Mr. Michael Russell:

A Chathraiche, agus a Chomataidh, móran taing airson cuireadh a thoirt dhomh tighinn a bhruidhinn ribh an-diugh. Ann an litreachas clasaigeach na h-Èireann, tha an duan “Deirdre a’ Fàgail na h-Albann” a’ sealltainn an ceangal eadar an dà dhùthaich againn a tha a’ dol air ais córr is mìle bliadhna. San rann seo, tha Deirdre ag ràdh mu dheidhinn gleann sónraichte:

Gleann Da-Ruail, Gleann Da-Ruail,

Mo chean do gach fear dar dual,

Is binn guth cuthaige,

Air craobh chrom,

Air am binn os Gleann Da-Ruail.

I thank the Chairman and the committee for the invitation to give evidence today. As I have just said in Scottish Gaelic, a classic of Irish literature is Deirdre's Farewell to Scotland. In that work, which links the ancient cultures of our two countries, she remarks on a particular Scottish glen, in my own constituency, Glendaruel, and says of it

Glendaruadh, Glendaruadh,

My delight in every man who belongs to it.

Sweet is the voice of the cuckoo

On the bending tree,

Sweet it is above Glendaruadh.

I not only represent that glen but have lived in it for 25 years, and I represent a constituency which includes the Mull of Kintyre, the closest spot in Scotland to the island of Ireland. Therefore, I feel close in every sense and deeply honoured to be, I think, the first Scottish Minister to give evidence to a committee of this Parliament.

The Scottish Government recognises Ireland's unique position in this Brexit debate and on the wider European scene. Ireland's close links with the UK were reiterated by the Tánaiste in his speech at Chatham House last week, and its full and wholehearted membership of the EU were delineated well by the Taoiseach in the European Parliament last month. Scotland is therefore particularly pleased that Ireland is our closest international partner as it stands in a position of both great knowledge and great influence. Our countries have had strong links for generations and these links touch all of us in many different ways. For my part, I was honoured in 2013, as a member for Argyll and Bute, to welcome Ireland's President to Iona, Eilean Idhe, as part of the 1,450th celebrations of the landing of another Irishman on that island, Colum Kille. I spent a considerable part of my time when I was much younger in this city building the Celtic Media Festival, now in its 40th year, which I founded on the island of Benbecula in 1980 and which had as its first chairman Muiris Mac Conghail, then controller of RTÉ 1.

Those cultural exchanges thrive to this day. I do not need to tell the Chairman, with his deep knowledge of traditional music, that Ireland is a country of honour at this year's 25th Celtic Connections Festival which finished in Glasgow last weekend. I recall being in Kerry to give a lecture at the Blasket Centre some years ago, drawing on my own work on photographers of the Scottish islands. Our links, rooted in a shared and collaborative past, are robust. They continue to grow despite the difficult present, as is evidenced by the resources we have put into and the importance we attach to our innovation and investment hub in Dublin, led by Mr. John Webster. Such links will be of great importance for our future.

I will address the subject in hand, Brexit, and the questions of where we are, how we got here, and where are we going. The committee will no doubt be aware that Scotland voted overwhelmingly to remain in the EU. Current polls indicate that there would be an even bigger majority were the referendum to be held again today. Like our Irish neighbours, we have been placed into an unwanted situation not of our own making. There are two interconnected sets of negotiations. One is the UK-EU negotiations on the UK's exit and the other, probably less well-known to the committee, is the intra-UK negotiations on a joined-up UK approach to the key exit issues and on the implications of Brexit for the devolved settlements. We welcome that the principles of phase 1 of the negotiations were agreed in December. We have always been very careful to say and do nothing that would impede such an outcome. We are particularly mindful of the importance of ensuring that the progress to peace made in the North is not jeopardised in any way by either governmental action or careless talk. We regret the ambiguity from the UK Government on many of these matters and the constant appeasement of the hard right, ideological Brexiteers. We welcome the UK Government's guarantee that there will be no hard border in Ireland. That must be delivered and therefore we will watch with interest to see how that happens, especially after the Downing Street pronouncement on the customs union this week.

It is imperative that the UK's exit not undermine the progress we have seen over the past 20 years.

Looking ahead to phase 2, the risks associated with negative outcomes are even greater. From a Scottish perspective, we have closely analysed the potential impact. Just last month, we published Scotland's Place in Europe: People, Jobs and Investment, which presents the potential implications for Scotland's economy if the UK finally exits the EU. It sets out the cost to Scotland of exiting the EU by considering three scenarios: staying in the Single Market and customs union; reverting to WTO rules; and the middle ground of some sort of Canadian-style free trade agreement. The evidence clearly demonstrates that, in any scenario short of full EU membership, Brexit will significantly weaken the Scottish economy and result in slower economic growth and lower incomes compared with remaining in the EU. For example, we estimate that a hard, WTO rules, Brexit could lead to a loss of 8.5% of GDP in Scotland by 2030, equivalent to £2,300 per individual.

Every committee member has a copy of the document and I would be pleased to elaborate on it. It concludes that the only acceptable alternative to EU membership is membership of the Single Market and customs union, although that would also result in some economic damage. Nothing less will do, which is a conclusion that we believe the UK Government's own internal analysis has also reached. In that regard, we are in full agreement with what the Tánaiste said today in County Louth, urging the UK to stay in the Single Market and customs union. He stated: "The closest possible customs and regulatory partnership is in the best interests of everybody ... across these islands, and indeed in the best interests of the European Union and its future also."

We are committed to working with the UK Government as constructively as we can as negotiations and preparations progress. However, we have concerns around how it has managed this process to date and the impact that will have on the devolution settlement. I will address that matter briefly now.

We continue to press the UK Government to agree a means by which the Scottish Government can play a direct and representative role within the UK's negotiation with the EU. As made clear by the terms of reference of the Joint Ministerial Committee (EU Negotiations), JMC (EN), of which I am the Scottish member, all four UK governments should have oversight of the negotiations to ensure as far as possible that agreed outcomes are secured. The deeply regrettable lack of a functioning Assembly in Northern Ireland has caused difficulties, but that is no excuse for the way the JMC (EN) has functioned or, rather, failed to function.

The next phase will be significantly tougher. It is therefore essential that all governments across the UK be fully involved in the negotiations on the UK's future relationship with the EU, something that has not happened in the past. We also need to be fully engaged in agreeing on the endpoint, something that was again promised in the terms of the reference of the JMC (EN) but has not yet been delivered. This matter has been the subject of correspondence this week between the First Minister, Ms Nicola Sturgeon, and the Prime Minister.

The introduction of the European Union (Withdrawal) Bill in the UK Parliament represents a considerable problem for us, as it is clearly a power grab, reserving to Westminster responsibilities for matters currently covered by EU law in devolved areas. The Bill is the main vehicle for a legal withdrawal. Inter alia, however, it empowers UK Ministers to make changes in devolved policy areas without the involvement of the Scottish Government and Scottish Parliament. It also takes straight back to Westminster all the areas of devolved competence currently shared with Europe. Concerns about this approach are shared by all parties in the Scottish Parliament, including the Conservatives. The parties agree that the Bill is incompatible with devolution. The Welsh Government has similar concerns and worked with us to publish amendments, which would have enabled us to recommend consent to the Scottish Parliament.

Now that the Bill is in the House of Lords, in which the SNP does not participate because we believe that election is a pre-requisite for legislators, the disquiet has intensified. Lord Hope, the former distinguished Scottish judge and leader of the crossbenchers, said in the Second Reading debate on the Bill said last week: "I am astonished by this Bill's failure to respect [the devolution] settlement in its formulation of the regulation-making powers given to Ministers."

Unless there are significant changes to the Bill, we will not recommend that the Scottish Parliament should give its consent. The Welsh Government is providing the same recommendation to the Welsh Assembly. Such consent, though a constitutional convention, has never been refused in such circumstances. Discussions continue on the potential for amendments to be made, and the UK Government has expressed an intention to table amendments in the House of Lords. However, it has still not agreed to correct the key defects of the Bill or provided the wording of those amendments for agreement with the devolved administrations.

I am happy to give further information on the structures that exist and the difficulties that we are experiencing, but let me first make a couple of final points that may give us a little hope for the future.

Ireland is Scotland's sixth largest export market and there are already more than 100 Irish companies invested in Scotland. These companies employ approximately 6,300 people across the country and contribute turnover to the Scottish economy of £3 billion. During her visit to Ireland last year, our First Minister spoke of the opportunities ahead for Ireland and Scotland to move forward with a sense of shared self-interest. We believe that there is limitless potential for the economies of Ireland, the North and Scotland to become even more closely bound along what might be called a Celtic business corridor and to deepen our relationship in that way.

Just this morning, I was impressed by the ABP Food Group plant in Cahir, County Tipperary. ABP has a major plant in Perth, Scotland. The great brands of Irish and Scottish beef are building a global market together, but Brexit is a useless and unforeseen impediment to making that relationship grow and flourish.

We have much in common and much to discuss. Scotland needs to mitigate the undoubted damage that may be wrought on our economy and our society by Brexit. No matter how difficult, we need to find positive solutions. In passing, let me commend the Irish Government's approach in the matter of supporting SMEs to address the Brexit issues facing them, something that we are looking to emulate.

Brexit continues to cloud our horizon. As the UK and the EU 27 turn to phase 2 of the negotiations, Scotland not only continues to strive to establish a constructive relationship with the UK that allows us to offer compromises and to co-operate, but also wants to be heard by the 27 so that there is an understanding of our unique position, our need for differentiation and our desire, if it is at all possible, not to lose our European citizenship and the closest of links with a European ideal that has helped to deliver peace and prosperity on our Continent for half a century. In short, we must be heard, and we intend to be heard.

For those who want to drag us out of Europe against our will, their triumph can only come if there is, in the words of that great Kerry poet, Brendan Kennelly, the "Supremacy of silence". We will not be silent. Of course, we will continue to be steadfast in our support of an outcome that recognises the particular needs of this island. We will continue to forge a positive future partnership between us, recognising not just our shared interests, but also our shared identities, which will not change. Móran taing.