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House of Lords defeat on UK Internal Market Bill This time on the devolution aspects of the bill. What, when, why, how?
https://twitter.com/UKHouseofLords/status/1329098855401611265
The UKIM bill contains 2 Market Access Principles:
Mutual recognition - goods & services acceptable in one part of the UK are automatically acceptable in the others
Non-discrimination - prevents laws that favour local goods or services https://www.instituteforgovernment.org.uk/explainers/internal-market-bill
Mutual recognition - goods & services acceptable in one part of the UK are automatically acceptable in the others
Non-discrimination - prevents laws that favour local goods or services https://www.instituteforgovernment.org.uk/explainers/internal-market-bill
The UK gov argues that the bill is necessary to prevent trade barriers between different parts of the UK after the end of transition, once the the four administrations are not longer collectively bound by EU law. But it's not the only programme of work designed to do this...
Since 2017 the 4 govs have been developing Common Frameworks which set out processes to manage divergence, agree common goals, minimum standards in areas where devolved and former EU competence intersect. These are jointly agreed between all 4 govs. https://www.instituteforgovernment.org.uk/explainers/devolution-common-frameworks-brexit
The Scottish & Welsh Govs argue CFs are sufficient to protect the internal market and the bill is unnecessary. The UK gov argues the UKIM bill is needed as 'backstop' to provide certainty for businesses in areas CFs aren't being developed or aren't agreed.
But there are concerns that UKIM bill could undermine the Common Frameworks process. They arguably reduce the incentives for the UK gov to reach agreement with the DAs on minimum standards if English goods will be accepted everywhere regardless - risking a race to the bottom.
They also remove the discretion of the 4 govs collectively agree that some instances of divergence are acceptable, as rules could be challenged by private actors under the bill if applied - as @ProfKAArmstrong sets out in his blog here: https://brexittime.com/2020/11/17/food-for-thought-cooperation-versus-competition-in-the-uk-internal-market/
The amendment that has just passed would disapply the market access principles in areas where divergence has been agreed through common frameworks, and prevent the UK gov from legislating in areas still under discussion.
More thought may be needed on how this amendment could be made to work in practice - but this could provide an opportunity make the bill more acceptable to the devolved administrations, as I argued in September. The Commons should consider it seriously https://www.instituteforgovernment.org.uk/blog/uk-government-should-be-prepared-compromise-uk-internal-market
