Levelling-up and Regeneration Bill: letter from Cabinet Secretary for Finance and Economy

Mr Neil O’Brien MP
Parliamentary Under Secretary of State for Levelling Up, the Union and Constitution
Department for Levelling up, Housing and Communities
Fry Building
2 Marsham Street
London
SW1P 4DF

June 2022

Levelling-up and Regeneration Bill

I am writing to reply to your letter of 10 May 2022 regarding the Levelling Up and Regeneration Bill as introduced to the UK Parliament on 11 May 2022 Firstly, I must strongly express my frustration that yet again we received little advance sight of a draft Bill before its introduction. Such actions show continued disregard for devolution, undermine the role of Scottish Ministers and does not make for good law.

I note the UK Government’s view that Part 1 does not require legislative consent from the Scottish Parliament: “[s]ince these duties apply to inequalities across the UK as a whole this does not relate to the legislative competence of the Northern Ireland Assembly, the Scottish Parliament or Senedd Cymru” (Explanatory Notes, paragraph 1539). The levelling up missions contain provision for devolved purposes, covering areas that are within the devolved responsibility of the Scottish Government and Scottish Parliament. We have already made clear our view that while we welcome additional funding for Scotland, it is unacceptable for the UK Government to decide how money should be spent in areas of devolved responsibility, especially without any meaningful consultation or engagement. In line with the devolution settlement, it is the Scottish Government that should decide priorities and objectives (including allocation of funding) for these matters, accountable, through the Scottish Parliament, to the people of Scotland. Therefore, it is our view is that Part 1 of the Bill would require the consent of the Scottish Parliament. It is not for UK Government Ministers to set targets for these matters in Scotland, nor to report on achieving these to the UK Parliament. The Scottish Government would not recommend the Scottish Parliament consents to these provisions and cannot support Part 1 of the Bill. 

We are also considering the need for legislative consent for other provisions carefully, as your letter suggests. Our officials will be discussing these in more detail as the bill progresses.

Our officials have had discussions on Part 5 relating to Environmental Outcome Reports. Currently there is very little information available regarding the planned changes and how this may impact on well-established and understood processes that are designed to protect our environment. We cannot support the provisions in this Bill that would effectively give UK Government Ministers powers to override these environmental protections in Scotland. I am also concerned that this may lead to significant divergence if England abandons the current environmental assessment processes that are applied across the UK and which follow a similar framework, share a common legislative heritage, and align with EU regulations.

Clause 116 gives the Secretary of State powers to set environmental outcomes for the whole of the UK in regulations. This is unacceptable and cuts across Scottish legislation and the powers of Scottish Ministers. Scotland is already constrained by an anomalous reservation of legislation affecting marine environmental regulation in offshore Scottish Waters (otherwise executively devolved) which needs to be rectified through the provision of legislative devolution in this area. Thus, rather than undermining the devolved settlement this legislation should ensure that Scottish Ministers have the powers to legislate across all Scottish terrestrial and offshore regimes, thereby rectifying this anomoly.

We will consider the offer of secondments to Scottish Government policy officials to work with your teams.

Respect for devolved competences is essential in drafting legislation, and the lack of effective engagement here is troubling. In addition we have specific concerns on the Bill as set out above. I believe our officials should discuss how to address these, and look forward to better and constructive engagement on the Bill as it progresses.

I am copying this letter to the Secretary of State for Scotland, the Welsh Government Minister for Finance and Local Government and the Northern Ireland Finance Minister.

Kate Forbes