Cynulliad Cenedlaethol Cymru

Good afternoon, and can I welcome Members and the public to this afternoon's session of the External Affairs and Additional Legislation Committee? This afternoon we'll be taking evidence from the Cabinet Secretary for Finance in relation to work on the JMC(EN) and the European Union (Withdrawal) Bill, and interests across Europe of the Welsh Government.

Before we do, if I can just remind ourselves of some housekeeping: can I ask Members to ensure that their mobile phones are either on silent or off to ensure they don't interfere with the broadcasting equipment? If you require simultaneous translation from Welsh to English, that's available on the headphones on channel 1. If you require amplification, that's available on the headphones via channel 0. There is no scheduled fire alarm this afternoon so if one takes place, please follow the directions of the ushers to ensure we all leave safely. We've received apologies this afternoon from Steffan Lewis, where there'll be no substitution.

Can we move on to the item on the agenda, which is the scrutiny session with the Cabinet Secretary? Can I welcome the Cabinet Secretary, Mark Drakeford, this afternoon? Cabinet Secretary, would you introduce your officials for the record, please?

Thank you, Chair. So, I'm accompanied this afternoon by Simon Brindle, who has been leading for the Welsh Government at official level in discussions on frameworks, and Hugh Rawlings, who has been taking a lead in our discussions with the UK Government on the European Union (Withdrawal) Bill.

Thank you for that. In fact, we'll go straight into that particular topic, because, clearly, since we last met, the Lords have completed the Committee Stage of the EU withdrawal Bill, where the amendments that were put down by the UK Government were withdrawn. Therefore, there is still no amendment to clause 11, which is of great concern. Can you, perhaps, update us on the latest position, because I understand that the Welsh Government's officials have been in discussion with Whitehall officials? So, where are we now?

Chair, the position we're in now is: you will have seen that the UK Government, in not pressing its amendment at Committee Stage to a vote, gave an undertaking to come forward in the House of Lords with revised amendments at Report Stage. Since then, a great deal of very detailed work has gone on at official level, involving the Scottish Government, the UK Government and ourselves. The Welsh Government's position remains as it has been throughout: our ambition is to achieve an agreed amendment to those aspects of the withdrawal Bill that impact on the devolved settlement, to be able to see those amendments go down at the Report Stage in the House of Lords, and, on the basis that they are agreed, to come to the National Assembly and put a legislative consent motion down that we could support.

We are in the very final stages of this process. The House of Lords conventions require that the UK Government puts down any amendments for Report Stage with a week's notice. The clause 11 debate, the most crucial debate, is scheduled in the House of Lords for, not next week, but the week after. That means that the UK Government would have to lay such amendments at the very start of next week.

The detailed work that has gone on gives me some grounds for optimism that an agreed amendment could be crafted, but we don't have one as yet, and further work will go on this week and into the start of next week, from our point of view, doing our very best to come to an agreed outcome.

Thank you for that update, but, clearly, as you highlighted, the Committee Stage has completed and Report Stage starts on Wednesday of this week, so there's a very tight schedule to be applied. Has there been a JMC(EN) since the Assembly passed the Law Derived from the European Union (Wales) Bill on the progress of the discussions? Is there one scheduled in the near future? Because one of the things we've always been concerned about is the scheduling of JMC(EN) meetings, and the agendas for the JMC(EN) meetings don't seem always to be available to you early.

I'm just trying to remember the sequence of events, as to whether or not the last JMC(EN) happened after, but I don't believe it did. I think we haven't met as a full JMC(EN) since the continuity Bills were passed here and in Scotland. There is a JMC(EN) that is being scheduled for next week, date to be confirmed.

There is a JMC(EN) next week, but, most recently, there was a JMC plenary, chaired by the Prime Minister, and that dealt, among other things, with withdrawal Bill issues.

But that was actually before the final Stages 3 and 4 of the Bill.

It may well have been.

The period we're talking about is the Easter recess. Has there been a JMC(EN) over the Easter recess?

No, no.

No.

Okay. We've also heard speculation in the media, effectively, that there is likely to be a referral of the Law Derived from the European Union (Wales) Bill to the Supreme Court. Have you, as an official, had any notification of this?

I've had no official confirmation that that will take place. Chair, I see the same suggestions. The Welsh Government will be disappointed if the UK Government does decide to refer the Bill to the Supreme Court, but if it does, and if it does it in the next few days, then we will recognise that the timing of that decision is the result of the process that we are all bound with—the number of days that are allowed to elapse between the passing of a Bill and a referral—rather than a decision that the UK Government is making of its own volition on the timing issue.  

I understand the time it has to be done by is Wednesday, I believe, which is the deadline, but, of course, they don't have to do it. 

No. 

Will this impact upon the discussions you're having at official level on the amendments to the withdrawal Bill? 

Well, I think, from our point of view, we would do our best for there not to be an impact, in the sense that we've always said, and said many times—you must be very sick of hearing me say—that we would much prefer to resolve this by an agreed amendment than through the continuity Bill. The continuity Bill was always a fall-back position rather than our preferred position. So, that remains the case. We have not changed our minds on that at all. Therefore, we will still want to maximise whatever opportunities there are to come to an agreed amendment, and we would not want a referral to the Supreme Court to make that more difficult than it already is. 

But if a referral does come, you will rigorously defend the continuity Bill.

If we're in a position where we don't have an agreed amendment, and the continuity Bill is in front of the Supreme Court, we are confident of our position and we will defend it to the full. 

Jane. 

You've mentioned LCMs, and I suppose it's very difficult to anticipate when the Welsh Government would expect a debate on a legislative consent motion on the EU withdrawal Bill. It's going to be difficult for you to anticipate whether an LCM or, indeed, further LCMs might be necessary. 

Well, Chair, I think we would anticipate laying a supplementary legislative consent memorandum to reflect whatever UK Government amendments come forward at Report Stage. So, I think we are committed to providing an updated consent memorandum. If we are in a position where we can bring a legislative consent motion in front of the Assembly in positive terms, then there probably is only one window where we can do that. We would not be able to do it until after the Report Stage, because that's when we will see the amendments and we will see whether the House of Lords supports them. But we would want to do it before Third Reading, because if we were not to secure legislative consent by the Assembly, we have to do that while the UK Government still has a chance to respond to the consequences of that, and that's the only window there now is. That's why I said earlier that this is closing down rapidly around us. So, that probably brings us nearly to the middle of May, and, on timetables that we've seen, the Report Stage should be finished and with the Third Reading still to take place, there will be a small window there and that's what we will be aiming for.  

Would that be either way—whether there are amendments laid or amendments not laid? Is that window the same? 

Hugh, correct me if I've got this wrong, but our process in this is different to Scotland's. The Scottish Government only lay an LCM if they are able to recommend its support. If they're not going to recommend support, they just don't lay an LCM. Whereas our way of doing it here has been to lay an LCM, then the Government will make its views known on whether we are proposing to the Assembly that it should be supported or not. In that sense, there would be a vote here and that vote would happen in that window. 

Okay, thank you for that. We'll move on to common frameworks, which are part and parcel of the discussions. Mark. 

Thank you. When you gave evidence to the committee on 5 March, I think you said there'd been 25 so-called deep-dive discussions between devolved administrations and the UK Government over policy areas where common UK frameworks might be needed. Are you able to tell us how many there have now been and what policy areas have been discussed? 

Yes, Chair. I'll start off and I'll ask Simon to provide some of the detail that the committee wants, as he's been more directly involved in it all. Just under 30 deep dives—formal deep dives—have now been completed. They have covered all of the areas where initial assessments suggested that cross-UK legislative underpinning for frameworks might be needed. All of those deep dives have involved officials from all three administrations. Some deep dives have lasted for more than a day, so the amount of time is slightly longer than the number. The most recent ones have only been completed in the last week or so.

Yes, there's been a deep dive on the services directive, which was a late addition to the UK Government's list of areas that may require legislation. Several of the more substantive topics of agriculture, sport and some of the environment issues have had follow-on deep dives, with officials going further into some specific aspects of those policy areas and identifying future programmes of work that may be required to take the issues forward. Some of the issues are more self-contained and actually reach a consensus relatively quickly.

I think it's probably fair to say that the whole area around frameworks and the deep dives is a big piece of work—it's a programme of activity that is going to run from identifying the issues and methods of working through to legislation, if it's required, and the oversight of that, right through to a discussion on policy, drafting of instructions and scrutiny of those issues, and right through to taking those pieces of legislation through.

Okay, thank you. Four days after you gave that evidence, the UK Government published its own analysis of the areas where it believes that legislative and non-legislative common frameworks may be required. Where is the Welsh Government up to now in its own consideration of that analysis?

Thank you, Chair. That continues to be an iterative process, involving ourselves and the other Governments in that consideration. We received, on 11 April, further analysis from the UK Government itself on these matters. It's not concluded, and I don't think, probably, it's the sort of process that is going to have a neat end point to it, because one discussion tends to give rise to another discussion in the complexity of these matters.

I would say that there are two big themes that have emerged from the consideration so far, one of which I think I probably mentioned last time. One is that, below the headline, once you get into the detail of it what you find is that there are some aspects under the headline that everybody agrees will need a legislative underpinning, but there are many aspects under the headline where the conclusion is that non-legislative forms of securing UK-wide arrangements could just as easily and effectively be brought about. So, I think, as Simon said, some of the topics are relatively narrow, some of them are very broad, and, under the broad ones, there's a lot of differentiation.

The second point, which I think I mentioned last time but remains a running theme of all of this, is that future governance arrangements for all of this are coming through all of the discussions as something that it is crucial to get right. Once we've agreed on a framework, what will be the process for keeping that framework under review? How could any partner to it who feels that it's not working out as we originally anticipated bring that to the attention of other people? What will be the process for being able to revisit and revise frameworks as experience takes us further? To give everybody confidence that these are going to be effective working arrangements, they need to have a set of rules surrounding them. Those rules are not yet invented, but, across the range of discussions, that is emerging as a common theme.

Have you any views on what body or organisation should conduct that adjudication role?

Well, as you know, Chair, the Welsh Government produced a detailed paper last year making some proposals about the way in which future inter-governmental relationships could be conducted across the United Kingdom. I think some of the principles that we set out there will be applicable here. What we want to see is a system in which there is parity of esteem, as you know because we've rehearsed it here. The criticisms of the current processes—the JMC processes—are that they are very lopsided. Only one party is able to call meetings, only one party is entitled to prepare agendas, only one party produces papers, and that just means that it's not a forum of genuinely equal participation. With the frameworks, we will all be signatories to them. We need a level playing field set of rules in future that allows any component part of the United Kingdom to be able to initiate discussions, produce papers to explain why they think something may need to be revisited, and the adjudication process needs to be one in which the people who initiate the problem don't end up being the judge and the jury in that issue. So, those are some of the principles that we set out in our paper, and we think that we need to work back from the principles to the arrangements that we would need to govern the way the frameworks will operate.

But clearly there's a difference between agreeing and reviewing what should be adjudicated and then adjudicating on what then might result if there's a dispute—

Yes, sure.

—surely, or do you feel that should be some form of independent body, albeit that the Governments themselves will obviously have a role—the role—in determining what should be adjudicated?

Well, first of all, Chair, I agree that the two things are different. Now, I am sure that we would want a process in which adjudication outside the membership is a backstop, a last resort, not the first resort, and that the pressure in the system should always be to secure agreement, and we put in our paper, you will remember, a sort of modified form of qualified majority voting in future arrangements so that agreement wouldn't depend upon any one player being able to veto an agreement from everybody else. So, my emphasis would be on trying to find arrangements that put pressure on all the parties to come to agreement amongst themselves. Would we need a set of arrangements to break a tie if there was a log jam and it couldn't be broken in that way? Well, I think that's the sort of detail that you would want all the parties to be able to get around the table and discuss, and everybody ought to be able to put their ideas into that mix.

Based upon the experience you've had today with JMC(EN) in particular, what confidence do you have you will be able to actually deliver that type of mechanism?

Well, Chair, the reason that I emphasise this, and the reason that the Welsh Government has emphasised it, is that I think it is essential to the future effective functioning of the United Kingdom. Now, you could say that the JMC is as it is because we haven't needed—people who defend the process, anyway, would say it's because we haven't needed anything better than that because, by and large, the European Union has provided the rulebook that all four parts of the United Kingdom are bound into. So, the scope for the need for these inter-governmental discussions has been much narrower. Post Brexit and post the transition period, we will have to write our own rulebook, and that means that we need better processes and procedures for doing so. It has been hard to capture attention from others to this issue, and you can sort of see why, you know. In some ways, it is not that easy for the Scottish Government to spend a lot of time talking about how to make the United Kingdom a more effective entity in the future when its political ambition is not to be part of the United Kingdom. And the UK Government—we struggle to get them to focus on this issue very much because Brexit is a pretty overwhelming set of policy challenges that their hands are very full with. But we work away at it because we think it will be genuinely necessary, and the fact that all participants in the framework discussions from all parts of the United Kingdom have kept coming back to the fact that we need to create a rule book of that sort I think is beginning to create a bit of a bridgehead into this discussion where we hope we will be able to secure a bit more energy and attention and willingness to think through how these arrangements will work.

Frameworks are one aspect of it but there is a much wider set of inter-governmental arrangements that we will need to reinvent and reinvigorate so that they work effectively the other side of Brexit and allow the United Kingdom—. You know, in this sense, we are a Government committed to making sure the United Kingdom succeeds, and if it's going to succeed it will need better ways in which it's four component parts can come together to solve areas where we all have our own discrete responsibilities.

Agreeing a common rule book on how the UK succeeds, which clearly we fully support you on, is one thing, but adjudication is another. The EU has the European Court of Justice. If, ultimately, a dispute cannot be settled—and that's what I'm referring to: a body—. Would it be, in your mind, the Supreme Court, an entirely new body, or is this something that's still got to be discussed?

I think it's more in that final category, Chair. It's an important issue, and it does have to be resolved. As I say, the principle for me is that it can't be resolved by one of the parties around that table having that role to itself, but I think the mechanisms are still probably—. We're not at the point really where thinking is mature enough to be able to identify what the options would be.

Before Suzy asks the last question in this section, if you don't mind—. On 5 March, you referred to the Sewel convention and your belief that it should apply to common frameworks. Is that still your current position or what are your thoughts currently on that?

Chair, maybe I should just make clear what I was saying last time, which is that I believe the Sewel convention should apply to any frameworks that require a legislative underpinning, because Sewel is a legislative convention. Now, there will be lots of things, as I said earlier, that we will resolve without needing legislative underpinning, and that will require other sorts of processes. But where we all agree, between the Governments of the United Kingdom, that a framework is so significant that it must be underpinned by legislation, whether that is by a Government Bill that sets it out or whether there are some other legislative mechanisms that underpin it, then I believe that the Sewel convention should apply, because if the UK Government is legislating on behalf of devolved administrations then I think the consent of the National Assembly for Wales and the Scottish Parliament ought to be secured.

Now, I have seen arguments from some people that that wouldn't be the case here. That argument says that these are issues that we will have all agreed, if we ever do agree, will be held at Westminster; they wouldn't have been passed down to the National Assembly. The argument runs that, if they're being held at Westminster, they are reserved matters, and reserved matters do not require the Sewel convention. So, there are people who have argued that Sewel would not apply to these frameworks on the grounds that these are matters that have crossed the line and are now in the reserved category. I don't agree with that. I think it is very clear. The whole reason why we are having the discussions about frameworks is because we've all got responsibilities to pool here, and if those responsibilities are pooled and a legislative underpinning is required to give expression to that pooling and that legislative action happens at Westminster because these are responsibilities that, in the end, will lie here and in Scotland and Northern Ireland, I believe the Sewel convention should apply.

Thank you.

Can I just go back, before I bring Suzy in, to my question and the answer you gave? You gave your vision, you gave your ambition very clearly as to how you'd want to see some form of agreement around competence. You actually didn't express whether you were confident that you will achieve that. Based upon the past experience over the last seven or eight months, where, effectively, the UK Government's been dragged screaming, shouting and kicking to the table because, back seven months ago, they were not going to even look at amendments—they threw them out, clearly, in the House of Commons, and we're still waiting for those amendments—do you still have the confidence that they are now learning about devolution, and that they're accepting the fact that there needs to be this type of agreed equal partnership in both frameworks and beyond?

Well, I'll give you an optimistic and a pessimistic take on that. If I'm being pessimistic, I would say that we have all had to devote an enormous amount of time and effort to putting right a problem that need never have existed. Because I remember discussions well over a year ago now with the Secretary of State for Exiting the European Union in which I said to him that this was a quarrel that need never have happened, but if they'd started from the point of saying that these were matters that could be resolved by agreement, then we would have made far greater progress than we have in having to fight the clause 11 process, which I think was mistaken from the outset. So, that's a sort of gripe, really, that we've had to spend so many hours trying to get back to the right position.

To be more optimistic, however, I have to try and retain a degree of confidence that we will get this right in the end. I would want to say that the efforts that have been made up at the Joint Ministerial Committee, particularly under the chairing of Damian Green and David Lidington, I think have been genuine efforts to try to find a way back from where clause 11 started and to a position where we can all agree. Whether we will succeed—the next week will be pretty crucial to that, but the UK Government has already come forward with one very significant amendment in the inversion of clause 11, and it recognised at the House of Lords that there were further amendments still to lay. If you're going into negotiations with other people and you want to achieve a result, you have to do it on the basis that all partners are willing to play their part in that. In that sense, you have to stay optimistic that you can bring this off.

Okay. Suzy.

Thank you. I hope you'd agree that one of the reasons, perhaps, you've been able to exercise this leverage, shall we say, over these last few months in particular is that you've had the support of the Assembly, not least this committee, in pushing the arguments. When we reach the stage where common frameworks were agreed, or about to be agreed, how do you see us scrutinising your decisions on those frameworks, particularly on the non-legislative areas, because at least with legislation we've got some means to quiz you on your decision?

Sure. Well, first of all, Chair, can I agree with the point that Suzy Davies made? It is immensely helpful, when you are going into discussions of this sort, that other players around that table know that you are speaking for a wider body of opinion than simply the Government's own view. The work that this committee has undertaken, the reports that you have produced, the work that the Constitutional and Legislative Affairs Committee has undertaken, the commentary they've provided on these processes, and what has been said on the floor of the Assembly—we may not think so always, but, actually, these people are taking notice of these things, and it has mattered, definitely, in the discussions, as has the broad sweep of opinion at the Scottish Parliament on this matter as well, including some things that were said in the House of Commons by Conservative Scottish Members of Parliament on aspects of the Bill and clause 11.

As to how the Assembly will have opportunities to scrutinise the actions that the Government takes in the framework area, again, I agree with what Suzy said. On the issues that require legislative underpinning, we have a set of processes that we use and people understand. Where there are non-legislative agreements, then I think there will be the normal set of opportunities.

The thing that maybe is different, I think, is that there will be a greater role for subject Ministers and subject committees than there has been, maybe, up until now. Up until now, the main action has been here and has been with those of us who have been involved in the direct discussions. But the frameworks will fall to the Minister who has responsibility for the environment, for example, and I imagine that those Ministers will appear before their subject committees and be scrutinised on them, just as we will continue to do all the other things that we do in terms of answering questions on the floor of the Assembly, making written and oral statements, taking part in debates. So, all the normal mechanisms that the Assembly has, we will want to continue to operate, but on a committee level, on a slightly wider basis than heretofore.

The Constitutional and Legislative Affairs Committee has been doing some work on inter-governmental agreement matters, and just as I think that the future will require a different set of arrangements at the UK level, it may be that we will have to do some work collectively to see whether the scrutiny arrangements we have for the non-legislative aspects of the framework are fit for the new purposes and the new world that we will be in.

Well, that's a very interesting answer, because I'm sure, speaking as a Member of a Parliament as opposed to an Executive, I'd like to think that we'd have some influence over what the frameworks might actually look like, rather than post facto scrutiny some way down the line. But I suppose that's for us. But, anyway, thank you.

Well, it's a very fair question to ask the Cabinet Secretary because it's important as to what our role will be in agreeing, because, obviously, a lot of the discussions on clause 11 are on consent of the Ministers and not on consent of the Assembly, and therefore it is important to understand where our consent is required and how we actually give that consent.

Yes. Well, in legislative matters, it is clear, and in non-legislative things, we are all, to a certain extent, working our way into the new world. I'm very happy to give an assurance that the Government will continue to use all the existing mechanisms that exist to make sure that the Assembly is able to scrutinise the work that we do. I'm also giving an indication that the work that CLAC has started may need to be built on further to make sure that there is the robust level of oversight that will be required.

And if I could just add to that, clearly what we're envisaging here is common frameworks applying across the whole of the UK by way of agreement between the four administrations. Processes of scrutiny ought to develop to reflect that, in the sense that the four Parliaments ought to be working together to develop scrutiny arrangements that enable them, more effectively, to scrutinise the four Governments collectively than would be done by, let us say, just this committee scrutinising this Government on the way we are interpreting and applying the framework. To get a holistic view of the operation of a framework would require much more effective inter-parliamentary work, and I think, obviously, that is under way, or the thinking is beginning on that sort of thing. 

Those discussions are under way with the inter-parliamentary forums that exist.

Can I go back to the 30—I think you mentioned—deep dives that have taken place so far?

Just under 30.

I always question the words 'deep dive' when someone tells me it's a day's work, particularly in an area that is quite broad, as you identified. How detailed are those dives in those broad areas? Obviously, with the narrow areas, you have a better chance of getting more detail, but we've mentioned some of those—. Fisheries support, for example, is a topic, but that's quite a large area. So, how detailed are those, and are you expecting that to be split into further dives in different areas within that umbrella?

I'll ask Simon, who's been in the room.

I think I've attended about half of these 30 or so deep dives. The process varies from topic to topic depending on the extent to which administrations have a background of close, joint working. So, the initial phase is agreeing the agenda and the common areas for discussion and sharing a mutual understanding of the policy areas as they apply now under EU frameworks where member states have agreed to make decisions on those things at an EU level—so, understanding the parameters by which that policy operates, and then actually exploring how the four administrations are currently operating in that policy area; some of these topics, depending on their nature, get quite legalistic in the sense of which laws apply and what the actual constraints within that are—also, the extent to which there's a shared view across the administrations for continuity and a similar approach as it's currently led, and the extent to which that area is intertwined with what a future trade relationship with the EU may be, and international obligations that may apply in these areas, whether that's beyond EU level—so, World Trade Organization, for example, or other international obligations. So, policy areas may be in theory broadly open, but actually there are constraints that operate, not just at the EU level.

The successful deep dives have actually teased out, through these issues, understanding areas of commonality and difference of opinion and identified next steps, and in some of those broader areas significant work has gone on beyond that. So, there have been multiple discussions getting further and deeper and deeper into the specifics around, say, agricultural support, where the one topic area identified more than two dozen specific issues within the administration of agricultural support, some of which are just through information sharing or non-binding agreements between administrations for good practice of sharing information; others where there are international obligations and treaties and so on. There is a genuine need for legislative underpinning behind that particular area of work. So, the work is to be focused on identifying those issues and actually making sure that these functions operate properly, and where there is mutual interest of administrations in jointly working, and actually what the parameters of that joint working could be, because a framework, by definition, isn't a one-size-fits-all—it sets the lower limits and upper limits of how the four countries of the UK could operate respecting devolution, understanding the variations that could apply, while still meeting those obligations.

And will we be receiving any sort of publication from the Welsh Government as to its consideration or analysis of the work to date, and, if so, when?

So, I think the next phase of this work—it is subject to the negotiations around the withdrawal Bill, and how we actually proceed with that—would be to continue updating on progress of the discussions at JMC(EN). But I'd envisage this maturing into a programme of work identifying bodies of legislation that may be required for those areas and a common approach for the memorandum of understanding or other mechanisms that are used for the non-legislative areas. I think some of that will turn into future legislation that will get put on parliamentary or Assembly timelines. Subject matter committees of those areas will get into the detail of that, so, for example, if agricultural support does end up heading towards having a legislative underpinning, a future agriculture Bill would be the mechanism by which any such framework would be enacted, and that would go through the normal scrutiny processes and normal exposure of looking at the policy areas. I think, as the Cabinet Secretary has described, there needs to be thought about how the non-legislative issues are shared and discussed, both in the specifics and also an overview of it. 

And, just for clarification, at that point, I assume, it's your Cabinet Secretary colleagues with responsibility for the portfolio who will take over the negotiation side of things. 

That's how I envisage it will be. There will be a wider team of people involved in those discussions. Chair, would it be helpful at this point if we at least supplied the committee with an updated note of the deep dives that have taken place—

That would be very helpful. 

—so you can see that?

We move on now to the, perhaps, discussions on the negotiations, so we'll talk about JMC(EN). Clearly, that was established to discuss the negotiations. Jack, do you want to start the questions?  

Yes, thanks, Chair. I'd like to focus on, specifically, the withdrawal agreements, and ask the Cabinet Secretary to outline his views on the latest version of the draft text of the withdrawal agreement. 

Well, I suppose the first thing I'd say, Chair, is that we are very glad to see that agreement in terms of providing certainty and continuity, and so on; we're very glad to see it. As you know, we argued from the very beginning for a transition period, and the most significant thing in the withdrawal agreement is that we now have—I know nothing is agreed until everything is agreed, and kept being reminded of that, but the withdrawal agreement does commit the United Kingdom and the European Union to a transition period, and we're very glad about that. We welcomed the advances that were in the agreement on citizenship rights for people who will come here during the transition period.

There is still a lot of detail to be worked out on the practical arrangements around citizenship rights, including what will happen at the end of the transition period, but we were happy to welcome the steps forward there. And I suppose the island of Ireland and arrangements there was the aspect of the withdrawal agreement that proved most contentious. The Welsh Government's version is clear enough on it: the way to solve the problem on the island of Ireland is for the United Kingdom to remain in a customs union, and for there to be full regulatory alignment not just between Northern Ireland and the republic, but between the United Kingdom and the European Union, in order to allow trade not to be impeded by tariff and non-tariff barriers.  

Thanks, Chair. 

Jane. 

Yes. What was also helpful, I think, were the guidelines that came forward in the March European Council, but what are your views on the guidelines and have you got any concerns about those guidelines? 

Well, I think the guidelines were helpful. They have a—you know, they do have a sense of optimism in them that a wide-ranging deal can be achieved. There is positive language in there about deals on goods and services with minimal tariff and non-tariff barriers, and on future UK participation in crucial European Union programmes. So, overall, we think that the tone of those guidelines is helpful. Do we have concerns? I suppose there will be two key concerns that we would have. One is timing. We would have preferred the UK's original position in relation to the transition period, when the Prime Minister talked about a period of around two years, rather than the more definitive 21 months and it all ends at the end of December 2020. I think many serious commentators have anxieties as to whether or not all this can be done in a 21-month period, and, if all the transition arrangement does is just move the cliff edge 21 months later, rather than genuinely make sure there isn't a cliff edge, then it won't have done the job that it set out to do—so, some anxieties about the timing being over-definitive.

When I was in Brussels a few weeks ago and spoke to most of the major political groups there, one of the things I was trying to persuade the Parliament on was to leave a bit more creativity around the period of time. Why would you not want to take a little bit longer, if that guaranteed you got a really good deal, rather than having some sort of guillotine that meant that those possibilities had been excluded?

And then I think the other anxiety we would have is a different one, and that is an anxiety about the UK Government and about its continued use of a sort of red line strategy within the guidelines. Again, we've said to the UK Government that, if a red line strategy ever was useful, its usefulness has run its course. And the UK Government's insistence that we won't be in a customs union and we won't be in the single market, well, it's unhelpful from the point of view of the Welsh economy. The document that we published, 'Securing Wales' Future', we still think that that is the best advice as far as Wales is concerned. Sixty-one per cent of our trade goes to the European Union. Jobs in the Welsh economy depend upon new barriers not being erected to those vital arrangements in Airbus, in Ford and in the food industry, to take the most obvious examples. And a red line strategy, in which we rule things out rather than trying to negotiate the best deal, I think is our second big area of anxiety. 

We were in Brussels as well recently, as a committee, and talking very much about future relationships, and you know we published the report there on future relationships with the EU, and I think that's something where we would like to know a bit more about how you see future relationships developing for the Welsh Government in terms of high-level relationships and also those kinds of relationships that you appear to be developing. For example, the fact you went to the Netherlands last week, and signed a declaration of friendship, which indicates that you are—. Also, we know that you'd also been to Bilbao, but I think that was on another matter in terms of exploring working relationships and learning from that experience. But we are working as a committee on future relationships, and it's helpful to know what the Welsh Government's view is on this.

Well, our general view, Chair, is, as we say in the rather trite phrase, 'We're leaving the European Union, but we're not leaving Europe', and that there's been a huge investment over decades now in having fruitful relationships with other parts of Europe and other regional Governments in Europe, which are vitally important to businesses, but also in other areas too of professional practice and policy development and in very straightforward things like making sure that the public health protections that we enjoy as a result of our membership of EU institutions, that those things aren't lost to us the other side of Brexit. So, you can see this on a number of different levels, I think.

I referred earlier, Chair, to the fact that we were pleased to see the Prime Minister, in her Florence speech, say that the UK Government recognised that there would be programmes in the future that we wanted to remain part of, and that you understand if you want to be a member of that club you'd have to pay the entrance fee to it: so, Horizon 2020, and Erasmus+, and, from our point of view, the interterritorial co-operation programmes that we're involved in. So, we want the UK to take a very positive view of those things, those programmes, which we know are in our interest to be a member of, and to try and do whatever we can to keep those doors open to us.

Then there are those European-wide institutions, which—. We probably take a wider view of this than the UK Government does at the moment. But there are so many things, where, rather than having to try to invent them for ourselves, it is simply better if we can find a way of continuing to be part of European-wide bodies. Now, we recognise that, if we're not a member of the European Union, we will not probably be able to stay in membership of those things in the same way. But there must be inventive and imaginative ways that we could work on that would allow us to continue to play a part, make a contribution, but to get the benefit in return. You know we've argued from the beginning that the UK should remain a subscribing partner of the European Investment Bank, for example. But there are many, many other European-wide bodies of that sort where we think it is in the UK's interest that we try and stay in the room, and to play a part and get the benefits.

And then, from a Welsh perspective, we are making considerably bigger efforts than we have needed to in the past, to keep key relationships with other parts of Europe at a regional level, to let people out there know that we are very keen to go on being able to be part of those arrangements into the future. I went to Bilbao, to the Basque Country, mostly talking about tax and the way that they organise those things, but also because, in terms of their economic future—and here's a region that's gone from having its economy 30 percentage points below the European average in GDP in the 1980s to 30 percentage points above the European average today. They have identified five key regions of Europe for economic relations in the future, and Wales is one of those five. So, it's absolutely in our interests to continue to have a regional-level relationship with them. I went to the north of Holland on Friday, because, again—that's Amsterdam and all its trading relations with the UK, very keen to make sure that they continue to have a positive relationship with the Welsh Government and with the Assembly here. So, we are putting more effort into that, because we have to get the message out to people who may believe that, because of Brexit, somehow we are not going to be wanting to play our part with them in the future, and we're determined to put that message right.

Thank you.

And, on that point, do you have a strategy to actually—? Have you identified the regions you think are important to Wales? Because you've said that the Basque Country has identified five. Have the Welsh Government identified a number?

Well, we're going to have to, Chair, I agree, because we don't have the capacity to go on doing everything everywhere. And that's financial capacity, but it's also just in terms of people's time and so on. So, we will have to, as this process goes on, identify those regional parts of Europe where our relationships need to be stronger. Some of them are not difficult to identify from early on. The Basque Country certainly would be one. The Flemish Government—we have very strong links with the Flemish Government; they've been very much developed over the last three or four years, because of the centenary of the first world war and the very distinct Welsh interest in that part of Europe. And again, it's a very successful region, very determined to do everything it can to allow the freest trading relationship between the EU and the United Kingdom post Brexit. So, I don't think we have a definitive list at this point, but we will have to, over time, find those places where our efforts are likely to show the greatest returns.

Work in progress, then.

Yes.

Can I just ask very briefly on that—? Presumably you are choosing regions that are not only just advantageous for Wales, but that actually have a strong voice in the EU's negotiating position as well, because we have to accept that some regions and nations have louder voices than others.

Yes. And you need allies in that—people who are willing to help us to keep doors open, for Wales and for the United Kingdom. So, you want to work with those parts of Europe that will be able to deliver the most effective voice in that context for you.

Thank you.

On that point, Jenny.

Just going back to the thorny issue of our relations with the island of Ireland, clearly, you know, we've got 100 years of history here, of free movement of labour and goods, between the island of Ireland and the island of Britain. Given our geographical situation, this is absolutely crucial to Wales. Given the implications for Wales, what involvement is the Welsh Government going to have in the series of talks that need to take place over this matter?

We don't expect to have a direct involvement in the detailed six weeks of discussions that are going on between the UK Government and the Commission on the border issue in Ireland, but you can be sure that the UK Government is very well informed from us about the specific Welsh interests that there are at stake here. It will be very familiar to this committee, but, while we say absolutely nothing that would imply that we don't think that keeping the border free in the island of Ireland, with all that goes with it in the peace process and so on—. We're absolutely signed up to the importance of that, but a solution that created a border down the Irish sea has direct implications for Wales in terms of Holyhead and Pembroke Dock and Fishguard and so on. So, we have spelt these issues out with the UK Government. We have to rely on them conducting those negotiations but doing it in a way that has Welsh interests firmly in their sight.

Ken Skates, the Cabinet Secretary for economy and infrastructure, issued a statement recently about the importance of Welsh ports. Clearly, that would be at risk if we started to have some borders in the middle of the Irish sea. These are pretty fundamental to our geographical position. We can't change that. Do you think that there is any optimism for seeing that the UK Government is mindful of these major issues for Wales?

Well, there is no doubt that they are aware of them.

I'm sure you've put it to them.

Yes, we have, and I know that the Wales Office has focused on this issue and made sure that the UK Government is aware of it too. Mrs May said that no British Prime Minister could sign up to a border in the Irish sea. She wasn't necessarily saying that because of Welsh ports, but the issue is clearly one that the UK Government is seized of, but they are involved in some of the most difficult problems that Brexit throws up when they're talking about Ireland.

So, you clearly don't expect to be directly involved in the complex negotiations between the UK Government and the European Commission on this matter, but how will Wales's interests be played out in influencing the negotiating lines ahead of the June European Council meeting?

Chair, I think I would have said the last time I was in front of the committee that we have been promised a paper by the UK Government on how devolved administrations will be involved in the second phase of discussions, the negotiations over the future relationship. You know from Hugh that there's going to be a JMC(EN) next week. We are yet to see that paper, but I have seen, quite regularly, reports of the work that is going in to preparing the paper and some of the ideas that are being discussed as part of it. So, I've got a bit of confidence that that paper is in preparation and that some serious work involving the devolved administrations as well has gone into its preparation. So, I'm hopeful that it will emerge at next week's JMC(EN) so that we will be able to express our views on it and report on it where we can. It is very important that it does happen in short order, because if there is a set of working arrangements that that document proposes then those will be the working arrangements we will use in advance of the June council. Given that it's not many months away, getting those arrangements in place is very important.

So, that paper, as I see it emerging, will talk about structured ways in which Ministers will be able to engage on the next phase of negotiations and how that will be supported by a range of formal official-level discussions between the UK Governments, so that by the time we get to a ministerial discussion, you're doing it on the basis of the sort of detailed work that will be necessary. So, I can't probably say much more, Chair, without having seen the paper, and I have been disappointed before that papers that are promised don't arrive or that a promise that appeared to be there in the preparation doesn't get delivered in the paper itself, but we are promised a paper and I at least know that some serious work has been going on to develop its content. 

Michel Barnier, at the end of last week, did offer the olive branch of the UK being able to remain in both the customs union and the single market right up to the end of the transition period if we changed our mind. Is that the sort of thing that at least gives us a backstop if we can't come up with more imaginative solutions? 

Well, Chair, my understanding is, subject to correction, that we are we going—that that's what the transition period does—. We are now all committed to remaining, in effect, in the European Union for another 21 months, but not having participation in its political institutions. 

I absolutely agree on that. What I thought he was saying was that we could change our mind on leaving the customs union and the single market if we had a reconsideration. 

Well, our position is unchanged, Chair. Full and unfettered participation in the single market, membership of a customs union—both of those things, we say, are fundamental to the future health of the Welsh economy. A Brexit that puts jobs and the economy first would secure both those things. 

Thank you.

Can I ask a question? You've highlighted that the JMC(EN) next week is likely to take place and that this paper may well be presented to that, but you've also highlighted you've had that promise in the past. Two things: are you still frustrated by the fact that papers are not ready when they should be ready—when they've been promised and they're not coming through? And if it isn't available for next week, how critical is the time factor going to start being for this type of discussion to take place?  

Some of the basic administration of the JMC(EN) has undoubtedly improved in the last six months. Some of the things that were really astray in the first six months—where you didn't have papers and you didn't have agendas and you set off on the train in Cardiff not even knowing where the meeting was going to take place—that has been a lot better. But, even at the last JMC, papers were being tabled the night before the meeting took place. I've forgotten just for the moment what the paper was, but I do remember saying to David Lidington, 'This was a paper that the Welsh Government would have liked to have welcomed, but how can I be expected to do that when I really haven't had a chance to read it properly? Had we had it in good time, we would have been able to have come here today to be positive about it and to have welcomed the proposals that it made'. So, I do still share some frustrations that the mechanics of the JMC are not in good working order. I've put it down myself not to people who couldn't be bothered or that it's an attempt to try and keep something from you. I put it down to the fact that the system is under such pressure. It is managing so much—so many urgent Brexit-related items to try to deal with—that it is struggling to do it in the way that we would normally expect business to be transacted. That doesn't mean that you don't get frustrated when you're at the receiving end of it.

And how critical is the timing of it now if it's delayed to another meeting?

Well, if it doesn't appear next week, we will press for as early a following meeting as we can get. It was promised for March and we didn't get a JMC at the end of March, so we're already a few weeks beyond where we were hoping to see it. I continue to be hopeful that we will see it next week and that it will be a document that we can work on further.

I do welcome your optimism. Suzy.

Yes, just a quick question on that paper. I appreciate you haven't seen it yet, but will you be expecting to see, built into it, time, I suppose, which would allow for the four sets of parliamentary scrutiny of what's going ahead, or are you expecting it to be completely inter-governmental without any opportunity for parliamentary influence, I suppose?

Well, what I would like to see in it is a regular pattern of engagement that takes place according to a reliable timetable. The House of Lords select committee that reported on the JMC arrangements made exactly this point—that one of the reasons why the JMC isn't as effective as it needs to be is because it doesn't have a pattern of meetings. All meetings are ad hoc, all meetings are arranged without a sense of rhythm to them. What I would hope that we will see will be a pattern of inter-governmental arrangements around the second phase of negotiations that tracks the negotiations. The negotiations will have a rhythm to them because that's the way that the Commission goes about its business. It timetables it and it's on a cycle and so on, and the JMC process needs to track that. If we have a reliable pattern of meetings at the JMC, then I think that assists the legislature in deciding where it wants to put its effort in scrutinising that process, because there will be a timetable and so on that you'll—. I think it's very difficult from a legislature's point of view to scrutinise the JMC when the sporadic nature of them means that you can't timetable time and effort into keeping track of its work because it doesn't have an established way of doing things that allows that to happen. So, that's one of the ways I hope that the second phase will work better in itself, but also it will be easier for legislatures who are there to keep a watchful brief on all of these things to organise their time.

Thank you.

You have, I think, the inter-parliamentary forum that met at the end of March that did also come out with an agreement that the JMC is not fit for purpose at this moment in time, and therefore supports your arguments that there needs to be clearly something better, so that we can ensure that the processes are clear and the outcomes are clear and they're reported appropriately.

Personally, Chair, I think that there's a very general agreement amongst almost everybody who's looked at it. I don't know if you saw the Institute for Government paper that was published, I think last week, which has got a whole chapter in it on this matter. They come to exactly that conclusion.

Suzy, do you want to ask anything else?

No, thanks; that was fine for me. If you want to ask—.

We've also heard from the Secretary of State for Exiting the European Union about the withdrawal and implementation Bill that will be likely to occur following an agreement on the withdrawal. Have you had discussions yet with the UK Government as to whether they will be seeking the consent of the devolved institutions in relation to that Bill?

We've had some preliminary discussions in the JMC with the Secretary of State for Exiting the European Union about the withdrawal and implementation Bill. I don't recall that it specifically raised the issue of consent and, of course, we have not seen either a Bill or even a White Paper, as yet, which would precede it. I think my own view would be that it is difficult to see how, if the UK Government has come to the conclusion that it needed the consent of the devolved legislatures to the withdrawal Bill, how it would not need our consent to the withdrawal and implementation Bill. I mean, the one takes us out of the European Union way of doing things, and the other one will opt us back into them for the implementation period. So, I think the answer to your question is: I don't think we have had those direct conversations. I find it difficult to see how consent would not be part of what was required.

And have you had discussions as to—in simple words—the treatment of Assembly Members equal to the treatment of Members of Parliament? Because the example of the analyses that were provided to Members of Parliament is showing how, perhaps, we haven't been given the same, in my view, respect as Members of Parliament. Have you had those discussions with the UK Government? 

No, Chair, we haven't, and, in some ways, I struggle a bit to see how we would. I absolutely recognise the point you've made and I've seen it, but I don't know that it would be proper for the Executive to be making representations on behalf of the legislature without the legislature having asked us to do it. Do you see what I mean? It's not our place, really. It's your business. Now, if the legislature asked the Government to make those representations, I'm sure—of course, I'm sure we would. But I don't think we would presume to make them on your behalf.

Okay, then let me ask the next question, which is within your gift in one sense: have you asked the UK Government whether you can now distribute those analyses to Assembly Members? Because, last time, they had said that you couldn't.

I have seen nothing that suggests that their position has changed.

Will you write to them to seek if their position has changed, so that you can actually honour Assembly Members? 

If you would like—. If you would find that helpful, then I'm sure we would be happy to do so.

Yes, I think that would be helpful. Are there Members with any other questions? Then I thank the Cabinet Secretary and his officials for their attendance this afternoon. You will receive a copy of the transcript for any factual inaccuracies. Please let the clerking team know as soon as possible if you identify any. Once again, thank you for your time this afternoon. 

Thank you very much.

I'm sure we'll be having further meetings.

I move on to the next item on the agenda for Members. That's item 3, papers to note. The first paper is correspondence from Lord Callanan, Department for Exiting the European Union, regarding the EU withdrawal Bill, to our letter, and it's dated 22 March 2018. Are Members content to note that response?

The second paper is correspondence from the Cabinet Secretary regarding the committee scrutiny session on 5 March, where he came back with some extra information that was requested. Are Members happy to note that?

And the third one is from the Institute for Government report, 'Devolution after Brexit', which is at the end of your papers, particularly on managing the environment, agriculture and fisheries. Are Members happy to note that?

Can I just raise one point on Mark Drakeford's letter? I think he says that something's been referred to Lesley Griffiths's department. Are we going to do a separate letter on that, or will we just take it that that's on its way—the response?

Well, we haven't received a response, so we can write to the Cabinet Secretary for Energy, Planning and Rural Affairs to see where they are on that.

Well, just a gentle prod, yes. Okay, thanks.

We'll do that.

With that item, we move on to item 4. Therefore, in accordance with Standing Order 17.42(vi), can I suggest we resolve to meet in private for the remainder of today's meeting? Are Members content to do so? Then we will move into private session for the remainder of the meeting.