Internal Market Act ‘roadblock’ hampering devolution

It was presented as the answer to problems created by Brexit.

But experts say the legislation that stopped Scotland's Deposit Return Scheme (DRS) from going ahead is causing major problems between the UK Government and devolved administrations.

And while the new Labour government has pledged to reset the relationship between Westminster, Holyrood, the Senedd and Stormont, it is claimed that this commitment "cannot be met" unless the "roadblock" is resolved.

The paper, from the University of Glasgow's Centre for Public Policy, said: "All roads to such a reset must first recognise and navigate the roadblock created by the United Kingdom Internal Market Act."

The act (UKIMA) was brought in by the former Conservative government in December 2020 to prevent divergent trade rules across the UK, post-Brexit.

It was opposed by the Scottish and Welsh governments and drew criticism from opposition parties within those parliaments.

An exemption from the act was needed for the Scottish Government's DRS to come into force.

But Westminster leaders refused to grant one which covered glass containers, saying that the scheme would put Scottish consumers at a disadvantage compared to others in the UK.

Holyrood ministers said omitting glass meant the recycling initiative would not be viable and the plan was shelved while the UK Government worked on a similar plan of its own.

The report, by experts from the universities of Glasgow, Liverpool, Stirling and Queens University Belfast, claims hampers devolved governments' ability to make "ambitious" measures a reality and there is a lack of agreement over the procedures for achieving exemptions.

And while there is now cross-government working on new restrictions to the sale of tobacco and vapes, the report claims "UKIMA-driven coordination risks stifling policy innovation at the devolved level, may slow the pace of policy development and could generate pressure to conform to the standards that the UK Government deems appropriate for England".

Though Scottish Secretary Ian Murray has said he wants to "reset" the relationship between governments and "turn disagreement into cooperation", Labour's manifesto did not commit it to reforming the UKIMA.

But Professor Nicola McEwan and colleagues have said "doing nothing is not a viable option", stating that the act has "undermined the authority and status of devolved institutions and contributed to the erosion of intergovernmental trust".

However, they state that reforms "should not be for the UK Government alone to determine, nor the UK Parliament alone" and said collaboration between the legislatures is the only way to ensure consensus.

McEwen said: "The UK Internal Market Act was introduced despite considerable opposition from devolved institutions. It has already had a constraining impact on their policy ambitions. The UK Government should recognise and address that if it is to achieve a meaningful reset in its relationships with the devolved governments."