On Monday (28 September), the Scottish and Welsh Governments published ‘Legislative Consent Memorandums’ (LCM) regarding the UK Internal Market Bill. Both recommended that the Scottish and Welsh Parliaments should withhold consent.

This Insight looks at each government’s position, as well as broader concerns about how the UK Government deals with legislative consent.

The Internal Market Bill and legislative consent

The United Kingdom Internal Market Bill 2019-21 was introduced to the House of Commons on 9 September 2020. It seeks to legislate for a UK ‘Internal Market’ at the end of the Brexit transition period.

The Sewel Convention states that the UK Government will “not normally” legislate on devolved matters without consent from the relevant devolved legislature. The UK Government accepts that this convention applies to every part of the Bill.

The Scottish and Welsh Parliaments and Northern Ireland Assembly require the Scottish and Welsh Governments and Northern Ireland Executive to publish a LCM when the UK Government puts forward legislation affecting devolved matters. These typically explain the rationale behind the granting or withholding of consent.

Although the Scottish and Welsh Governments published their LCMs on Monday, the Northern Ireland Executive has yet to do so.

The Scottish Government LCM

In its LCM, the Scottish Government sets out several objections to the Bill. It questions its necessity given the ongoing Common Frameworks programme, and believes it encourages “harmful deregulation” without adequate parliamentary scrutiny.

Its most substantial criticism is that the Internal Market Bill is “fundamentally incompatible” with the “principles and practice” of the devolution settlement in Scotland. By compelling primary or secondary Scottish legislation to conform to the principles of the Bill, the LCM argues that it introduces “a new, wide-ranging constraint on devolved competence.”

The Scottish Government also believes the provision in the Bill that allows the UK Government to provide financial assistance risks “an uncoordinated and potentially incoherent approach to spending in devolved areas.” It objects to the Bill’s intention to make state aid (which will replace EU subsidies) a reserved (sitting with the UK Parliament) rather than devolved matter.

Finally, the LCM says the Scottish Government is “deeply concerned” at the UK Government’s “increasing” tendency to add enactments to Schedule 4 of the Scotland Act 1998. That schedule contains a list of enactments the Scottish Parliament is not allowed to modify. Other Brexit legislation was added to that list in 2018 and 2020. The Scottish Government says this means Holyrood’s legislative competence will be “permanently reduced.”

As a consequence, the Scottish Government does not intend to lodge a formal motion on the Internal Market Bill. Instead, it will invite the Scottish Parliament to debate the legislation “in due course.”

The Welsh Government LCM

The Welsh Government LCM concurs with many of the Scottish Government’s objections but departs in other respects.

Welsh Ministers agree the Internal Market Bill risks resulting in a “race to the bottom” in terms of standards. They object to the potential “setting aside” of “Welsh-made rules” as applied to goods or services originating from other parts of the UK. The LCM also rejects the proposed reservation of state aid and the intention to make the Internal Market Bill a “protected” enactment under Schedule 7B of the Government of Wales Act 2006.

Unlike the Scottish Government, however, the Welsh Government’s LCM says it is “not opposed,” either to the principle of a UK internal market or to a UK-wide state aid regime (though it believes the Bill goes “far beyond” what is necessary). Welsh Ministers also say they are “open” to the creation of an independent Office of the Internal Market. But they don’t believe the Competition and Markets Authority “as currently constituted is a suitable vehicle for this.”

The Welsh LCM states that the Welsh Government plans to publish proposed amendments to the Internal Market Bill but will not recommend consent by Senedd Cymru/Welsh Parliament unless it is “substantially amended to address our significant concerns.”

Even if both the Scottish and Welsh Governments recommend withholding consent (or do not even lodge consent motions), this will not prevent the Internal Market Bill from becoming law.

Reforming the Sewel Convention?

The Institute for Government (IfG) recently published recommendations for ways to “repair” what it calls a “breakdown in trust” created by the passing of UK-wide legislation without the consent of the devolved legislatures.

The IfG proposes:

  • the UK Government formally recognises that consent is required for legislation amending the powers of the devolved legislatures
  • an agreed “minimum period” in which UK Government departments share draft legislation with their devolved counterparts
  • “devolution statements” explaining why the UK Government has chosen to legislate without consent
  • a greater scrutiny role for parliamentary committees.

Last week, the House of Commons Procedure Committee also announced an investigation into how the Commons engages with the UK’s territorial constitution. Karen Bradley MP, the Committee Chair, said the IfG’s recommendations provided “an excellent starting point” to examine how the Commons interacted with the Sewel Convention.

About the author: David Torrance is a researcher at the House of Commons Library, specialising in devolution and the constitution.

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