Brexit and Devolution

Good morning. I’m really glad to have the opportunity to take part in this event today, and I’d like to start by thanking the Wales Governance Centre for convening this discussion and the other participants who have made the time to be here today. I was very interested in Akash’s and Aron’s presentation on 20 years of devolution, and I look forward to hearing the thoughts of our other contributors as the morning progresses.

It is two years since the publication of ‘Brexit and Devolution’, one of a series of policy papers which we have published, building upon the themes we originally set out in ‘Securing Wales’ Future’.  

‘Brexit and Devolution’ was our response to the implications of Brexit for the devolution settlement, for relations between the governments, and for the constitution of the UK. 

After three wasted years of fruitless and mismanaged negotiations by the UK government, we are likely to be facing a straight choice between a no deal Brexit and remaining in the EU. We have concluded that it’s time to go back to the people. So we are calling on parliament to legislate for a referendum, and we will be unequivocal in backing remain.  

But whether or not we leave the EU, there is now an urgent need for fundamental reform of the relationship between the governments.

Even before the referendum, the intergovernmental structures were creaking, to put it mildly. It quickly became clear that the simple fact of the UK’s decision to leave, let alone the consequences of leaving, would require a step-change in the ways in which the governments of the UK work together. 

So, ‘Brexit and Devolution’ set out our vision for the future of devolution and intergovernmental relations.  We called for a UK Council of Ministers, and for better dispute resolution. In order to help build the more robust structures we say are needed, we recommended an independent secretariat, perhaps based on what already exists for the British Irish Council. And we called for a UK constitutional convention, to address the question of how the UK’s constitution needs to change. We were the first and so far the only administration to set out a vision for the future governance of the UK, although I look forward with interest to the future publication by the Scottish Government of its vision for UK relations. 

When we published ‘Brexit and Devolution’, we didn’t claim to have all the answers – it was as much about initiating the debate that needed to take place and seeking to shape the discussion on a basis of principle. We said: here are the issues we face as a result of Brexit, here are the reasons why the existing intergovernmental machinery simply won’t cut it anymore, and here are our proposals for change.

It has provided us with a route map for our thinking as we have embarked on an arduous constitutional journey. 

Two years on, what’s changed? The short answer is, not enough.   As we stand here today, the destination we described is still a spot on the horizon and I want to talk about the implications of that. But let’s first take a moment to take stock of the steps we have in fact taken so far. 

I want to start by looking back briefly to the EU Withdrawal Act and the intergovernmental agreement which accompanied it. That may seem like old news to some, but I think its history illustrates both the worst tendencies of the UK government, and also what can be achieved by purposeful engagement. 

The background, as you’ll recall, was the question of what ought to happen to those powers which sat within devolved competence but hitherto were exercised within a framework of EU law. The UK government’s response was to develop and introduce an EU Withdrawal Bill which would lock down our legislative competence, based upon an assumption that all powers returning from Brussels should stay in London until some unspecified future time. And it developed and introduced its bill without any meaningful engagement with the devolved administrations. As an early test of the UK Government’s approach to the constitutional challenges of EU exit, this was an inauspicious start -- and an important insight into the constitutional instincts of the UK government when under pressure from events beyond its control.

But, working with the Scottish Government, we secured major concessions, significantly extending the powers exercisable by the devolved institutions and building in controls for us over how the powers in all parts of the UK might be frozen, including the requirement for both Houses of Parliament to resolve separately if they are to override the objections of the devolved administrations. Those powers have not actually been used of course, and the UK Government has confirmed in its two published reports to date that it has no reason to use them. 

Of course, not everyone agreed that this was a good outcome, and we still occasionally hear ill-informed and frankly nonsensical allegations that we gave away vast swathes of devolved competence. The fact is we moved the UK Government from its starting position of a bill which sought to lock down all returning powers, to an act which locks nothing. 

We moved the UK Government a very long way, but we did so by being prepared to compromise ourselves. If we’d have held out for a perfect solution which gave us everything we wanted, we might have ended up with far less. 

And we achieved far more by working with the Scottish Government than either of us could have done acting alone. Indeed, we ought not to forget that intergovernmental relations isn’t just about the UK Government; it’s also about the relationships between the devolved administrations.  And our relationship with the Scots is as strong as it has ever been.  We work closely on a wide range of issues even though our constitutional ambitions are very different – and we do so by focusing on the very many matters on which we have common cause, whilst recognising that, on occasion, our paths will diverge. 

I know the Scottish Government sees our proposals for intergovernmental reform as sensible and realistic, and I anticipate that when they publish their proposals later in the summer, there will be much common ground between us.

But returning to the EU withdrawal act and the intergovernmental agreement --  subsequent developments have demonstrated that its value goes beyond its original purpose. We have drawn upon it as a precedent for what one part of UK Government has agreed, when negotiating with another part. Advances secured in one set of particular circumstances can be a useful template for other circumstances, indeed also for an overarching approach.

To take one example, in the Healthcare (European Economic Area and Switzerland arrangements) Act, we were able to secure bill amendments and an intergovernmental agreement, which establishes and protects the devolved administrations’ role in the development of international healthcare agreements and the regulations which implement them. Similarly, in respect of the Agriculture Bill, we have agreed with the UK Government a bilateral agreement relating to the classification of agricultural support. 

In both cases we were able to move the UK Government significantly from its opening position, and did so in part by drawing on the precedent of the earlier IGA. But – and this is important, given the criticisms in some quarters of the Agriculture Bill in particular – we also recognised that we would need to compromise.

There are other achievements – for example we’ve secured agreement to the establishment of what is in all but name a Joint Ministerial Committee – a JMC for trade – a key demand in our trade policy paper. Following lobbying by the Welsh Government, a Health Ministers’ quadrilateral has been established and met for the first time earlier this year, and similar ‘quads’ are developing in other areas. Overall there are positive signs that at least some parts of Whitehall are starting to ‘get it’. 

The problem is that it is too patchy. And even where relations are positive and constructive, they rely far too heavily on individual relationships. Now the quality of personal interactions is always going to be a crucial dimension in politics, equally, but that poses a risk in times of change.

I am not short of things to criticise the UK Government for, about how it deals with the devolved administrations, but David Lidington, who has lead for the UK Government on constitutional relations with the devolved administrations, has always personally sought to play a positive and constructive role. Where progress has been made, it is in part at least a result of his commitment to maintaining relations.  

But the problem of course is that ministers change, and a system which relies – even in part – on individual personalities and relationships in order to work, is neither robust nor sustainable. And where that system goes to the heart of the constitutional settlement, these are unstable foundations. 

And that is now a very real risk, as we face the prospect of a new Prime Minister, and a new cabinet, perhaps one which is even less sympathetic to the legitimate concerns of the devolved administrations. That’s why it’s so important that we build a far more robust structure around which the governments can interact. 

Constitutional relations should be founded on the rock of fair and robust structures for decision making and dispute resolution, rather than the sands of benign relationships.

And this takes me on to the distance yet left to travel on this constitutional journey we are on.

I want to read you a passage from the very first paragraph of the 2013 devolution Memorandum of Understanding under which we currently operate: this memorandum sets out the understanding of, on the one hand, the United Kingdom Government, and on the other, the devolved administrations of the principles that will underlie relations between them. 

‘on the one hand’ the UK Government, ‘and on the other, the devolved administrations’. This reveals of course that the fundamental premise of the UK constitution, indeed in some way, the underlying logic of the concept of devolution itself is a set of bilateral relationships with the UK Government – vertical relations with Westminster and Whitehall rather than horizontal relations between four parliaments and governments. 

But as well as this, the tone in which that relationship is described is almost adversarial – on the one hand, and on the other -  the implication is that the devolved administrations are unknown, unpredictable creatures, which need to be corralled and controlled! At the outset of devolution, such nervousness might be all too easily predicted. But the devolved executives and legislatures are settled features of the Welsh and the UK landscape today - people under 40 can barely imagine a world without devolution, a world which has delivered two decades of tangible benefits to the people of Wales, Scotland and Northern Ireland. 

But in many ways the UK Government’s approach still reflects that very dated language: as the First Minister suggested in his speech to the Institute for Government last month, the UK Government seems still to have a profound ambivalence about devolution. Or worse, an attitude that if we behave ourselves, the UK Government will out of the goodness of its heart, allow us some limited powers of self-government. A “get what you’re given” type of devolution.

Perhaps that is a reason why, after 15 months, the review of intergovernmental relations commissioned by the Prime Minister and First Ministers, still has no concrete progress to report. The existing, inadequate arrangements and structures remain, without even an agreed plan for how they might be reformed. No progress has been made in respect of our call for a Council of Ministers, or for a better system for dispute resolution. And that is deeply disappointing.

Discussions between officials have of course been underway throughout that time, and relations are positive if not so far hugely productive. There has been aspects of progress, for example on agreeing new principles for intergovernmental relations, on which the Welsh Government leads.  But it is just not good enough that this has not lead to a better structure for intergovernmental working and decision making by now.

I acknowledge that it is not an easy process: the constitutional aspirations of the governments involved are different. And the absence of political leadership for the Northern Ireland executive creates a further challenge. But none of that can fully excuse the fact that – in terms of concrete, demonstrable progress on the ground – nothing has actually changed.

If we are to see real progress, we need to see a renewed and strengthened commitment from UK Ministers to the review. We need an undertaking that compromise will be needed on all sides, and that nothing should be kept off the table, so that officials on all sides feel properly empowered to engage in the detailed discussions needed. 

But more fundamentally, we need to see the change in attitude towards devolution for which the First Minister argued in his speech in May, based on mutual respect and parity of esteem and participation between the various governments, rather than the “grace and favour” devolution we currently have.  In that way, we would have a chance of delivering the change we need to see. 

And this requires an understanding that the concept of the supremacy of Parliament – the conventional point of embarkation for any discussions of the British constitution – is no longer fit for purpose. This of course is not the eternal, immutable constitutional verity that it is often presented as. Created in the mid-seventeenth century, perhaps it will be replaced in the twenty first? Devolution tells us in Wales that the sources of authority extend way beyond Parliament. And Brexit has illustrated that rather dramatically, right across the UK.  Whilst we continue to cling to the constitutional comfort blanket of Parliamentary supremacy, we will fail in the task of reimagining for the 21st century, the British constitutional settlement. 

Or what Lord Sumption in giving his recent Reith lecture in Cardiff referred to, perhaps inadvertently, as the “English state”.

But let us be clear, far from simply presenting a challenge to Parliamentary supremacy, Brexit, if it takes the form of a disorderly, chaotic exit from the EU is also an existential threat to the United Kingdom itself – we know clearly the constitutional aspirations of the Scottish Government, and even UK Government Ministers are apparently anticipating the possibility of an Irish border poll in that scenario. A hard Brexit is certainly capable of dismantling the Union.  And no amount of reform to intergovernmental relations can mitigate that risk. 

But even if by some chance we do leave on 31st with a deal, the point of our departure is actually when the strains on our existing architecture will really start to take their toll.

So I want to conclude by talking about the next big challenge for intergovernmental relations. The prospect of departure from the EU is creating a new and fundamental tension for our constitution and the relationships between governments, in respect of actions on the international plane. Actions which are looming ever larger as we contemplate a life outside the political structures of the EU. 

Resolution of this tension will become ever more pressing as we move from the negotiation of the terms of our departure, and into the negotiation of our future relationship with the EU, and the wider world. 

The problem can be simply described: entering into legally binding international agreements is reserved, but the implementation of those international agreements is often devolved. 
 
But the question of how we then ensure that devolved interests are properly represented as the UK seeks to forge new relationships – with the EU and beyond – is more contested. Indeed, the core of the initial disagreements between the Welsh Government and the UK Government on both the Healthcare Act and the Agriculture Bill was how the UK Government proposed to make international agreements which would impact on devolved competence and set out to do so without acknowledging the legitimate interests of the devolved administrations.

Let me be clear.  In future, the devolved administrations must be fully involved in negotiating our international relations. Our view, adopting the language of the Sewel convention, is that the UK Government should not normally proceed with a UK negotiating position which impacts upon devolved competence, unless it has been agreed with the devolved administrations. And even when a matter is fully reserved, often it is likely to have some impact on aspects of life within devolved competence and the principle even there should be that the UK Government should seek to proceed by agreement, though we accept of course that in those matters, the UK Government will ultimately set the UK line. 

What we will not accept is any attempt by the UK Government to fall back on the international relations reservation as a catch-all way of ‘keeping the devolved administrations in their box’.  

At the moment, this is a discussion between governments, between legislators and those with an interest in constitutional affairs. But ultimately these discussions and decisions will be felt directly in the lives of individuals. People in Wales, Scotland and Northern Ireland have voted for decisions on important aspects of their lives to be taken by their devolved governments and parliaments, within a wider union. And the United Kingdom Government needs to understand that the best way to ensure that the union works, and works better, is to respect, support and indeed enhance devolution.

That is the case we in the Welsh Government consistently make and where the UK Government has recognised that, there are successes to which we can point. There are signs across Whitehall that the penny is beginning to drop, but a change of political leadership and the upheaval of Brexit requires us all to be even more vigilant now, and to be purposeful in pressing the case. 

In addressing the pressures that Brexit has brought to bear on our devolved constitution, the Welsh Government has sought to lead the debate. And we will continue to do so as we seek to forge a set of intergovernmental structures that are capable properly and sustainably, of meeting the breadth and scale of the challenges which lie before us today, and which in so many ways, are only an earnest of those which we will face in the years ahead. 

Diolch yn fawr iawn.