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Written Statements

Volume 639: debated on Wednesday 25 April 2018

Written Statements

Wednesday 25 April 2018

Cabinet Office

European Union (Withdrawal) Bill: Clause 11

The UK Government have today tabled amendments to the devolution provisions in the EU (Withdrawal) Bill. In parallel, a supporting intergovernmental agreement has been published at: https://www.gov.uk that sets out a number of additional commitments on how the amendments, if agreed, will work in practice.

My priority has been to reach agreement with the Scottish and Welsh Governments on the EU (Withdrawal) Bill. Over recent months, we have been in intensive discussions in order to find a mutually acceptable way forward. This needed to provide greater reassurance to the devolved Administrations that the distribution of returning powers in otherwise devolved areas would honour the devolution settlements, while maximising legal certainty on how current UK frameworks will function as we work together to implement new arrangements where they are necessary.

The Government tabled amendments at Lords Committee stage that reflected the progress made on frameworks since the autumn when we started working with the devolved Administrations on our analysis. Those amendments debated by peers established a presumption that returning powers in otherwise devolved areas would flow to the devolved legislatures. The UK Government withdrew the amendments in order to continue our discussions with the Scottish and Welsh Governments and consider the suggestions made by peers during the debate and others in their consideration of the proposal.

Following Lords Committee stage of the EU (Withdrawal) Bill, officials from the UK, Scottish and Welsh Governments jointly explored options put forward by all three Administrations. I discussed the proposals with Mark Drakeford AM, Cabinet Secretary for Finance in the Welsh Government and Mike Russell MSP, Minister for the UK Negotiations on Scotland’s Place in Europe a number of times in order to agree a way forward.

The new proposal, which is given effect through the amendments to the Bill tabled today and the supporting intergovernmental agreement, will see decision-making powers returning from Brussels transfer to the devolved legislatures. For a small number of areas, set out in the intergovernmental agreement, we expect that common legislative frameworks may be needed in whole or in part across the UK after the UK has left the EU. While these are being designed and implemented, we have proposed maintaining the existing common arrangements through the exercise of regulations in specific areas. The proposal emphasises the importance of joint working—the UK Government are under a legal duty to share any such regulations in draft so that the approval of the devolved legislatures can be sought before proceeding to the UK Parliament. It also recognises though the importance of providing legal certainty where agreement cannot be reached between the Governments and where, despite this, the UK Government and Parliament consider it necessary to act; for instance, to protect the UK internal market, ensure our international obligations are met or manage our common resources. It is right that these amendments recognise that it is only the UK Government, with approval of the UK Parliament, that can act for the UK as a whole. This is built on, and now delivers in legislation, the suggestion put forward during the Lords Committee debate that there should be a presumption of acting with consent, with a means for the UK Parliament to act where agreement is not possible.

Responding to specific proposals put forward in the UK Parliament and the devolved institutions, the maintenance of existing frameworks is strictly time limited. The amendments now ensure that the regulations maintaining specific frameworks will expire five years after they come into force, if not revoked earlier, and the power to create those regulations will expire two years after exit day at the latest.

In line with the amendments tabled at Lords Committee stage, the UK Government will also be under a legal duty to report to the UK Parliament periodically on the progress made towards establishing new frameworks and therefore removing any temporary arrangements. Our preference, however, is to design and implement new common arrangements that are better suited to the UK as quickly as possible in the coming months and years.

The intergovernmental agreement covers a number of non-legislative commitments, which support the tabled amendments. It confirms, for instance, that the UK Government will not bring forward legislation for England where the devolved Administrations are prevented from doing so by virtue of existing EU frameworks being maintained. In response to the points raised in the debate at Lords Committee stage, the UK Government have committed to ensure that clause 11 regulations will not affect the operation of the Sewel convention and that related practices and conventions in relation to future primary legislation, including legislation giving effect to common frameworks, will continue to apply. In exchange, the agreement sets out that the devolved Administrations will not unreasonably withhold recommendations of consent, recognising that this is ultimately a decision for the devolved legislatures.

I welcome the letter from Mark Drakeford which confirmed yesterday that on the basis of these amendments the Welsh Government will recommend legislative consent to the National Assembly of Wales for the EU (Withdrawal) Bill. This demonstrates the significant progress made on both sides to ensure we deliver maximum legal certainty with a functioning statute book on exit day. As part of this, the UK Government and the Welsh Government have agreed that the UK Government will seek to withdraw the reference to the Supreme Court of the Law Derived from European Union (Wales) Bill, known as the continuity Bill and that steps will be taken to repeal it from the statute book.

The Scottish Government have at this stage declined to join the agreement between the Welsh and UK Government, but the UK Government remain hopeful that the Scottish Government will become party to the agreement, which builds on extensive work between the UK, Scottish, and Welsh Governments over recent months and reflects the considerable and constructive policy development. Irrespective of our ongoing discussions, the UK Government will honour the commitments they have made towards the Scottish Government in these documents, including seeking their agreement before maintaining a temporary framework.

The Northern Ireland civil service has been kept informed of developments. Our priority is to see a restored Northern Ireland Executive. The intergovernmental agreement remains open to incoming Ministers in a future Northern Ireland Executive. I am writing to Northern Ireland parties to update them on the latest position in relation to the EU (Withdrawal) Bill.

As a result of these changes, the devolved legislatures will see a significant increase in their decision-making powers as a result of EU exit. I look forward to continuing to work with them on designing new arrangements and will continue to keep the UK Parliament updated on that progress.

[HCWS646]

Exiting the European Union

General Affairs Council

Sir Tim Barrow, the UK’s Permanent Representative to the European Union, represented the UK at the General Affairs Council (GAC) meeting in Luxembourg on 17 April 2018.

The agenda covered: Reform of the Electoral Act, Rule of Law in Poland /Article 7(1) Treaty on European Union (TEU) Reasoned Proposal and, under any other business, the Commission’s annual enlargement package.

A provisional report of the meeting and the conclusions adopted can be found on the Council of the European Union’s website at:

http://www.consilium.europa.eu/en/meetings/gac/2018/04/17/

Reform of the Electoral Act

Ministers discussed proposed amendments to the electoral law governing European Parliamentary elections. The majority of member states supported the text. The presidency indicated its hope that the file will be adopted by written procedure before the end of April to enable the proposals to come into force ahead of the 2019 EP elections.

Rule of Law in Poland / Article 7(1) TEU Reasoned Proposal

The Commission provided a positive assessment of progress in the dialogue between the Commission and the Polish authorities regarding the rule of law and Poland’s judicial reforms. Although changes introduced by the Polish Government to the reforms so far did not fully satisfy the Commission’s concerns, the Commission hoped that outstanding issues could be resolved in the coming weeks. The Commission indicated that it expected to present its final assessment on the rule of law at the next GAC in May.

The UK intervened to welcome progress and emphasise the importance of the issues and values at stake. The UK welcomed the positive momentum in the dialogue towards a solution and affirmed its support to both parties in taking dialogue forward.

AOB - Annual Enlargement Package

The Commission presented the 2018 annual enlargement package, assessing progress of the six western Balkan countries and Turkey on meeting the criteria for EU membership. The package recommended opening accession negotiations with Albania and Macedonia. The Presidency concluded by expressing hope that member states would reach agreement on the enlargement conclusions in June.

[HCWS643]

Foreign and Commonwealth Office

Wilton Park: Tailored Review

I am announcing today the start of a tailored review of Wilton Park, an executive agency of the Foreign and Commonwealth Office.

The principal aims of tailored reviews are to ensure public bodies remain fit for purpose, are well governed and properly accountable for what they do.

https://www.gov.uk/government/publications/tailored-reviews-of-public-bodies-guidance.

Wilton Park is an executive agency of the FCO, which convenes discreet dialogue on the UK’s strategic foreign policy priorities. It has shaped and delivered events since 1946 linking a global network of experts from a range of sectors, including academia, the military, civil society, business, politicians and diplomats.

The review, the first since 2015, will provide a robust scrutiny of and assurance on the continuing need for Wilton Park—both its function and its form. If this process finds the agency should be retained in its current form and status, it will then consider how Wilton Park can deliver on its core mandate more effectively and efficiently. It will also assess the control and governance arrangements that are in place to ensure that Wilton Park and the FCO are complying with recognised principles of good corporate governance.

In conducting this tailored review, officials will engage with a broad range of stakeholders across the UK and overseas, including staff, management and the board of Wilton Park. These consultations will include participating and sponsor organisations of Wilton Park events as well as partners from across UK Government, foreign Governments, international organisations, business, academia and the third sector.

The review will follow guidance published in 2016 by the Cabinet Office: ‘Tailored reviews: guidance on reviews of public bodies’. The terms of reference for the review can be found at: https://www.gov.uk.

I shall inform the House of the outcome of the review when it is completed and copies of the report of the review will be placed in the Libraries of both Houses.

[HCWS642]

Home Department

Independent Inquiry into Child Sexual Abuse: Interim Report

I am pleased to announce that the independent inquiry into child sexual abuse has, in accordance with its terms of reference, today published its Interim Report [HC 954] . Pursuant to section 26 of the Inquiries Act 2005, I am also laying a copy of the report before the House.

The report will be published on the inquiry’s website at: https://www.iicsa.org.uk

and at: https://www.gov.uk. Copies will also be available in the Vote Office.

The interim report provides an overview of the work undertaken by the inquiry so far, together with emerging themes and recommendations.

Across Government, the interim report will be given careful and proper consideration. Discussions with business managers are currently in hand to schedule a debate to be held in Government time to enable the House to fully discuss the content.

I would like to thank Professor Jay and the panel for their continued work to uncover the truth, expose what went wrong in the past and to learn the lessons for the future.

[HCWS645]

International Development

World Bank Group Capital Increases and Reform

I am pleased to confirm that on Saturday 21 April, World Bank governors welcomed the package of additional financing for, and reforms to, the World Bank Group (WBG). As a shareholder to the WBG, the UK is expected to contribute. The UK contribution of around $550 million (around £390 million based on current exchange rates1) over an expected five years would support a package that is expected to enable US$315 billion of additional global development financing by June 2030, delivering life-changing development impacts globally.

This package is firmly in UK national interests and represents good value for money for UK taxpayers. The WBG is the largest development actor globally with the scale, expertise and experience to deliver life-changing development projects. It shares UK values and projects these globally. This package will further enable the WBG to support global development, prosperity and security, including through its work to reduce poverty; support an open, rules-based, and predictable international trading system; mobilise private finance; and address sources of instability. This will support our prosperity and security at home, while maintaining the relevance of the WBG in the eyes of all its shareholders.

As a leading shareholder, the UK Government played a central role in supporting this package helping to shape important reforms that will further enhance WBG effectiveness and efficiency and support UK national interests. These included ensuring that the share of lending going to the poorest countries will increase and that wealthier countries, such as China, will pay more to borrow. This will support wealthier borrowers in their transition from being aid recipients to aid donors. Given the WBG’s impressive track record of supporting UK national interests and delivering results, and the further reforms that have been agreed, the UK Government support the package.

Governors will be asked formally to agree the package by the annual meetings 12 to 14 October 2018. DFID will lay an order before Parliament and a departmental minute relating to the increase in contingent liabilities, before making any payments towards this package (expected in 2019).

Shareholder support

The package will involve a total of US$13.0 billion of paid-in capital from shareholders. It will also involve shareholders accepting an additional contingent liability of US$52.6 billion, the UK share of which is estimated to be around $1.9 billion (or around £1.4 billion2).

This would comprise:

US$7.5 billion of paid-in and US$52.6 billion of callable capital for the International Bank for Reconstruction and Development (IBRD), the WBG institution that provides financial support and advice to middle-income and creditworthy low-income countries;

US$5.5 billion of paid-in capital for the International Finance Corporation (IFC), the WBG institution that provides financial support and advisory services the private sector in developing countries for projects with development impact; and

an adjustment in relative shareholding in the IBRD to more closely reflect changes to the economic weight of its shareholders and their contributions to the International Development Association (IDA), the World Bank’s fund for the poorest countries, while maintaining UK’s joint fifth single seat on the IBRD board with France. IFC shareholding would also be adjusted to ensure that it is more closely aligned with IBRD shareholding while retaining the veto of the largest shareholder, the US.

Russia was isolated in indicating that it would not participate in the package. This intransigence occurs against a wider backdrop of continued Russian efforts to undermine multilateral co-operation.

Impact

The WBG has a proven track record in delivering life-changing development results, for example, between 2015 and 2017 it supported:

286.5 million people receive essential health, nutrition and population services;

81.2 million people get new or improved electricity services;

73.2 million people, microenterprises and SMEs receive financial services; and

53.9 million and 44.5 million people gain access to an improved water source and improved sanitation facilities respectively.

The IBRD and IFC’s financing models allow them to deliver many multiples of shareholder contributions in development finance. Each $1 of capital paid in by shareholders has delivered almost $50 in development finance. This package, and the UK contribution within it, would enable the IBRD and IFC to deliver a further US$315 billion of global development financing by June 2030. This additional financing and the reforms secured will support the WBG in delivering further life-changing development outcomes.

Reforms

As a leading shareholder in the WBG, UK Government engaged with the WBG management and other shareholders to support the package, while securing important reforms to further enhance the WBG’s efficiency and effectiveness. These included:

Strengthening global peace, security and governance—Increased WBG investment in fragile and conflict affected states, with IFC increasing its support for the poorest and most fragile countries to 40% of its total support by 2030 (from around 24% currently).

Strengthening resilience and response to crises—A new crisis buffer for the IBRD, which would allow it to surge lending in crises. Investment in projects with climate change benefits increased to 30% of IBRD support by June 2023 and 35% of IFC support by June 2030.

Promoting global prosperity—An increase in the mobilisation of private finance and further support for economic development and market creation through regulatory reform and infrastructure investment.

Tackling extreme poverty and helping the world’s most vulnerable—IBRD support to its poorer clients will increase to 70% (from around 63% historically) of its total lending and the proportion of its projects that narrow gender gaps will increase to 55% by June 2023.

Delivering value for money and efficiency—Further efficiencies. A new “financial sustainability framework” to help ensure that IBRD lending levels remain sustainable. Higher prices for wealthier countries, such as China, borrowing from IBRD.

1 This and all further GBP figures in the written ministerial statement are converted from USD using HMRC average exchange rate of April 2018 of £1 = $1.4,065.

2 See previous footnote.

[HCWS644]