5. What assessment has the Welsh Government made of the evidence received so far by the House of Commons Welsh Affairs Committee during its ‘Brexit, trade and customs: implications for Wales’ inquiry? OAQ53394

We welcome the evidence provided so far, which highlights the risks to the Welsh economy of any greater friction in trade with the EU. Ken Skates, the Minister for Economy and Transport, provided written evidence in October 2018, and we will make a fuller assessment once the inquiry makes its report.

Thank you for that answer. I wonder if you read the evidence from representatives of the University of Edinburgh, the Institute for Government and the University of Sussex, where those witnesses expressed considerable reservation on any power for the devolved institutions to have a veto over trade deals, and one of the witnesses expressly warned that that was a potentially dangerous process, which was likely to lead to a great reduction in the number of possible trade deals that would be feasible. Now, we clearly need effective consultation—deep consultation—with a thorough mechanism that if a devolved institution is concerned about implications of a trade deal, that that's raised also in Parliament, and there are many processes that would allow that. That would take us along the lines of mechanisms used, for example, in Canada and Australia. But can you tell me whether you are expressly ruling out this nuclear weapon of somehow having embedded in devolved institutions a power of veto over trade deals?

The Member's question goes to the heart of how the devolved settlement and the reserved powers interact with each other. Obviously, international relations is reserved, but in order to deliver some of the commitments made in those negotiations and agreements, that will sometimes intersect with devolved competencies in, potentially, a wide range of areas. So, it's fundamental that we reach a settlement and an understanding in relation to these matters that acknowledge the power of the UK Government to negotiate these agreements but also respect the devolution settlement and give this Assembly and Welsh Government a locus in those discussions. As he will know, the Government of Wales Act 2006 already provides that the UK Government can effectively direct changes in the law to comply with negotiations, to comply with agreements reached internationally.

Our view as a Government is that it's essential—given that that is the case—that the views of Wales, the views of this Assembly and the views of Welsh Government are properly engaged and taken fully into account in relation to devolved matters, not just at the eleventh hour, if I can put it like that, but throughout the process of negotiation. It's that sort of deep engagement that we seek, rather than the veto that he refers to in his question.

He will know, of course, that we've called for a joint ministerial committee on international trade, to enable a formal system to be put into place to agree negotiating positions and to resolve the sorts of tensions that will inevitably arise in this area. I'm pleased that UK Government Ministers indicated in the House of Lords recently their intention to create exactly that sort of forum. 

In addition to that, a concordat is being developed that will specifically detail how the Department for International Trade and the devolved administrations will work together for future UK trade agreements with third countries after the EU exit, if that becomes a reality.

Can I thank the Counsel General for that answer? It's very important that we address the issue of trade. As David Melding highlighted, the evidence from some indicated that there should not be a veto, but in listening to the news that's coming out from the US today—that in fact the US steel producers are encouraging Donald Trump to put a ban on UK steel in any trade deal we do with them, which would have a devastating effect upon the steel industry here in Wales—a trade deal negotiated by London without our involvement could result in implications damaging our Welsh economy, and we'll have to pick the pieces up as a consequence of that.

Do you therefore agree that it is important that this joint ministerial group you're talking about on international trade should actually have teeth within it so that you have to be listened to and not just put in a corner and them thinking they can put you away? It's important the voice of Wales is heard and responded to to ensure that our Welsh economy, our Welsh industries, our Welsh citizens do not suffer as a consequence of a UK deal.

The Member is right to describe it in that way. This isn't simply about information sharing and so on. What we want is a body that enables these issues to be fully taken into account and the particular dimensions that perhaps apply in Wales to be fully baked into that set of discussions. The sorts of issues that he has identified in his questions go to the heart of the kinds of things that we need to be able to address through that mechanism.