Published by the House of Lords common frameworks scrutiny committee, the report says Brexit has put “significant strain” on the relationships and calls for a reset in intergovernmental relations.
It urges the UK Government to use common frameworks to look at changes in the Northern Ireland Protocol and minimise divergence between NI and Britain.
The report also suggests the House of Lords should play a role in being a neutral forum for the views of the devolved legislatures to encourage co-operation.
The document raises concerns over delays to the common frameworks programme, the limited stakeholder engagement or opportunities for parliamentary scrutiny, and the lack of clarity on the relationship between the frameworks and the Northern Ireland Protocol.
On the Internal Market Act, it says it could constrain the ability of the devolved administrations to regulate effectively in areas of devolved competence.
Baroness Andrews, chair of the common frameworks scrutiny committee, said: “Common frameworks are a crucial legacy of leaving the EU that has too often been overlooked.
“They create the processes necessary for day-to-day co-operation across the UK in areas such as food safety, farming and the environment.
“During the committee’s inquiry, we found widespread support for common frameworks across sectors and in every part of the UK.
“However, the UK Internal Market Act has clearly damaged relations with the devolved administrations and could severely compromise the common frameworks programme.
“We also have concerns about transparency and how the frameworks will relate to the Northern Ireland Protocol.
“While the relationships between the UK Government and devolved administrations are acknowledged to be severely strained, we believe that the collaborative approach of common frameworks should be used as a model to reset UK intergovernmental relations and build a co-operative Union.”
Last week in a joint statement, Scottish Government trade minister Ivan McKee, Northern Ireland’s finance minister Conor Murphy and Welsh finance minister Rebecca Evans criticised the UK Government for using powers under the new Internal Market Bill to “bypass us completely”.
The UK Government has been accused of using new powers implemented since Brexit to take control of money that would otherwise have been passed to devolved nations.