How the UK and devolved governments can agree on the EU Withdrawal Bill

The UK Government is locked in dispute with the Scottish and Welsh Governments over Clause 11 of the EU Withdrawal Bill. The clause prevents the devolved administrations from modifying ‘retained EU law’, the term for all the European legislation the bill will bring into domestic law.

The effect would be that all powers exercised in Brussels return to Westminster, at least initially, giving the UK Parliament the ability to create binding legal frameworks in place of EU law. The devolved governments say this is unacceptable, and Edinburgh and Cardiff have both refused to grant legislative consent to the bill.

The Government accepts that Clause 11 needs to be amended, but it has not produced alternative proposals, despite promising to do so before the bill left the House of Commons. Meanwhile, the Scottish and Welsh Governments propose that Clause 11 should simply remove the requirement for devolved bodies to act in accordance with EU law. Full control of the 100-plus areas of ‘intersection’ between EU and devolved law would then revert to the devolved level.

As a result, new UK-wide frameworks would have to be negotiated on a case-by-case basis and could not be unilaterally imposed by Westminster. The concern in Whitehall is that this would increase the risks of legal uncertainty and regulatory divergence, and could make it more difficult to implement a new UK-EU economic relationship.

The bill has now entered the Lords with the UK and devolved governments still dug into their trenches. Recent reports suggest, however, that a peace deal may be within reach.

There is no simple route to agreement on Clause 11

One option, proposed by Professor Jim Gallagher, is to insert a ‘sunset clause’, meaning EU powers would automatically transfer to the devolved level at a specified future point. In the interim, the UK Government could guarantee legal certainty while it finalises Brexit negotiations and works out what should replace EU law.

However, ministers fear this would create "an artificial cliff edge” for two or three years, delaying rather than avoiding the risk of regulatory fragmentation. Conversely, the Welsh First Minister points out that this provision could be "extended ad infinitum in the future" and so would not satisfy devolved concerns either.

A slightly different proposal is a ‘standstill agreement’, under which Clause 11 would be removed in its current form. EU powers would flow to the devolved level, but the UK and devolved governments would commit not to diverge from policies inherited from the EU before agreement on how to replace them. This is unlikely to provide sufficient reassurance to the UK Government unless given legal force. But in that case, devolved consent might still be withheld.

A third idea is again to devolve EU powers by default, but to specify conditions under which Westminster could legislate for new frameworks. The Labour Party has proposed a version of this. The idea would be to give a hard edge to the UK-devolved agreement of October 2017, which spells out when common frameworks will be necessary.

However, this could increase the risk of legal disputes in which the courts are required to interpret vague concepts such as ‘the UK internal market’, ‘management of common resources’ and ‘the security of the UK’ – three of the agreed reasons for new frameworks. If broadly interpreted, the effect could be a significant limitation on devolved autonomy. The devolved bodies would also fear the centralising logic of new cross-cutting powers for Westminster to implement international obligations and trade deals, the other main rationales for UK frameworks.

The UK and devolved governments must – urgently – agree on a new division of powers

In principle, the most sensible way forward would be to agree at the outset which policy areas require UK-wide legislation and which can be devolved in full. This would be the cleanest solution, keeping with the logic of the devolution settlements, which give statutory force to the powers of different institutions rather than to principles underpinning the constitution.

The EU Withdrawal Bill could then be amended to reserve to Westminster areas where legal consistency across the country is agreed to be necessary – perhaps, for instance, aspects of state-aid policy, animal welfare and chemicals regulation. One big challenge is the lack of time to agree the detail without overly delaying the bill.

Alternatively, the bill could devolve everything, but Westminster could then take back specific powers from Edinburgh, Cardiff and Belfast on a case-by-case basis, either using existing powers or a new procedure set out in the bill, as Professor Rick Rawlings has proposed.

Either way, the devolved institutions would have to give their consent to ceding control of these areas. Additional guarantees would therefore be needed – for instance, that future frameworks in these areas must be jointly agreed between the UK and devolved governments, with appropriate scrutiny by the respective legislatures.

There would also be a case for placing intergovernmental bodies such as an expanded Joint Ministerial Committee system on a statutory basis. Devolved ministers would then have enforceable rights to be involved in decision making and increase its transparency.

Ultimately, the UK Government will have to make some meaningful concessions. If it does not and devolved consent is refused, then it is difficult to see the EU Withdrawal Bill proceeding, since the Lords may refuse to back legislation that would rip up 20 years of constitutional convention and plunge the UK into further intergovernmental conflict. That prospect gives the devolved governments leverage, but they must also recognise the need for a sensible deal involving compromise on both sides.