Present (via Teams)
- Jeremy Miles MS (Chair)
- Rt Hon. Mark Drakeford MS
- Eluned Morgan MS
- Julie James MS (until item 5)
- Kirsty Williams MS
- Lesley Griffiths MS
- Rebecca Evans MS
- Vaughan Gething MS
- Dafydd Elis-Thomas MS
- Des Clifford, Director General, OFM
- Piers Bisson, Director, European Transition
- Simon Brindle, Director, Brexit Strategy
- Tim Render, Director, Land, Nature and Food
- Carys Evans, Principal Private Secretary, First Minister
- Will Whiteley, Head of Cabinet Division
- Gareth Williams, Special Adviser
- Jane Runeckles, Special Adviser
- Dan Butler, Special Adviser
- Christopher W Morgan, Cabinet Secretariat
- Damian Roche, Cabinet Secretariat (minutes)
- Toby Mason, Director of Communications
- Liz Lalley, Deputy Director, European Transition (Preparedness)
- Emma Edworthy, Deputy Director Trade Policy
- Ruth Bacigalupo, Head of Services, Trade Policy Team
- Rob Parry, Deputy Director, European Transition (Legislation)
- Michelle Grey, Head of Negotiation Policy and Co-ordination
- Euros Jones, European Transition
- Lauren Stamp, Senior Private Secretary, CGMET
- Paul Harrington, Head of Intergovernmental Relations, European Transition
- Shelley Hughes, Deputy Head of Frameworks Policy Team
- Enfys Dixey, Head of Economic Competitiveness Policy
- Ed Sherriff, Deputy Director, European Transition (Negotiations)
- Rhydian Ayres, Deputy Director of Brexit Borders Policy
- Steven McGregor, Brussels Office
- Kayleigh Sweet, Project Development Manager – Priority 1 Funding Streams Team
- Hannah Blythyn MS
- Ken Skates MS
- Jane Hutt MS
Item 1: Minutes of the previous meeting and actions arising
- The minutes of the 22 July meeting were agreed. The actions had been completed and information was included within the papers circulated for this meeting.
Item 2: Update on developments - Paper to note: Update on EU negotiations
- The Counsel General and Minister for European Transition provided an update on developments since the last meeting. It was noted that recent developments on Rest of the World negotiations, preparedness, border requirements and legislation would be covered during items 3, 4, 5 and 6 respectively.
- In relation to UK/EU talks, the 8th formal round of negotiations had been held the previous week.
- The talks took place in the particularly difficult wider context of the publication of the UK Government’s Internal Market Bill. It was clear that provisions in the Bill, if enacted, would breach international law, and the EU would be seeking legal advice.
- Only one final formal round of talks remained before the October European Council deadline and with the current pace of progress, the prospects for a deal looked difficult. Particularly concerning was how the UK Government, rather than seeking to build confidence in their trustworthiness as an international negotiator, had undermined the talks by reneging on their previous legal commitments to the EU.
- A meeting of the JMC(EN) had been held on 3 September, where the Counsel General had pressed UKG on a number of matters including: the critical importance of reaching a deal with the EU in order to protect jobs and businesses; continued participation in EU Programmes; the UKG’s apparent refusal to commit to maintaining a robust state aid framework; the need for further discussions in relation to the supply chains for vital goods such as food; and support and advice for businesses regarding the cumulative impacts of COVID-19 at the end of the transition period.
- Little or no reassurance had been received on these matters.
- The meetings taking place with the PMG on readiness issues had been welcomed, but the point was made that ministerial engagement had been long overdue and important preparation time earlier this year had been lost because the UK government had not engaged at this level.
- JMC(EN) had endorsed the first 2 Common Frameworks, on Nutrition and Hazardous Substances, and they could progress to legislative scrutiny by the 4 legislatures.
- The Welsh Government’s view of the destructive impact the Internal Market Bill would have on devolution settlements had been made clear, not least in the area of spending powers.
- In a statement to the Senedd the previous day, it was made clear that, while the Welsh Government was not opposed to the concept of the UK Internal Market and the objective of ensuring the internal market could work smoothly post-EU Transition, the UK government’s Internal Market Bill was a heavy-handed piece of legislation which represented a serious assault on the Welsh Government’s devolved competence.
- The Bill undermined years of collaborative work on the Common Frameworks; put at risk our ability to effectively regulate and create innovative policy in Wales in the future; sought to reserve state aid through amending the GOWA; and put in place new powers for UK government Ministers to fund projects in Wales which sat wholly under devolved powers, including in areas of health and education.
- That was all in addition to the fact that the Bill breached international law in respect of the Northern Ireland Protocol.
- It was unlikely that the Welsh Government could recommend the Senedd provide Legislative Consent to the Bill unless it was substantially changed through amendment.
- A meeting with Chloe Smith MP, Minister in the Cabinet Office, would explore whether there was any serious intent from the UKG to address these concerns.
Updates from ministers
- The point was made that the UKG scheme that would replace EU funding may not cover what was currently received from the EU, potentially leading to a cut in the resources available to the Welsh Government. The Finance Ministers of the devolved nations had made a joint statement about the impact this would have, particularly as the effect of the pandemic was still not fully known.
- The Minister for Environment, Energy and Rural Affairs provided an update on the last Inter-Ministerial Group (IMG) on Environment, Food and Rural Affairs at which concerns around borders issues, in particular qualifying goods from Northern Ireland and tariff issues, were raised. A further meeting had taken place with Victoria Prentis MP, PUSS at DEFRA, at which David TC Davies said he would take up the issues raised with the Secretary of State for Wales.
Item 3: Update on Rest of the World negotiations
- The Minister for International Relations and the Welsh Language introduced the paper, which provided an update on the latest developments in the UK’s negotiations with the rest of the world.
- The UK government was prioritising the negotiation of 3 key Rest of the World (RoW) Free Trade Agreements (FTAs) - the USA, Australia and New Zealand. An FTA with Japan had been approved in principle and should be ratified before the end of the year.
- Since the last meeting, the fourth round of US negotiations had launched on 8 September and would run through week commencing 14 September.
- The 2nd round of negotiations with Australia would commence on 21 September.
- The 1st round of negotiations with New Zealand launched on June 18. A deal was unlikely prior to the end of the transition period.
- There was positive news in relation to an Agreement in Principle (AIP) with Japan, which was announced on 11 September. The Agreement would need to be approved by the Japanese Parliament (Diet) and the UK Parliament, but there were no known barriers to the agreement being ratified before the end of the Transition Period. This was a ‘continuity-plus’ AIP, replicating the current EU-Japan Economic Partnership Agreement, but with some additional gains in financial services, data and digital trade.
- The Sub-Committee turned to the UKG Trade Bill, which had completed its passage through the House of Commons (HoC) on 20 July. Second reading in the House of Lords (HoL) had taken place on 8 September and an LCM laid in the Senedd on 2 April, recommending that the Senedd consent to Part 1 of the Bill. It was agreed that the LCM should be debated in the Senedd during the autumn following completion of Report stage in the HoL, but prior to third reading in the HoL.
- The Sub-Committee discussed and agreed the Welsh Government’s negotiating positions, which included: Trade in Services and barriers to that trade; Rules of Origin; and Good Regulatory Practice and Regulatory Cooperation.
- The Sub-Committee agreed the recommendations and endorsed the further work set out in the paper.
Item 4: Work on preparedness
- The Counsel General and Minister for European Transition introduced the item, which provided an update on recent developments on preparedness for the end of the transition period.
- A significant amount of work had been undertaken by officials over the summer in relation to the prioritisation of preparedness projects and the Counsel General thanked officials for their diligence. This work had ensured that resources would be focused on the most critical areas and those most aligned to strategic priorities.
- The Sub-Committee agreed the paper and triaging of UK-wide projects and noted the further work outlined on preparing for the end of the transition period.
Item 5: Border requirements
- The Counsel General and Minister for European Transition introduced this item, highlighting that borders was the single largest operational readiness challenge.
- The Minister for Environment, Energy and Rural Affairs set out the challenges faced by Welsh Government and partners as a result of the UKG ignoring repeated requests from the devolved administrations to extend the transition period, despite the lack of progress in the negotiations, the time pressures involved and he implications of COVID-19. This had presented major challenges in relation to ensuring compliance with legal obligations and operationalising delivery plans against short deadlines, even with a phased approach to import checks.
- These timescales were very tight, with issues such as site procurement, Border Control Post designs, planning, site operations, traffic management and public consultation to consider.
- It was essential to ensure effective governance arrangements were in place for joint working with the UKG and in relation to delivery bodies like the Animal and Plant Health Agency.
- The point was made that this work had an impact on all portfolio areas and effective co-ordination across Government was essential.
- The Sub-Committee noted the update, paper and recommendations.
Item 6: Any other business / Paper to note: Legislation Update
- The Counsel General and Minister for European Transition referred to the helpful paper to note on legislation, which set out the scale of the SI work that would be needed by the end of transition. Further information on this would be provided at the next meeting.