Yes, the weather would have to be by the TAFs - a bit like the FAA 1/2/3 rule for having to have a planned alternate when IFR.
Re the TK requirement - this statement refers NOT to the present 9-exam (PPL/IR) TK but a supposedly much reduced version, appropriate to private IFR flight. Obviously I agree that if the present TK was involved then the whole scheme would be just plain silly - you may as well get the full IR
A remaining thing I don't like is that this proposed rating will still have to be taught by professional FTOs, not by your old PPL school. This is a MAJOR issue, as IMHO the majority of UK PPLs are not within practical driving range of a commercial pilot FTO for doing a flight the same day. And if you introduce hotel residence then the whole thing becomes highly unattractive. You may as well take a cheap flight down to say Greece and do the full IR down there. A huge reason why the FAA IR has such a penetration among US pilots is that they can do it as a natural continuation of their training.
On the plus side, when I look back on my long VFR (pre-IR) trips across Europe, some of which had ~ 700nm legs out of the UK, most of them could have been done under this proposed IFR rating, and they would have benefited hugely from the enroute IFR clearance. Only on one or two did the IMC-R (which I also had) get used to get back in.
Overall, I am in two minds about what to think about this. I do think an ILS should be a part of it, otherwise how the hell do you deal with the case of a really duff TAF? I believe the Australian one has an SRA in the basic module, but SRAs are apparently extremely rare in Europe (I don't recall seeing one). One can always get vectors down to the MVA but usually the MVA is way above the VFR minima...