My Lords, I shall speak to Amendment 6. I am extremely grateful to the noble Baroness, Lady Randerson, and to my noble and learned friend Lord Hope of Craighead for their support of the amendment. It tries to grapple with the areas that have been raised so far, but it must be remembered that the Bill applies to agriculture as well, and that makes the task much more complicated. It seems to me that the Bill provides in Schedule 1, that it is possible to have a subsidy that addresses an equity rationale, such as social difficulties or distribution concerns.
It is unfortunate that the word “equity” was used, because we used it in a completely different sense in our earlier debate. That must be one really good reason, if I may say so with respect, for not adopting the amendment of the noble Viscount, Lord Chandos—but I did not mean that as a throwaway line for the Minister. We will need to know what it means, and it is very important, it seems to me, to grapple now with the question of how we take into account the need for levelling up, or providing subsidies, where regional help is necessary in agriculture and fish. I think this is ultimately a political question—I will return to that in a moment—and the worst possible thing to do would be to allow independent bodies, particularly judicial bodies such as the CAT, to be embroiled in political decision-making.
It seems clear to me that we must have some form of agreement or definition of what are the criteria, or a map if need be, by which we can apply levelling up. As I understand it, we could look at GDP per person, which is the European Union method. We could look at GDP per employee. We could look at household income, and could then dream up—I do not mean that disrespectfully because it was no doubt carefully considered when it was done—a broad economic index that takes into account productivity, skills, unemployment rates, population density, employment, et cetera. We must be very clear how a business, or Ministers giving agricultural subsidies, can direct those subsidies according to some metrics that have a UK-wide basis. Is that something that can be done?
My concern here arises out of the criticism that has been made—I do not want to go into the merits of the criticism—of the way the social prosperity fund has had its index looked at. It must, it seems to me, ultimately be a political decision to decide what are the factors that go into making disadvantages which need to be addressed for a levelling up. This is not something a court should do; it is a political question and, for the sake of the courts, we should not be shunting political decisions to a judicial body, or an independent body such as the CMA.
That is the first proposition: this is a political question and it should be resolved politically. There are two ways of doing that. The first way and, I argue, by far the best way is to do it is by agreement in a common framework.
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As economic development, agriculture and fisheries are highly devolved issues, it should be possible for the four Governments—there may be a difficulty with Northern Ireland, but I think we ought to leave that on one side until the issue of the two regimes is more carefully analysed—to make some detailed agreement, and I have suggested a common framework, about the principles applicable to the delineation of areas, by which I do not necessarily mean a map, and the kind of area you could constitute. Obviously, if you pick a particular area and take GDP, the size or geographical delineation of it will make a difference to the result. It is important that this bears some relationship to the levelling-up fund, because you cannot see those as two different aspects. The Governments of Scotland and Wales will want to say, “Some money ought to come from money that is not ours; the rest comes from ours”, but there ought to be a common set of principles which enable the Governments, whether they be in London, Cardiff or Edinburgh, to agree which areas are economically in disadvantage from the perspective of both agriculture and industrial development.
The alternative is to do this in some other way. It seems a long way down the line at the moment, but we shall no doubt get to the clause that concerns the use of guidance. It is a matter of principle that guidance is not binding on the CMA or the CAT. How do the Government propose that this extremely difficult political issue be dealt with? There is no regulation-making power, so it cannot be that, and the guidance is not binding, because it cannot be binding on the CMA or the CAT. Although the Minister is entitled to make definitions of meanings, that is only guidance; it is not law. If you leave this, first, to the Competition and Markets Authority and its report and, ultimately, to the CAT, it will have to decide what is meant by those words and equity rationale and how it is proper to constitute a set of metrics by which you can define them.
I do not think it is fair to leave it to the courts or the CMA to do that; politicians ought to grapple with this issue—either, as would be my preference, through a common framework or by some other method that produces a clear definition of what is permitted and how these areas are to be defined.