‘Brexit will bring immense challenges for devolution’
Former top diplomat Sir Emyr Jones Parry warns that ‘immense’ challenges are ahead for devolution as Brexit looms but argues that co-operation between the UK’s different governments is vital...
EXITING the EU will not lead directly to additional powers being available to the devolved nations.
Those powers result from Acts of the British Parliament, and in the case of Scotland are already comprehensive other than for the powers reserved to Westminster.
However it will free the devolved legislatures from the specific obligation to legislate consistent with EU law and with EU policies as they exploit the powers already transferred to them by Westminster.
The EU single market currently delivers consistency of laws governing trade between the 28 member states and by definition within the UK. However after Brexit there will be no equivalent mechanism to ensure free movement of goods between our four nations.
One option would be for the four governments to agree a common approach for a particular policy, and then for each legislature to legislate appropriately in terms which are complementary and would permit mutual recognition and hence unhindered movement within the UK.
A more efficient approach would be for Westminster to legislate for the whole of the UK regardless of the devolved competences. If this followed prior consent by the devolved legislatures, the outcome should be acceptable to all.
But if Westminster legislates without that consent then there will be a substantial constitutional issue with claims of London conspiring to recover powers from the devolved administrations.
That risk is particularly acute in the drafting of the Great Repeal Bill which will seek to make legal in the UK after exit thousands of EU rules which currently only apply in the UK because we are members of the EU.
Most of those rules lie within the competences of Edinburgh, Belfast and Cardiff. Who is to legislate on what, and with what prior consultation, is a major constitutional challenge.
So far there is no clarity of thinking. Real consultation and cooperation between four governments is needed if the sensible goal of continuity of law is to be achieved without dispute.
That requirement to consult and concert policy is also evident in the negotiation of future trade access to the Single Market. There are distinct interests within the UK which must be considered in formulating an overall UK strategy.
Usually the negotiation of trade agreements between two nations aims to produce a more open liberal outcome. Whatever the eventual UK access to the single market it will be less liberal than the present arrangements.
Today, the UK is a member of the most liberal arrangement ever devised – no customs duties or nontariff barriers within a customs union. We can only end up with less.
The future relationship with the EU will impact directly on the different interests within the UK, industrial, agricultural, services and so on. The UK’s various external trade agreements to be negotiated with third countries will affect not just the conditions of external trade but also the internal policies to be put in place within each nation.
Agriculture is an obvious example where support regimes may be limited by the terms of the trade agreements negotiated by HMG.
The common theme is the need for meaningful cooperation. This is underlined by the requirement to put in place substitute policies to replace those of the EU after exit.
Agricultural experts, instead of administering the Common Agricultural Policy, will have to draft policies of support meeting different conditions and environments, which are financially sustainable and meet the emerging international obligations. Expert capacities are scarce.
Better that the four governments work cooperatively before separate decisions are then made, hopefully coherently.
The challenges ahead are immense and the different work burdens substantial. But if opportunities are to be seized and damaging constitutional dispute avoided, governments need to work constructively and more transparently with each other to find solutions which as far as possible meet the different interests involved. The Joint Ministerial Committee brings together representatives of the four governments, in part to liaise on such issues. But it does not seem to get into a real productive debate to tackle these problems, still less to encourage working cooperation between officials as policy is being developed.
Sir Emyr Jones Parry is President of the Learned Society of Wales and a former UN ambassador
AHARD BREXIT could lead to a “fourfold whammy” for Welsh farmers, according to Labour MEP Derek Vaughan.
After 2020 they could lose – or have severely reduced – their current subsidies; they could see punitive tariffs imposed on meat exports to the EU; new trade deals with countries outside the EU could see their produce undercut at home by New Zealand lamb; and migration restrictions affecting EU citizens could make it more difficult for them to hire the workers they need.
Mr Vaughan said: “It seems that Theresa May remains intent on driving a hard Brexit – an outcome that would cause devastating damage to the Welsh economy, with the farming community among the worst affected.
“The fourfold whammy could put many farmers out of business, and it is vital that the case for the UK retaining unfettered access to the European Single Market is made forcefully during Brexit negotiations. So far the UK government has agreed to guarantee current levels of farm payments until 2020, but they haven’t given any guarantees about what happens after that. I can’t see them being willing to carry on the same levels of payment when they are pitching farm subsidies against other budget areas.”
Plaid Cymru AM Simon Thomas, who represents Mid and West Wales, also expressed concern about the implications of a hard Brexit under which the UK’s trading relationship with the EU would be governed by World Trade Organisation rules.
He said: “The implications for the agricultural sector are very serious indeed because WTO rules go straight to tariffs. If you think the single market is complicated, WTO rules are not simple. You’ve got two sets of tariffs – an ad valorem tariff, which is a 12.8% tariff on the value of meat exports. Wales’ farming is lamb and beef, and dairy. Those are the main things. We’ve got 6% poultry, but horticulture is only 5% of Welsh agriculture, so it’s a complete reversal to the English situation, where it’s 55% crops. These are very fundamental points for us.
“On top of the ‘value added’ tariff, you’ve got a tariff on the weight of fresh carcass of beef and lamb. The effective tariff on fresh beef from Wales works out at about 84%. So you’re basically doubling the price of Welsh beef, and the effective tariff on lamb is between 45% and 50%. There is no way on earth that Welsh farmers can compete on that basis. We don’t compete on price, we compete on quality, on high welfare standards, on a green environment. We sell ourselves as a green nation – and we do have grass-grazed lamb and a lot of the beef is as well. This is where Wales is – we’re a premier grassgrazing producer in western Europe and we export it. We do well on exports, and 90% of Welsh agricultural exports go elsewhere in the EU. A lot of it goes to England, but 50% of exports don’t, so we’d be losing 50% of our market.”
Mr Thomas said the impact of that would be a major shock to the Welsh farming industry: “I would certainly be concerned that the hill farmers would find it impossible to survive in such circumstances. There would be demands for public-sector subsidy more than we give now, which I think would be very difficult to justify. And there would be a huge impact on the Welsh language from that. Farming is the biggest industry in Wales where the Welsh language is used – I think 37% of farmers are Welsh-speaking across all areas of Wales. One in 20 people in rural Wales are employed directly in farming, and there would be knock-on effects for tractors and hauliers and the rest.
“The impact would be enormous for coming suddenly out of the single market like that.” But Welsh Conservative leader Andrew RT Davies – a farmer who campaigned for Brexit – did not share the fears of Mr Vaughan and Mr Thomas. He said: “What we’ve had from the Chancellor is a clear assurance that the subsidy regime, the support regime, will be in place until 2020. No government can go beyond 2020 because
that’s it’s mandate. Actually the Common Agricultural Policy as currently constructed runs out in 2020 and the new seven-year CAP would have kicked in.
“All the direction of travel around the CAP was that it was falling as a percentage of the EU budget, and indeed, much of the support was being redirected from the western countries to the new accession countries in eastern Europe. So there was less money coming anyway.
“But I have always maintained that it is in the national interest to maintain a food security policy, and any government which doesn’t maintain a food security policy or support the agricultural industry is failing in its national duty and I will hold my colleagues to account.”
Meanwhile, the Farmers’ Union of Wales said there was an urgent need to make progress on a wide range of issues. FUW President Glyn Roberts said: “Now that Article 50 has been triggered we know there are just two years in which to deal with a huge volume of work.
“As well as pressing issues with regard to trade deals and negotiating the best possible exit options for the UK, we also need good progress in parallel in terms of reaching understanding and agreement between devolved administrations if we are to develop a home market that works for all.”
Hours after last year’s EU referendum outcome was announced, the FUW called for the Brexit process to be taken at a sensible pace, given the huge amount of planning and work the process would entail.
In February, the House of Commons Library described the Great Repeal Bill, the mechanism by which all EU-related legislation will be reviewed and transposed, as “potentially one of the largest legislative projects ever undertaken in the UK”.
Mr Roberts said: “Implementing the Great Repeal Bill is just one element of the work which needs doing over the next two years. Time is running out fast, and moving forward in terms of developing a UK framework for agriculture is just one element of that work.”
Following consultation with members, the FUW agreed last autumn that a UK agricultural framework should be put in place “which prevents unfair competition between devolved regions and secures and protects adequate long-term funding for agriculture, while also respecting devolved powers over agriculture and the need for flexibility within that framework which allows devolved governments to make decisions which are appropriate for their regions”.
The need to move forward in developing a framework was highlighted in a recent letter to all UK agricultural ministers.
“Such a framework must be discussed with stakeholders and agreed between devolved governments and agricultural ministers, and the wider economic, environmental and social importance of agriculture to our economies make it imperative that such discussions do not become an arena for separate political battles,” said Mr Roberts. “We cannot have an ‘England-centric’ solution imposed on us by the UK government.
“We are concerned that discussions at the highest level regarding the need for and nature of such a framework are not progressing at the appropriate rate, particularly given the very short period during which important decisions need to be made, and that’s why we are repeating our call for all the governments to work closely and cooperatively to ensure the wellbeing of our rural communities is not compromised.”
In evidence recently given to the House of Commons Welsh Affairs Committee, the FUW highlighted both the need to move forward at an appropriate pace and the dangers of trying to implement a wholly new system prematurely.
Mr Roberts said: “In recent years we have seen what can happen when even slight changes are made to systems and rules which affect agriculture, particularly in England and in Scotland. And the problems in England in 2005 and 2006 are well documented. We have to have a gradual transition to any new rules, and that means making sure there are few differences between the systems which are in place on the last day of EU membership and the first day of Brexit. A UK framework needs to be in place to achieve this.”