Chamber and committees

No. There were no formal discussions between the Scottish Government and European Union member states—

Thank you for the question, Mr Harvie. Perhaps it would help colleagues if I highlighted the annex to the Scottish Government’s position paper on this question. I most certainly would not want to read all of it into the record, as it would take far too long, but it goes into considerable detail about the regulatory systems in, among other countries, Switzerland, Australia and Canada, and explains how one manages systems there. Mr Harvie is alluding, I think, to my previous point about ensuring that the system that is in place must surely reflect proportionality and balance.

Mr Harvie also asked me about the UK Government’s position and whether I have an understanding of it. It seems to be saying two things at the same time. First, it is saying that it would wish common frameworks to succeed, which I agree with. Secondly, however, it is saying that the internal market act should be retained, specifically for reasons relating to the Windsor framework. That is the reason that it has given. Frankly, that is spurious—that is not the reason. There are plenty of other ways of doing whatever one needs to do in relation to the Windsor framework; one does not require the internal market act to be retained in toto for that.

Why, then, does one wish to retain the internal market act? I can only conclude that it is because UK Government ministers can imagine circumstances where they would wish to use the power to drive a coach and horses through devolution in order to stop something. They will work, in the first instance, to try to make common frameworks satisfy the processes in order to be able to say that they are respecting the devolution framework, that they have reset relations and that they are working in good faith, but somewhere in SW1, there is a fear that issues will come along where they would wish to override the devolution settlement using the internal market act.

That is the only rational explanation that I have for the act’s retention. If it is an agreed position that common frameworks are the appropriate way of dealing with things, and if everybody has agreed that the IMA is not required for anything to do with the Windsor framework and is not the only way of satisfying that criterion, that is the only logical conclusion that I can come to for its retention.

Indeed it does, and there are very few people out there—there might be one on this committee—who do not agree that common frameworks are the best way of proceeding. It is the commonly held view of the UK Government, the Scottish Government, the Welsh Government, the Scottish Parliament, the Welsh Senedd and, I imagine, the majority of parliamentarians in the House of Commons. Common frameworks are where it is at.

The issue, though, is the retention of the internal market act, given all the reasons and concerns that were expressed to the committee, the evidence that the committee has been provided with and the absence of recognition by the UK Government that it should do what Labour promised in the run-up to the previous UK general election, which was that it would repeal the act.

Will the Scottish Government continue to invest its efforts in working collegially to ensure the effective workings of the single market, while at the same time understanding that devolution is about different policy making, and potentially different policy outcomes and priorities? It is a balance, and because of that divergence, it is necessary to work out how one makes sure that one can do that with proportionality and balance, not with the ultimate muzzle and restraint that the internal market seeks to impose on elected democratic Governments and Parliaments in the UK. That is not what the devolved settlement was about. I point again to the evidence from the then Secretary of State for Scotland, Donald Dewar, in a debate in July 1987, on that very question: it is “germane”, it is not theoretical and it matters.

We are, increasingly, seeing a list of policy areas in which the uncertainty that the internal market act imposes is growing and growing. It is very disappointing that the UK Government has not taken the opportunity to consider that while reviewing—it is a good thing to review, of course—how single market arrangements operate, and that it has chosen to exclude the agreed position of the Governments and Parliaments of Scotland and Wales on the question.

Of course, Mr Adam is correct, and that is the position of this Parliament, which has voted twice for the repeal of the internal market act. I would prefer to invest my time and effort in making the common frameworks work, with the internal market act being taken off the statute book, and—to paraphrase Mr Adam—getting on with it. We need to work together on the questions that are brought up by legislation in the rest of the UK and by legislation in Scotland, Wales and Northern Ireland, and on making the common frameworks the only route for doing so.

Apart from anything else, if the common frameworks are, ultimately, going to work, they have to be understood as the sole route for dealing with these internal market questions. That would be a good thing, and I hope—even at this late stage—that the UK Government will reflect on its error, because it certainly does not reflect a reset of relations, if that was the intention. It has been pointed out that, by excluding the position that is supported by the Scottish Government, the Scottish Parliament, the Welsh Government and the Welsh Senedd, that would most certainly not be a reset, but a continuation of the previous UK Government’s approach to devolution.

Mr Harvie asks a very interesting question, about how one reconciles the operation of intergovernmental agreement—whether in the form of treaties or in the form of rolling, on-going arrangements of intergovernmental relations—and how one involves Parliaments in that process. It is a good question.

I have lost count of how many times I have come to the committee. Committee members know that I am perfectly happy to come here as often as you would wish to hold me and the Government to account in the area for which I have responsibility. I have no objection to coming back here for detailed sessions about how common frameworks are working in this area or other areas. It is not for me to answer as to how others would allow themselves to be held to account in their Parliaments but, especially given that it is the position of this Parliament that one wishes the common frameworks to work, I am very keen to be answerable to you about the extent to which we are able to ensure that and about the progress of all of that. I have no objection to that whatsoever.

That is not the case.

International examples are very illustrative, because most other Governments that operate a devolved or federal Government model have very clear processes in place—some of them are constitutionally ordered. One would have guardrails for intergovernmental relations to ensure that a Government cannot take office then act in bad faith. That is what the previous UK Government did and working relations were, in general terms, appalling by any metric, whether overrides of the Sewel convention, the records that show how difficult it was to make intergovernmental relations work, how many meetings were cancelled or how many meetings did not even take place. It is probably even worth looking at the common frameworks’ different elements that were set up and how long processes take.

Such metrics reflect whether the processes are working optimally. Other countries manage it. I counsel against hoping that good faith is enough of a guarantee of good governance. Having systems that have guardrails in place would serve us all well, domestically and internationally.

I hope so, Mr Bibby. However, I do not want to fall out about the fact that the UK Government has chosen to introduce a review and exclude from it the position that both the member and I commonly represented in the Scottish Parliament. I have made the point already that it would have cost it nothing to consider that as part of its review.

Neil Bibby is right, though, that much has happened since the last UK general election that suggests a change in direction. There is no doubt about the atmospherics—absolutely none—but we are now getting to the pointy end of seeing what decisions are being made. I am not hugely optimistic about what excluding the repeal of the IMA means in this particular area. We are yet to see what will happen during the reset discussions with the rest of the European Union. We have worked very hard, in good faith, and I am pleased that the UK Government has taken on board the priorities of the Scottish Government in relation to those discussions. However, we will have to wait and see with what political weight the UK Government represents the priorities of the Scottish Government in negotiations with the European Union.

I hope that a reset means something more than meetings, atmospherics and the formal presentation that things are different. At some stage, the reset has to reflect decisions that are made and the spending of political capital. I will continue to work to try to make that possible. Even under the last Government, some individual ministers were prepared to work in good faith while others were not, and where that was possible, I was prepared to do that. Here, we have a Government that is saying that it wants common frameworks to work. Good. Let us try to do that, but please be under no illusion that the Internal Market Act is being kept on the statute book for a reason. The only reason that I can foresee for the IMA being kept on the statute books is for it to be used, at some stage, to overrule the workings of the devolution settlement, and that should concern us all.

I regularly listen to Mr Kerr speaking in the chamber in defence of the Parliament. In many of those contexts, I do not agree with the point that he is making. However, when it comes to defending the position of the Parliament in relation to this question, apparently that is dogmatic. I reject that.

The position that we have set out has been the position of this Government and this Parliament and of our Welsh colleagues and the Welsh Senedd. It is a mainstream opinion and concern that, as I already mentioned, was directly addressed by Lord Hope, who is not a member of this Government or any governing party. In fact, as far as I am aware, he is a member of no party. I also draw the committee’s attention, if members have not seen them, to the late Donald Dewar’s contributions on the question of the devolution settlement that was passed.

I have listened closely to the evidence that business organisations have provided to this committee. They have made it clear that they want a regulatory environment that fosters clarity and certainty, and they have made it equally clear that they do not want a confused and uncertain regulatory environment. The Scottish Government wants those outcomes for businesses, too.

However, I would make this point: other countries manage to ensure a properly functioning internal market while recognising and protecting local powers and responsibilities, and the defenders of the internal market act will have to explain why that is somehow impossible in the UK. That is the point on which there is unhappiness on the part of both the Scottish Government and the Welsh Government: the UK Government has overlooked—that would be the most charitable way of putting it—the position of both the Scottish and Welsh Governments and Parliaments, which voted for the repeal of the internal market act, in having a review of the options and choosing to exclude that particular one. Theoretically, one could have considered it and then concluded that that was not the route to take, but to exclude the option from the off is, I think, more a reflection of the UK Government’s position than that of anybody else.

I am doing my job in defending the position of this Parliament and of this Government by recognising that common frameworks are a constructive way of working together; indeed, I have given an example of investing in that process myself. What I will not do is accept the continuation of something that is damaging to the devolution settlement, is damaging to this Parliament and is absolutely and totally unnecessary.

That reflects the answer that I gave to Mr Harvie. Going forward, I am in favour of as much reflection and having as much of an informed understanding of this issue as possible. It is in all our interests to do that. I will come back to that point if Mr Bibby has any follow-up questions.

I have a supplementary point in response to the previous question that he asked me. I omitted to point out that the internal market act is unique in not allowing for any consideration of non-economic policy outcomes. Herein lies the challenge. Policy divergence in devolution relates to the full range of responsibilities of this Parliament—unfettered. Yet, this is an act that will only allow decisions to be made that relate to economic consequences. For example, if one looks at the operation of the internal market, one can see that the entire focus is economic—it is not focused on public health, the environment or any other devolved matter. That is the point that I have been trying to make consistently about the understanding of proportionality and balance. Incidentally, that is something that happened when we were in the European Union but does not happen in the United Kingdom under the internal market act.

We have a responsibility to think about all those other policy areas when we vote on proposals in the Scottish Parliament. We have to work our way through the consequences of trying to make that work in relation to the common market in Great Britain—and we have not even touched on the consequences of a part of the United Kingdom being part of the single European market as well as the United Kingdom single market. That is something that we will all have to reflect on after yesterday’s announcement by the US President. Will one part of the United Kingdom be facing tariffs that other parts of the United Kingdom do not?

Having a system in place with commonly agreed intentions is where we should be investing our efforts to try to find our way through the challenge that Mr Bibby has identified. That challenge is about getting the right balance—this is the point about proportionality and balance—when it comes to policy innovation, rather than having a simple, economically driven assessment, which many people fear will tend towards the lowest common denominator as opposed to having innovative policy that might lead to better outcomes in different places.

The bottom line of all this is to understand a simple point: 85 per cent of the population and electorate of this state live in one constituent part of it. Unfortunately, many decision makers in that part of the United Kingdom think that they should reserve for themselves the ultimate right to determine what policies should impact on us all. That is not what devolution is about.