Peers' devolution report points up "fundamental threat" of Brexit
Brexit presents a fundamental challenge to the future of the UK, as the supremacy of EU law has been the "glue holding together the United Kingdom’s single market", according to a report from a House of Lords committee published today.
The EU Committee's report Brexit: devolution recommends that during Brexit "the statutory balance of competences between the UK Parliament and the devolved legislatures should as far as possible be unchanged", leading to a "significant increase in the powers and responsibilities of the devolved institutions".
Its conclusions were agreed before last week's publication of the European Union (Withdrawal) Bill, under which powers returning from Brussels will initially vest in Westminster. This led to a joint response from the Scottish and Welsh Governments indicating they could seek to withhold legislative consent to the bill in its current form. The report is clear, however, that a durable outcome "will need the consent of all the nations of the United Kingdom, and of their elected representatives".
Highlighting the "complex overlapping competences" within the UK and the risk that these become "increasingly unstable" through Brexit, it warns: "Any attempt to use Brexit to make a power grab, either to 're-reserve' powers previously devolved, or to claim more devolved powers, could compound this instability: this is not the time to embark on controversial amendments to the devolution settlements."
Stressing the need for UK Government and the devolved Governments to "set aside their differences and work constructively together to achieve an outcome that protects the interests of all parts of the UK", the committee calls on the UK Government in particular to "raise its game" in consulting the devolved Governments, so as to give them real influence in the Brexit negotiations.
They could also have an enhanced role in managing EU migration, given that in relation to non-EU migration there is already differentiation in the provision of tier 2 visas to meet sectoral requirements. "Local and regional economic and demographic needs, rather than central targets, should drive decision-making."
The report notes in particular the "acute concern" that the devolved jurisdictions will lose heavily if needs-based EU funding is replaced by UK subsidies granted in accordance with the population-based Barnett formula.
Particular needs
Looking at Scotland in particular, the report concludes that the Scottish Government’s proposal for Scotland to remain a member of the EU single market, while the rest of the UK leaves, would be politically impracticable, legally complex and economically disruptive. However it calls on the UK Government to “respect the particular circumstances in Scotland”, including the high level of support for remaining in the EU.
Any Brexit deal, it adds, should accommodate Scotland’s particular needs, including its reliance on EU migration to meet both labour market and demographic needs. In view of the uncertainty at present over the Brexit negotiations, the committee cannot reach definitive conclusions about the feasibility or desirability of achieving defferentiated arrangements across the various policy areas, but is of the view that conferring legal personality on Scotland, to enable it to negotiate its own agreements with the EU or third countries in areas of devolved competence, would have "profound and unpredictable constitutional and political consequences".
For Northern Ireland, the Committee restates its previous conclusion that the unique circumstances there will require unique, flexible and imaginative solutions. It notes that Brexit has already undermined political stability and exacerbated cross-community divisions, and in light of the Conservative/DUP agreement it calls on the Government to maintain confidence among the nationalist community. It welcomes the commitment of the UK Government and the European institutions to protect the achievements of the peace process and to avoid the imposition of a hard border in the island of Ireland.
As for Wales, the committee notes that its economy is heavily dependent on exports to the EU, and Welsh manufacturing would be hard hit by a failure to agree a comprehensive trade deal. Loss of EU funding will also put Welsh agriculture at risk, given the predominance of hill farming and sheep farming.
Lord Jay of Ewelme, a member of the committee and former head of the Diplomatic Service, commented: “Brexit’s impact on the future of the United Kingdom will be profound and unpredictable. At the moment the internal politics are pretty toxic, and we saw only last week the start of what could become a deep and bitter dispute on the role of the devolved institutions in passing the EU (Withdrawal) Bill.
“We can’t afford this. The UK Government must respect the devolved institutions. It’s not enough saying it’s listening to them –it’s actually got to take account of what they say and adjust its approach to accommodate their specific needs. Equally the devolved administrations must work with, not against, the UK Government to get the best Brexit for the whole of the UK.
“Devolution in the UK has been uncoordinated. For the last 20 years the EU and its institutions have helped hold together an increasingly devolved UK. In the long term we will need real reform: we will need to agree guiding principles, and finally replace the Barnett formula with a needs-based funding arrangement.
“But that’s for the future. In the short term what is crucial in getting the best out of Brexit for all parts of the UK. That means setting aside party politics and working together. It means the Government getting the basics right, using existing structures like the Joint Ministerial Council on European Negotiations to build a true consensus.”