DOI: https://doi.org/10.58248/HS64

Overview

Recent years have seen tensions increase in the UK Government’s relations with the devolved executives in Scotland, Wales and Northern Ireland, particularly at a ministerial level.[i] New questions have been raised about devolution and decision-making following Brexit and the Covid-19 pandemic.[ii] [iii]

Themes within this topic area identified in the horizon scan as likely to be important in the next parliament included the state of intergovernmental relations, the development of the UK’s internal market and regulatory frameworks post-Brexit, the UK Government’s power to legislate in devolved policy areas without consent, and the future of the Scottish and Welsh devolution settlements.

Challenges and opportunities

The Institute for Government characterised recent relations between the previous government and the devolved executives, as “strained”. It noted the process and consequences of Brexit as being responsible for deepening tensions.[iv] However, it also argued that a new government “has an opportunity to reset relations” with the relatively new first ministers in all three devolved executives.[v]

Effective engagement between the UK Government and the devolved executives is important to manage the intersection between devolved and reserved powers, and to support joint decision-making where governments share responsibilities.[vi]

A new three-tier intergovernmental relations (IGR) structure was introduced in January 2022, to provide “a positive basis for productive relations”, and support “ambitious and effective” intergovernmental working.[vii] This also included a new dispute resolution process, although this has not yet been tested, and there are wider questions about implementation.[viii]

The IGR arrangements offer an opportunity to improve engagement, but they also rely on each administration’s active participation, particularly that of the UK Government,[ix] something that both the Welsh and Scottish Governments previously suggested was lacking.[x] The absence of a fully functioning Northern Ireland Executive between February 2022 and February 2024 also impacted the new arrangements.[xi]

While 2023 saw an increased number of meetings taking place within the IGR structures,[xii] most interministerial meetings still take place outside of these structures, and in some policy areas have occurred less frequently than envisaged or not at all.[xiii]

One key area for intergovernmental working is the trading relationship between different parts of the UK after Brexit. The UK Internal Market Act 2020 established a legal underpinning for this, including a set of market access principles designed to avoid barriers to intra-UK trade.

These principles can limit the effect of any regulatory divergence by one or more nations in areas like environmental protection [xiv] This is because products produced (or imported) for sale in one nation of the UK with its own distinctive standards can still be sold in the other nations.[xv] As a consequence, no administration can compel traders of goods produced or imported into another part of the UK to comply with its standards if they have already satisfied the regulatory standards of one of the other UK administrations, even if these standards are lower.

There is an intergovernmental process to secure exclusions from these market access principles, with the UK Government having final say over whether exclusions can be permitted, and with what scope. This has contributed to intergovernmental disputes, most notably over the Scottish Government’s proposed Deposit Return Scheme for drinks containers.[xvi] The development of the UK’s internal market regime remains at an early stage,[xvii] and progressing this without provoking further disputes may prove challenging.

A set of Common Frameworks was also envisaged as part of the UK’s post-Brexit internal market. These are processes and policies agreed between the UK Government and devolved administrations in policy areas within devolved competence formerly regulated by the EU.[xviii] However, the House of Lords Common Frameworks Scrutiny Committee concluded in 2022 that while Common Frameworks had helped the UK Government and devolved administrations reach consensus in some areas, they nonetheless represented an “unfulfilled opportunity”.[xix]

Meanwhile, the exceptional arrangements agreed for trade and regulatory policy in Northern Ireland as part of Brexit were a key factor in the collapse of the Northern Ireland Executive and Assembly in 2022, and remained a source of tension between some parties and the UK Government.[xx] The Assembly is due to vote on whether to maintain the core elements of the Northern Ireland Protocol (as modified by the Windsor Framework agreement) in December 2024.[xxi]

More generally, the Scottish and Welsh Governments have raised concerns about what they saw as the previous UK Government’s undermining of the devolution settlement via interventions in devolved policy matters.[xxii] Both the Scottish and Welsh Governments have drawn particular attention to the previous UK Government’s willingness to pass legislation affecting devolved policy areas where one or more of the devolved parliaments have withheld consent despite the Sewel Convention.[xxiii]

The Sewel Convention recognises the sovereignty of the UK Parliament to pass laws in devolved areas, but that it would “not normally” do so without the consent of the devolved legislatures. The Institute for Government has estimated that this occurred in respect of at least 18 UK bills in the last parliament. It has noted that “withholding consent has been more frequent since Brexit” and argued that this “shows a clear need for greater coordination and communication between the governments”.[xxiv]

Disputes have also arisen over post-Brexit funding arrangements. Concerns were raised about the UK Government’s control over funds allocated via the UK Shared Prosperity Fund (the replacement for EU structural funding), and its powers under the UK Internal Market Act 2020 to provide financial assistance throughout the UK, including in devolved policy areas.[xxv]

The UK Government’s constitutional powers to block laws passed in the devolved legislatures have been a further cause of controversy, following the use of Section 35 of the Scotland Act 1998 to ‘veto’ the Gender Recognition Reform (Scotland) Bill in January 2023.[xxvi]

A further challenge is the lack of consensus on the future of devolution in Scotland and Wales. The Scottish Government remains committed to pursuing independence, but the Labour Party’s manifesto stated it does not support independence or another referendum.[xxvii] With regards to Wales, its manifesto committed to devolving employment support funding and to consider devolving probation and youth justice, but did not reference the much wider-ranging recommendations of the Independent Commission on the Constitutional Future of Wales, which was established by Welsh Government and reported in January 2024.[xxviii]

Key uncertainties/unknowns

The Labour Party’s election manifesto promised a “reset” in relations between the UK Government and devolved executives.[xxix] The success of any such “reset” may depend on decisions taken by the government, especially on the issues discussed in the previous section, and how the devolved executives respond.

A further uncertainty is the timescale over which the government will take forward its manifesto commitments in this area. The Labour Party’s election manifesto set out several commitments,[xxx] including:

  • producing a new Memorandum of Understanding on the Sewel Convention, which affirms that UK Government will “not normally” legislate in areas of devolved competence without consent from the relevant devolved legislatures
  • establishing a Council of the Nations and Regions, a new forum bringing together the Prime Minister, the First Ministers of Scotland and Wales, the First and Deputy First Minister of Northern Ireland, and regional Mayors in England
  • restoring decision-making over the allocation of post-EU structural funds to the representatives of Scotland, Wales, and Northern Ireland

Key questions for parliament

  • What would a ‘reset’ of intergovernmental relations look like?
  • How might the proposed new Council of the Nations and Regions contribute to intergovernmental relations, and interact with existing intergovernmental relations structures?
  • Are the currently available mechanisms for resolving intergovernmental disputes sufficiently clear and effective?
  • What will be included in the proposed new Memorandum of Understanding on the Sewel Convention, and what constitutional or legal status will this document have?
  • What will be the government’s approach to the UK internal market and potential regulatory divergence between the UK nations?
  • How will the government handle any demands for a second Scottish independence referendum?
  • Will the new government devolve further powers to Scotland, Wales and Northern Ireland?
  • How will the devolved executives be given a greater role in the allocation of post-EU structural funds?
  • What are the implications of the increasing scope and status of devolution within England for devolution in Scotland, Wales and Northern Ireland?
  • How can scrutiny of intergovernmental relations be delivered in UK Parliament?
  • What role can interparliamentary activity play in supporting scrutiny of devolution and intergovernmental relations issues, and how might interparliamentary relations be strengthened?

References

[i] Meg Russell, Hannah White, and Lisa James, Institute for Government and UCL Constitution Unit, Rebuilding and renewing the constitution: Options for reform, July 2023, p18

[ii] Alex Walker, UK in a Changing Europe, Brexit and devolution: where are we now?, 19 March 2024

[iii] Nicola McEwan, A General Election reset for the Union?, 1 July 2024

[iv] Institute for Government, The precarious state of the state: Devolution, 7 June 2024

[v] Institute for Government, The precarious state of the state: Devolution, 7 June 2024

[vi] David Torrance, House of Commons Library, Intergovernmental relations in the United Kingdom, 17 November 2023

[vii] Nicola Newson, House of Lords Library, Intergovernmental relations within the UK, 10 January 2024

[viii] Nicola Newson, House of Lords Library, Intergovernmental relations within the UK, 10 January 2024

[ix] Institute for Government, The precarious state of the state: Devolution, 7 June 2024

[x] Nicola Newson, House of Lords Library, Intergovernmental relations within the UK, 10 January 2024

[xi] Nicola Newson, House of Lords Library, Intergovernmental relations within the UK, 10 January 2024

[xii] Adam Cooke, Senedd Research, Two years on, has the review of intergovernmental relations led to “ambitious and effective working?”, 1 February 2024

[xiii] Annie Bosse, Scottish Parliament Information Centre (SPICe), Two years into the reform of intergovernmental arrangements – has the new approach been implemented?, 7 February 2024

[xiv] Nicola McEwen, UK in a Changing Europe, Policy Landscape 2023 [Chapter: The Union], 5 September 2023, p37

[xv] Thomas Horsley, UK in a Changing Europe, Reshaping devolution: the United Kingdom Internal Market Act 2020, 10 October 2022

[xvi] Alex Walker, UK in a Changing Europe, The intergovernmental relations system and Scotland’s deposit return scheme, 2 June 2023

[xvii] Annie Bosse, Scottish Parliament Information Centre (SPICe), Annual report from the Office for the Internal Market 2023-24, 28 March 2024

[xviii] Alex Walker, UK in a Changing Europe, Brexit and devolution: where are we now?, 19 March 2024

[xix] Heather Evennett, House of Lords Library, Strengthening the UK Union, 7 March 2024

[xx] Institute for Government, The precarious state of the state: Devolution, 7 June 2024

[xxi] John Curtis, House of Commons Library, The Northern Ireland Protocol and Windsor Framework, 1 February 2024

[xxii] Nicola Newson, House of Lords Library, Intergovernmental relations within the UK, 10 January 2024

[xxiii] Senedd Research, The Sewel Convention: What happens to UK laws rejected by the Senedd?, 10 July 2023

[xxiv] Institute for Government, The precarious state of the state: Devolution, 7 June 2024

[xxv] Nicola Newson, House of Lords Library, Union of the United Kingdom: Under stress?, 16 June 2022

[xxvi] Heather Evennett, House of Lords Library, Strengthening the UK Union, 7 March 2024

[xxvii] Labour Party, Change: Labour Party Manifesto 2024, 13 June 2024

[xxviii] Welsh Government, Independent Commission on the Constitutional Future of Wales: final report, 17 January 2024

[xxix] Labour Party, Change: Labour Party Manifesto 2024, 13 June 2024

[xxx] Labour Party, Change: Labour Party Manifesto 2024, 13 June 2024


Photo by: Brynteg via Adobe Stock

Horizon Scan 2024

Emerging policy issues for the next five years.