UK Government to 'fast-track' Internal Market Act review

The UK Government is to "fast-track" a review of the controversial Internal Market Act, it has announced.

The Westminster legislation was brought in to prevent barriers to trade within the UK after Brexit.

But it was opposed by the Scottish and Welsh governments, which said the act restricted devolved parliaments.

The SNP accused the then-Conservative UK Government of enacting a "power grab".

Provisions within the legislation were behind a block to the Scottish Government's shelved Deposit Return Scheme.

In a written ministerial statement published today, the UK Government has confirmed it will "fast-track" a review of the act.

A review will be launched in January and will be completed by the summer.

This is ahead of the legal deadline for a review by December 2025.

Douglas Alexander, UK trade minister, said: "The UK internal market is essential for the UK economy, allowing people and business to buy and sell goods, provide services and work across the four nations of the UK.

"The internal market has been estimated to be worth around 10 per cent of GDP and Scotland, Wales and Northern Ireland all trade more within the UK market than outside it. It’s crucial we protect that market whilst respecting policy divergence which comes with devolution.

"This UK Government is committed to engaging with the devolved governments, and we recognise frustration with how the UK Internal Market Act has operated in the past, particularly the lack of clarity in terms of how it operates.

"That is why we are bringing forward a review of the act six months earlier that the statutory deadline. We will engage directly with the devolved governments as part of the review in a good faith process that seeks to balance the different policy choices that devolution affords us, while protecting the integrity of the internal market to ensure we can continue to drive for economic growth, jobs and higher living standards.

"This government is delivering our Plan for Change with investment and reform to deliver growth and put more money in people’s pockets. Reviewing this act is a key part of that."

This comes soon after a paper from the University of Glasgow's Centre for Public Policy found that the Internal Market Act had created a "roadblock" between administrations. 

Professor Nicola McEwan and colleagues 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".

They warned 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.

In his statement, Alexander said that "the operation of the UK Internal Market Act can be improved, including more certainty and clarity when considering proposals which remove areas of regulation from the scope of the market access principles". He stated: "We believe that the UK Internal Market Act should complement Common Frameworks and support collaborative policy-making."

The Scottish Government has been contacted for comment.