Annex: Food Compositional Standards and Labelling provisional common framework

Risks and benefits of the commonframework approach

1. The purpose of commonframeworks is to establish commonapproaches in some areasthat were previously governed by EU law, but that are within areas of competence of the devolved governments or legislatures.1Theyare a key tool for intergovernmental workingand discussion on approaches to law and policy now that the UK is no longer a member of the EU.

2. The Food Compositional Standardsand Labelling (FCSL)common framework sets out how the governments will work together and make decisions on regulatory alignment and divergence in the post-Brexit context.

3. The structures provided by common frameworks could enhance joint working and promote a shared approach to tackling common challenges. They could offer opportunities for the Welsh Government to influence and inform decisions taken by other governments, as well as providing defined routes for engagement at an international level.

4. However, common frameworks also present potential risks, such as relinquishing regulatory freedom in favour of a common approach, making it harder for Welsh stakeholders to influence decisions, and risking blurring accountability to individual Parliaments.

5. Such benefits and risks are not unique to the commonframeworks that we have considered, but cut across the whole common frameworks programme. In February 2022, the Scottish Parliament Constitution, Europe, External Affairs and Culture Committee concluded that:

“260. […] Common Frameworks […] have the potential to resolve the tensions within the devolvedsettlement through managingregulatory divergence on a consensual basis while facilitating open trade within the UK internal market.

261. But the Committee believes there is a risk that the emphasis on managing regulatory divergence at an inter-governmental levelmay lead to less transparency and Ministerial accountability and tension in the balance of regulations between the Executive and the Legislature”.2

1 JointMinisterial Committee (EU Negotiations), Communique, 16 October 2017

2Scottish Parliament Constitution, Europe, External Affairs and Culture Committee, UK Internal Market inquiry, 22 February 2022, p.42

6. The correspondence we have received from the Welsh Government in respect of common frameworks has not always clearly articulated the risks and benefits of working through those frameworks, or how they might be managed.

Implications for making Welsh law and policy

7. The FCSL common framework requires governments to discuss and agree approaches to law and policy,and set out processes for resolving any disputes or disagreements that arise. As such, the framework could, in practice, limit the exercise of devolved competence.

8. This will not only affect the Welsh Government as it makes policy or prepares legislation, but will also affect the development of Senedd Bills.For example, Memberswho wish to table amendments to Bills passing through the Senedd, or committees that plan to introduce committee Bills, may need to consider the implications of relevant common frameworks, and potentially how to engage with these intergovernmental arrangements.

9. It could also make it more difficult for stakeholders in Wales to influence the development of Welsh law and policy.

10. When the governments agreed principles for common frameworks, they agreed that they should “maintain, as a minimum,equivalent flexibility for tailoring policiesto the specific needs of each territory as is afforded by current EU rules.”3 We regard this as an important principle.

11. In its report in February, the Scottish Parliament Constitution, Europe, ExternalAffairs and Culture Committee recommended that:

“…there should be a similaragreement between the Scottish Government and Scottish Parliament that,as a minimum, there should be no dilution of public consultation or of parliamentary scrutiny.”4

12. Thought should be given to whether such an agreementbetween the Seneddand the Welsh Government would be helpful.

3 JointMinisterial Committee (EU Negotiations), Communique, 16 October 2017

4Scottish Parliament Constitution, Europe, External Affairs and Culture Committee, UK Internal Market inquiry, 22 February 2022, p.36

Transparency

13. We recognise that the process of reaching four-Government agreement on common frameworks is necessarily iterativeand can be complex. It was helpfulthat an initialdraft version of the FCSL provisional common framework was published in March 2021. However, it is far from ideal that the final provisional framework was not published for scrutiny until February 2022, especially as it had already been in operation since the end of the transition period on 31 December 2020.

14. The framework will, rightly,remain under review.However, it includeslimited information about ongoing reporting to Parliaments and stakeholders, engagement with stakeholders, or scrutiny of changes proposedduring review and amendment processes. We explore each of these issuesbelow.

Reporting on the operation of frameworks

15. ur letter of 21 March 2022 to the Minister for Health and Social Services (Minister for HSS) in respect of the Public Health Protection and Health Security (PHPHS), Blood Safety and Quality (BSQ), and Organs, Tissues and Cells (other than embryos and gametes) (OTC) provisional common frameworks,5in late 2021, the House of Lords Common Framework Scrutiny Committee noted its disappointment that those frameworks did not include commitments to ongoing engagement with Parliament.6

16. In a letter to the Fifth Senedd’s ExternalAffairs and Additional Legislation Committee in January 2020, the then Counsel General and Brexit Minister committed to “lay a report before the Senedd at

5Letter from the Chair of the Health and Social Care Committee to the Minister for Health and Social Services, 21 March 2022

6Letter from the Chair of the House of Lords Common Framework Scrutiny Committee to the Minister of State for Health, 23 November 2021; Letter from the Chair of the House of Lords Common Framework Scrutiny Committee to the Minister of State for Health, 14 December 2021

least annually, which provides an assessment of the functioning of each Common Framework”.7We welcome this commitment from the Welsh Government.

17. In November 2021, the Counsel General told the Senedd’s Legislation, Justice and Constitution Committee that the four governments had “committed to future reportingon the frameworks as part of the process for the oversight of the frameworks within the Intergovernmental Relations Review”, and that this would assist Senedd committees in monitoring frameworks in the longer term.8

18. In January 2022, in response to questions about how the Senedd and stakeholders would be updated on the continuing operation of the frameworks, includingany changes, the Minister for HSS told us that:

“The expectation is that reports on frameworks will be public documents once they are signed off by portfolio Ministers and will be made available to the relevant committees in the four nations as well as relevant stakeholders.”9[emphasis added]

19. The Counsel General repeated this ‘expectation’ in oral evidence to the Legislation, Justice and Constitution Committee on 31 January2022.10 In a letter to that Committee in March 2022, he stated that the “exact format of the annual reporting mechanism is currently being worked through at an official level”.11

20. We appreciate that common frameworks and associated reporting are intergovernmental arrangements, and that the Welsh Government may not be able unilaterally to guarantee that these joint reports will be published. Nevertheless, we are concerned that full agreement has not yet been reached on this important point of transparency, and that a commitment to publishing reportsis not included in the FCSL framework.

7Letter from the Counsel General and Brexit Minister to the External Affairs and Additional Legislation Committee, 23 January 2020

8Letter from the Counsel General and Minister for the Constitution to the Legislation, Justice and Constitution Committee, 19 November 2021

9 Letterfrom the Ministerfor Health and Social Services(BSQ and OTC common frameworks), 17 January 2022

10 Legislation, Justice and Constitution Committee, RoP [paragraph 54], 31 January2022

11Letter from the CounselGeneral and Ministerfor the Constitution to the Legislation, Justiceand Constitution Committee, 2 March

Stakeholder engagement

21. Like the PHPHS, BSQ and OTC common frameworks, the FCSL framework offers limited commitments in respect of meaningful ongoingstakeholder engagement. In our letterto the Minister for HSS on 21 March 2022 about the PHPHS, BSQ, and OTC provisional common frameworks12 we noted that the House of Lords Common Framework Scrutiny Committee had similar concerns on this matter.13

22. In this context, we welcome the Welsh Government’s commitment that “if changes are proposed to the scope or functioning of the FCSL Framework, stakeholders will be consultedin advance of Ministerial agreement”.14

23. However, we continue to agree with our colleagues in the House of Lordsthat there must be ongoing, open and meaningful engagement with stakeholders on the operation of common frameworks. We believe that this should be provided for within the frameworks themselves.

12Letter from the Chair of the Health and Social Care Committee to the Minister for Health and Social Services, 21 March 2022

13Letter from the Chair of the House of Lords Common Framework Scrutiny Committee to the Minister of State for Health, 23 November 2021; Letter from the Chair of the House of Lords Common Framework Scrutiny Committee to the Minister of State for Health, 14 December 2021

14Letter from the Minister for Health and Social Services (BSQ and OTC common frameworks), 17 January 2022; Letter from the Minister for Health and Social Services (PHPHS common frameworks), 17 January 2022

Scrutiny of changesduring review and amendment

24. me the commitment in the Deputy Minister for Mental Health and Wellbeing’s (Deputy Minister for MHW) letter to us on 21 April 2022 that “TheSenedd will be informed of upcoming review periods in order to feed into the process”.15

25. We also reiterate the recommendation we made in respect of the PHPHS, BSQ and OTC frameworks, that to avoid duplication, it would be helpful for such notification to include information about how and when stakeholders will be engaged in any particular review, and how and when any consultation responses will be made public.

Dispute resolution

26. We welcome the Welsh Government’s commitment to notify the relevant Seneddcommittee(s) of disputes raised under common frameworks. As we noted in our letter to the Minister for HSS in respect of the PHPHS, BSQ and OTC frameworks, our view is that, to ensure proportionality, the Welsh Government need only notify Senedd committees of disputes that are escalated to Ministerial level.16

27. The initial draft of the FCSL common framework was published before the Intergovernmental Relations Review was completed, but noted that it would be updated to reflect the Review’s outcomes. The Review was completed in January 2022, including a revised inter-ministerial dispute resolution process through which disputes over common frameworks can be escalated.17 However, the final provisional FCSL common framework published in February2022 does not reflect the revised inter-ministerial dispute resolution process.

15 Letterfrom the DeputyMinister for MentalHealth and Wellbeing, 21 April 2022

16Letter from the Chair of the Health and Social Care Committee to the Minister for Health and Social Services, 21 March 2022

17 UK Government, Policy paper: review of intergovernmental relations, 13 January 2022

Text Box: Recommendation 8: The Welsh Government should confirm that, before it is finalised, the FCSL framework will be updated to reflect the new inter-ministerial dispute resolution process set out in the review of intergovernmental relations published in January 2022.

28. We note that the framework does not specify any timelines or time limits for dispute resolution. We asked the Deputy Minister for MHW about this in March 2022. Responding in April 2022, she said:

“It is recognised that disputes may vary in nature, complexity and operational contextand therefore a set time limit would not be conducive to reaching the best outcomes for all governments”.18

29. While we recognisethat disputes will vary as the Deputy Minister suggests, a lack of time limits could result in delaysto Welsh Government legislation or policy decisions until the disputehas been resolved, with knock on implications for the time available for scrutiny, implementation or spending.

30. In addition, in responseto our questions about the dispute resolution process, the Deputy Minister for MHW stated:

“It will be imperative, however, that consumers, industry bodies and business are consulted in a timely manner to influence decision making on any proposed changes to food compositional standards and labellingpolicy, due to the significant impact changes could have on business”.19

31. We agree. However, there is no provision for stakeholder engagement in disputeresolution in the FCSL common framework.

Scope of the FCSL common framework

32. The FCSL framework sets out that changes will be in scope if a government proposes a change to law or policy:

§ In an area of returningpowers;

§ In an area where EU law allows different domestic legislation to achieve common outcomes (such as national rules for curds and mincemeatin the Jam and Similar Products Regulations); or

§ For requirements for establishments based in, or products circulated in, only one part of the UK.

33. This means that the FSCL frameworkrequires joint decision-making in some areaswhere the four governments previously had autonomy to regulate differently when the UK was in the EU.

34. The FCSL framework is broader in scope than other relatedframeworks. For example,the Food and Feed Safety and Hygiene (FFSH) framework provides that changes will be in scope in areas of returning powers, and only in certain circumstances. It is not clear to us why different approaches have been taken for the different frameworks.

35. The Deputy Minister for MHW told us in April 2022 that changes to the law in areas where the EU allowed national measures to achieve common outcomes (for example the rules for curds and mincemeat in Jam and Similar Products Regulations) will be within the scope of the framework as it relates to jointworking, but will not be bound by dispute resolution.20 However, this position does not appear to be reflected in the FCSL framework itself. Such changes are outside the scope of the FFSH framework.

36. In response to our question about why changes to the law that apply only to businesses established or products circulated in Wales wouldbe within the scope of the framework, the Deputy Minister for MHW responded that the inclusion of such changes within the scope of the framework would ensure that Ministers were “informed of the approaches recommended in other nations, and that consensus should be sought on the approaches to take, whether consistent across nations or different”.21 We note, however, that under the common framework on food safety,such changes are

subjectonly to notification and are not withinthe scope of the joint working or decision-making arrangements.

37. The FCSL framework provides that changes to non-EU derived law on food composition (such as rules on products containing meat) will be subject to discussion through the framework, but not bound by the dispute resolution process. In evidence submitted to the Scottish Parliament Health, Social Care and Sport Committee, Quality Meat Scotlandcalled for more clarity on what will happen if there is a disagreement.22We agree that it would be helpful for stakeholders to have clarity on how such matters, which fall outside of the dispute resolution processes, would be resolved.

Role of the Foods Standards Agency

38. The Deputy Minister for MHW told us that staffing capacity for the Food Standards Agency (FSA) in Wales has been increased, which “allows the FSA in Walesto contribute to developing policy in relation to food labelling and compositional decisions for Wales”. She adds that staffing capacity will be kept under review, but notes that the review of FSA Wales announced in June 2021 has not been progressed because it has not been possible to procure a suitable contractor to undertake the work. A further procurement exercise will be run later in 2022.23

39. We welcome the assurance that there is appropriate capacity and expertise in the FSA in Wales to deliverpolicy that workseffectively for Wales, but are disappointed to note that the plannedreview of the FSA in Wales has not yet taken place.

22Quality Meats Scotland, Written submission to the Scottish Parliament Health, Social Care and Sport Committee, April 2022

Review of retained EU law

40. The UK Government has set out its intention to legislate to enable retainedEU law to be amended more easily.24

41. In her letter of 17 January2022, the Ministerfor HSS statedthat any proposedamendment or

repeal of retainedEU law would be undertaken through a “separate process” to theframeworks.25

42. However, the UK Government has subsequently said that it is:

“…committed to the properuse of Common Frameworks and will not seek to make changes to retained EU law within Common Frameworks without following the ministerially-agreed processes in each framework”.26

43. Managing divergence between different parts of the UK in areas coveredby retained EU law is a core purpose of the common frameworks programme. It is therefore important that any amendment or repeal of retained EU law in common framework areas be taken through the relevant common frameworks, not a “separate process”.

UK InternalMarket Act 2020

44. Part of the purposeof the FCSL framework is to ensurethe smooth functioning of the UK internal market.

45. The UK Internal MarketAct 2020 (the 2020 Act) sets out new marketaccess principles in law. In essence, the principles aim to allow goods permitted or imported into any one part of the UK to be

24 UK Government, The benefits of Brexit: how the UK is taking advantage of leaving the EU,January 2022

25 Letter from the Minister for Health and Social Services (BSQ and OTC common frameworks), 17 January 2022

26 UK Government, The benefits of Brexit: how the UK is taking advantage of leaving the EU,January 2022, p.33

sold or suppliedin any other part, with some exceptions. The UK and devolved governments have agreed a process for considering UK Internal Market Act exclusions in common frameworkareas.27

46. The Welsh Government’s view is that the 2020 Act implicitly diminishes the powersof the

Senedd and the Welsh Government.28

47. In her letter of 21 April 2022, the Deputy Minister for MHW confirmed that the FCSL common framework will “operate in the context of the UK Internal Market Act 2020 (UKIMA), where the effect will be determined on a case-by-case basis”. She addedthat there were “no intentions to request an exclusion”.29

48. However, the framework does not includeany reference to the 2020 Act or to the exclusion process.

49. As we noted in our letter to the Minister for HSS on 21 March 2022 about the PHPHS, BSQ, and OTC provisional common frameworks30 we agree with our colleagues on the House of Lords Common Frameworks Scrutiny Committee that frameworks should be updated to reflect their interaction with the 2020 Act and to acknowledge the process for agreeing exclusions from that Act.31

International obligations

50. Part of the purposeof common frameworks is to ensurecompliance with international obligations.

51. However, there is an inconsistent approach to international obligations across the FCSL framework and the frameworks that apply to food safetyand nutrition. For example, the FCSL framework makes no reference to:

27UK Government, Guidance: process for considering UK Internal Market Act exclusions in common framework areas, 10 December 2021

28 WelshGovernment, Written Statement: legal challenge to the UK Internal Market Act 2020, 18 January 2021

29 Letterfrom the DeputyMinister for MentalHealth and Wellbeing, 21 April 2022

30Letter from the Chair of the Health and Social Care Committee to the Minister for Health and Social Services, 21 March 2022

31Letter from the Chair of the House of Lords Common Framework Scrutiny Committee to the Minister of State for Health, 14 December 2021

§ How governments will work togetheron the implementation of relevantinternational law or standards, as set out in the nutrition framework.

§ Whether governments will seek to agree positions ahead of significant international summits on standards (as EU MemberStates do), as set out in the nutrition framework.

52. There are also inconsistencies in respect of the UK’s representation on international bodies. For example, the nutrition framework provides for devolved representation at meetings of the Codex Alimentarius Commission, whilethe FFSH framework provides only for Defra/FSA attendance at these meetings.

53. Responding to our question about how governments would work together to agree positions in relation to international food standards, the Deputy Minister for MHW told us that “the parties will automatically use any updatedInternational Relations Concordat, and the wider outcomes of the Joint Intergovernmental Relations Review, as the basis for such international considerations”.32This is reflected in the framework. However, despite the Joint Intergovernmental Relations Review being completed in January 2022, the International Relations Concordat has yet to be updated.

UK-EU obligations

54. The UK Government has acknowledged that the FCSL framework intersects with the Trade and Cooperation Agreement (TCA).33 The Deputy Minister for MHW told us in April 2022 that:

“The FCSL Framework was not intendedto provide enhancedengagement on

matters relatingto the UK-EU Trade and Co-operation Agreement. The FCSL

32 Letterfrom the DeputyMinister for MentalHealth and Wellbeing, 21 April 2022

33Letter from the Parliamentary Secretary to the Cabinet Office to the House of Lords Common Frameworks Scrutiny Committee, 24 May 2021

Framework is a mechanism for UK-wide co-operation in relation to the devolved

matters of food compositional standards and labelling policy”.34

55. However, other common frameworks do provide for Welsh Government engagement in TCA committees—this is something we welcome, as it supports the aim of the common frameworks programme to ensure compliance with international obligations. The FCSL framework, conversely, makes no reference to the TCA, upon the terms of whichthe UK and EU currentlytrade, including in food products. Consequently, the FCSL framework does not provide for the possibility of Welsh Government engagement in relevant TCA committees.

Northern IrelandProtocol

56. Under the Northern IrelandProtocol, any changesto EU law on food compositional standards and labelling must be applied in Northern Ireland.

57. The frameworks provide information about how governments will consider the implications of changes to law and policy in Northern Ireland and Great Britain for divergence, but offers limited detail about how this will work in practice.

58. As we noted in our letterto the Minister for HSS on 21 March 2022 about the PHPHS, BSQ, and OTC provisional common frameworks35 we agree with our colleagues on the House of Lords Common Frameworks Scrutiny Committee that common frameworks should be updated to provide additional detail about when changes introduced in Northern Ireland through the Protocol will be considered in the relevant frameworks.36

34 Letterfrom the DeputyMinister for MentalHealth and Wellbeing, 21 April 2022

35Letter from the Chair of the Health and Social Care Committee to the Minister for Health and Social Services, 21 March 2022

36Letter from the Chair of the House of Lords Common Framework Scrutiny Committee to the Minister of State for Health, 14 December 2021

59. The Deputy Ministerfor MHW told us in April 2022that:

“Horizon-scanning processes are in place to monitor upcoming EU changes that will need to be implemented in Northern Ireland.The FCSL Framework ensures that any proposals for divergence among the GB nations are subject to four-nation consideration and that Ministers in all four nations have the opportunity to raise a dispute with their counterparts”.37

60. She added that potentialEU-driven legislative changeswould be considered by the four-nation FCSL Officials Group, and noted that “divergence will emerge over time”.38 This is despite previous Welsh Government statements that it intends to maintain and improve upon EU standards. For example, the Counsel General told the Legislation, Justice and Constitution Committee in January 2022:

“One of the principles and positions the Welsh Government has taken throughout this process is that there should be no derogation from the standards that we actually hold to at the moment, and that the EU standards should be the very minimumthat we should have. Of course, it has alwaysbeen the case with EU law that they've always been minimum standards; they've never been something that have prevented any member of the European Union from wanting to go beyond. So, as far as, I think, Welsh Government is concerned, we want to maintain those standards. Where we can improve upon those standards, we want to improve upon those standards”.39

37 Letterfrom the DeputyMinister for MentalHealth and Wellbeing, 21 April 2022

38 Letterfrom the DeputyMinister for MentalHealth and Wellbeing, 21 April 2022

39 Legislation, Justice and Constitution Committee, RoP [paragraph 118], 31 January2022

International trade

61. Common frameworks aim to facilitate negotiation and implementation of international trade agreements. The Deputy Minister for MHW told us that the FCSL framework would provide opportunities for discussions of UK positions on FCSL policy issues, includingwhere such issuesmay be relevant to the negotiation or implementation of a trade agreement.40

40 Letterfrom the DeputyMinister for MentalHealth and Wellbeing, 21 April 2022