My Lords, I have a sense of déjà vu about this debate. The noble Lord, Lord Liddle, will well remember our debates on the EU (Withdrawal) Bill. These amendments relate to delegated powers included in Parts 1, 2 and 5 of this Bill. I should probably decline the kind opportunity afforded to me by the noble Lord, Lord Thomas, to comment on the parentage of Henry VIII, apart from saying that the noble Baroness, Lady Bloomfield, who is an expert on all these matters, tells me that his parents were Henry VII and Elizabeth of York—officially, at least.
I should say in answer to the noble and learned Lord, Lord Hope of Craighead, and his comments on the Sewel convention that the Government are fully committed to that convention and its associated practices for seeking consent. These powers are purely there to ensure that the legislation works properly and is future proof. There is no intention whatever to use the powers to avoid Sewel processes.
I should like to take this chance to emphasise the importance of these powers for the ongoing dynamism of our internal market, and to emphasise that the Government will not take lightly their responsibility in administering these powers. I am of course listening carefully to what your Lordships say but it is important for me to explain how we intend to use these powers.
The Bill aims to ensure a smooth transition for businesses as they are no longer subject to EU constraints. However, we recognise that this is an ambitious new system and the Government want to make sure that it works as well as possible for businesses and for devolved Administrations. As the system embeds in the functioning
of law and trade, we will of course be monitoring this. We will speak to stakeholders and devolved Administrations to ensure that it works as well as possible within our constitutional framework. Where it does not, the Government need to be able to make necessary amendments to the system for the benefit of all parts of the UK. In line with normal arrangements for secondary legislation covering devolved matters, we will of course engage with the devolved Administrations in the spirit of the devolution memorandum of understanding. This system has worked well for 20 years and continues to do so.
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I turn to the specifics of the amendments in the group, beginning with Amendments 12, 13, 27 and 28. These amendments seek to remove the ability of the Secretary of State, in consultation with the devolved Administrations, to amend the list of statutory requirements that are in scope of the mutual recognition and non-discrimination principles for goods. I remind noble Lords that with regard to these clauses the power to amend will enable us to carry out practical and useful amendments that might be needed early in the operation of the regime. They will also enable us to respond to business and consumer experience of the principles. For example, there are several types of regulatory requirements currently not covered by the market access principles, such as those on the recycling of goods. If it becomes clear that the exclusion of these categories is creating significant barriers to trade, say by allowing specific, discriminatory and unwarranted restrictions to be enforced that could add to business costs, the power in Clause 6 would provide a means of resolving this by adapting the scope of the non-discrimination principle. To reiterate: these powers are not intended for casual redrafting but simply to enable the provisions to work properly.
We are also fully committed to ensuring that the use of this power is subject to effective oversight and consultation. First, any use of the power would require an affirmative regulation to be made in Parliament. This will ensure that Parliament will be able to scrutinise and vote on any changes. Secondly, consultation with colleagues in the devolved Administrations is required for any change to the relevant requirements. I hope that I have addressed noble Lords’ concerns on those amendments.
Amendments 38 and 39 remove the power to adapt the list of legitimate aims. Again, I must emphasise the importance of ensuring that the Government have the flexibility to adapt and improve the Bill to address any challenges or inconsistencies that arise during the implementation phase. We will, as always, be listening carefully and attentively to business and consumer stakeholders to ensure the UK internal market’s continued smooth functioning and to maximise certainty as we leave the transition period. The current legitimate aims list ensures that Ministers of the UK and the devolved Administrations are not constrained by the rules against indirect discrimination when rapid action is needed—for example, to address a food or feed safety emergency or a public health emergency. The list is narrowly drawn to ensure that limited barriers to free trade can be created and, therefore, Ministers will
need the flexibility provided through Clause 8(7) and (8) to respond swiftly to the feedback we get from business and consumer stakeholders.
I am aware that comparisons have been drawn with the EU system, in which there are similar lists, as part of the EU rules. However, we are not in the business of doing a copy and paste of EU rules but designing measures that will work for the United Kingdom. Our view is that it is important to have a limited list and a power to amend, based on feedback from stakeholders. For the reasons that I have set out I am unable to support the amendments and hope that the noble Lord, Lord Fox, and the noble Baroness, Lady Andrews, will withdraw or not move them.
Amendments 46 and 47 remove the Secretary of State’s ability to make regulations to amend Schedule 1, which contains provisions excluded from the application of the market access principle. This may make it impossible for the Government to respond to business and wider stakeholder feedback and act rapidly to adjust the list of exclusions. This would be needed if implementation shows the need for a review, or if further areas are identified that need exclusion due to a shifting economic landscape. This would be the case, for example, if the application of the market access principles to a new technology would pose a threat to public security or the environment. Much like the other powers in the Bill, we are fully committed to ensuring that the use of this power is subject to effective oversight and scrutiny. Again, any use of the power would require an affirmative regulation to be made in Parliament, ensuring that all MPs, from all parts of the UK, can scrutinise and vote on any changes. I therefore hope that noble Lords will understand that for that reason I am unable to accept these amendments.
Amendments 72 and 73 seek to remove the Secretary of State’s regulation-making power in Clause 17, which contains a power to amend Schedule 2 by the affirmative resolution procedure, to add, amend or remove services or requirements to those currently excluded from the principles of mutual recognition and non-discrimination. This is necessary to ensure that the list of exclusions is appropriate and to provide the flexibility to respond to future developments in services regulation. There is also a strictly time-limited power to introduce amendments to Schedule 2 via the “made affirmative” procedure. There is a risk that a situation may arise whereby it appears necessary for a particular service sector to be added urgently to the schedule to prevent that sector being unwittingly brought within scope of the market access principles in a way that could cause undesirable outcomes.
This is, of course, particularly relevant to sectors that are currently not applying the principle of mutual recognition as a result of retained EU law, and therefore such a sudden change could be problematic. This “made affirmative” power is necessary to ensure that the Government are able to maintain the status quo at the end of the transition period where this would be appropriate. These amendments would also mean that the Secretary of State could no longer amend the list of exclusions in Schedule 2 by the normal affirmative resolution procedure. This power is necessary to make any future changes to the schedule, as there may also be some services or requirements which may no longer
need to be excluded from the provisions of the Bill. It is important that the services in Schedule 2 be regularly reviewed and altered to reflect changing circumstances, which is what the power in this clause stipulates. For these reasons, therefore, I am unable to accept the amendments from the noble Lord, Lord Fox, and the noble Baroness, Lady Andrews, as they would make it impossible to fulfil the objectives set out above.
Amendments 97 and 98 seek to remove the power in Clause 20 on indirect discrimination in the regulation of services for the Secretary of State to add, vary or remove the legitimate aims. The list of legitimate aims covers a limited range of necessary objectives for regulators, which would justify a requirement that may have an indirectly discriminatory effect. The legitimate aims are the protection of the life or health of humans, animals or plants, the protection of public safety or security, and the efficient administration of justice. The list of legitimate aims is vital, as it clarifies whether a requirement should be considered indirectly discriminatory and, as a result, whether it is justifiable for a requirement to result in a service provider being put at a disadvantage compared to a similar provider from another part of the United Kingdom.
The list, as drafted, is a closed and exhaustive list. However, there is a possibility that the need to add to, remove from, or vary this list might arise in the future: for example, in relation to future types of services regulation that could not have been foreseen at the present time. To allow flexibility to adapt to potential changes in circumstances, a power for the Secretary of State to add, vary or remove additional legitimate aims is crucial. Therefore, I cannot accept these amendments and I hope that noble Lords will not press them.
I turn now to Amendment 160, which seeks to remove the power for Ministers to amend the type of movement to which Clause 43 applies by regulation. The UK Government have been unequivocal in their commitment to unfettered access for qualifying Northern Ireland goods moving to the rest of the UK market, and to guaranteeing this in legislation before the end of the year. The definition of a qualifying Northern Ireland good has been set out in draft secondary legislation, and will maximise certainty and avoid disruption for Northern Ireland businesses moving goods to the rest of the UK at the end of the transition period. This first-phase approach is intended to be a bridge to a longer-lasting regime that will focus its benefits on Northern Ireland businesses. We are working with the Northern Ireland Executive and businesses to ensure that the next phase of the regime, which will come into force during the course of 2021, focuses its benefits specifically on Northern Ireland’s businesses. As part of that, in line with representations made to us by business, we would want to be able to seek to provide the benefits of unfettered access to goods moving from Northern Ireland to Great Britain, however they make that journey. That is the flexibility that the power provides, and it would seem to be against the interest of traders in Northern Ireland to unduly limit that possibility at this time.
I can reassure the noble Lord, Lord Fox, that the power in Clause 43(8) is only intended to be used as part of our phased approach to delivering qualifying
status for unfettered access. As such, it would be expected to be exercised alongside any change to the definition of qualifying Northern Ireland goods. However, in order to ensure that there is appropriate flexibility as regards the sequencing and approach to further legislation, the powers are not formally linked in the Bill. Therefore, I am sure that the noble Lord will feel able to withdraw his amendment.