10. Legislative Consent Motion on the Subsidy Control Bill

Part of the debate – in the Senedd at 5:28 pm on 1 March 2022.

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Photo of Rebecca Evans Rebecca Evans Labour 5:28, 1 March 2022

Diolch, Llywydd.  I move the motion. I am grateful to the Economy, Trade, and Rural Affairs Committee and the Legislation, Justice and Constitution Committee for their reports on the Subsidy Control Bill, and I thank them for their comments. A supplementary legislative consent motion was laid on 6 January, clarifying our position on the clauses the LJC committee noted and no further actions were raised.

The United Kingdom Internal Market Act 2020 made subsidy control a reserved matter. However, it significantly impacts on non-reserved matters such as economic development, agriculture and fisheries. The impact of this Bill on non-reserved areas raises concerns. We need a detailed regulatory framework that works with, not against devolution.

Businesses are our partners and they rightly call for clarity and certainty on what support is compatible with the UK subsidy control regime. The proposals in the Bill fail this basic test. They effectively give broad powers to the Secretary of State to shape the regime in the future with little scrutiny from the UK Parliament, and none whatsoever from this Senedd.

Once again, the UK Government has demonstrated its indifference to the ramifications for Welsh businesses, jobs and the economy. A rudimentary understanding of the devolution settlement makes it clear that this creates confusion and uncertainty that jeopardise investment in our economy.

This Bill permits the Secretary of State to refer subsidy awards or schemes granted in devolved policy areas to the independent subsidy advice unit in the Competition and Markets Authority, and extends standstill requirements in place upon referred awards or schemes. If enacted, this will undermine Welsh Ministers' power to act in areas within devolved competence.

These powers will not extend to Welsh Ministers where subsidies impact on devolved competence. This could create a conflict of interest for the Secretary of State if Welsh Ministers request a referral of a UK Government award or scheme announced by great fanfare only days previously, for example. This Bill reflects only the narrow political interests of the UK Government rather than the wider needs of the UK.

Despite repeated requests to UK Ministers for changes to be made, nothing substantive has been forthcoming, and I'm extremely concerned that the Bill could have far-reaching practical and constitutional implications for Wales. This Bill undermines the status of devolved primary legislation and it will make it harder to support disadvantaged regions. It makes investment in our most deprived communities less attractive by failing to provide a UK-wide regional aid map. This directly contradicts levelling up by scrapping the mechanism designed to stop Government investing more heavily in Mayfair than Merthyr.

Therefore, I move that the Senedd refuses legislative consent for the Subsidy Control Bill.