 Welcome to the eighth meeting in 2019 of the Finance and Constitution Committee. We've received apologies this morning from Bruce Crawford, our convener, and from Angela Constance. I welcome George Adam to the committee as committees substitute. We've also received apologies from Alexander Burnett, who has amendments on the fuel poverty bill, which has been considered by the local government committee, but he hopes to join us later this morning. Before we start, could I just remind members and witnesses please to put phones into a mode that won't interfere with proceedings? The first and only item that we have on our agenda today is to take evidence on Brexit from the Cabinet Secretary for Government, Business and Constitutional Relations, Michael Russell, and from two officials, Jenny Brough from the EU exit readiness team, and from Ellen Lever, head of negotiation strategy for the Scottish Government. I welcome all the witnesses to our meeting this morning. I understand from the cabinet secretary that he doesn't wish to give an opening statement this morning, so if I may, I'll launch straight into questions. Cabinet Secretary, we want to start with no deal planning and the Scottish Government's readiness for no deal. I think that we know that nobody here wants a no deal Brexit, but it is still, unfortunately, a possibility that there might be a no deal Brexit on the 12th of April or, indeed, thereafter. Can I ask for an update, cabinet secretary, on where we are and where you are in terms of the Scottish Government with regard to readiness planning for that eventuality? Yes, thank you, convener. I would confirm, I don't think anybody in this room wants a no deal, as a result of which we are doing our best politically to avoid that, and everybody should do that. Equally, we will do everything that we can to mitigate the effect of a no deal should that take place, but I want to stress very strongly at the outset that we cannot do everything, and that should be understood. That would be an unprecedented set of circumstances. We have tried to cover all the bases, but clearly that would be very difficult to do. We should also be clear that a no deal could reduce Scottish GDP by up to 7 per cent. You've seen the published figures, and that would be very serious. We would be dealing, essentially, with the effect of a very sharp, very sudden slowdown, plus a number of other effects, which are not primarily economically related—for example, the interruptions to the supply chains. We have taken in the Scottish Government a view that we should endeavour to deal with that through our resilience mechanism. I think that tomorrow will be the 16th meeting of the resilience committee, which has been uprated and has grown in size very substantially, to include a whole range of other interests. Local authorities, COSLA, Food Standards are there. There's a whole range of other interests around the table and who are taking part in those preparations. We have also, at the invitation of the Prime Minister, who invited the First Minister to take part in the UK exit cabinet sub-committee, which is meeting this afternoon. In London, I was there last week and I've been to three meetings. Mr Swinney has been to two. I think that the First Minister will be there this afternoon. We have participated in those meetings, which are essentially a meeting of most UK cabinet ministers alongside the First Minister of Scotland, the First Minister of Wales and the head of the Northern Irish civil service. On the structural side, there's a lot of work going on. What we've wanted to do—I don't think that I'll give anything away to say that one of the papers for last week's meeting with the word interdependency was used, which is the first time that I think that I've seen it used. In the UK Government's sense, there has been an acknowledgement that all the Governments have had to work together because of our responsibilities. The Scottish Government is responsible for the delivery of the health service in Scotland. The Scottish Government has responsibilities in terms of civil order. All those things have to be done in Scotland, but they have to be done and are being done in collaboration with the UK Government. Just to say in terms of where we are, our participation in the medicine stockpiling activity has taken place. The Cabinet Secretary for Health and Sport is very actively engaged in that and has had discussions with her UK counterparts. As far as we are aware, and we have had reports on this through the UK structures, that system is in place and ready to operate. In terms of food distribution, the retailers and others are reasonably confident that they can continue to supply, perhaps not completely uninterrupted with every piece of every item, but we will be able to continue to supply. We have expressed particular concern about the ends of supply chains, which are in Scotland, essentially the north and west on the periphery of the country. Work has been done and continues to be done to make sure that the transport infrastructure is robust enough to cope with that. Transport Scotland has been key and much involved in that. In terms of the particularly vulnerable people, Eileen Campbell, working with COSLA, has been particularly focused on that issue to make sure that those who are particularly at risk or are vulnerable can be thought of and structures and arrangements put in place for them. We have, of course, through the UK structures, been aware of the difficulties that would take place with export. Quite clearly, it is one thing to get goods into a country, it is another thing to make sure that companies can export, and particularly those who export foodstuffs will be vulnerable. We have looked at and continue to examine and work on the possibility of a two-way process, so goods coming in can go out in the same transportation, and that would be possible. However, the biggest barrier to export, particularly in foodstuffs, will come with phylo sanitary inspection. The confidence that the EU would have, for example, in foodstuffs going to them, because it would no longer be—and you will appreciate this particularly with your background—a legal mechanism to enforce the regulations. If we were not in the EU, we would not be subject to European Court of Justice, the regulatory framework could not be enforced. Therefore, it is not a question of failing to trust people who are providing the same thing on a Monday that they were providing on a Friday. There is no mechanism to enforce that trust, and that is a key issue. Although all those things are in place, we continue to meet, to discuss, to have the structures in place. There is a control room, a resilience control room, now in place at Bilson Glen. The first responders and the police, organised by the police, are fully in operation. The 24-hour-a-day operation of the resilience room, that is the core of it, is ready to go at any time. It could have been stepped up the week before the 29th, which was the intention. That has not proved to be necessary, but we will review that on a daily and weekly basis. For example, tomorrow we will discuss that issue again. We have also, through the SCORE mechanism, been able, with the extra time to do some deep dives on some of the issues that have arisen. We are reviewing and confident in our arrangements that we have made, but I conclude with what I have started. Whilst we have done everything that we can, I am quite sure that we have not done everything. That is a very full answer. One thing that you did not talk about, however, was where the Scottish Government is with regard to budget planning in the context of the possibility of a no-deal Brexit in April. Perhaps that is a question for the Cabinet Secretary for Finance rather than for you, but we do not have him in front of us. We have you, so where are we in terms of budget planning? There are two parts to the budget question, and let me give you those two parts. The first part is that the consequentials that have come so far have gone into the system because the system is undertaking budget planning. Those have been distributed across the portfolios and, for example, within the local government settlement, primarily for the work that is already being done. It is not a question of additional costs having been identified and those paid for. That is part of the normal process of government. What has been last year will be this year. I think that we are now in the second phase of that, which is over and above those monies provided what additional costs are being incurred. The resilient structure is being developed to be able to apportion those costs and to ask people to come forward to those costs. In a sense, a bill is being created of what the additional costs have been over and above the monies that are in the system. That is where we are now. I cannot give you the detail of that, but certainly at some stage in the coming weeks I think that we will have an idea of what that additional expenditure has been and that will be something that we should discuss with the committee. Does the Scottish Government anticipate that, in the event of a no-deal Brexit, an emergency budget would have to be presented to this Parliament? The UK Government says that it would have to present an emergency budget. We would have to present, I think, broadly the same, but we would have to get additional resources from the UK. The principle that we have applied from the beginning of this, and I said this before to this committee, is that there should be no financial disadvantage to any part of the Scottish public sector, let alone the private sector. There should be any financial disadvantage, and we would expect to have those monies paid to us. James Kelly wants to cover some of those issues, but I want to bring Emma Harper in first, if I may, to talk about no-deal planning and freedom of movement. Thank you. Good morning, everybody. Just before I ask my question, it's interesting to hear about medicine stockpiling, because I am one of those type 1 diabetics who is an insulin pump user, and I'm still a wee bit wary of the continuity of future supply, but I suppose I can follow that up. All we can go by—and I know you are—all we can go by is the assurances that we receive. The assurances in the UK Department of Health is that insulin has been stockpiled by, I think, more than one manufacturer, so that it would be available for an extended period of time. The other problem with a no-deal, and I just make this point, is that we don't know how long it would last. If you look at figures that were out earlier this week, British business has gone through an extraordinary stockpiling in recent weeks. There's a remarkable graph that I'm sure we can provide to you that shows the extent of stockpiling, which is unprecedented at any time in the last half century. Apparently, pharmaceutical companies have done this, and stockpiles exist, and as far as we are aware, there are very few drugs for which there are not alternatives, even if the drug is not stockpiled, but insulin is a particular worry, because it's not manufactured in these islands. I am interested in what happens with a no-deal on immigration, so there will be an immediate cease or stop of free movement. That will have consequences for our hospitality businesses and caring. I've raised this in chamber as well about dairy farming in the south-west of Scotland, so I would be interested to hear about what would be the consequence then with an immediate cease of free movement. I think that the first thing that people would notice is that there would be very restrictive border controls for a period of time. They may not last forever, but the first reaction would be for intense checks at the border. We don't know what rules would apply. The United Kingdom Government has said that it is not relaxed but reasonably confident that there would be no particular slowdown in people coming in and out. If you look at what has happened in the last month with French immigration and customs controls being imposed and people working to rule, there have been considerable delays, for example on the Eurostar. In those circumstances, I think that the actual functioning of the borders would become quite slow for a period of time. What migration rules would be applied would be another issue. Again, the UK Government says that it will have temporary migration measures. There is a complication in this, of course, which is the common travel area between Ireland and the UK, which predates to the EU and which there is a commitment to continue. I think that there would be some confusion for a period of time. That would also be legal. It would also be a matter of sentiment. People would not necessarily want to stay if they felt that there were problems in living here, as a result of which you would see an increase in people leaving. That would be problematic for the labour market. We have seen an increase in people leaving already. I am aware that nurses and midwives are not registering with the Nursing Midwifery Council in order to come here from Europe. Is that still the case? There are two issues at play here. One is a sentiment issue. This is universal. People want to go where they feel that they are needed or wanted and will not be prejudiced. There will be no prejudice against them. People are not everybody, but people are uncomfortable. The second one is the value of the currency. If the currency falls, then the benefit to people being paid in that currency falls. It may not be worth a while. I noticed that Michael Govitt given this as a principal reason for slowdown in migration. He is not entirely wrong, but you would have to ask why has the currency fallen. Brexit is clearly an issue in there. However, people have other places to go. In particular sectors, there is also considerable competition in the health sector, which is always a shortage, European wide. Agriculture labour is, of course, in short supply. That is one of the drivers within the increased availability of agricultural permits, for example, from people from the Ukraine and the Ukraine Association Agreement. That will be an issue. If you are working in not just fruit picking in the east of England, I noticed last week about asparagus growers in the south east of England who think that they will lose 20 per cent of their crop this year because they rely just as fruit growers rely on migrant labour who will not be available to do so. The minister came on the second part of that question to talk about the sentiment issue and the danger that people from other EU countries who already feel very insecure for the past few years might make an urgent decision to leave. Has the Government attempted to carry out any assessment to gauge the extent to which that is a risk, either in public services or in the rest of the economy? Both Governments know that this is a risk. We have nothing quantifying, but we are seeing the experience of it. I do not know if the UK Government is quantifying. What we are doing, however, is mounting a campaign that will be live shortly to encourage EU citizens to stay and to make it clear that they are valued and wanted. We believe that there is sufficient risk and evidence of sufficient risk for us to take some exceptional steps to try to encourage people to stay. I have not seen any evidence of the exact numbers. I have seen drops, for example, as Emma Harper indicated, in the registration of nurses and midwives. There are many people who have met people who have come to our surgeries who have said that they are going away because I can think of one in my constituency, somebody from Germany who had lived in Scotland for 20 years who has gone back to Germany because they are uncomfortable. The status issue has been problematic. People do resent having to register, and people who have paid tax all their lives resent having to register. That is a factor. It is not everybody. I think that Scotland has been reasonably clear that it wants people to stay. There are elements such as the demonstrations that we saw on London and Friday. That upsets people. It really does upset people, and they feel threatened. Thank you, convener. You mentioned earlier, cabinet secretary, that COSLA has been involved in discussions around resilience, which is not entirely as we would expect. Why then, in terms of the £92 million that has been allocated for no-deal planning from the UK Government, has none of that funding been passed on to COSLA to carry out necessary planning that they obviously will have to undertake? I think that there is a misunderstanding of what the system is in terms of how money flows. Let me be clear about this. I am not saying that there should not be additional funding for local authorities for Brexit preparations. I have had those conversations with Alison Evison and I continue to have them. I have encouraged Alison and Sally Loudon to quantify the costs that they are meeting and to make sure that that information is given to us, and I am sure that that will happen. The cost of Brexit preparation—very few of them have been separated out. I suppose that part of my portfolio is a specific cost of Brexit preparation, but the procedure that we followed last year—last financial year and this financial year—has to make sure that the money is allocated where people are spending money and money has been allocated in the spending settlement. That is what has been happening and therefore there will have been money allocated right across the Government. What we are now talking about is specific additional costs that are being met. I have made it clear that there should be money for them, but that has to come from the UK Government and we have to have it as part of our accounting process of what we are meeting. What is happening south of the border is the direct relationship between the UK Government and local authorities. That is a direct funding relationship. The funding relationship in Scotland is funding to the Scottish Government, and that money has been spread across the portfolios of the Scottish Government. We are however concerned that additional costs that are being entered into now will require to have money given to them and that is what the accounting we are thinking. Is the case that, at this minute, none of the £92 million that was allocated specifically for no-deal planning has gone into local authorities? No, it is not the case. That money exists right across the system and that has been used by every part of the Scottish Government. I am differentiating from the £92 million that has been spread in that way and is helping us to meet all the additional costs right across the public sector and the additional specified costs that we need to know about so that we can essentially draw up the bill. That is the distinction that I am making. The £92 million that has specifically come to the Scottish Government from the UK, none of that has gone into local authorities and that is the position that has been outlined previously. I disagree with that position with respect. I think that money is across the system and is being used by every part of the system. However, I do agree and entirely agree—and I have made this point to Alison and Sally and to other local authorities—that they need to quantify the additional sums that they have spent, as other departments need to do. This is a constant refrain from me and from the Cabinet Secretary so that we have that bill ready to present. I will leave it to that, convener, but I would say that the position that you are outlining is a bit inconsistent from what we have heard in previous parliamentary answers. Alexander, I think that you had a question on no-deal planning before we move on to other areas. Thank you very much, convener, and Cabinet Secretary, and firstly my apologies for being late. I was in another committee speaking to my amendments in the fuel poverty bill. Can I ask what the Scottish Government is doing in preparation for a no-deal Brexit to ensure the oil and gas sector can continue moving goods and services to and from oil rigs? We are in regular contact with the oil and gas sector. That goes through the appropriate departments in the Scottish Government. Whatever assistance they require to have, we will be looking at whether we can provide it to them. We have tended to find in this that, in the private sector, people know what they need to have, and they are making arrangements to have it. For example, if I look at some other sectors, they will be trying to charter boats, they will be trying to make sure that they are protected in stockpiling. For example, I imagine that, as an oil and gas, there will be issues of equipment that come from other parts of the EU, which they will require to have, either in spares or in—and that will have to be, presumably, has been stockpiled. I will have to check with individuals, but presumably that has been stockpiled. I can give you other examples in the public sector. For example, Caledonia McBrain was looking—again, I do not know how much they have done of that, but they were looking to see if they could purchase spares for some of their vessels that had been built in Poland so that they had those available rather than having to get them. I presume that that has happened. However, there are areas that the oil and gas sector cannot prepare for, because those require decisions from either ourselves or the UK Government. Particularly in relation to migration, I would again expect that there would be a flow of labour of some sort, probably highly specialised labour from other European countries, which could not be allowed for in terms of the question that Emma Harper asked earlier, if there was a more restrictive migration system. I would think that there would be three things taking place. One is—and I am sure that it is taking place—a discussion between the Scottish Government and its officials and the sector in terms of any special things that need to be done, the preparations that the sector has done and rightly done—a lot of businesses have done that, particularly accelerated in the last couple of months—and some things that are regrettably insoluble because those require decisions by the UK Government in terms of migration or the EU in terms of regulation that cannot be presently anticipated. I am sure that your remarks at the beginning are certainly applicable to the larger companies who have been able to spend more time and resource on preparations. For the smaller companies, can I ask what is being done to maintain the supply chain in the UK and ensure that flow of services can continue in a no-deal Brexit? The next thing that could happen is that there should not be a no-deal, so we continue—we said that at the beginning—I do not think that there is anybody in this room who wants a no-deal. If any of us have influence on that, they should use that influence, but in terms of small companies, a number of things right across, not just now, in our gas sector, have been applied. One is that we have had particularly strong support from Scottish Enterprise, Hanson Enterprise and Skill Development Scotland, in its prepare for Brexit work, and that has shown a big increase in uptake in recent months. That allows companies to assess—small companies particularly—what the impact is upon them, and we have encouraged people to do that. If companies have not done that, they need to do it. Even now, they need to do it. If anybody is watching this and has the opportunity, go and do that now. In Scottish Enterprise and Hanson Enterprise and Skill Development Scotland, people can talk to about the way in which they can get additional help in the supply chain. Their professional associations are also important. They will know their peers and they will know how the supply chains work. Those supply chains need to be negotiating with those businesses, and businesses need to be approaching them. We cannot clearly approach every contractor and say that this is what you need to do, but they need to know that that is happening. If they export, for example, there are UK systems whereby they can register and get up-to-date information, but we cannot legislate what happens when a lorry gets to Zebrugge or gets to Calais. There will be issues in there in terms of compliance, which are not entirely clear at the present moment, but all those things are available, all those things have been available, and the information has been there. We launched the prepare for Brexit update last year, and so far that has worked particularly well. We have also added additional resources into the system. We have put £2 million in earlier this month to help businesses to do more preparation for Brexit, and we will do as much of that as we can. I think that we want to move on from no-deal planning to the possibility of there being an alternative to a no-deal, which is obviously a deal. Neil, you wanted to kick off questions. Thanks, convener. Good morning, cabinet secretary. There have obviously been a lot of votes in the House of Commons last weekend on Monday evening. I wonder if you could clarify why your Westminster colleagues abstained on Ken Clark's proposals for a minimum of a permanent customs union. Because it does not include freedom of movement, and that is absolutely crucial to us. We have never supported a customs union per se. We believe that it is the single market and customs union relationship that would make the difference in that. We did not support Nick Boles in the first attempt, because we did not think that that was clear enough. There was negotiation over the weekend, and negotiation can produce results, because there was negotiation over the weekend, which produced a clearer text from Nick Boles and assurances, which we thought were satisfactory, and we backed his resolution. It is very similar to—there are some differences—the position that we took in December 2016. A customs union on its own does not do that. A customs union on its own does not provide the protection that we need, particularly in terms of regulation. A customs union not only permits, but allows various substantial regulatory divergence. It is the regulatory divergence that is the problem. In addition, freedom of movement is absolutely central to us. The Scottish economy needs freedom of movement. There is no doubt about that. I have used at this committee before the example of the Highlands and Islands as a region that will lose 20 per cent of its workforce in the next five and ten years because of demographic factors. That will lead to very substantial continued depopulation. Unless that labour force is replaced, there is no clear way to do so without the present freedom of movement arrangements. That is what we should go for. I realise your preferences for no Brexit and for maintaining freedom of movement, but I think that the key phrase in Ken MacLeod's proposal was a bare minimum of a customs union. If you want to go further, you can still support that proposal. Are there any circumstances? If that proposal is to come back as a minimum of a permanent customs union, are you willing to compromise it all on that? Not unless it would have to be fleshed out so that we understood it. I mean, with the greatest respect—I do accept to take Ken Clarke's word—a bare minimum from what is a backbencher is not actually very reassuring at this stage. There needs to be more than that. However, what we need to focus on on Tuesday was that old Westminster of Maxim and the vote follows the voice. In a sense, we know what people supported. They supported the common market, too, and they supported a referendum. Those would seem to me the two big areas where it would be possible to coalesce around. We would want to see what happens. Now, this changes hourly almost. We do not know what Jeremy Corbyn will take to the table. The First Minister is in London today, too. We have our absolute clear views, and we ignore Scotland by refusing to discuss this with the Scottish Government. Today, so far, is not a sensible idea, but that being said, I think that you could get movement, continued movement, around common market, too, and a referendum. I think that that is where the focus might be. I would much rather not have a Brexit, and if there is to be, having a confirmatory vote is absolutely essential, given the changes that have taken place over the last two and a half years. Thank you. Willie, do you want to follow up with us? Yes. Thank you very much, convener. Cabinet Secretary, that Ken Clarke motion that my colleague referred to 10 Labour MPs voted against that as well. I mean, we could nitpick all day about who voted for what option really, but where do you think we are in the space of trying to get some kind of agreement and a deal? The Prime Minister clearly looks as though she's finally accepted that her deal can't go through, as she said, three attempts at it. It's not going through, and she's opening up these discussions with Jeremy Corbyn and hopefully others, too. Where do you think we might be coalescing around some kind of deal that might get a majority? I'm not sure that the Prime Minister does accept that her deal won't go through, because it seemed that her statement last night was open to a number of interpretations. But that being said, I mean, I think there's little point in taking her deal back to the House of Commons as it is, because I think it's inevitable that it would be defeated again, even some of the people who voted for it on Friday seem to have voted against it. So I think we need to pay calm so that the clock is ticking. I think it's very difficult to interpret the EU council decision on 22 May as anything other than saying, if you're going to have an extension of 22 May, you have to have elections. I think that that's very clear in the council decision. I don't see anything in the coverage of the last 24 hours that's changed that. For the purpose of argument, I believe that there should be European elections. I positively welcome them. I think that the preparations clearly have been made in various places, but they can't take place, unless there is a decision to allow them to take place. I think that they should take place. I think that there should be a much longer delay. I think that people should be encouraged to have their say if people's vote is entirely right to happen. But at the present moment it's very difficult to say what will take place in the next 24 to 48 hours. Allegedly, the Prime Minister wants a conclusion to this by the end of this week. I think that that's probably flexible into Saturday. In those circumstances, the EU also wants to know what the proposal would be for council. It is very difficult to see what that proposal would be, but if I were able to wave a magic wand and get what I want, apart from no Brexit, which I think has been a complete distraction and disaster for the last two and a half years, of really massively damaging proportions, it would have to be a very long delay, a referendum, the European elections taking place, and perhaps some calmness coming into this to look at the damage that would be done by proceeding along the present lines. Are you getting any sense at all that the MPs, political parties, are willing to compromise even a little further to get some kind of deal? It seems to be fairly intransigent at the moment, and people swapping sides in both sides. Is there a thing as we go with that? Are you getting any sense at all that there's movement towards getting a deal? The one thing that we all seem to be agreed is that nobody wants to know to you. I think that you'd have to be pretty hard of heart not to have been pretty downcast last Wednesday and last Friday. I think that it would—again this Monday—it does try everybody. A lot of people are very affected by this and are very profoundly depressed by it, and I worry about all of us in that sense, and I certainly worry about those who are at the very centre of it. You also always have to try and take some brighter note from what is taking place. If I go back to the negotiations over the weekend with Nick Boles over his resolution, that was possible to get a coming together in order to do something, and I think that's positive. I regret, for example, that some MPs did not support that, because clearly some of them thought—some Liberal MPs clearly thought from the evidence that, by supporting that, they would be weakening the case for people's vote. I don't think that was the case. I think that in a ballot where you were allowed to choose as many things as you wanted, I don't see how that could be the case. I think that there is movement. I think that people are focused on things. What will come out of discussions with Jerry Corman? I don't know, but if there is—as the Prime Minister seemed to indicate—a commitment to accept the outcome, if there were a multiple choice, not just one thing, but a multiple choice that was voted on, that would be interesting. I share that sense of frustration and anguish at the various outcomes of the votes that we've seen in the House of Commons in recent days, Cabinet Secretary. Do you agree that we are well beyond now the point where any of us can insist only on our first preferences in this? We have to accept that, in the interests of reaching a compromise—and it is going to be a compromise—we are going to have to—you've used the phrase many times before—red lines. We're going to have to rub out red lines. You've been very consistent in insisting that any form of Brexit must continue to have single market membership and membership of not just a customs union but of the customs union, as it's understood with regard to the common commercial policy and the single tariff. Where is the SNP prepared to compromise in order to ensure that we don't leave without a deal, given that that is now where we are? We are all having to not insist on our first preferences, or perhaps even on our second preferences, but on outcomes that we agree are suboptimal in order to avoid catastrophe. I think that you have to recognise that compromise is not about accepting the lowest common denominator. I say that point very seriously. It is certainly about being able to bring to the table a flexibility in discussion, but it's not about saying what's the least that we can all agree on. I think that there are very strong reasons for saying that, without freedom of movement, for example, there are real enormous problems for Scotland that cannot be very difficult to overcome. That being said, we've had our differences on this in the past, but I genuinely believe that, from the very beginning, the stance that I've taken on behalf of the Scottish Government has been one in which we've attempted to compromise. We've put forward in Scotland's place in Europe what we thought that compromise would be. We've had no willingness to do so for two and a half years, so, of course, I welcome if there is a willingness to do so, and I think that we are edging towards that. My first preference is not to do this. That's what Scotland chose not to do in June 2016. Accepting common market 2, which is leaving the EU, is therefore very much a compromise on our part. There are, for example, even in common market 2, some issues about flanking policies, which are not clear and are not problematic. At the end of the day, I accept that there needs to be continued discussion, and therefore things may change over the next 24, 48, 72 hours. However, I don't think that I would want to be understood that we were not compromising. We have compromised very substantially. Whether there are more compromises to be made by everybody will be an issue as we see over the next 72 hours. However, a compromise that takes the United Kingdom out of the single market is one that you would not be prepared to make under any circumstances, even if it was the only way of avoiding an ideal presence. I'm not saying that, convener. I think that that type of language from me wouldn't help in the next 72 hours. I'm saying where I think we are and what we've said consistently and how we've tried to bring that to the table. I've lived eight breaths, Scotland's place in Europe, for the last two and a half years. Sometimes, people in my party have been unhappy that I've espoused that as a compromise. However, I still believe that that is workable, but I would rather not do it. I think that the evidence that we've seen so far is that not doing it might be the best choice. The thing that squares all those circles is the people's vote, because it does in the end say the political system cannot reach that decision. Let the people reach that decision. Thank you. That's helpful. I know that Patrick Harvie wants to come in in a minute, but I'm just going to bring George Adam in first. Just a quick supplementary. I've been watching all this from the relative calm of the Scottish Parliament, but you've been up and down in the bear pit that is Westminster at the moment. It's like a three-ring circus down there. No one can agree with what day of the week it is, let alone anything else. We're not to labour the point on compromise. How do you see the potential for a compromise at this time, considering the heat and the way things are, the way the discussion has been had down in Westminster? How do you see scope for being able to find that? I think that a three-ring circus looks wonderfully well organised compared to what you witnessed at Westminster most of the time. That has produced a lot of heat. All of us will have said and done things. We look back and think, gosh, that really got under my skin, and I might have said things I shouldn't have said. All of us would have done it. I think that this particular moment is such a serious one, that I think that everybody has an obligation. As people tried to show on Monday, everybody has an obligation to think—I wrote this on Sunday, and I'm just repeating what I wrote on my column on Sunday—it is really important that people say to themselves, what is best for the countries—because there are four countries involved—what is best for the people that I represent? That should be very much at the forefront of their minds. Therefore, debate, discussion and negotiation are really important on a genuine basis. That's what I think everybody will be trying to do in the next 72 hours. However, it is tough that you can't ever throw away the past. People are pretty wrung out by this. The last two and a half years have been very tough for people at the heart of this. Every day, you get up in the morning and think, what on earth could happen next? People need to have a calm sooch on this now. We are effectively at Brexit minus five days, and the public are getting to the stage where they are asking desperately, what is the future? Where are we going? For me, I like to try and keep things simple. I'm a simple guy, just to get on with life. It's very difficult for the public to actually be able to understand why politicians Westminster will not sit down and actually agree with one another. It's not an analysis that will be shared universally around this table, but you and I would believe that it illustrates that the Westminster system is broken. I do think that it illustrates that. I think that it's been in a process of being broken for half a century or more. However, at this particular sharp juncture, we have to see whether negotiation can produce a result. A few minutes ago, you said that it was unclear whether or not the Prime Minister would be willing to meet with the First Minister. While you were speaking, a UK minister was on television and said that there is absolutely no point in Theresa May meeting with the SNP over Brexit, to which the interviewer said, We're just hearing that May is to meet Nicola Sturgeon today, and the minister replied, That's fantastic news. I think that events are clearly fluid. Mr Have you illustrated perfectly the world in which we live? Having said that, if the purpose of these meetings with the Prime Minister is to make the generous offer to Jeremy Corbyn and others perhaps to share the blame for Brexit, would you agree that they need to be very cautious about that process and what the real intention and purpose behind it is? Do I take it from your comments so far that the compromise that is conceivable from the Scottish Government's point of view is that whatever deal might end up getting support has to be put to the people that that is a requirement with a remain option on the ballot paper? I don't think that you could possibly have a second vote without remain being an option. That would be inconceivable. From the very beginning, I've made it clear that that would not be possible. Thank you. Good morning, cabinet secretary. I was going to ask a question about the second referendum option, and I think that you've been quite clear responding to Patrick Harvie. Just so that I'm clear about this, is it the Scottish Government's view that a second referendum is required in all circumstances? I'm sure that, like me, you would not want to appear to be an extremist of any description. That was indeed a perish of the thought. Let me put it this way. I think that the best outcome of this would be a people's vote on an option. We can discuss that, but I will absolutely say never. I've made it clear to Patrick Harvie that that is essential, but I do not wish to close any possible avenue. I take the convener's line on this. I don't want to close any possible avenue in the next 72 hours, but I think that it would be very difficult to justify refusing to take this to the people. If there were to be a second referendum—and this is all entirely hypothetical, I appreciate it at the moment, and it's a very fast-moving territory—we ended up with a referendum giving a choice between the withdrawal agreement as it stands and remain, which I assume you won't remain on the paper, so that would be something that the Scottish Government would press. Let's say that there was a narrow vote, 52 per cent, 48 per cent, in support of the withdrawal agreement, with the Scottish Government then accepting that that needs to proceed. I think that it would depend on what the vote in Scotland is. I mean, I've been consistent from the beginning. You and I disagree on this matter. We're not going to reconcile each other on this issue today. I suspect that we will never reconcile each other today. I think that a situation in which the people of Scotland continued to support being members of the EU and were denied that option for a second time would be insupportable. I'm not sure—you and I have exchanged this with members of your party over the past two and a half years—that's the position that we have. We're not going to be able to change that today. Can I ask a related question, not about referendum but about revoking? As I understand it, it's the Scottish Government policy that article 50 should be revoked. Is that correct? Yes, so we would be very pleased if that were to happen, particularly this morning. In the Miller case, the Supreme Court ruled that to invoke article 50 required bespoke legislation that the Prime Minister did not have that legal authority. In the Whiteman case, the European Court of Justice decided that it's for the United Kingdom to decide whether it wishes to revoke article 50 or not in accordance with the constitutional requirements of the United Kingdom. What can you tell us, if anything, about what the Scottish Government's understanding is of what the constitutional requirements in the United Kingdom would be, were the decision to be taken by the Prime Minister or the Cabinet that article 50 should be revoked? Does it require legislation in the light of the Miller judgment or not? I really think that it would be very dangerous of me to bendy words with you about this issue, because you are far better positioned to argue this than I am. My position is that I think that it's plausibly arguable either way. I think that you have yet again proved why I'm not going to get involved in this. Does the Scottish Government have a legal view about this matter? No, I don't think it does. Perhaps it should have. My own view is that it is arguable either way, and I'm glad that such a distinguished lawyer has confirmed that with me. I don't think that's the issue. If we got to the position that revocation was the political decision, a way would be fun to revoke in double quick time, whether that was by emergency legislation or by the learnings. That's the sort of argument that might not stand up in the Supreme Court, would be my advice, but let's leave that one there. Emma, do you want to come back on this question of compromise and deal making? I am interested in the mood in Westminster that is obviously different than the mood here in our young, sensible Parliament compared to what we're seeing unfold in Westminster. I'm interested in whether there are people that are moving towards compromise, that are open to negotiation, debate and discussion in order to not have us go down the no-deal route. I think that we've seen from the indicative votes that there are people who are very keen to find a way forward, and there are those who are still stuck in their trenches and will not move from those trenches. Some people will be stuck in those trenches forever, without a doubt. Particularly on the ERG side, there are people who will never, ever accept anything other than the hardest of Brexit, and that's presently where they are. I think that the Scottish Parliament, I don't want to do a sort of, here's taste, was like a presentation, but I do think that the Scottish Parliament has tended to show an ability to work across parties, which has been more impressive. We have been able to seek, well, on the continuity bill, there were differences, but in leading up to the continuity bill, we were able to get almost unanimous views that there shouldn't be an imposition on the Scottish Parliament in terms of its obligations and rights and duties and competencies. Since then, we've also managed to get pretty substantial majorities—two thirds, three quarters—majorities of the Parliament for certain propositions. I think that we've shown a way to work together, which has been helpful, not perfect. There's been some pretty heated debates and discussions, but I would have hoped that that would rub off and people would recognise that, and I think that there are people who recognise that at Westminster. It's a different system. You can go back to 1997 and 1999 and the desire of those people who established this Parliament to have a different system. It's not entirely worked, politicians are politicians, they will be adversarial, but standing orders make a difference, the way in which the Parliament is laid out makes a difference, all those things create a bit of a difference. The process so far of negotiating and attempting to pass the withdrawal agreement has been variously characterised as the easy part of Brexit—the simple or straightforward part—with the future agreement viewed as being the most contentious element. Many of my constituents would be deeply alarmed at that prospect, but, in relation to the situation that we now find ourselves in, based on your experience over the past two and a half years, what have been the reasons behind the current on-pass that we face? What aspect has been political—the decisions of politicians? What aspect has been related to the culture of institutions? What aspect has been constitutional, i.e. the legal relationships governing these islands? It's a very interesting question. I think that it will be a matter of considerable analysis in future years. Why, what took place in June 2016 went so terribly wrong? I think that there are many reasons for it. The first of which has to lie—I'm being very straight here with the Prime Minister—is that there were two fatal flaws in the approach. One is that the desire to keep an ambiguity about what the UK wanted in order to keep the broadest coalition of our own party on side was very damaging. It was only the Chequers agreement in June last year that resulted in them writing down what they wanted. They should have written down what they wanted in a quasi-legal text in the first month. I think that that was a big problem. That's when the disintegration of the Government started, because people started to resign because they couldn't agree to what was written down. The second issue in there is a failure to bring people together. This has been commented on again and again. Andrew Ronsley had a very good piece at the weekend, which I would repay reading on this. There was a moment—I suspect that moment—was probably towards the end of 2016, when it was clear that there were major decisions to be made, for example at that stage, whether or not we would be in the single market in the customs union, because we should remember that that was still up for grabs until the Lancaster House speech in the end of January 2017. There was a moment to sit down for the Prime Minister to bring people together—not now, but then Jeremy Corbyn, Nicola Sturgeon, Cardwin Jones, Arlene, Northern Ireland, Assembly was still in operation, Martin was still alive—to sit down with everybody and say, how could we actually get something that would command the broadest support? That never happened. That isn't what happened at the JMC in 2016, the first one since 2014, the JMC plenary in October 2016, in which, essentially, the Prime Minister simply said, Brexit means Brexit—she actually said that—without defining it and without any indication of how it would happen, and without seeking a consensus around the table of what it meant and how it could move forward, because we published our paper in December 2016, which argued for customs union and single market membership. I remember sitting in David Davis's office in the House of Commons, saying to him, that this hasn't been ruled out, has it? No, absolutely not. It hasn't been ruled out. This is still on the table. A week later, we had the Lancaster House speech without consultation, without seeing a text, without knowing what was happening. That is a failure to it. You are alluding to something that underpins all this, how the devolved administrations work with the UK Government. The problem here is a long-term problem of what devolution is and how it operates. Devolution is essentially a system of compromises that is built around the concept of parliamentary sovereignty at Westminster. I think that that is impossible for it to continue in that way. I think that the weight of Brexit has finally illustrated that. Now, my preferred solution is a relationship of equality, where you have an independent Scotland working with an independent England. However, I addressed this last week in a lecture that I gave to the Institute for Government, which, if you haven't got, I'm happy to provide. I do think that you have to accept that that is what we want to do. If we take part in a debate, even in the short term, about intergovernment relations, we do it on the basis that there needs to be a new settlement. That settlement needs to be defined by a different relationship between the parts. It also has to be defined by a means by which you enforce that relationship. I constantly quote the Tishach remark from the British Irish Council last year in Jersey, where he talked about the relationship of trust within the EU between the countries, depending on essentially the way in which that could be enforced through the European Court of Justice. I think that in the intergovernmental relationship you will require to have for it to work something that is justifiable. However, the problem with that, before the convener points it out, is that it is not possible to do that within the concept of Westminster sovereignty. That is the conundrum that is required to be solved. Devolution is not about a hierarchy of Governments. Governments have defined roles. It is about a hierarchy of parliaments. How you resolve what has now become the difficulty within that is the big issue. There is an intergovernmental review under way. It has not gone anywhere yet, but that is the big issue for the IGR. There are a couple of other issues that we want to talk about before wrapping up the convener. One of them is the continuity bill. Neil, have you had a question about that? On the continuity bill, where are we with the continuity bill in terms of addressing the middle and supreme court? I have been meeting with representatives of the parties. There is, I hope, an agreement of how we are going to take this forward and the issues forward. There is a draft letter that I am seeking agreement from the other parties, too, before I send it to the Presiding Officer. I think that it would not be possible for me because it is still in draft and being discussed with other parties to go into any detail about it, but I think that I hope that we could have that resolved within the next few days. Neil Findlay has the letter. I think that he has said that it is okay. I am waiting to have response from others. I am sorry that the timing of this is not quite as good as it could be, but we are in a position where I think that we will be able to resolve that. I think that I probably can say that I do not think that it would be possible for us to move to a reconsideration stage, but the rest of it I want the detail to be agreed by the parties as that is what I have followed through. I understand what you are saying about cross-party engagement. What role will it be for Parliament to scrutinise your suggestion? Once I have written to the Presiding Officer, I will of course be open to questioning and scrutiny on this issue. I am happy to do so through the questions in the Parliament or to this committee again to say how I think that we should take things forward. However, I feel that I should, having done this through a cross-party basis, wait for that letter to be approved. I am not quite clear, cabinet secretary, how this committee fits into that. This committee spent a long time scrutinising and debating amendments to that bill, not late into the night by Westminster standards, but certainly late into the evening by Holyrood standards. When will this committee be told what the Scottish Government's view is about the future of that legislation? I intend, because it is a question of whether or not to take a reconsideration stage at this stage, I intend to write to the Presiding Officer to say what the Government's intention is with that bill. It is a Government bill. I will ensure that you are cited on that and the committee is cited on that when that happens. I am waiting for the agreement of the other parties to do so. I said at the very beginning that I would want the other parties to seek a common agreement, a common position. That is what I am trying to do. Any other questions on the continuity bill? I have a question about frameworks. The committee published a report on common frameworks. On Monday of last week, you will have seen it and hopefully studied it. I do not expect a full response. We will get a written response from the Government in due course, I understand, before the end of this month. There is one issue that was raised in that report that I would like to get you on the record about today, if I may. A theme that has emerged from the parliamentary scrutiny of a number of LCMs relating to so-called Brexit bills is concern about the provision of delegated powers to the UK Government to legislate in non-reserved areas currently within the competence of the European Union without seeking the consent of this Parliament. I wonder if you had any reflections on the concerns that the committee has talked about in three of its reports on that matter. Do you share those concerns? If so, how do you think that they should be addressed? I do share those concerns. I would want to look at the issue of how they would be addressed in my formal response, but I can certainly say that we do share those concerns. It is another illustration of the fact that there is an ad hoc system operating that impinges upon, in my view, the proper operation of the Scottish Parliament. I share those concerns. I would want to respond in detail and to work with the committee to resolve the issue. I think that the committee is concerned that these are issues that you have dealt with in an open and transparent way, rather than negotiated and agreed, as it were, behind closed doors by ministers and officials. That is the specific set of concerns that the committee would want to bring to the table. I agree that it is undesirable to do it that way. One of the pressures on this has been the weight of that material in the last six months because of the no-deal preparations. I agree that it is undesirable. I do not think that it is something that we would want to continue. I want to find a way to make sure that it is more transparent. I remain very keen, as we saw with the protocol between the Government and Parliament on how to handle the big increase in SIs that we have as much transparency as we possibly can. I am keen that that continues and expands. There is, for example, the issue whether or not it happens, but there could be quite a weight of Brexit-related legislation coming to this Parliament in the next three to six months. I want to make sure that that is done in a very transparent way. Some of that legislation will contain the same issue. Final question, convener. Yesterday, there was a lot of discussion, including on Twitter, of the possible recall of this Parliament during the recess. What would be the purpose of any recall of this Parliament during the forthcoming recess? I think that there would be three purposes for the recall, the first of which would be to ensure that members are updated on arrangements for no deal. Those are very serious arrangements. We would want every MSP to be aware of what they are and to be able to scrutinise those arrangements. That would be the first one. The second one would be to update the Parliament on any political issues or issues of sensitivity that have arisen during the last week, essentially, if we meet next Thursday and Friday in the light of negotiations and the implications of any ruling of the European Council. The third one, I have to say, is to do with what I think members would want. I would be surprised if most members did not want to be at the forefront of ensuring that the devolved competencies and interests are looked after and defended and scrutinising that at a time of no deal. I would be surprised if members wanted to be elsewhere when that particular moment of crisis—because it would be a moment of crisis, I mean we have been in a perpetual crisis—but it would intensify the crisis if, next Thursday and Friday, we found ourselves essentially with a no deal. That would be the purpose. All of those purposes relate to a no deal Brexit? They do. The problem with the timing of this, convener, is that we may only know whether or not that is happening on the evening of the Wednesday with the European Council. I think that it is likely that we will meet on the Thursday at the present moment, barring something happening in the next few days. That is very helpful. Thank you very much. Can I thank the witnesses for their contributions this morning? I thank all members—oh, sorry, Patrick. You want to stop? I want to stop the point. You touched, minister, at Cabinet Secretary, earlier briefly on the question of European elections. Over the last days and weeks, it has felt more hopeful that we will still be in the European Union in one shape or form for the longer term than it previously did. I know that you are not, in terms of Cabinet ministerial responsibility, directly responsible for European election planning, but is it the Scottish Government's view that we should work on the assumption that those elections will take place and are the arrangements being made at local level for the administration and organisation of those elections? I am, actually, the minister responsible for election planning. I take that responsibility on. Those elections, however, are organised by the UK as a member state, not by the Scottish electoral administrators. They administer them, but the driving force for those is the UK. If we had the ability to do ourselves, we would do ourselves, but we do not. In those circumstances, yes. There is a cut-off date. The cut-off date is the 15th. It is the 12th for the European Council, so a decision will have to be made in the next week. Unequivocally, I believe that they should happen. I would want them to happen. I think that the EU's position is that they really have to happen if things go beyond the 12th. I would hope that they would happen, and we will contest them very vigorously. I appreciate that you are not in the position to press the go button and say that we will conduct those elections, but organisations that are under devolved control, local authorities, schools and the police would be involved to some extent. Are you confident that they are working to the assumption that that may well be the case? Knowing electoral administrators, as I do, and having got to know them over the last few months—although I was a member of the Arbathnut commission on voting system things, so I have had an abnormal interest in that for a long time—I have to say that I am absolutely confident that electoral administrators will be prepared. The moment that they are told that that is going to happen, they will do so efficiently and effectively. Thank you very much. I would like to thank the witnesses for their time and contributions this morning. I thank all members as well for the tone of the questioning this morning. I think that this has been a session perhaps unusual, given the subject matter, that has shone light on the issues rather than generated heat. I am grateful to everybody for that. With that, I close this meeting of the Finance and Constitution Committee.