Finance and Constitution Committee

Meeting date: Wednesday, September 12, 2018

Official Report 789KB pdf

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European Union (Withdrawal) Act 2018

Item 3 is to take evidence on the European Union (Withdrawal) Act 2018 from the Cabinet Secretary for Government Business and Constitutional Relations. Today’s session follows on from the evidence session that the committee held last week with the Secretary of State for Scotland. I welcome our witnesses to the meeting: Michael Russell, the Cabinet Secretary for Government Business and Constitutional Relations; Gerald Byrne, the team leader for constitutional policy; and Steven MacGregor, head of the parliamentary legislation unit in the Scottish Government.

Before we move to questions from the committee, I invite the cabinet secretary to make some short opening remarks, if he so wishes.

Thank you, convener, and thank you for the invitation to be here today.

It is worth reminding ourselves at the outset of how central the Sewel convention is to the position of this Parliament in the constitutional arrangements of the United Kingdom. Essentially, for as long as Westminster claims unlimited parliamentary sovereignty, the existence of this Parliament and the Scottish Government is always contingent on Westminster’s will. Westminster can legislate in devolved areas or change the powers of this Parliament or Scottish ministers without us being able to do anything about it legally.

Recognising that, the Sewel convention was established in 1998 as the original Scotland Bill was going through, to provide protection for the Scottish Parliament from Westminster undermining our legislation or interfering in our powers. Since 1999, the convention has operated impeccably, being observed by both Governments and Parliaments respecting devolved competence and devolved decision making. As David Mundell said last week, that has included matters on which there has been a good deal of controversy, not least the independence referendum. That has been the case until now.

We are all familiar with the events around the EU withdrawal bill. I want to emphasise two points, both of which appeared in the Secretary of State for Scotland’s evidence last week.

First, in answer to a question from Mr Tomkins, Mr Mundell said that the Sewel convention had been “adhered to”. For the avoidance of doubt, the Scottish Government does not believe that that is the case. We believe that the Sewel convention was breached in the passage of the withdrawal act. Consent was properly sought. It was denied by this Parliament but the bill nevertheless proceeded. Nothing happened between the seeking of consent and its refusal to make those circumstances “not normal”. By contrast, in Northern Ireland the UK Government made clear on the introduction of bills that circumstances were not normal, for reasons we understand. The difference is clear. The Sewel convention is of no value if the UK Government can decide at the end of the process that consent is not after all required, particularly if it is not forthcoming. The UK Government considered it was a legitimate approach that the withdrawal act should concern all of us.

Secondly, the secretary of state said that it was very clear back in 1998, when the convention emerged, that the Westminster Parliament would always be able to legislate on devolved matters. He said to the House of Commons in June this year:

“While the devolution settlements did not predict EU exit, they did explicitly provide that in situations of disagreement the UK Parliament may be required to legislate without the consent of devolved legislatures.”—[Official Report, House of Commons, 14 June 2018; Vol 642, c 1122.]

In my view, those statements stand the Sewel convention on its head. The Scotland Act 1998 made clear the legal right of Westminster to legislate in devolved areas. It could not do anything else in our system. However, the point of the convention is that the legal right to legislate in devolved areas will not be used except with the consent of this Parliament, most decidedly not in situations of disagreement. There is grave cause for concern about the future of the Sewel convention under this UK Government. It appears to think it has adhered to the convention but only by emptying it of any meaning or value in protecting this Parliament. This is not an absolutist position, as the Secretary of State for Scotland contends. It is simple recognition of the purpose of the convention and practice over 20 years.

There is, therefore, a problem that needs to be fixed. That was also identified by the House of Commons Public Administration and Constitutional Affairs Committee in its report on these matters published in July.

The Scottish Government has made various suggestions to address the problem for discussion with the UK Government, including revisiting the statutory provisions in the Scotland Act 1998 that were extensively considered by past committees under Bruce Crawford as convener.

Today, I will write again to David Lidington to set such discussion in motion, and a copy of that letter will be provided to the committee. I hope that he will respond positively to that request. I also look forward to discussing these matters with parties in the Parliament, both later today and subsequently.

In the meantime, as I said to the committee last week, the Government will work with the UK Government to develop Brexit legislation to ensure that Scottish interests are protected as far as we can, but we cannot, in all conscience, invite the Parliament to consider the issue of legislative consent if the UK Government reserves the right to set aside its view for all Brexit-related bills.

Thank you, cabinet secretary. I had intended starting this morning’s conversation with a question on common frameworks, but for understandable reasons you have concentrated on issues to do with Sewel and consent. Patrick Harvie has questions in that area, so he will go first on this occasion.

Good morning. I also expected this to come up a little later. I have a question about the statement that you gave before the summer recess, in the second half of June 2018, when you said that, in relation to the embedding of the consent mechanism into legislation, you intended to

“provide ... detail of ... legislation at an early stage in the new session, and I expect that the ... legislative process ... will get under way shortly thereafter.”—[Official Report, 19 June 2018; c 16.]

There was no suggestion of that in the programme for government. In fact, it suggested that the Scottish Government would wait until the end of the negotiations to set out our judgment on the best way forward at that time. Does that earlier intention to set out specific proposals still stand? When do we expect to hear back?

Are you asking about proposals about Sewel?

My understanding is that that was a comment about the embedding of the consent mechanism into legislation.

We cannot embed it in our own legislation. This is a matter for legislation that will cover devolution as a whole. What I am saying today is that I am putting a set of ideas to David Lidington and to the UK Government about what change would free up this situation to allow us to operate the convention again.

As I indicated in my opening remarks, this essentially lies in the area of ensuring that there is clarity about what is being asked for and how it is being asked for. You cannot ask for legislative consent for any part of a bill, get to the stage at which that legislative consent is refused and then say, “It does not matter because we are going to do it anyway”.

We need to embed in legislation a process that defines when legislative consent is required—and when it is not—and when it is required, make sure that it is binding, so that if consent is not given, that is final. That is the proposal that we are making and we hope to discuss that with parties here, including Patrick Harvie. As you know, we have a meeting this afternoon to look at some issues and I hope this will be one of them. I am in the process of writing to the United Kingdom and that letter will be provided today, and I hope to discuss that tomorrow.

If Mr Lidington or the UK Government do not respond positively and do not intend to legislate on this in the near future, does the Scottish Government intend to publish legislation and seek the support of members of either house at Westminster to debate specific proposals?

It is a good point. I am certainly prepared to consider that, but there is an on-going process of looking at intergovernmental relations. At the last joint ministerial committee plenary—I think that members of the committee know this and it has been referred to—there was an agreement that intergovernmental relations would be reviewed. That was agreed by the Prime Minister, so I find it surprising that there did not seem to be that indication from the Secretary of State for Scotland last week. Nothing much has happened, as the official who was with me last week at the JMC on European Union negotiations confirmed. Officials have met to discuss it once. We and the Welsh Government take the view that that needs to be given a push. The Welsh Government has published proposals. We have published proposals on devolution in “Scotland’s Place in Europe” in December 2016 and we have more proposals here.

An issue that will undoubtedly arise tomorrow and will continue to arise is for the UK Government to put some urgency and push behind this, and the PACAC report pushes that as well. Let us try to see whether we can move on that, but I am entirely open to publishing or drawing up legislation if that is an effective way of moving forward.

I am trying to understand exactly where we are with the disagreement between the two Governments about the extent to which the Sewel convention was adhered to in the passing of the withdrawal act. I understand that you are disappointed that the legislation was passed without the consent of the Scottish Parliament. I am also disappointed that the consent of this Parliament was not given to the passing of that legislation, but I do not yet really understand the constitutional and legal basis for your position that the Sewel convention was not adhered to. Can I walk you through it so that I can perhaps begin to understand it?

Yes.

The starting point is section 28 of the Scotland Act 1998. Section 28(7) states:

“This section does not affect the power of the Parliament of the United Kingdom to make laws for Scotland.”

You referred to that in your opening remarks. Subsection (8) adds that it

“is recognised that the Parliament of the United Kingdom will not normally legislate with regard to devolved matters without the consent of the Scottish Parliament.”

That is the statutory recognition of what has been called the Sewel convention. I do not understand, I am afraid, what in the process of the enactment of the withdrawal act was not compliant with both the letter and the spirit of those statutory provisions, which are the statutory provisions that govern all of us.

09:15  

Let me give you an illustration of why I think that the Sewel convention was not adhered to. In the Northern Ireland Budget Bill, there was a declaration by the UK Government at the very start of the process that these were “not normal” circumstances and, therefore, it would legislate without the consent of the Northern Ireland Assembly.

If there had been, at the start of the withdrawal bill process, a declaration by the UK Government that it did not intend to seek legislative consent because these circumstances were not normal, I would reluctantly agree with you.

I think that this is one of these circumstances where a substantial re-examination is needed. For example, I heard Carwyn Jones say on Saturday that he thought the myth of Westminster parliamentary sovereignty should be set aside forever, so this is not a view held only by us.

However, what happened was that the Westminster Government decided that it would request consent, so quite clearly it believed these were normal circumstances, and only when that consent was refused did it say that these were not normal circumstances. It was the refusal of consent that created the lack of normality. That interpretation is very far from what any of us would have expected.

Are you really saying to us that there were no intervening incidents? We are talking about legislation that took a year to be passed. The European Union (Withdrawal) Bill was published in late June 2017 and it was enacted in early June 2018. We are talking about a legislative process that took a year and during the course of that year, a number of things happened.

One of the things that happened was that you introduced legislation into this Parliament that you then asked this Parliament to enact under emergency procedure. You said in your statement in the chamber seeking the support of the Parliament—which was given to you—to enact that legislation under emergency procedure that

“these are not normal times”.—[Official Report, 1 March 2018; c 29.]

There was a recognition by that point in the process that whatever one could say about the enactment of the legislation that is necessary in order to ensure that our statute books are coherent after exit day, this was no longer normal. You said yourself three times in that statement that these are not normal circumstances. This is what I do not understand. I do not understand how the position that you seem to be adopting now is that everything is normal unless the United Kingdom Government says at the beginning of the process that something is not normal, when we are talking about legislative processes that take months and months and in which there are many actors, including you. You said in this Parliament that these are not normal circumstances and we reluctantly agreed with you. They were not normal circumstances.

You may have reluctantly agreed with me but, of course, the Secretary of State for Scotland, the Secretary of State for Exiting the European Union and the Chancellor of the Duchy of Lancaster did not agree with me because they did not use those words specifically about their own bill. The statute indicates that those words apply to the bill. If, at any stage, David Mundell or Damian Green and subsequently David Lidington or David Davis had said, “We now believe in the light of what Mr Russell has said”—and I did not know that I was that influential—“that the circumstances around the European Union (Withdrawal) Bill are not normal, and therefore, we are not seeking legislative consent; we are just going to do it,” that would have been understandable, but they did not do so. The fact that I said it about a different bill does not mean that it applies to the bill in question. That is a basic disagreement between us on that issue.

This is the last question from me about this. Do you think that the process of enacting the withdrawal act and the UK Withdrawal from the European Union (Legal Continuity) (Scotland) Bill counts as normal legislative process?

It does not matter at all what I think. You have quoted the Scotland Act 1998 and you have quoted it very accurately because you have quoted the statute and what normality means is applied to that bill. That is what we are addressing in our proposal to David Lidington. You have to say in that piece of legislation, “We are not seeking legislative consent because these are not normal circumstances,” just as the UK Government did in the Northern Ireland Budget Bill, and that cannot be ignored. The UK Government did not do so; it did not attempt to do so. To do it at the end of the process was clearly wrong and did not observe the spirit or the letter of the Sewel process.

Is it your position—looking forward, not just thinking back to the European Union (Withdrawal) Bill—that in the absence of that up-front comment that circumstances are not normal and consent will not be sought, the problem is that this Parliament will never know, when it is asked for consent, whether that consent will be respected?

Of course, because the definition of consent, as you know, is given as including consent as we understand it, withholding consent or doing nothing at all, so we would be unable to know whether our position would be respected. There could be the mother and father of all disputes if the UK Government says at the outset, “We are not seeking legislative consent for this bill,” but that would be better than allowing the whole process to happen, at no stage indicating that there is any other intention—indeed, I believe that the Secretary of State for Scotland kept saying that he did not envisage circumstances in which the legislation would be overruled—and then overruling it. That is against the spirit of Sewel; I believe that it is against the letter of Sewel; and it goes against having democratic respect for the institutions.

I know that Angela Constance wants to raise issues to do with intergovernmental relations, which the cabinet secretary has introduced into his narrative. Do you want to deal with that subject now, Angela?

I think that it would be quite timely, convener. Good morning, cabinet secretary. I am very interested in intergovernmental relations and how they could be improved in a spirit of respect and reciprocity. You mentioned that the JMC has begun to at least moot this subject, although there is a need for further progress. You also mentioned the Public Administration and Constitutional Affairs Committee report that was published in July, which specifically said that after 20 years, Whitehall still does not understand devolution, which not only goes against the principle of devolution but, significantly, is also bad governance.

What is it that needs to change? You have mentioned aspects of the legislative consent motion process but what needs to change in terms of structures, cultures, intergovernmental agreements and perhaps even reciprocal political commitments?

You would not disagree, I know, that the best relationship would be one of equality, which comes from independence. However, short of independence, we have to look for solutions. One of the barriers to those solutions is this view of absolute Westminster sovereignty, which needs to be challenged. However, even within that circumstance, we need to remember that there is no hierarchy of Governments in devolution; there is a hierarchy of Parliaments.

The UK Government must operate with the Scottish Government, the Welsh Government and the Northern Ireland Executive—when it is present—as equals and recognise the roles that they each have. Therefore, the frameworks are an anathema in those circumstances if they are imposed but quite understandable if they are negotiated and agreed.

There is that relationship of equality, but, as I have often said, the weight of Brexit on devolution has shown that there are deficiencies and difficulties that need to be addressed. We had a conversation last week about where devolution is going. The Welsh Government has published on this and we have published on this, in the original “Scotland’s Place in Europe” document at the end of 2016—in chapter 5, I think.

Chapter 4.

Chapter 4. See, I do not keep it by my bed every night. In chapter 4, we look at a range of issues; they are really divided into three. People have a set of rights—employment rights, human rights, and environmental rights—that we want to protect; we are concerned that the UK Government may not protect them in future. We want to make sure that we have the ability to deal with those. We would need a number of powers in order to operate effectively in the new regime; trade is one, which we have outlined in the trade paper, but there are a range of others. There is a third area that has not been greatly discussed but needs to be thought of—legal personality. Ensuring that Scotland and the Scottish Parliament have legal personality would allow us to enter into agreements in a similar way to the devolved parliaments in Belgium, which have that responsibility.

We can put a range of proposals on the table. There is a range of ideas from Wales. Wales is very keen on the idea of a council of ministers—a council of equals—mirroring in a sense the Council of Ministers that exists in the EU. Post-Brexit, this council of ministers would deal with the areas covered by frameworks. That idea is worth discussing. Wales goes into some detail about voting and qualified majority voting and ways to deal with it. What is concerning—and we have the PACAC report, saying that it does not work—is that there are no ideas coming from the UK, none whatsoever. The impetus for this is all coming from the devolved Administrations.

That indicates two things. One is that I think it is true what David Cameron said, that the UK Government devolved and forgot. There are whole swathes of the UK Government and whole groups of ministers who have never dealt with devolution and do not understand it. Some of us are long in the tooth. We grew up with the ideas; 21 years ago yesterday, there was the devolution referendum and we are still around and we understand how it works—we want to move on but we understand how it works. There are not very many people in the UK Government, and not many people in the civil service, who understand it and respect it. That needs to change.

The second thing that needs to happen is that there needs to be an understanding of equality. Four years ago, when the independence campaign was on, many assurances were given about powers, about equality and particularly about partnership. Those assurances need to be honoured; they are not being honoured at present.

You mentioned common frameworks. The Secretary of State for Scotland gave evidence to this committee last week that despite a number of invitations to do so, he was unable to confirm that common frameworks would not be imposed on the Scottish Government or the Scottish Parliament. We would like to have your response to that for the record. Also, Mr Mundell indicated that good progress is being made on common frameworks. Again, for the record, can we have your response to that, please?

Yes. I have made it very clear—I think I did it again at this committee last week—that on the basis of working together, we will work on frameworks; the work of the civil servants and the officials on both sides proceeds on those frameworks. There is clearly understanding of what needs to be done, but where there is imposition, we will not co-operate, because that does not respect the partnership; it assumes a hierarchy of devolution in terms of Governments that does not exist.

I am very happy to continue the discussions that are going on—I have made it absolutely clear that we will do so—but we cannot accept imposition. I am sorry that Mr Mundell could not commit himself on that matter but I am very clear about it—as long as there is no imposition, the discussions will continue.

The secretary of state also said that good progress is being made in discussions about common frameworks. What is your perspective on that?

Yes, there is continued discussion and there is progress on frameworks and we are able to put frameworks in place as things go on. Where frameworks move into legislation, there will be greater difficulties. We are committed to not giving legislative consent, as you know, because of the circumstances that we are in. Issues will also arise as bills are published. The agriculture bill will be published today and issues have arisen there. However, we are continuing to try to make sure that the voluntary discussion works. All voluntary discussion works on the basis that nobody has a veto but everybody is trying to get a solution, and that is what we are trying to do.

Thank you, cabinet secretary. Patrick Harvie, do you still have some outstanding questions on common frameworks?

I have questions on one or two specifics. The cabinet secretary might want to write to us after the meeting if he is not able to give specific answers just now.

Environmental governance is one of the areas where common frameworks will be discussed and decisions need to be reached about the extent to which those matters are dealt with on a common basis across the UK and the extent to which they are dealt with separately. There have been calls, for example, for either a UK-wide regulator or environmental watchdog agency or for individual country-level bodies to be established within the countries of the UK to take on some of the functions that are currently held at European level.

There are also proposals for the UK to seek continued membership of the European Environment Agency, which includes some non-EU states. Can you give us an update on the extent to which agreement has been reached on those issues? I am aware of stakeholders in the field of environmental policy who are not yet seeing any clarity on that.

09:30  

It is appropriate that I seek information from the relevant officials and from the cabinet secretary, so I will write to you with the details on that. I will make one point, however, about membership of the European Environment Agency—and it is a general point not a specific point. We are interested in ensuring continued presence and continued involvement in a range of agencies as those opportunities arise. We are taking a positive approach, but it would be far better to get the latest position on that and then write to the committee.

We will exhaust as many issues as we can in relation to the bill and then we will go on to wider issues, cabinet secretary.

My question is about the protected geographical indication status of our produce in Scotland and, more widely, in the UK. Last week, the Minister of State for Trade Policy, George Hollingbery, said that some countries regard PGIs as non-tariff barriers to trade. He said there is no question but that Scotch whisky would carry some sort of PGI, because it is easily counterfeited and needs to be protected. He went on to talk about Japanese and South Korean markets, which was interesting because I was focusing on the EU PGI status that we currently have agreement on. He talked about market penetration, and it was interesting to hear that his information was different from that of David Mundell, who gave evidence to us the following day. Basically, he said the intention is that PGIs will remain exactly as they are and that we will have such arrangements in any future trade deals.

I am interested in the differing opinions, the information that is coming out and the reluctance of the UK Government to give assurances over the future of PGI status. What discussions have you had about protecting our PGI status?

I was concerned when I saw the Minister of State for Trade Policy’s evidence. He seemed very down on Ayrshire cheese, for example. Apparently, it is not penetrating the Japanese market enough. Speaking as someone who was brought up in Ayrshire, I regret that. I think the Japanese are missing out on a treat.

I was concerned about the dichotomy between those views. My understanding is that a strong commitment has been made to the food and drink industry and that PGI status will be maintained. However, I noted some concern yesterday from James Withers, the chief executive of Scotland Food and Drink, that that will not be the case. It is really important that PGI status is maintained, and the simplest way to do that—apart from staying in the EU, which would clearly still be the logical thing to do—would be to make sure that, in any exit agreement and future relationship agreement, there was an understanding of the continuation of a PGI scheme that worked for both sides. I hope that sense would prevail in that way.

The risks of getting this wrong are very great, and if the Minister of State for Trade Policy himself is not committed to PGI status across the board, I think we have a very serious problem. We will continue to argue for PGI status not just for Scotch whisky, Scottish beef and Scottish lamb but for all the other things that are of extreme importance, such as the cheeses, Stornoway black pudding and Arbroath smokies, which are very important and need to be recognised. If the Minister of State for Trade Policy will not do that, we will.

There is a PGI process taking place right now for Scottish wild venison. That process was begun in May, but I assume that it will be delayed because of the Brexit negotiations.

I think that it is unlikely to be completed. I cannot speak with absolute veracity of whether that process will be completed, but it seems unlikely to me that it will be completed at this stage. It may well be completed, though, and I would commend Scottish wild venison. Argyll is a strong producer of wild venison and it is very important.

We have strayed on to the Trade Bill. Someone has another question on that bill, and I am going to finish with Adam Tomkins asking about the European Union (Withdrawal) Act 2018 before we move on to the wider issues. I think that George Adam has a question on LCMs.

We have moved on, convener.

I apologise if I missed an opportunity to bring you in.

Minister, what did you mean in your statement yesterday when you said of the European Union (Withdrawal) Act 2018 that

“this Government will have nothing to do with”—[Official Report, 11 September 2018; c 15.]

that legislation? You said that the Scottish Government will have nothing to do with the European Union (Withdrawal) Act 2018.

I said, with reference to section 12—

Can I ask the question? The European Union (Withdrawal) Act 2018 is the law of the land, whether we like it or not, so what did you mean when you said

“this Government will have nothing to do with”

the law of the land?

I meant just what I have been saying about section 12. We will not co-operate with section 12 orders if they are operated, because we believe that frameworks should be voluntary and not enforced on us.

In your view, is it normal for a Government in this country to say that it will have nothing to do with the law of the land?

I think that, in the context of my statement, it was not only normal and necessary but well understood—obviously with exceptions.

I do not understand what that means. Can you clarify that, please?

I think that it is clear what I mean.

Let us move on to the impact on the budget, in general terms, of the UK’s exit from the European Union.

It is less than 200 days from exit day and from the start of the 2019-20 financial year, when the budget will kick in, yet we are weeks away from the publication of the Scottish budget. You have rightly warned, in a number of speeches and interventions, about the impact of Brexit on the Scottish economy and on public services. I will repeat the question that I asked you in the chamber yesterday. What assessment has the Scottish Government made of the impact of Brexit on the 2019-20 draft budget?

Mr Kelly, I will repeat my answer more or less, but I will expand on it a little because I am not being difficult about this in any sense. I understand the question and I understand that Brexit will have such an impact. We have published figures that show the potential impact on the Scottish economy of the various types of Brexit—those figures are in the public domain, both in the first version of “Scotland’s Place in Europe” and in the second version, which we published earlier this year. We will continue to update that document, which is a macro publication that indicates what the impact would be on Scotland and what we are doing.

However, there is also the issue of consequentials to the budget for the additional costs that we are meeting, which I addressed in my statement yesterday. I gave a clear indication of where that money is being spent, and I indicated that further information will be forthcoming. We do not have knowledge of the future consequentials but there would obviously be an impact.

Focusing on the narrower issue of the impact on the coming year’s budget, I cannot say what the situation will be. That is properly for the Cabinet Secretary for Finance, Economy and Fair Work to say, and I give you an assurance that he is looking at that. The issue will be addressed in the budget.

Just as we are not yet absolutely clear about the legislative impact, there is a huge range of issues that would produce an impact from any scenario of Brexit. I will give you an example. If there were to be a no-deal Brexit, there would be a range of immediate costs that would be very difficult to quantify in the short term. If there were to be the softest of Brexits, with the customs union and the single market, the costs would be very much reduced but there would still be an impact, because we would have to quantify how issues such as labour shortage would impact on the budget.

I give you a commitment that that work continues. It is very difficult to estimate those costs, but it continues. I also give you a commitment that the cabinet secretary will address the matter—in his budget, I presume, but also in his discussions with Opposition parties. I draw your attention to the published papers that contain information about the potential impact on Scotland.

Let us be clear. Are you saying that the Scottish Government has assessed the scenarios that you have outlined directly to gauge the impact on the Scottish budget in relation to revenues and spending?

I am saying that the scenarios we have outlined are quantified in both “Scotland’s Place in Europe” and in “Scotland’s Place in Europe: People, Jobs and Investment”, which indicate what effects there would be. As time passes and we know what is going to take place, the Scottish Government will undoubtedly report on the impact on the budget.

Bearing in mind that the budget is going to be published before the end of the year, are you able to detail what work has been carried out directly on the impact on that budget and the various spending?

I am sure that Mr Mackay will want to be as comprehensive as he can be about the work that is being done and the implications. I am not trying to avoid answering the question, but it is Mr Mackay’s responsibility as the person who produces the budget. As a budget spokesperson, you will be in negotiation with him about such matters, and that is the right way to proceed. I cannot go into the details of the impacts on the budget here and now; that must be done by Mr Mackay.

Let us move on to a different area. Willie Coffey wants to have a discussion about the Chequers deal.

Last week, Mr Mundell told us that the Chequers deal was still on the table; yet, shortly after that, we heard Boris Johnson in his ranting describe it as “a suicide vest” the detonator for which we would hand to Brussels. Shortly after that, a former Brexit minister said that Mrs May faces a tremendous amount of political crisis and rupture if she does not ditch the Chequers plan. With that kind of loyal support within her own party, do you not think it is time that the Tories stopped their civil war and started applying their attention to avoiding a no-deal Brexit scenario?

To be charitable to all sides in the civil war, it has been going on for 40 years and it is not likely to come to an end this week. We are, in a sense, collateral damage in that civil war—everybody is—while it is going on. It is very damaging indeed, and very irresponsible.

We have to try to understand where the Chequers deal is now and where it might go. There are two conflicting views of the Chequers deal. The Prime Minister and various others who have spoken publicly about it believe that it is fully formed—that is it. It is on the table. It will be accepted and it is going to go ahead. However, nobody apart from the Prime Minister and those around her believe that that is the case. I have heard civil servants and others talk about the deal evolving.

The crucial question is whether the deal can seriously evolve into something that can produce a high-level agreement—a sort of blind Brexit. We must remember that this is about exit—it is not the end. It is not even the beginning of the end. It might be the end of the beginning, because, once the exit has been agreed, the future relationship will need to be decided, and that will be the hard thing. The really depressing thing I have to say this morning—Mr Tomkins accused me of spreading gloom in the chamber on 11 September—is that there are years of this ahead. We are trying to deal only with the exit just now. When we start to try to deal with the future relationship, it is going to be even worse.

Where we are at the moment is this: can Chequers produce the high-level, blind Brexit agreement that will let the present Tory Government off the hook even among its own supporters and get it through to next year? Can the Government move to that or will it be stopped by the Brexiteers, those people who presented a completely half-baked report yesterday in the House of Commons? We do not know, because the answer to that question lies in the internal Tory party shenanigans. It does not lie in anything to do with Brexit or anything to do with the negotiation; it lies in whether the Prime Minister is able to move. Last night, Robert Peston reported on a group of Tory MPs who were openly talking about getting rid of her, so how can we have any confidence in the process at all?

Yesterday afternoon, while I was delivering my statement, members of the Tory front bench were shouting about something that Michel Barnier is alleged to have said yesterday. Michel Barnier said something else last night. Clutching at straws is what most of the Tories are doing at present. What they should be doing—you are not wrong about this—is sorting out their own house and being ashamed of the mess they have made of it.

Last week, Mr Mundell, too, said that Mr Barnier was not to be believed about dismissing the Chequers deal. In the past few days, he has said that a deal might be possible in six to eight weeks, but do we know whether he means the Chequers deal?

Mr Barnier’s number 2 said something quite fascinating last week in the middle of a row about what Mr Barnier had said to the Exiting the European Union Committee and the language in which he had said it. He indicated, rather interestingly, that the row told us not much about what Mr Barnier had said but a lot about the current state of British politics. There is a constant obsession with every statement, with swings one way and then swings the other way.

There just might have been a good way to do this. I do not think so, because I think leaving the EU is the wrong thing to do, but there might have been a good way to do it. However, this is the worst possible, most incompetent way you could imagine, and the responsibility for that lies fairly and squarely with the current UK Government and the Conservative Party.

Maybe we can cut through the party politics and get back to talking about the business of Government.

Over the past few days, we have heard some commentary about the Chequers deal from various stakeholders. On Monday, NFU Scotland said:

“It is important that politicians of all parties put their shoulder to the wheel and secure something as close to the Chequers agreement as possible. If we step away from that, it will be detrimental to UK and Scotland.”

We heard similar comments about the Chequers deal last week from the Confederation of British Industry Scotland, and other stakeholders such as the Scottish Fishermen’s Federation have been supportive of what the UK Government is trying to achieve. Why is the Scottish Government not listening to those important stakeholders in the Scottish economy and Scottish society and, instead, carrying on with the posturing that we have heard this morning?

09:45  

Let me start with the business of Government. With the greatest respect, Mr Fraser, if the UK Government was doing the business of Government, we would not be in this mess. On the issue of the Chequers agreement, the words “close to” are interesting. By the way, I am quite happy for people to read the CBI president’s statement of last week, which does not endorse the Chequers deal by any manner of means. On getting

“as close to the Chequers agreement as possible”,

the closest that would be acceptable would be single market and customs union membership. Customs union membership is halfway in the deal; single market membership is not in it, except possibly in goods in a totally false split.

I want the best possible deal for Scotland, and that is what I will continue to argue for. I am not going to hide the fact that the Chequers agreement will not fly. We know that it will not fly, and NFU Scotland has not said that it will fly. How can it change to provide the basis for a solution? That is the issue: how can it change? Until there is agreement to change it in order to get agreement, there is no point in having this discussion. The deal has to change. Is it evolving or is it settled? That needs to be resolved, and the two sides are presently saying different things.

The internal warfare in the Tory party is creating enormous instability, and business after business is complaining. Last night, the chief executive of Jaguar Land Rover made an unequivocal statement about that. It behoves the Conservative Party to listen rather than to pretend that everything is fine, because it is not fine.

If there is a vote on the Chequers deal in the House of Commons, what do you expect your Westminster colleagues to do? Will they vote it down?

As I said yesterday in my statement—I am happy to repeat it—that is a false distinction.

No, it is a very simple question, and it needs a yes or no answer.

No, it does not, and it is not going to get a yes or no answer.

If there is a vote on the Chequers deal in the House of Commons, will your SNP MPs support it or vote it down?

You are not going to get a yes or no answer, because the reality is that there is a range of possible options. The much more likely vote will be between a blind Brexit, in which we do not know what is going to happen, a high-level statement that goes nowhere and the madness of just opting out. What everybody should be supporting—we will go on arguing for it, as my colleagues in the House of Commons have—is, at the very least, single market and customs union membership. We are not going to be put in the position—

The Chequers deal does not support that.

We are not going to be put in the position of backing a Prime Minister whose actions on these matters have been disgraceful, nor will we be put in the position of betraying the people of Scotland who voted to stay in the EU. In all circumstances, we will do the best thing for Scotland, which is not being the midwife for Brexit. Brexit is a disaster for Scotland. You know that, Mr Fraser, and it is about time you recognised it.

You have answered my question, Mr Russell: you will vote it down. Thank you.

Last week, the Secretary of State for Scotland was reluctant to share with the committee details of the specific sectors of the Scottish economy that the UK Government believes will be hit hardest by a no-deal Brexit. Has the UK Government provided those details to the Scottish Government?

The information that has been published by the UK Government includes its analysis, which is similar to our analysis and is actually slightly gloomier. I do not know whether that information about specific areas of the economy exists, but it has certainly not been shared with us.

You mentioned a difference between the analyses of the Scottish Government and the UK Government. Yesterday, you referred to the no-deal technical notes. In what areas—if any—is there a difference of opinion between the Scottish Government and the UK Government on the details that are set out in the technical notes?

The technical notes often deal with what you might call wishful thinking. There are whole areas in the technical notes that say, “This is what we would need to do, but it would be contingent on the EU saying that it would do this.” The technical notes are often like small deals because there would be small deals within an overall no-deal scenario. An example is the rolling over of the aviation agreements. As you know, Dominic Raab got a bit of a tongue-lashing yesterday for having tried to set that up with all of the 27 member states without going through the negotiating process. A lot of the small-scale deals require European agreement and there is no such agreement; so, at the very least, we should be sceptical as to whether those deals can stick.

We have agreed that we will fact-check those technical notes against Scots law and any information that relates to Scotland, and we have tried to do so. We have not seen all of them, so we cannot fact-check them all, and we are not endorsing that policy view. We are passing it on, and we are saying that it is important that that stuff exists. However, I do not think anybody knows whether the arrangements would work. Some of them might and some of them probably would not—that is the difficulty of the situation.

It needs to be understood that the no-deal scenario should be ruled out and could be ruled out in two different ways. It could be ruled out simply by saying that, in the event of a no-deal scenario, we will seek to continue single market and customs union membership for the foreseeable future. That is one way. The other way in which it could be ruled out is by seeking an extension of the article 50 process, making it an automatic trigger that, if the Government cannot come to a deal, it will say to the EU, “We want to suspend the article 50 process while we work this out.” Both approaches are legitimate and could be taken. I do not understand why they are not being taken. Instead, the Prime Minister keeps saying that a no-deal scenario would not be the end of the world or a disaster. Well, it would be. It would not be the end of the world, but it would result in a very difficult set of circumstances.

Further detail of the Scottish Government’s response to those technical notes, including the fact-checking and other comments, would be welcome.

I note that, and I am not averse to providing that information.

That would be good. You said that you have published “Scotland’s Place in Europe” and other statements. For transparency, will you publish all papers that you have commissioned on the impact of Brexit and the preparations that have been made by the Scottish Government?

I am not going to make a commitment to do that, because I am not sure what is on that list. We will publish what we write—we have prepared, I think, 16 papers of one sort or another. I will provide the list to you. We have published an extensive list of papers and will continue to do so. We plan to publish more papers in the weeks and months ahead.

Thank you for giving evidence to us this morning, cabinet secretary. We are very grateful to you.

I suspend the meeting to change witnesses.

09:53 Meeting suspended.  

09:57 On resuming—