Brexit, powers and the Scottish Parliament: The case of agriculture and fisheries
Monday 27 March 2017
The Scotland Act 1998, which established the Scottish Parliament, is based on the principle that the Scottish Parliament has powers over policy areas which are not explicitly reserved (to Westminster). In Scotland, and especially on the part of the current Scottish Government, there is a widely held view that where policy issues such as agriculture, fisheries and the environment are not reserved under the Scotland Act, the Scottish Parliament has powers over the range of policy issues covered by that subject.
This is based upon the principle in the Scottish Constitutional Convention Report of 1995 that Scotland's Parliament would have a defined range of powers and responsibilities which would encompass sole or shared responsibility for all functions except those retained to the United Kingdom Parliament. The UK Government, on the other hand, takes the view that the powers of the Scottish Parliament, in the context of the reservations set out above, are those as currently exercised – they are not absolute across all aspects of the subject matter.
Current Agriculture and Fisheries policies
At present, under the current devolution settlement, the Scottish Government is responsible for the implementation of the EU’s Common Agricultural Policy (CAP) in Scotland. Since the EU is a single market and the UK is in a Customs Union, British food producers can currently trade with other EU countries without restriction. Because of the size of its agricultural sector, Scotland currently receives some 16% of the total of EU CAP expenditure in the UK, much higher than the Barnett formula percentage for Scotland of 8% which roughly represents Scotland’s population share of the UK.
The Scottish Government is also responsible for the implementation of the Common Fisheries Policy (CFP) in Scotland and Scottish waters The CFP is very different from the CAP in that it is largely focused on resource management by setting quotas for fishing within the EU’s zone, subject to agreed rules about sharing the allocation between the fishing fleets of the different countries. As for agriculture, accompanying public health measures make it possible for Scottish seafood producers to trade within the EU without restriction. Since the referendum the Scottish Fishing Industry has made clear its support for taking Scotland outwith the scope of the Common Fisheries Policy.
How extensive are any new Scottish powers likely to be?
At this stage, in the absence of any UK proposals on how to implement Brexit and the implications for devolved authorities, we have no clarity on what the extent of any new powers for the Scottish Parliament might be. We do know from comments from the Prime Minister, Home Secretary and Secretary of State for Scotland that the ambitious plans of the Scottish Government are unlikely to be met. The UK Government wants to maintain the existing powers of the Scottish Parliament and is looking at areas which might be strengthened, including in the area of agriculture and fisheries. This does not mean, however, that the UK Government will be happy to see all aspects of these policy areas devolved. The key constraints are likely to be as follows.
Single UK market and international trade
In line with s3.5-6 of the UK White Paper on Exiting the EU, a key aim of the UK will be to ensure the maintenance of the necessary common standards and frameworks for the UK domestic market, and to ensure the UK is able to strike ambitious trade deals around the world. To do so will require the setting of public health and other regulatory standards which will allow such trade to take place. While the Scottish Government will be keen to ensure protection for Scotland’s key exports including seafood and beef and sheep meat to the EU, there will be increasing pressures as trade deals are pursued with e.g. the US to introduce common regulatory standards across UK on issues such as GMOs or genetically modified organisms.
Resource management and international negotiations
Marine Scotland, a directorate of the Scottish Government, is currently responsible, with exclusive devolved competence, for controlling the activities of all fishing vessels operating within the Scottish zone and for managing and controlling the activities of Scottish vessels wherever they may fish – including fishing effort and quota. At present intergovernmental processes allows Scottish interests to influence positions taken by the UK in EU led negotiations. When the UK leaves the EU, Scottish based interests will want to ensure that the mechanisms for reflecting Scottish scientific advice and agreed positions is properly given weight when the UK negotiates directly with EU and non EU states.
The future financial framework?
At present, EU funding of CAP and CFP expenditure in Scotland comes directly from UK receipts from the EU. In future, given the UK Government’s commitment to fund such expenditure directly from the UK taxpayer, the UK and Scottish Governments will have to agree how to fund such expenditure. The challenge for Scotland is that currently some 16% of UK agricultural spending is spent in Scotland (and a much higher proportion of CFP expenditure). Will Scotland insist that it is funded under the new Scottish taxation arrangements, where one third of Scottish tax revenue is now raised by the Scottish Parliament, supplemented by direct payments by the UK Government? Or would it be more financially prudent to leave such expenditure to a UK controlled pot without Scotland having to contribute directly?
At present the Scotland Act 1998 reserves all responsibility for international negotiations to the UK Government. But there is pressure from various sources, notably former Prime Minister Gordon Brown, for Scotland to be given full powers to run agriculture and fisheries after devolution including the negotiation of international treaties. This would be in keeping with the logic of the Scottish Constitutional Convention of 1995, but would beg serious questions about how the UK would reconcile different objectives in international negotiations (such as the trade-off between fishing access for EU fleets and access for seafood exports to the EU market) if Scotland had autonomy on resource management issues.
Is the UK ready to give Scotland the same powers on international treaties as those currently exercised by Belgian regions including Flanders and Wallonia, given recent concerns such as the way Wallonia led opposition to the EU Canada Comprehensive Economic and Trade Agreement?