, whether it is a public or private company or a public body, will say that the most important thing about the board is getting a balance of skills and experience on it. In addition, nowadays, most boards feel the need to achieve a degree of diversity, generally expressed in terms of sex and race.

Putting together a balanced board is a complex task, and trade-offs often have to be made between the different characteristics that the different candidates can bring. The more that seats on the board are allocated to particular sources or interests, the more difficult it is to achieve balance. In something like the CMA, the board is not there to bring representative interests to bear; it is there to make sure that the CMA is run properly, so it should have people who can understand whether it is achieving its objectives or running itself effectively. Those are the most important characteristics.

If one has direct appointment to a public body such as the CMA, that can actually unbalance a board—you could end up with a lack of certain skills or experience, or an overrepresentation of certain commercial backgrounds, for example. When you have a single appointor, which in the case of the CMA is the Secretary of State, the challenge of getting a balance can be worked out between the Secretary of State, his department and the chairman of the relevant body. That is what happens in most public bodies. By taking away some of the appointments, you just make that process much more difficult to achieve.

I continue to believe, despite what noble Lords said earlier, that direct appointment by the devolved Administrations will inevitably be political, because they will be seen as representatives. Indeed, the noble and learned Lord, Lord Thomas, used the word “representatives” when he introduced this amendment earlier. A representative is never completely independent if he or she feels the need to represent.

One of the changes made by the Scotland Act 2016 was direct appointment to the board of Ofcom, and that was followed by similar legislation for Wales and Northern Ireland. I was deputy chairman of Ofcom at the time, so I understand the impact that that can have on board balance—but I do not want to talk about that beyond what I have already said about the difficulties in managing a board when direct appointments are made.

I would like to draw attention to Section 65 of the Scotland Act 2016, where the devolved Administrations were allowed to appoint a member directly. However, that appointment had to be made in consultation with the Secretary of State, which allowed one avenue for conversation to try to make sure that some degree of orderly balance was maintained in relation to the appointments. Amendment 54 does not even go so far as to recognise that precedent, and it is a very extreme action to be taken in relation to the CMA. I hope that the noble and learned Lord, Lord Thomas, will not press his amendment.

Baroness McIntosh of Hudnall Portrait The Deputy Speaker (Baroness McIntosh of Hudnall) (Lab)
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The noble Lord, Lord Liddle, has withdrawn, so I call the next speaker, the noble Baroness, Lady Randerson.

United Kingdom Internal Market Bill

Baroness Noakes Excerpts
Report stage & Report: 3rd sitting (Hansard) & Report: 3rd sitting (Hansard): House of Lords
Wednesday 25th November 2020

(3 years, 6 months ago)

Lords Chamber
Read Full debate United Kingdom Internal Market Act 2020 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 150-III(Rev) Revised third marshalled list for Report - (23 Nov 2020)
Baroness Noakes Portrait Baroness Noakes (Con)
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My Lords, I support the government amendments in this group, but I put my name down to speak in order to address the other amendments tabled by the noble Baroness, Lady Bowles of Berkhamsted. Like her, I am concerned about the heavy-handed penalties that could apply in respect of the CMA’s information powers under the Bill.

The CMA has extensive information powers under the Enterprise Act 2002, as the noble Baroness, Lady Bowles, explained, which are needed so that it can carry out its competition functions effectively, in particular in the face of companies or sectors that are resistant to one of the CMA studies. However, there has to be a serious question about the information powers put into the Bill in respect of the office for the internal market. It should be remembered there was no clear consultation on this during the summer, so the proposals have not had a lot of serious attention.

The OIM will of course be focused on the effectiveness of the internal market rather than the behaviour of companies or sectors. I understand that the OIM needs to build up a picture of intra-UK trade flows in order to understand the scope of what it is looking at, and it should have the ability to request that information. However, to back up that kind of information gathering with extensive penalties is not right. It stands in stark contrast with the Trade Bill, which sets up the possibility of requesting information from businesses in respect of international trade—but it is very clearly a request, with no compulsion. My noble friend Lord Grimstone of Boscobel confirmed that in Committee on the Trade Bill.

The office for the internal market may well want to gather information from the devolved Administrations or regulatory bodies within the devolved territories. For example, it could be looking at whether particular provisions have a detrimental effect. That sort of information gathering is largely within the public sector, and the enforcement provisions in Clauses 39 and 40 do not make sense in that context.

Can the Minister say who the “persons” in Clause 39, whom the Government expect to be served with a penalty notice, are? Could one of them be, for example, the First Minister in Scotland, or one of her Ministers? If not, why not? I suspect that the serious information that may need to be extracted at some stage will come from the devolved Administrations. Why should businesses, which will be the victims of any abuses of the internal market, be treated in the way envisaged in the Bill?

So I support the noble Baroness, Lady Bowles, in particular in her Amendment 62A to try to shield small companies from these powers. I listened carefully to what the Minister said in his introductory remarks, which were very helpful, but I remain concerned that the CMA will use inappropriately the powers given to it by the Bill. There are no safeguards against that, so I hope that my noble friend will take this away for further discussions between Report and Third Reading.

Lord Naseby Portrait Lord Naseby (Con)
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My Lords, I should declare an interest in that I have a partnership with my wife to look after 40 acres of woodland in Bedfordshire. I thank my noble friend on the Front Bench. I have worked on a great number of Bills in this and the other place, and it is good that when we discuss things in depth, right across the Chamber, problems are raised and the Minister listens. I welcome enormously Amendments 62 and 63.

However, I share the concerns of some other noble Lords about the implications of Amendment 62A. It raises questions that ought to be considered—although I am not in a position to repeat what my noble friend Lady Noakes said. I hope that the Minister has listened to the concerns expressed from both sides of the Chamber and will find a means of ensuring that what might be very unusual cannot happen. I am sure that my noble friend on the Front Bench is listening. Some consideration should be given to including Amendment 62A, or something comparable, in the Bill.

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So why am I offering this advice if my view is the opposite? Because, when the independence move or moves come, I hope that they can be done in a friendly, co-operative manner, with the kind of political, consensual approach more typical of the representatives of the devolved Administrations than of Westminster—as we hoped the move out the European Union could have been managed once the decision was made. Now, 36 days from the end of the transition period, with the nation in a state of great uncertainty, let us learn from that experience—and I can promise the Green group’s support for all the moves to try to ensure that power and resources stay with the devolved Administrations.
Baroness Noakes Portrait Baroness Noakes (Con)
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My Lords, I support Clause 42 and Amendment 66, but I do not support the various other amendments in this group, and in particular I wish to speak against Amendment 64, which seeks to remove the financial assistance power from the Bill.

I have been very concerned, throughout this Bill and again today, at the way in which grievances about devolution have been elevated into some kind of holy crusade which sees only evil in the UK Government. Noble Lords supporting various amendments on this theme have often alleged that the Government are playing a dangerous game with the devolution settlement and that this Bill represents a major power grab which must be resisted. I believe that the only people threatening the constitutional settlement on devolution are those who have set their face against—or at least ignored—the existence and value of our United Kingdom and our precious union.

I have also heard a lot of wishful thinking about the UK as a federation of equal states, which it is not. Many noble Lords have been pretending that “the UK Government” is synonymous with “an English Government”—which is also far from the truth. If there is a gap or weakness, it is that the UK Government and UK Ministers act mainly in the interests of the whole of the United Kingdom, and England gets left a bit to one side.

The Government have been consistent and clear that they intend to act in the interests of levelling up the whole of the United Kingdom. The actions of my right honourable friend the Chancellor of the Exchequer in today’s expenditure review are testament to that, and I say to the noble and learned Lord, Lord Thomas, that it is a very fine blue book—a Red Book, I believe, is normally reserved for a Budget Statement.

The UK Government will always act in the interests of the whole of the United Kingdom, and it is disingenuous of noble Lords to paint a picture of a domineering Government trying to strip powers away from the devolved nations. No powers at all are going to be taken from the devolved nations. Devolved Administrations still have the same powers to spend their money as at present.

Clause 42 creates the power to grant financial assistance across the UK so that it is put beyond doubt that the UK can replicate the sorts of financial flows that existed when the EU took money from the UK and graciously gave a bit of it back to us to use in the way it decided. In future the UK Government will make those decisions about how UK money is directed, rather than Brussels. The guiding light will be the needs of the UK as a whole, although I am sure my noble friend the Minister will confirm that there will be extensive discussions with and the involvement of the devolved Administrations.

Clause 42 talks about financial assistance but let us be clear: this is simply public expenditure. Public expenditure is sourced within the overall fiscal policies of the United Kingdom as set by the Chancellor of the Exchequer. It will be financed by UK taxation or UK borrowing, both of which are carried out by Her Majesty’s Treasury as part of its UK-wide economic policies. These are not matters for the devolved Administrations, however much they might wish otherwise.

Noble Lords really should be careful what they wish for. If Clause 42 is removed from the Bill, noble Lords will remove the mechanism the Government have chosen to funnel public money into their agenda to level up the whole of the UK. How do noble Lords think that the devolved Administrations will get the kinds of money that used to flow via the EU without Clause 42?

Of course, the Government have powers, in general terms, under the appropriation Act to decide upon and distribute public expenditure, but it is a well-known rule and general practice to take a specific legal authority for major expenditure that will be made on a recurrent basis. So the result of taking Clause 42 out of the Bill may well be that the large sums that the devolved nations expected to receive will disappear. Is that really what the noble Lords promoting Amendment 64 want to achieve?

Lord Rooker Portrait Lord Rooker (Lab) [V]
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My Lords, I again partly apologise to noble Lords because I intended to speak on later amendments and to support the noble and learned Lord, Lord Thomas, on Amendment 69. I will settle for Amendment 64.

I take exception to the definition of the Long Title from the noble Lord, Lord Naseby. Whichever way we read it, it is about devolved matters in the United Kingdom. We have only to look at the definition of infrastructure in Clause 42 to see that it absolutely covers devolved matters. His was a bit of a cheap shot at the noble and learned Lord, Lord Thomas, to try to imply that this was inconsistent with the Long Title.

My other beef is one I have had in the past regarding Wales and the Barnett formula. I have never understood why the people of Wales, including the politicians, have never risen up. Some years ago I was a member of the Select Committee that looked at the Barnett formula. It was abundantly clear that Wales had been cheated for years. If the Barnett formula was based on need, rather than population, Wales would be on about a third more than it is now. We told leading MPs about this, but I have never noticed any great kickback. Wales has been short-changed under Barnett for years. There is no easy answer to that.

The noble and learned Lord, Lord Thomas, was absolutely bang on in delivering the information from box 3.1 out of the Red Book at the beginning of the debate. I thought his eight questions were incredibly telling. I would use the term “pork barrel”, because that is what it is about. The Chancellor of the Exchequer, whose Statement I heard earlier, made it quite clear that the spending of this money relied on the consent of the constituency Member of Parliament, although I understand that the Treasury might have disowned this since. I tweeted, saying that it is incredibly dangerous for constituency Members of Parliament to be involved in executive functions. Local councils are always involved in executive functions; Members of the House of Commons are not. It is incredibly dangerous territory for them to get involved in, particularly in view of incidents that arose in the past.

I understand that the Treasury might have backpedalled a little on that, but it shows the thought process of those who constructed the Statement today, which is intricately involved with the Bill: destroy devolution, open up the pork barrel and give money to your friends based on the constituency MP. That cannot be a good form of governance. It cuts across devolution massively, whichever way anyone defines it. I have said before that my experiences have been at Defra and MAFF before devolution, then at the Food Standards Agency, which was a four-nation, non-ministerial department at the time. Whitehall has never really done devolution and never really understood what was happening. It has taken a while even for the House of Commons to become clear about the quite distinct advantages of devolution. It all went wrong, of course, when the proportional electoral system gave a majority Government. That is not supposed to happen, but neither, on the other hand, is first past the post designed to give coalitions, which is what we had in 2010. You cannot base the future construct of the constitution on such whims.

Governments come and go and will not be there for ever, but I very much agree with what the noble Baroness, Lady Bennett of Manor Castle, said: with devolution now under acute and very massive threat, there is no question but that this will push the independence movements of Wales and Scotland wider and further, particularly in Scotland, where it is stronger. I cannot see a solution to it. I think that we are heading headlong towards the break-up of the union. I will fight like hell to stop that and a lot of people will. The problem is, keeping the fight in words and debate. We are heading for the destruction of our country, without any policy announcement, a clear vote or a manifesto commitment. It is being done by subterfuge and backhanders.

In my view this is the direct effect of the Bill, particularly these attacks on devolution. Amendment 69 covers the same for Clause 44; they are two sides of the same coin. I was going to speak about Amendment 65, but I will leave that to my noble friend. This fundamental attack on devolution, with the push to break up the United Kingdom, is a much more serious affair than has been recognised by your Lordships’ House, where it has been recognised more than in the House of Commons. We need to send a signal to the elected House that our country, our constitution and the make-up of the union are under direct threat as a result of the Bill.

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Baroness Noakes Portrait Baroness Noakes (Con)
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My Lords, as the Minister knows, I am a strong supporter of the Bill and believe that it is important to allow the UK’s internal market to function, but I genuinely believe that the location of the office for the internal market is problematic. I fully support the OIM itself, as it will be essential to monitor the effectiveness of the UK’s internal market. However, the CMA is the wrong place for it at the wrong time.

It is the wrong place because monitoring the internal market is a radically different activity from the core functions of the CMA. To oversimplify, the CMA is focused on businesses which can and do behave badly on competition. By contrast, the office for the internal market will not target individual businesses or sectors; its targets will end up being the Administrations of the devolved nations or their regulators if they act in a way that undermines the internal market. Businesses trying to trade throughout the UK should be the beneficiaries of the OIM’s work, not the villains. Most of the CMA’s battles are fought on legal and economic analysis, which are often big battles with a lot at stake but a world apart from the kind of political battle in which CMA may find itself pitted against one of the devolved Administrations.

In Committee, I said that putting two different activities into a single organisation ran the risk of that organisation being a jack of all trades and master of none. Having thought about that further, it is potentially worse. If the CMA and the OIM get embroiled in long political feuds about restrictions on trade within the internal market, it could be very damaging to the CMA’s focus, which may take away from the attention it gives to its core competition-based work. We may end up throwing the baby out with the bath water. It is also the wrong time to put the OIM into the CMA, given the significant increase in size as it takes on additional activities following our departure from the EU. Organisations that try to take on too much and do too many things at once often end up achieving very little.

For those reasons, I support creating the office for the internal market as a separate body. I cannot, however, support the amendment in the name of the noble Baroness, Lady Bowles of Berkhamsted, because it has gone beyond the simple purpose of setting up an independent OIM and has strayed into state aid, with its own version of how that may be taken on in future. That goes too far.

Baroness Neville-Rolfe Portrait Baroness Neville-Rolfe (Con)
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My Lords, I support the main thrust of the amendment, as I explained in Committee when leading a debate on my amendment, for which there was considerable support across the House. There is a good case for establishing a UK office for the internal market, but the CMA is the wrong home, for all the reasons that my noble friend Lady Noakes articulated so well. The CMA operates with values—notably a deep suspicion of the good business can do and an aggressive approach to enforcement—that are not appropriate to the new office.

Subsections (1) and (2) of the proposed new clause come from an earlier amendment which, frustratingly, was not moved, and are on the right lines. However, the proposed subsection (3) is not sensible. If any of the devolved Administrations withhold consent for appointments on whatever grounds, the whole purpose of the new office could be stymied. One is reminded of President Trump and the World Trade Organization, when unexpected and unforeseen actions by an elected officeholder—in this case, the President—in an advanced and democratic country came close to wrecking the operations of a major component of the global economic order. We would be foolish voluntarily to run such a risk.

It may be argued that it is unlikely the devolved Administrations will act like President Trump or that this is an issue of the same order. I would retort that, five years ago, it was deemed impossible by all informed observers that a US President would act as he has towards the WTO. Life can contain surprises, and we act foolishly if we unnecessarily set up arrangements that risk being sabotaged.

Accordingly, I call on the Minister to agree to bring forward an amendment at Third Reading that incorporates proposed new subsections (1), (2) and (5) of Amendment 68A, which seem entirely sensible and widely supported. I regret that I cannot support Amendment 68A as it stands.

United Kingdom Internal Market Bill Debate

Full Debate: Read Full Debate
Department: Cabinet Office

United Kingdom Internal Market Bill

Baroness Noakes Excerpts
Baroness Bennett of Manor Castle Portrait Baroness Bennett of Manor Castle (GP)
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My Lords, I will speak very briefly in favour of Motion F1 in the name of the noble and learned Lord, Lord Thomas of Cwmgiedd. I thank him for his strong and determined pursuit on this issue over the many stages of this Bill. I join the noble Lord, Lord Adonis, in hoping very much that we will see our Opposition Front Benches support this and push it forward.

I will refer to many of the same issues that I raised on Motion B; we are talking about local control and local prioritising, as the noble Lords, Lord Adonis and Lord Liddle, have said. Without this amendment, this Bill would take financial control away from the devolved Administrations—money is power, as we know. I think it was in Committee that I raised the phrase “pork barrelling”, which has reappeared again and again. This is heading towards an American-style politics, and we have many reasons why we would not wish to head in that direction.

This means in practice that if you have, as we do, an Administration in Westminster who are keen on building new roads—even though they just create more air pollution and new traffic—and airport expansion, and not on spending on nature, that priority will be forced on to local devolved Administrations.

I slightly disagree with the noble Lord, Lord Liddle, who held up as a model local enterprise partnerships and the previous model under the coalition Government; business and elected people is one partnership, but I would like to see something which is much broader and takes in all elements of the local community.

I have been seeing a great rise in enthusiasm across many parts of government for deliberative democracy, for the climate assembly and the people’s assembly approach—the chance to bring together representative groups of people to make decisions. Given that increase in enthusiasm, I would like to see it written into the Bill. Perhaps we will pursue it in the future.

I come back to my point from the debate on the previous amendment about the issue of coercive control raised by the Domestic Abuse Bill. That explicitly looks at financial control as a way in which people in households exercise unequal control. I hope that your Lordships’ House would agree that in an ideal household, everyone has a real and equal say in the spending of financial resources and a real chance to have their say. I would be interested in the noble and learned Lord’s comments on this; the noble Lord, Lord Adonis, said that this was in consultation. I agree that we should have the word “consent” in this amendment. We are talking about democracy, about people having their say and about how we would like to see our nations run.

Baroness Noakes Portrait Baroness Noakes (Con)
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My Lords, when the Minister introduced the Motion, she explained clearly that the other place had claimed financial privilege and that it was customary for this House to respect that decision made by the Speaker. The noble and learned Lord, Lord Thomas of Cwmgiedd, said that this was not a financial issue. I respectfully say to the noble and learned Lord that it is not for this House to determine whether or not it is a financial issue. As I understand it, it has been accepted by this House for a very long time that the final arbiter of what is or is not a financial issue for which privilege can be claimed is the other place, through its Speaker. If we continue to disregard the Commons claim of financial privilege in relation to amendments we send to the other place for consideration, we not only show a lack of respect, particularly to the Speaker, but might be starting on a route to a constitutional clash with the other place, which would be most unfortunate.

When I sat where the noble Baroness, Lady Hayter, sits, many years ago, we often faced financial privilege being invoked against amendments we were pleased with ourselves for having sent back to the other place for consideration, but we always respected that decision when it came back. I hope that the noble Baroness, Lady Hayter, will continue that tradition in this place. Does the Minister know of any precedence for this place insisting on its amendments not once but twice in the face of a financial privilege claim by the other place, and does she agree with me that this is not a path down which this House should go?

Lord McNicol of West Kilbride Portrait The Deputy Speaker (Lord McNicol of West Kilbride) (Lab)
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Does anyone else in the Chamber wish to speak?