Legislative Consent Memorandum
Legislative and Regulatory Reform Bill
Draft Legislative Consent Motion
1. The draft motion, which will be lodged by the Minister for Finance and Public Service Reform, is:
That the Parliament agrees that the relevant provisions in the Legislative and Regulatory Reform Bill introduced to the House of Commons on 11 January 2006, that relate to the implementation of European Union obligations and which are within the legislative competence of the Scottish Parliament, or which confer executive powers on the Scottish Ministers, should be considered by the UK Parliament.
Background and Contents of the Bill
2. This memorandum has been lodged by Tom McCabe Minister for Finance and Public Service Reform, under Rule 9B.3.1(a) of the Parliament's standing orders. The Legislative and Regulatory Reform Bill was introduced at Westminster on 11 January 2006. The Bill can be found at:
http://www.publications.parliament.uk/pa/cm200506/cmbills/111/2006111.htm
3. The Legislative and Regulatory Reform Bill makes provision for Regulatory Reform Orders, which do not apply for devolved purposes in Scotland, and Hampton provisions which set out regulatory principles and compliance code (Enforcement Concordat) provisions for regulators of the private sector in reserved matters. The Legislative and Regulatory Reform Bill does two things. First, it widens the circumstances in which Regulatory Reform Orders can be used to amend primary legislation. These Orders cannot be used to make any provision which would be within the legislative competence of the Scottish Parliament, except for incidental, consequential, transitional or supplemental amendments to such legislation which have a reserved purpose. Second, the Legislative and Regulatory Reform Bill gives a power to make a statutory code of practice on regulatory practice, and sets out a series of regulatory principles. The code and principles will not apply to any regulatory function exercisable in Scotland which relates to devolved matters. It also brings forward a number of provisions which reflect closely provisions contained in the European Union Bill aimed at allowing for greater flexibility in implementing EU obligations under the European Communities Act 1972. These ex-EU Bill provisions are not, in themselves, connected to the European Constitution. The Legislative Consent Motion supports the Partnership Agreement by allowing Scottish Ministers to more efficiently fulfil their EU obligations.
4. As described above, the provisions of the Bill deal primarily with the exercise of regulatory functions in reserved areas. However, certain provisions within the Bill deal with the exercise of powers and the making of subordinate legislation relating to the implementation of EU obligations. These provisions largely make amendments to the European Communities Act 1972 ("ECA"). Under paragraph 1 of Part I of Schedule 4 to the Scotland Act 1998 some provisions of the ECA cannot be modified by Acts of the Scottish Parliament, and are therefore consequently reserved, while other provisions of the ECA do come within the legislative competence of the Scottish Parliament. The following provisions of the ECA cannot be modified by the Scottish Parliament:
• Section 1 and Schedule 1
• Section 2, other than subsection (2), the words following "such Community obligation" in subsection (3) and the words "subject to Schedule 2 to this Act" in subsection (4)
• Section 3(1) and (2)
• Section 11(2).
In addition to these specific references to the ECA in Schedule 4, the effect of paragraph 7 of Part I of Schedule 5 to the Scotland Act is that the Scottish Parliament is able to legislate for the purpose of observing and implementing obligations under European Community law so far as they relate to devolved matters. The legislative competence of the Scottish Parliament vis-à-vis the ECA is complex. The provisions of the Bill to which this memorandum relates cover sections of the ECA which can be modified by the Scottish Parliament and sections which cannot be so modified.
5. The parts of the Bill which require the Scottish Parliament's consent to a Legislative Consent Motion essentially widen the powers available to the Scottish Ministers to implement EC obligations and give greater flexibility in the use of section 2(2) of the ECA. In detail the effect is as follows:
5.1 The Bill extends the scope of the Statutory Instrument-making power in section 2(2) of the ECA so that it can also be exercised by Order, Rules and Schemes, as well as by Regulations (currently only Regulations can be made under section 2(2) ECA). This extension is achieved by clause 26 of the Bill which amends sections 2(2) and 2(4) of, and Schedule 2 to, the ECA. Consequently these amendments cover provisions of the ECA which are both subject to modification by the Scottish Parliament and provisions that are outwith the legislative competence of the Scottish Parliament. The extension of the Statutory Instrument making-power also changes the executive powers of the Scottish Ministers. Clause 26(4) makes a consequential amendment to Schedule 8 to the Scotland Act to provide for Orders, Rules and Schemes.
5.2 Clause 26(6)(a) of the Bill enables the Scottish Ministers to exercise the same powers as a Minister of the Crown under clause 26(5) in relation to the implementation of European Community obligations, so far as those obligations are within devolved competence. Clause 26(5) provides that for any legislation made before the coming into force of the Bill, which refers to Regulations made under section 2(2) of the ECA, the Scottish Ministers may amend that legislation so that it also includes a reference to any Order, Rules of Scheme under section 2(2). This widens the executive powers of the Scottish Ministers.
5.3 The Bill enables references to EC legislation, in domestic Statutory Instruments (including Scottish Statutory Instruments), to be ambulatory and pick up future amendments to that EC instrument, so that it can be provided that any reference to EC legislation is always to the latest amended form of that EC legislation, thus avoiding, in many instances, the need for a fresh Statutory Instrument under section 2(2) for successive technical amendments to the EC legislation. This is achieved by clause 27 of the Bill which amends Schedule 2 to the ECA. Schedule 2 is subject to modification by the Scottish Parliament.
5.4 The Bill makes amendments to the Scottish Interpretation Order [the Scotland Act 1998 (Transitory and Transitional Provisions) (Publication and Interpretation etc of Acts of the Scottish Parliament) Order 1999 (S.I. 1999/1379)] to insert definitions relating to the European Communities and to provide that references to EC instruments in Acts of the Scottish Parliament are references to that instrument as amended. These provisions are contained in clauses 24(4) and 25(3) and (4) of the Bill and are within the legislative competence of the Scottish Parliament.
6. It is the view of the Scottish Executive that the net effect of those provisions relating to devolved matters in Scotland will be to widen the powers available to Scottish Ministers to implement EU obligations. This ought to provide welcome flexibility in implementing EU obligations in the future.
7. The European Communities Act 1972 is the key statute which gives effect to European law across the United Kingdom. As the provisions outlined above relate to sections of the European Communities Act 1972 that cover a complex mix of reserved and devolved matters under Schedules 4 and 5 of the Scotland Act, the Scottish Ministers consider it appropriate to pursue these changes by way of a Westminster Bill with the consent of the Scottish Parliament through a Legislative Consent Motion.
Financial Implications
8. The direct costs associated with the Bill will be mainly administrative and are expected to be minor in Scotland. The indirect costs associated with the exercise of the new powers cannot be known with certainty at this stage but are also expected to be minor. The reduction in need for Scottish Statutory Instruments that should result from the Bill's ambulatory provision (as per paragraph 5.3 above) might be expected to result in some savings.
Scottish Executive
January 2006