What’s Whitehall’s beef with the Agricultural Bill?

It seems ironic that on the same day the Silk Commission reported that 62% of the people of Wales would like to see more powers given to the National Assembly for Wales, the Attorney General for England and Wales blocked the latest piece of Assembly legislation.

On 17 July 2013 the Assembly passed its eighth Bill since the 2011 referendum on primary law-making powers, the Agricultural Sector (Wales) Bill. The Bill, introduced as an Emergency Bill in response to the recent abolition of the Agricultural Wages Board for England and Wales (AWB), makes ‘provision in relation to the agricultural sector in Wales; and for connected purposes.’ The Assembly opposed the abolition of the AWB, so passed its own Bill providing for Welsh Ministers to be able to make Orders setting the terms and conditions for persons employed in agriculture in Wales and for the establishment of an Agricultural Advisory Panel for Wales to carry out functions in relation to the sector.

However, the Attorney General for England and Wales, Dominic Grieve QC, has referred the Bill to the Supreme Court to decide whether the Bill is within the Assembly’s legislative competence. This is only the second reference of its kind; not once has the UK Government referred a Scottish Bill or Act to the Supreme Court. Indeed, the first time a devolved Bill was referred to the judges by the UK Government was in relation to the Assembly’s first Bill: the Local Government Byelaws (Wales) Bill 2012, which was eventually found to be within the Assembly’s legislative competence.

Last December the UK Government announced its intention to abolish the Agricultural Wages Board for England and Wales through the Enterprise and Regulatory Reform Bill. The Agricultural Wages Board was responsible for setting wage rates and a variety of employment terms and conditions for agricultural employees in England and Wales. It had the power to issue an annual Order to set out minimum wages and terms and conditions. The Welsh Government “strongly disagreed” with the proposal to abolish the Board and considered it to be within the Assembly’s legislative powers. It therefore tabled a Legislative Consent Motion (LCM) in the Assembly on the provisions in the Enterprise and Regulatory Reform Bill relating to its abolition. The Assembly subsequently refused to consent to the motion. The Memorandum of Understanding records that the UK Government will not seek to legislate on devolved matters without the Assembly’s consent. However, in this case, the UK Government did not consider the matter to relate to a devolved matter so it did not see it necessary to seek the Assembly’s consent. The Assembly’s opposition to the abolition of the Agricultural Wages Board was therefore ignored and the Enterprise and Regulatory Reform Bill soon received Royal Assent and became law in late April.

The Assembly’s Agricultural Sector (Wales) Bill therefore seeks to preserve the level of statutory protection for workers prescribed in those Orders by allowing the Welsh Ministers power to make future Agricultural Wages Orders and establishing the Agricultural Advisory Panel to replace the functions of the Agricultural Wages Board.  However, according to the Welsh Government, its policy aim “is not to replicate the existing Agricultural Wages Board for England and Wales but to create a modern and effective mechanism for facilitating the Welsh Government’s aspirations for the sector.” Nevertheless, the Attorney General for England and Wales, Dominic Grieve, is “not convinced that the Bill is within the National Assembly’s competence.”

Before the Bill was introduced, the Assembly’s Presiding Officer, Rosemary Butler, also raised concerns as to the legality of the Bill in a briefing note to all Assembly Members. The test of whether a Bill or a provision of a Bill is within the powers of the Assembly is whether it relates to one or more of the subjects listed in Schedule 7 to the Government of Wales Act 2006 (GOWA 2006). This question is determined ‘by reference to the purpose of the provision, having regard (among other things) to its effect in all the circumstances’ (s.108(7) of GOWA 2006). According to the Supreme Court Justices in Imperial Tobacco v Lord Advocate [2012] UKSC 61, the equivalent provision in the Scotland Act 1998 is intended to be a generous settlement of legislative authority.

So, the big question is, what is the purpose of the Agricultural Sector (Wales) Bill? Is it, as the Presiding Officer asked, “to ensure a successful agricultural sector or to safeguard the wages and conditions of agricultural workers?’’

The Welsh Government believes that the Bill relates to Agriculture, a devolved subject in Schedule 7 to GOWA 2006. The First Minister, Carwyn Jones, told the Assembly’s Constitutional and Legislative Affairs Committee that “it falls within the competence of the National Assembly because it is an agricultural matter, as it is in Scotland.” The UK Government, on the other hand, argues that it relates to the non-devolved area of employment law. There is no exception relevant to agricultural wages set out in Schedule 7, but neither is it a specifically devolved subject, so by implication it is assumed to be reserved to the UK Parliament. However, it is worth noting that the Agricultural Wages (Scotland) Act 1949 was specifically included in the legislative competence of the Scottish Parliament by means of an exception to the general reserved area of ‘employment.’ The subject of the Assembly’s Agricultural Sector Bill would therefore be within the Scottish Parliament’s competence.

It will be up to the Justices of the Supreme Court to decide whether the subject matter of the Agricultural Sector (Wales) Bill relates to a devolved area in Wales or not. Such a challenge of legislative subject matter competence is unprecedented in Wales. Though the Byelaws judgment helped clarify what is meant by ‘incidental to, consequential on’ it does little to help us in this latest case. In the Byelaws case it was decided that the main purpose of the Bill was to streamline and modernise the procedure for making byelaws and the prohibited removal of a UK Minister of the Crown function was simply ‘incidental to and consequential on’ the main purpose and therefore within the Assembly’s legislative competence. For my analysis of the case see here.

We can look to cases involving Scottish legislation for insight as to how the Supreme Court might interpret the Assembly’s legislative powers, bearing in mind that section 154 of GOWA 2006 also provides that ‘any provision of an Act of the Assembly, or a Bill for such an Act, which could be read in such a way as to be outside the Assembly’s legislative competence is to be read as narrowly as is required for it to be within competence or within the powers, if such a reading is possible, and is to have effect accordingly.’

In Martin and Miller v Lord Advocate [2010] UKSC 10 the Supreme Court had its first opportunity of considering the extent of powers of a devolved legislature, in a case brought, not by the UK Government, but by individuals. Here, the Justices of the Supreme Court considered whether an Act of the Scottish Parliament was within the devolved legislative powers of that Parliament or whether it related to a reserved matter; they were split by three to two as to whether it was or not. The majority, holding that the Act was valid, decided that a broad-brush approach should be applied, meaning that the court should look at the general purpose of the legislative provision. They considered that if the overall purpose of the provision related to a devolved matter, then it should be found to be within the devolved Parliament’s competence.

The same test was applied in the Supreme Court case Imperial Tobacco v Lord Advocate, in another private party challenged.  The Justices found the Tobacco and Primary Medical Services (Scotland) Act 2010 which prohibits the display of tobacco products by vendors and prohibits tobacco vending machines to be within the Scottish Parliament’s legislative powers. The Court held that the main purpose of the Bill related to the promotion of public health and not the reserved matters of ‘the sale and supply of goods to consumers’ and ‘product safety.’ In coming to their conclusion, the judges observed that the phrase ‘relates to’ “indicates something more than a loose or consequential connection.” In the case of the Agricultural Sector Bill, are ‘employment terms and conditions for agricultural workers’ sufficiently connected to a devolved matter to be within competence? Or are they more than just ‘loosely’ related to a reserved matter?

In considering whether the subject of the Agricultural Sector Bill relates to a reserved matter, bearing in mind that there is not actually a list of reserved matters in Wales, the Supreme Court may wish to consider what the judges in the Imperial Tobacco case considered to be the ‘common theme’ of reserved matters. According to Lord Hope “matters in which the UK as a whole has an interest should continue to be the responsibility of the UK Parliament at Westminster.” In the case of agricultural wages, it may be difficult to argue that this is something in which the UK as a whole should retain an interest; after all, Scotland and Northern Ireland have their own Agricultural Wages Board.  Also, whether it actually relates to a reserved matter is a difficult question to answer in the Assembly’s case because, as I mentioned, there is no list of reserved matters. The deciding question therefore is likely to be, if Wales were to adopt a reserved powers model, would the subject of agricultural wages be an exception to the reserved matter ‘employment’ as is the case in Scotland?

Ultimately, the judges must identify the subject matter of the challenged legislation and then decide whether it falls within or outside the subject matters over which the legislature has authority. However, under the current Welsh devolution model, there is still considerable room for debate as to whether something falls within competence or not. The powers of the National Assembly are defined very differently from those of the Scottish Parliament and the Northern Ireland Assembly. In Wales, the Assembly has no power to legislate except in relation to the specific conferred areas of competence – a ‘conferred powers model of devolution’. In Scotland and Northern Ireland, on the other hand, everything is devolved, unless it is specifically reserved to the UK – a ‘reserved powers model of devolution’.

As I mentioned above, under the Welsh ‘conferred powers model’ there is no composite list of matters reserved to Westminster, just a list of matters on which the Assembly can legislate, and a list of exceptions to those matters. As a consequence, there are a number of subjects which are not mentioned at all, resulting in ambiguity and uncertainty as to whether something is devolved or not. For this reason, it is often difficult to judge whether something falls within or outside the subject matters over which the Assembly has legislative powers. This is precisely the case with agricultural wages: it is not an exception to the Assembly’s conferred legislative authority, but neither is there anything which states that it is a reserved matter (or an exception to a reserved matter as is the case in Scotland). Under the ‘reserved powers model’, on the other hand (as Emyr Lewis explains here) ‘there can be no subjects in limbo under this model, because the default position is that all subjects are included, unless expressly excluded.’ Also, as I mentioned earlier, the UK Government has never challenged a devolved piece of legislation under this model of devolution.

The Attorney General hopes “that this reference will give us clarity in respect of important questions about the breadth of the National Assembly’s competence.” However, it is doubtful whether we can ever achieve clarity on the Assembly’s powers without a move to a reserved powers model of devolution. It was clear from the public gallery of the Supreme Court last Autumn that even the best legal minds in the UK are yet to grasp the Welsh devolution arrangements. As Counsel General for Wales, Theodore Huckle QC, observed in the Byelaws case ‘it took five Supreme Court Justices, the Law Officers of England, Wales and Northern Ireland, several of the UK’s leading constitutional lawyers and a great many officials across three Governments to decide it was lawful to make minor changes to the way Welsh local councils deal with things like dog-fouling and loitering in public lavatories.’ We can now only wait and see what the Supreme Court will make of the latest ‘devolution issue’ case involving Wales and who they believe has the power decide the employment terms and conditions of Welsh farmers.

This is an amended version of the article and was updated on Friday 30th August