EU Exit: Devolved Governments

Thursday 21st July 2016 Westminster Hall

00:00

[Ian Murray (Edinburgh South) (Lab)]

I beg to move,

That this House has considered devolved governments and negotiations on the UK leaving the EU.

It is a great pleasure to serve under your chairmanship, Mr Bailey. One of the great privileges of being back on the Back Benches is that I can not only participate in these debates, but apply for them. I am grateful to the House for allowing me this debate. It follows on the back of early-day motion 325. One of the other unenviable privileges of being on the Back Benches is that I can now table early-day motions. I hope that all Members will sign my EDM once they have heard this debate.

Normally, I would say it is a great pleasure to hold this debate, but in many ways I would rather we were not. The repercussions of our vote to leave the EU will be profound and far-reaching in Scotland and across the United Kingdom and the European continent as a whole. We are already beginning to see the impact on our economy. The value of sterling has fallen against the euro, the dollar and most other international currencies, and remains highly volatile. Many businesses have predicted that Brexit will have a negative impact on their fortunes. The International Monetary Fund has revised down its forecasts for UK growth and said that Brexit risks throwing

“a spanner in the works”

of the global economy. Those of us who campaigned to remain in the EU warned of those obvious consequences and others as a probable outcome of our vote to leave. What was dismissed as “Project Fear” by many, we are now seeing as “Project Fact”, emphasised by today’s survey of German businesses, which concluded that 56% of them would want a hard bargain when negotiating with the UK.

We have to deal with what is in front of us and get the best possible solution for the UK and, for the purposes of this debate and my responsibilities, for Scotland. The evidence suggests that support for leaving was strongest in the most deprived areas of our country. I witnessed that myself at the Glasgow counting centre. In my constituency, the more affluent the area, the larger the remain vote. We have a responsibility and a duty as politicians to reach out to those who voted leave to strive to understand why and to respond to their concerns. I suspect that increasingly they feel that they have no stake in society. In general terms, although this is not necessarily always true, these are communities where the ravages of deindustrialisation have hit the hardest and where the economic recession has bitten deepest.

In many ways, there are pronounced similarities with the Scottish independence referendum in 2014, where some of the most deprived communities in Scotland voted to leave the UK. They also felt disillusioned and disfranchised in large numbers. Many of them had not cast a vote in many years, if at all. There is a clear problem for us to address, and we must find an amicable solution that reconnects communities to the political process and proves that politics can and will be a power for good in their lives. We must not let the Conservative Government or the Scottish Government—or any Government, for that matter—abdicate their responsibilities and abandon those who need help the most.

Immigration is an issue that came to dominate the EU referendum debate, and that concern must be addressed, but is immigration the true cause of the deep dissatisfaction felt in communities, or is it other things? There are six years of public sector austerity, the lack of a proper house building strategy, the failure to recruit adequate numbers of GPs, a dearth of well-paid, progressive, highly skilled work and crushing pressure on schools and hospitals. Those are failures not of the EU, but of national Governments north and south of the border. As such, they can all be resolved by a sea change in UK and Scottish Government policy. We should not allow the UK Government in particular to hide behind the EU over those public policy failures.

[Ian Blackford (Ross, Skye and Lochaber) (SNP)]

We in Scotland have a demographic challenge that can only be aided by people coming to live and work in Scotland, and we need to encourage people to do so, perhaps with the post-study work visa, and there are EU citizens who still wish to come. We need to talk about how immigration enriches us and not demonise those who wish to come here to live, work and make a contribution to our society.

[Ian Murray]

That is precisely my point: immigration enriches society. Politicians have to be much braver about making the positive case for immigration. The arguments are not mutually exclusive; they all have to be set alongside the fact that if we have an influx of people, whether through migration or for other purposes such as work, public policy has to respond. The previous Labour Government had the migrant impacts fund, which was precisely that kind of response for local communities in need of additional resources to deal with the impact of the movement of people, whether immigrants or otherwise. That was scrapped in 2010 by the Tory Government, and we should look seriously at bringing it back. None of these issues is mutually exclusive, and I absolutely agree with the hon. Gentleman. He was not only wonderful at intervening, but has successfully made me lose my place. I will get used to being back on the Back Benches shortly.

I was saying that we should reassure those who voted to leave and those who voted to remain that we are listening to them by demonstrating not just through speeches, but by our actions, that we are firmly on the side of everyone who voted in the EU referendum. In doing so, our first priority—it is a priority that needs to serve the interests of people across the entire country—should be to secure the best deal possible in the Brexit negotiations. That means adopting a negotiating stance that takes into account all views: those of people who voted to leave and those of people who voted to remain. The building blocks for the negotiations must be what we want to retain from the European Union.

As Scottish Labour’s Westminster spokesperson, my focus today is obviously on Scotland, but I am sure many people from the other devolved Administrations, such as Northern Ireland, which voted to remain, and Wales, which voted to leave—my hon. Friend the Member for Llanelli (Nia Griffith) is here—will have their say in the negotiations. I am sure Members from Wales and Northern Ireland will make those points.

Let us reflect on the vote in Scotland for a moment. Some 62% voted to remain, and 38% voted to leave. In my constituency, 78% voted to remain. I assume that was in no small part due to the contribution of the significant financial services sector to the economy in Edinburgh, the large number of businesses that export and the world-class universities that rely on EU funding for some of their world-leading research. Those factors all have to be taken into account as we set out our negotiating stance, so I will go through Labour’s priorities and principles.

[Hannah Bardell (Livingston) (SNP)]

The hon. Gentleman mentions his voters and the financial sector in Edinburgh. Does he accept that Scotland remaining within the EU would provide an opportunity for businesses to look north to Scotland, particularly in the financial sector? For those who are considering leaving London, there is an opportunity for his constituents, for Edinburgh, other cities in Scotland and Scotland overall.

[Ian Murray]

When I conclude my remarks, I will say that we should be looking at this as an opportunity, not only for Scotland, but for the whole United Kingdom. We are where we are. We need to ensure that the Government’s negotiations reflect what has happened, not only in Scotland but across the component parts of the UK, and make those arguments. I hope the financial services sector in the UK and in particular in Edinburgh reflects on where we are and makes those decisions accordingly. The uncertainty brought about by the decision to leave the EU is similar to the uncertainty that comes from any constitutional change that we have to deal with. I am delighted that the hon. Lady intervened, because she gave me an opportunity to mark my paper when I sat down. I am getting the hang of it.

I will go through the founding principles from which everything else in these negotiations should flow. We must be mindful of respecting and upholding the will of the Scottish people, not just in this referendum, but in the 2014 independence referendum. Those results have shown that Scots wish to remain part of the United Kingdom and retain the advantages of European Union membership. I understand that that is not a particularly easy thing to achieve, but they should be the founding principles of what we want to achieve in these negotiations. That is Labour’s starting point and forms the basis of what we believe should be Scotland’s negotiating platform.

That platform is informed by an excellent and aptly named paper written by Professor Jim Gallagher of Nuffield College, Oxford, entitled “The Brexit shambles: charting a path through the rubble.” Hon. Members can probably guess from the title where he is coming from on the issue. The paper identifies and delineates four priorities that should guide the Scottish and UK Governments—I have added one to make it five, because it does not mention the role of EU nationals and it is important to put that on the record as well.

As matters stand today, Scotland belongs to two Unions and gets significant advantages from both. The people of Scotland recognise that and have recently voted overwhelmingly for both Unions to be continued. The result of the referendums should be respected, but instead, they are being ignored. The political context in Scotland at the moment is that the Conservatives want Scotland in the UK but out of the EU, and the Scottish National party wants Scotland in the EU but out of the UK. Only the Scottish Labour party is clear that we want Scotland to remain in the EU and in the UK. The UK and Scottish Governments have an obligation to pursue every avenue in pursuit of that outcome, and to facilitate that, we should look at the priorities that should be put in place. Scotland’s first priority should be to urge the UK Government to accept a Norway-type option, if I can use that terminology.

[Stewart Malcolm McDonald (Glasgow South) (SNP)]

I am very grateful to the hon. Gentleman for giving way—he is a decent man. He said that he does not want to see referendum results ignored but went on to state that Scottish Labour’s position is to keep Scotland in the UK and the UK in the EU. Given that that is not what people voted for across the UK, does he perhaps consider that his party is behind the curve on the issue?

[Ian Murray]

When giving way, I should have asked the hon. Gentleman whether he would sign my early-day motion—he probably will not, given its content. If he had been listening properly, he would have heard me say that what the people of Scotland have voted for in the two referendums is a position where Scotland is in the UK and retains the advantages of being in the EU. I did not say that the UK will remain in both, because that is quite obviously not so.

[Hannah Bardell]

rose—

[Ian Murray]

I will give way to the hon. Lady if she confirms whether she will sign my early-day motion.

[Hannah Bardell]

I will need to read the hon. Gentleman’s early-day motion before I make a decision; it would not be appropriate to make a comment either way without prior knowledge. I have a brief point. Does he not recognise that many people in Scotland voted for independence on the basis that his party and other UK parties said that the only way to retain Scotland’s place within the EU was to vote against independence?

[Ian Murray]

I am sure that you will rule me out of order, Mr Bailey, if we rehearse the well-trodden paths of the arguments about the Scottish referendum. If the hon. Lady does not mind, I will touch on some of them as we go through my contribution. Knowing the time, that it is the last day of term and that everyone is desperate to head to the shores of Spain—without a visa—to enjoy the sunshine with their families, I will get on to that as we go through.

The first priority—the Norway-type option that I referred to—is that we would have membership of the European economic area. UK, and hence Scottish, membership of the EEA would mean maintaining much of the same conditions of trade and freedom of movement as currently exist. I am not sure whether the Government’s position in the negotiations is to maintain the free movement of people, but the Norway-style option would allow that to continue. It is worth putting in context why that is important.

The value of Scotland’s unfettered access to the EU single market is well established. The Scottish Government’s figures value Scottish exports to EU member states at around £12 billion annually, but it is worth reflecting on similar figures that show Scottish exports to the rest of the UK, which is why this is such an important debate. Those exports are worth four times that amount at £49 billion a year, which is why I think that the Scottish people have voted twice to stay with the advantages of being in both Unions. It makes scant economic sense to prioritise the EU market over the UK market. In this debate, it cannot be an either/or—we should strive to maintain full access to both.

UK membership of the EEA would allow Scotland to continue to trade undisrupted with both the EU and the UK. If that becomes impossible, a separate trading deal would have to be negotiated and nobody knows what that would look like. The other option at the other end of the spectrum, which I think unpalatable, would be to abide by World Trade Organisation rules. That would have significant impact on UK and Scottish trading capacity.

The second priority should be to protect Scotland’s public services and public spending by securing a continued fiscal and political union with the UK. These are the building blocks for the negotiations. The Scottish Government attach huge importance to the fiscal relationship with the UK; in his own words, the former Finance Secretary strained “every sinew” to protect it during the negotiations on the fiscal framework underpinning the Scotland Act 2016. The Scottish Government’s accounts and independent analysis show that Scotland is carrying a substantial budget deficit. It is incredibly important that Scotland’s position in the UK is maintained through the block grant and the Barnett formula.

Without those mechanisms, the Scottish Government would have to undertake dramatic spending cuts or increase taxes to balance the books, based on their current annual accounts. That point was reflected on by the hon. Member for East Lothian (George Kerevan), the SNP’s representative on the Treasury Committee, who said that not having those fiscal transfers would be incredibly difficult—I think that the word he used was “catastrophic”—for Scottish public services.

The third priority is the protection of Scotland’s currency union with the rest of the UK. Many of these arguments were covered in 2014, as we have just discussed in the intervention by the hon. Member for Livingston (Hannah Bardell), but it is worth revisiting them in this context, because it is incredibly important for the debate on how the negotiations with the EU proceed. If the first principle is to ensure that Scotland remains in the UK and with the benefits of the EU, we know that the euro is a non-starter, so that should come off the table—we owe the former Prime Minister and Chancellor Gordon Brown a debt of gratitude for keeping us out of that—but what of the other currency options that may be available? We know that the best available currency option at the moment is the current settlement. As part of the Scottish and UK Governments’ Brexit negotiations with the EU, we must make sure that Scotland’s position in the UK is protected, because Scotland’s fiscal and economic union with the rest of the UK is beneficial for the currency argument. I am conscious of the time, so I will not go through the currency arguments, but they are all on the record. The preferred arrangement in terms of Scotland’s fiscal, currency and economic position is the current arrangements, and the negotiations must underpin that point and reject all other arrangements.

I will quickly skirt through the fourth priority, which is to explore all options for Scotland’s future relationship with the EU. If we view this positively, it could turn the Brexit negotiations on their head, transforming a vexatious trial into an unprecedented opportunity. The hon. Lady mentioned that earlier. No one has ever suggested that the EU is a tremendous success and there are elements that Scotland may wish to relinquish. Equally, there are parts that Scotland may wish to retain. One aspect of the Brexit debate rarely mentioned is that it will greatly empower the Scottish Parliament. Many of the competencies, such as control over fisheries, agriculture, university research funding and environmental policy, will transfer directly to the Holyrood Parliament.

[Hannah Bardell]

I am grateful to the hon. Gentleman for being so generous; I promise this will be the last intervention. He makes the point about the EU not being perfect. Does he accept that, with a seat at the top table, Scotland could have a greater voice and influence in reforming the EU as an independent country within the European Union?

[Ian Murray]

That flies in the face of the arguments of economic, currency and political union with the United Kingdom; that is essentially Scotland turning its back on a much more successful Union, to be part of the European Union. What people have said quite clearly is that they want Scotland to be part of the UK and part of the EU. If where we want to get to in the negotiations is an independent Scotland—I am sure that it is for the hon. Lady; if it was not, I would be incredibly surprised—the journey and the pathway to get there are slightly different from the pathway and journey towards an outcome that keeps the UK together and keeps Scotland with many of its current advantages within the UK as a member state of the EU. That should be the genesis of the negotiations. I appreciate that the Labour party perspective and the Scottish National party perspective on the outcome of that journey are different, but my contention is that it has to be about keeping both Unions together.

Michael Keating recently observed that, given the new powers that will fall within the competence of the Scottish Parliament, the Scottish Government could choose to align themselves with the EU and the directives that currently exist, rather than the UK, and that they can have either an informal or a formal relationship. The key thing is that there will be new and interesting opportunities. For example, the responsibility for delivering air quality lies with the Scottish Parliament but falls under the EU directive. The inter-governmental working between the UK and Scottish Governments means that the English and Welsh policy and the Scottish policy to deliver that directive can be different, but they are under the same umbrella. Strong inter-governmental working will be needed to ensure that example and many others are delivered across the UK.

Lord Falconer, the former Secretary of State for Constitutional Affairs, commissioned a piece of work in the other place to set out options for a federalised membership structure. Many people say that that is impossible to achieve, but we are in uncharted territory and everything should be on the table when we examine the possibilities for protecting the component parts of the UK and the advantages they get from membership of the EU.

The fifth and final principle that should guide these negotiations, particularly from a devolved perspective, is that we must protect the rights of EU nationals who live, work and contribute to the UK. Conversely, we must protect the right of UK nationals to work, study and live in other EU countries.

The UK’s political landscape is changing rather rapidly. A week is certainly a long time in politics these days. Brexit is perhaps the reckoning that the political system has been needing for a long time. It enables us to readdress where we are in the political landscape and think about how we respond to the big issues for communities. There is no doubt that the basic things that people took for granted—a job, a decent wage, a home of their own, a secure pension in old age and the idea that the next generation will do equally well if not better than the current generation—are increasingly becoming unattainable. Whether that is fact or perception, it is what people tell us. They are working harder and doing the right thing, but they are not receiving the benefits. I think that is the genesis of why the UK voted to leave. That is a failure not of the EU but of national Government.

Let us reflect on where we are. I would like the Minister to address some of these issues. The principle that the UK should come out of the EU but Scotland should stay in the UK and retain many of the advantages of being in the EU should guide the Government’s negotiations with the devolved Administrations and the EU. The Minister has the opportunity to set out the UK Government’s position on the devolved nations and Administrations today and be clear that the Brexit negotiations will protect their interests. He should reaffirm that the UK Government will recognise that Scotland voted to be in the UK and to keep the advantages of the EU. Those will be the foundation stones and building blocks for the negotiations. If we are optimistic about this, and if we all want the same journey and outcome, those should be the conclusions that we seek.

The former leader of the Labour party, my right hon. Friend the Member for Doncaster North (Edward Miliband), said last week in his Tony Benn memorial lecture:

“This can be a progressive moment. In any case, there is no point in the left sinking into gloom. The only answer is to rise to the challenge. The optimists have always been the people we need at times of greatest adversity. Today we need them more than ever.”

I hope the Minister is indeed an optimist and will respond positively to this debate.

[Several hon. Members rose—]

[Mr Adrian Bailey (in the Chair)]

Order. I should make it clear that I intend the Front-Bench contributions from the SNP, Labour and the Government to start at 2.30 pm. I will give the Front Benchers 10 minutes each, and I would be grateful if they were flexible, so that the hon. Member for Edinburgh South (Ian Murray) has time to sum up briefly at the end. It would be helpful if speakers confined their remarks to a maximum of eight or nine minutes; otherwise, I shall start getting rather agitated.

13:55

[Ian Blackford (Ross, Skye and Lochaber) (SNP)]

It is a pleasure to serve under your chairmanship for the first time, Mr Bailey. I congratulate the hon. Member for Edinburgh South (Ian Murray). It is a pleasure to see him on the Back Benches, and it is always a considerable pleasure to listen to his erudite exposition. There is much in what he said that I can agree with; there are some parts that, as he will understand, I would not. I would describe it as a bit of a curate’s egg. I hope he will take that in the spirit in which it is intended.

[Ian Murray]

Pot, kettle, black.

[Ian Blackford]

You will get your chance later.

On 28 June, the First Minister of Scotland secured a mandate from the Scottish Parliament to seek to secure options for protecting Scotland’s relationship with the EU. I am glad to say that it was supported not only by the Scottish National party, but by the Labour party, the Greens and the Lib Dems, working in consensus for Scotland’s interests. Scotland’s Parliament came together to affirm its view on Scotland’s place within Europe.

We in the SNP argued ahead of the referendum that we should not be dragged out of Europe against our will. In the referendum, Scotland voted to remain in. Although England voted for Brexit, 62% of those who voted in Scotland voted to remain within the EU. We proclaimed our historic position as a European nation and our belief that our country is part of a wider family of nations.

Prior to the Act of Union in 1707, Scotland had for centuries established strong trading links with much of Europe, particularly northern Europe—the low countries, France, Germany, the Baltics and Poland, to name but a few. The Dutch town of Veere was essentially a Scottish trading port in the Netherlands. The Dutch conferred rights to Scotland, from a diplomatic point of view, in Veere. It was a two-way street. There was a significant European influence on Scotland. A walk through many Scottish towns, particularly on the east coast, shows the important influence of European architecture on our towns and cities. Dutch gable ends, for example, are prevalent in many parts of Scotland.

The point is that Scotland has long been at peace with itself as a European nation, predating the European Union by centuries. It is little wonder that many of us proudly define ourselves as Scottish and European. Alyn Smith MEP, speaking in the European Parliament, said this to Europe:

“please remember this: Scotland did not let you down. Please, I beg you…do not let Scotland down now.”

When we woke up on the morning of 24 June to find that the Brexiters had won in England, we recognised that there was a real threat that Scotland could be dragged out of the EU against its will. That is why it is important that we are having this debate on the issue of devolved Governments and the negotiations on leaving the EU. There must be respect for Scotland’s position of having voted to remain. For us, remain means remain.

We often hear about parliamentary sovereignty. I am minded of the words of Lord Cooper’s judgment in the Court of Session in the case of MacCormick v. Lord Advocate. He said that

“the principle of unlimited sovereignty of parliament is a distinctly English principle and has no counterpoint in Scottish Constitutional Law.”

We hold to the principle that the Scottish people are sovereign. If that is the case, we cannot be dragged out of Europe against our will. The people of Scotland have spoken. The people are sovereign, and the UK Government must recognise that legitimate position in their deliberations and negotiations on Brexit. The UK might be leaving, but Scotland’s future remains as a European nation.

In the days after the referendum, there was a failure of leadership in the UK Government, who sought to come to terms with the circumstances they had created. I was proud that on 24 June, when we were looking for leadership, it was our First Minister, Nicola Sturgeon, who spoke for many when she said:

“Yesterday, Scotland—like London and Northern Ireland—voted overwhelmingly to remain in the EU. We voted to protect our place in the world’s biggest single market—and the jobs and investment that depend on it. We voted to safeguard our freedom to travel, live, work and study in other European countries. And we voted to renew our reputation as an outward-looking, open and inclusive country.

Indeed, I want to take the opportunity this morning to speak directly to citizens of other EU countries living here in Scotland—you remain welcome here. Scotland is your home and your contribution is valued.”

Nicola went on to say:

“I want to make it absolutely clear that I intend to take all possible steps and explore all options to give effect to how people in Scotland voted—in other words, to secure our continuing place in the EU and in the single market in particular. We will also be seeking direct discussions with the EU institutions and its member states.”

Nicola was speaking for so many of us and, crucially, to the 173,000 citizens of Scotland who come from the EU—our friends, our colleagues and our neighbours, now fearful of their rights to remain living in our country, their country.

The Prime Minister has still failed to guarantee the rights of all EU citizens living here, with the suggestion that their rights will be used as a bargaining counter. What kind of society are we when we allow that level of fear to lay on the heads of many of our people, living in our country? It is immoral, wrong and something that the Government should deal with immediately, by protecting the rights of all EU citizens living not only in Scotland, but throughout the UK.

That message about exploring all options to give effect to how people voted in Scotland, to secure our place in the EU, has broad all-party and non-party support. What steps will the Minister take to reflect the votes and wishes of the Scottish people? Will he recognise the sovereignty of the Scottish people, and that we cannot be dragged out of the EU against our will? What will he do to recognise our rights? Will he agree to the Scottish Government, on behalf of the Parliament and people of Scotland, being given a full and formal role in negotiations on the UK’s future relationship with the EU?

We are often told that our position within the Union is one where we are respected. I say to the Minister: how are we to judge this? Actions speak louder than words. He should show us that his Government are respectful and will give the Scottish Government their rightful place. It is crucial that the Scottish Government are not only consulted, but at the table when negotiations are ongoing, to ensure that the voice of the Scottish people is heard.

We have been put in a position where our vital interests—businesses, jobs, universities, freedom to travel, workers’ rights and much else besides—are all at risk. A Conservative Government have put us into that position, so the onus is now on them to prove that our interests can be protected within the UK, because the fact is that the EU referendum has placed a big question mark over that.

The hon. Member for Edinburgh South spoke about the existing fiscal position, but the critical point about the fiscal position is that what we have today is a legacy of the UK Government. The fact that we want independence, ultimately, is not because Scotland is such a success story within the UK; it is because we know we can do much better. A crucial difference post-23 June is that one of the consequences of retaining our place in Europe is that Scotland becomes a destination. It is about us fulfilling our potential, creating opportunities for jobs and investment, growing the Scottish economy and, therefore, creating the tax revenues that will allow us to deliver on the social policies that we want. It is about a new Scotland, with its own place in the world—a bright, bold and optimistic Scotland, which is at peace with itself. That is what we seek to deliver.

The Scottish Government are committed to maintaining Scotland’s reputation as an outward-looking, open and inclusive country. We will look at all options to protect Scotland’s place in the EU. Today, independence is not the only option on the table. Our guiding principle in all our actions is to protect Scotland’s interests and our place in the EU. We will work with all parties to achieve that—I extend the hand of friendship to my hon. Friend the Member for Edinburgh South, if I may call him that, and to others, because we must ensure collectively that Scotland’s place is protected.

If it becomes clear that Scottish independence is the best and only way to achieve that, then it is an option that Scotland has to have. The Scottish Parliament must be fully involved in that consideration, and it is not something to be hurried. However, if the Scottish Parliament judges that a referendum on independence is now the best option to secure Scotland’s continued place in Europe, the Scottish Government have a duty to act. Will the Minister give a commitment today that if the Scottish Parliament calls for a referendum on Scottish independence, the UK Government will respect it? That is a simple question, which requires a simple answer. Do the UK Government accept that it is for the Scottish people to determine their own destiny?

The First Minister confirmed that the Scottish Government will now begin to prepare the legislation required to allow a referendum to take place if and when the Scottish Parliament so decides. The context for a second independence referendum is very different from that in 2014. A second referendum would not be a re-run of 2014, and it would be fought on entirely different grounds. The UK that we voted to stay in in 2014 no longer exists. Independence could be the best option to provide security for our economy and society, and to keep Scotland in the EU. It would be about preserving the status quo—independence would not be about Scotland wanting to leave, but about wanting to stay with what we have.

The Scottish Government are focused utterly on protecting Scotland’s interests and on doing all they can to ensure that Scotland remains in the EU. We consider that the process to exit the EU requires Holyrood’s consent and we cannot foresee circumstances in which the Scottish Parliament would give that without the guarantees that we asked for. Our focus is on protecting Scotland’s interests and remaining in the EU, not on frustrating England’s will to leave—it would be for Westminster to deal with the consequences of that situation. For us, remain means remain. We must not, we cannot and we will not be dragged out of Europe against our will. Westminster must respect the people of Scotland.

14:06

[Nia Griffith (Llanelli) (Lab)]

I welcome the Minister to his place, in particular because of his knowledge of devolution in Wales and because he was a remain campaigner. I very much hope that he will be successful in the Brexit negotiations, because a successful outcome matters to all of us.

The Prime Minister and her predecessor have made it clear that devolved Administrations should be fully involved in negotiations as part of the UK team. That is happening at an official level, but the commitment must remain when things move into the next phase, beyond the initial consultation. There needs to be a real recognition that in certain areas—in particular, agriculture and fisheries for example—there is no UK position. Those matters are devolved entirely, which heightens the need for the Welsh Government to be at the top table.

Access to the single market is absolutely vital for Welsh business. Welsh exports are worth some £5 billion a year, and we have a trade surplus with the EU, unlike the UK as a whole. It is vital that everything is done to keep that marketplace open for us, because some 200,000 jobs in Wales are in effect dependent on that export market for Welsh business, industry and agriculture. Anyone looking to set up a business in Wales must have reassurances about what sort of access they will have to the single market.

We are not talking only about local people setting up businesses in Wales; people from other EU regions do so too. We already have some 500 companies based in Wales that are from other areas of the EU, creating jobs and opportunities for Welsh businesses. They need some immediate reassurance about their situation and what it is likely to look like in the future. We have had statements from the big companies, such as Tata and Airbus, about the challenge that Brexit will pose for them. They will need as much reassurance as possible to stop them pulling out. We want to ensure ease of trade and competitive conditions for them to operate in the UK.

Let me turn to agriculture, on which we have our own devolved policy in Wales, as I have mentioned. Overall, the EU accounts for 40% of exports from Wales, but the figure for agriculture is far higher. The EU accounts for 93% of the lamb that we export, 35% of sheep, 92% of beef and 98% of dairy products—all going to the EU. Those Welsh beef exports are worth £52 million and the Welsh lamb exports £122 million. As I understand it, the EU imposes an average tariff of some 14% on agricultural imports from non-EU countries, with higher rates for individual items. I have even heard of rates of between 58% and 70% on beef products. It is essential that Wales is at the top table and we get the best deal we can for the continued export of our agricultural produce. We all accept that the common agricultural policy needs reform, but we must ensure that we support farmers—particularly those in the so-called areas of natural constraint, which are more challenging to farm.

Before the referendum, Brexit campaigners promised that Wales would not lose out. The Minister for Farming, the hon. Member for Camborne and Redruth (George Eustice), said:

“If we vote to leave on 23 June, the UK government will continue to give Welsh farmers and the environment at least as much support as they get now.”

But the new Environment Secretary said during the referendum debate:

“It would make so much more sense if those with the big fields do the sheep, and those with the hill farms do the butterflies. That would make a lot more sense for the UK and it’s perfectly possible but only if we leave the EU and sort it out for ourselves.”

Although we take conservation seriously and have an excellent record on that, I really do not want Wales to be reduced to one great big butterfly park, because active, vibrant farms are the lifeblood of our rural communities. It is essential that the Environment Secretary clarifies her position on these issues and the Welsh Government are right there at the negotiating table, finding out exactly what that statement means. I really hope that the Minister will ensure that support for Welsh farmers will continue.

To turn to other areas of EU funding, Wales benefits enormously from the European regional development fund and its vital expenditure on upskilling and infrastructure projects, particularly in the valleys and west Wales. Again, we want to ensure that Wales does not lose out in any way. I am particularly concerned, because in response to my question during Welsh questions last week, the Secretary of State for Wales implied that there would be a complete rethink of that funding. He said that

“simply replacing what are currently EU funds with another source from Westminster misses the point: the EU referendum sent out a number of messages, and those areas that receive most EU funds were the areas, sadly, that voted most strongly to leave the EU. We need to look at models of regional aid in a different way.”—[Official Report, 13 July 2016; Vol. 613, c. 278.]

I am really quite puzzled about what he meant by that. Did he mean that he is thinking of cutting the money that goes to the poorest areas of our country?

That £600 million comes to Wales through a needs-based formula. Remember that the Holtham commission said that the Barnett floor was only a temporary measure and funding for Wales needed to move to a much more needs-based formula. Will we lose even the part of our funding that is already needs-based? As I say, the Secretary of State is not giving any reassurances on that. We need to know exactly where we stand, and it is extremely important for the Welsh Government to be at the table.

I know that other Members want to speak, but I want briefly to mention our universities. Because of the differences in funding for universities in Wales, significant decisions are being made. We want to have collaboration, as we can do 10 times more when we work together, and I hope that many cross-border projects will be able to continue.

I would like to say a quick word about EU nationals. Health policy is devolved to Wales, and we are extremely dependent on EU nationals and extra-EU nationals coming to work in Wales—particularly in rural areas, because many of our specialist staff like to stay near the big centres, where they perhaps feel that they have better promotion prospects. Those EU nationals need certainty. We have had two messages: the message that people from the EU would be able to stay was quickly followed up with the message that, “We are not quite sure whether they can.” We do not want them to hop off and apply for jobs back in their home countries because they do not have the security of knowing that they can stay and settle in Wales. We need that certainty urgently, and we also need guidance on what will happen in future. There have been delays in the past—visas have not been available for doctors from outside the EU—and we need to know what will happen with EU nationals. Will there be a fast-track system, and how will that work? Another related but different area is the slaughterhouses and meat-packing factories, which are largely staffed by EU nationals. We need to know what their position is and how that can be taken forward.

No contribution of mine on Wales would be complete without a word on steel. We must make it really desirable for any investor in steel to be in the UK, and that will be so much harder now. There can be no excuses now about the EU causing delays. The Government have to act on energy prices, keeping out Chinese imports and ensuring that the conditions are absolutely right for our steel industry to stay here. For all those reasons, I want the Welsh Government to be fully involved in all the Brexit negotiations.

14:15

[Alistair Burt (North East Bedfordshire) (Con)]

It is a pleasure to serve under your chairmanship, Mr Bailey. I congratulate the hon. Member for Edinburgh South (Ian Murray) on securing the debate; it is a real pleasure to see the Under-Secretary of State for Exiting the European Union, my hon. Friend the Member for Worcester (Mr Walker) in his place. It is 33 years since I was secretary to the Back-Bench energy committee when his father was Energy Secretary—that was my first official position here—and it is a great pleasure for many of us that my hon. Friend is in his place.

I make no secret of the fact that I am a reluctant Brexiteer. I am not even sure whether I can acually be classed as that. I campaigned to remain in the EU and I am very disappointed with the result, but like all of us here, I am a democrat and—to use those wonderful words—we are where we are. As we have heard today, the referendum result is clouded, because it has raised so many more questions than have been settled. I am also here because I am British—mother from Dundee, father from Fife; I am classic British.

Although some of the questions that hon. Members have raised will be settled in relation to their own territories, how they are settled does concern Westminster. Over the years, I have been as much a plumber here, interested in the mechanics of how things work and how questions are settled, as I have been concerned with the results themselves. There are some questions that will not be for us to settle, but ensuring that in this process Westminster speaks clearly, effectively and fairly with the devolved Administrations will be really important. The bulk of my remarks relate as much as anything else to that process and how we get it right.

The hon. Member for Edinburgh South focused rightly on the key issue in relation to Scotland—its vote to remain in the EU and how that is to be taken into account—but the exchange between him and the hon. Member for Ross, Skye and Lochaber (Ian Blackford) makes it clear that the Minister will have to give us some idea over time of how the conundrum of the Scottish position, with the issues that have been raised in relation to independence, will be taken into account by Westminster in the negotiations.

There are clearly regional distinctions in how matters affect different parts of the UK. The hon. Member for Llanelli (Nia Griffith) spoke about the issues affecting Wales, including agriculture and the balance of exports. Scotland has its own sectoral interests, which are powerfully important. Will that in any way dictate the order in which the United Kingdom tries to deal with trade negotiations, for example? Some countries are more important to some parts of the UK than others. Will there be an order of preference for trade negotiations? We already know that we have a shortage of negotiators. As we start to get more, will all the countries that we are seeking trade deals with be dealt with at the same time and under the same conditions, or will some be seen as more important than others because of their importance to different parts of the UK? If so, precisely how will that be handled?

It would seem that there was no comprehensive planning for how to deal with that by either those who advocated a leave vote or the Government. Is that true? Was there more planning than we were made aware of? There has been no manifesto setting out quite what model we are after and what model will suit not just England but the different devolved Administrations. Will it be the Norwegian model, or will it be the more bilateral Swiss model? Will the World Trade Organisation model benefit certain parts of the UK? If so, how will we all handle that?

As the hon. Member for Ross, Skye and Lochaber and I think also the hon. Member for Edinburgh South mentioned, immigration is seen differently in Scotland from in England because of the numbers and the ways in which people have moved. Again, if we are to negotiate in relation to trade deals, and trade deals vis-à-vis free movement, will that be handled differently in relation to Scotland, Northern Ireland and Wales than it will be in England? If so, what is the mechanism for doing that?

What about the repeal of some legislation on the back of our EU negotiations? It was said during the course of the debates on leaving that some social legislation, perhaps affecting health and safety, and workers regulations would come into the negotiations. Really? Surely Parliament has a say on that. Can negotiations on that be conducted before Parliament has had a voice or even a vote on those matters, or are they to be conducted and then brought to Parliament for some sort of endorsement? If so, what happens if Parliament, which at the last count was weighted rather against leaving, does not feel that that base of negotiation is actually in the best interests of all the British people? How is the process to be managed?

I will not dwell on that because time is short, but there are other sectoral issues to consider, such as manufacturing, which affects all of us. One of the phrases most commonly picked out during the debate was from Patrick Minford, who said, in effect, that the consequence of leaving would be that manufacturing would be all but eliminated,

“But this shouldn’t scare us”.

I suspect some people might well be scared of that. How is that to be taken into account in the negotiations?

The key for me is that all the options require detailed parliamentary scrutiny, certainly from a Select Committee, and possibly a measure of parliamentary action in terms of votes and legislation. Do we have any commonality among ourselves about how that will be taken forward and what the process will be? We need to start there.

I spent some years in the Minister’s position, so I will not say “Can the Minister answer this?” and “Can the Minister answer that?” because he cannot answer all the questions asked in the debate at present. However, the debate has been a very valuable first step, and I hope it is helpful to know that even though some of us are not physically located in the devolved Administration areas, we care very much about how the process is handled by Westminster as a whole. We are just as interested in the outcomes, and I want to ensure that the Westminster mechanism fairly and effectively covers all the ground that needs to be covered. I am sure the Minister has that in mind. If he cares to venture any answers to some of the questions I have raised, I will be pleased, but I suspect that some of the answers will come out over time.

[Mr Adrian Bailey (in the Chair)]

I would not normally allow a person who was not here at the beginning to participate in the debate, but as Mr Fitzpatrick did submit an application to speak and I know he was participating in a debate in the Chamber, I will give him a maximum of five minutes to contribute. I want to give as much time as I can to the Front-Bench spokespersons.

14:22

[Jim Fitzpatrick (Poplar and Limehouse) (Lab)]

I hope I can stay inside that time and leave a few minutes for the hon. Member for Glasgow South (Stewart Malcolm McDonald), who is also standing. I am grateful for the opportunity to make a contribution on behalf of London. I congratulate my hon. Friend the Member for Edinburgh South (Ian Murray) and I welcome the Minister to his new position. I wish him well.

Mayor Sadiq Khan is aiming to reach broad agreement for further devolution of London government in the aftermath of the EU referendum result. He wants to secure for City Hall and the boroughs significantly more control over the taxes raised in the capital and how public services are run. He wants to protect Londoners from the economic fallout of leaving the EU by creating more autonomy for London government. He says:

“This is essential to protecting Londoners’ jobs, wealth and prosperity.”

He believes that greater devolution for the capital will benefit not only London but the whole country.

Councillor Claire Kober, the chair of London Councils, said:

“We are united with the Mayor in calling for the greater devolution of powers from Whitehall.”

The Mayor says:

“I’m not asking for London to get a bigger slice of the British pie. That wouldn’t be fair. All I’m asking is that we get more control over the slice of the pie”,

referring to that which London produces.

The Mayor has made five demands of the Government. He calls on the Home Secretary to guarantee that EU citizens already in the UK can stay once Britain leaves. He asks for a commitment to make staying in the single market and the retention of passporting rights a top priority during talks with Brussels. He wants London to have a seat at the negotiating table. He asks for guarantees that key security and policing systems built up with European partners over many years are retained to help keep London and Britain safe, and he calls for discussions on more powers to London to start straightaway.

I recognise that many will have perceived this debate as being about Edinburgh, Cardiff and Belfast, but London has very important, specific issues that need to be addressed. I am grateful for the opportunity to put the Mayor’s comments on the record, and I look forward to hearing the responses from the Front Benchers.

[Mr Adrian Bailey (in the Chair)]

Stewart McDonald, I will give you three minutes.

14:24

[Stewart Malcolm McDonald (Glasgow South) (SNP)]

I am very grateful to you, Mr Bailey. May I congratulate the hon. Member for Edinburgh South (Ian Murray) on securing the debate, welcome the Minister and say what a pleasure it is to follow a fellow south-sider from Glasgow? I think it was Winston Churchill who said:

“The trouble with committing political suicide is that you live to regret it.”

It feels as though we are living through a long political suicide at the moment.

The Brexit masochists have utterly ruined politics and turned it on its head. I will not allow my country—nor will my colleagues who join me on these Benches—to bear the brunt of that, because on the back of a Brexit result that Scotland did not vote for, the behaviour and response of the political establishment here in London has been shambolic. The Government and Opposition parties have decided to turn in on themselves and go on a back-stabbing regime that even Shakespeare would have thought had gone too far.

People not just in Scotland but in all parts of the UK—not least here in London—have looked on aghast at the abdication of responsibility, largely of people such as the new Foreign Secretary. They toured around the country on a big red bus, telling us to vote leave and take control, but when it came to it they could not get away from taking control far enough. And my goodness, what a sense of humour the new Prime Minister has in appointing who she has appointed to certain offices of state, such as our new Environment Secretary—now she will have to go and tell the farmers why Brexit was such a good idea. I would love to be a fly on the wall for that.

When I was first elected to this House, I made my maiden speech on the European Union Referendum Bill. I made the point back then that Tory Members had on glasses that were so rose-tinted that they could not see the problem they were walking into, so nobody can say they were not told that, in trying to kill one union, they may end up killing two, because all options are on the table.

I accept what my hon. Friend the Member for Ross, Skye and Lochaber (Ian Blackford) said. If it comes to a second independence referendum, that will have to be fought on different grounds and in a different way. We will have to give serious consideration to where we went wrong last time round, and I accept that we got some things wrong last time round. We failed to convince a majority of people to vote for independence. It was not the BBC or the Daily Record that managed to sneak in that result; we failed to convince enough people. But my goodness the mood has changed now, because my hon. Friend was also right that the UK that people voted for no longer exists.

I want to finish with an appeal to the Minister and to Members from other parts of the UK. Please try to understand the political mood in Scotland. That involves not just listening to what we in the Scottish National party have to say or what the hon. Member for Edinburgh South has to say. Try to engage with people in Scotland, because the farce that is Westminster politics is looking less and less appealing.

The farce that is Westminster politics is something that fewer people are willing to put up with, because as this place makes our country smaller and makes us look in on ourselves more, people will demand to do what was on the side of that big red bus, and that was to vote leave and take back control—to re-establish ourselves as a contributing European nation. We are in uncharted and potentially even dangerous waters, but nobody can say they were not told at the time. I hope the Minister can give us some assurance—

[Mr Adrian Bailey (in the Chair)]

Order.

14:28

[Patrick Grady (Glasgow North) (SNP)]

It is a pleasure to serve under your chairmanship, Mr Bailey. Like others, I congratulate the hon. Member for Edinburgh South (Ian Murray) on securing his debate and using his new found liberty—perhaps I should say independence—on the Back Benches so creatively in this last gasp before the recess. I also warmly welcome the Minister to his post. Westminster Hall has not been short of Brexit debates in the weeks since the referendum and that is likely to continue, so we will set up a tent, bathing facilities and so on for him, because I think he is going to be spending a lot of time in here. However, it would also be worth having a debate on the Floor of the House, now that there is a fully accountable Secretary of State. The House of Lords has spent an awful lot of time debating the Brexit result; we have yet to debate it on the Floor of the House. The attention in this and previous debates in Westminster Hall clearly demonstrates a desire on the part of Members to have a debate on the Floor of the House.

[Nia Griffith]

Does the hon. Gentleman agree that that should be in Government time and not simply a Backbench Committee debate?

[Patrick Grady]

I absolutely agree. The Government, to their credit, genuinely recognised the importance of the Chilcot inquiry and found two days to debate it, so they ought to be able to find time for us to debate the Brexit result. In that debate, what Members will hear from SNP Members is the start and end point they have heard today: that it is democratically unacceptable for Scotland to be taken out of the EU against its will. We have been consistent on that, before, during and after the European referendum, which is why we have a mandate to argue that point.

[Jim Fitzpatrick]

I am pretty sure I recollect the Leader of the House announcing this morning that in the September fortnight when Parliament sits there will be a debate on the petition on the EU referendum, but that will be in Backbench Business Committee time and not Government time.

[Patrick Grady]

Yes, and it will be here in Westminster Hall, so the point about the main Chamber still stands.

I will look briefly at how we got here in the first place, the responses of the devolved Administrations so far, the impact of Brexit and the way forward in negotiations and some of the possible outcomes, especially as they affect Scotland. It did not have to be this way. The Scottish National party moved an amendment to put in place a four-nation lock, so that all parts of the UK would have to vote to leave before the whole of the UK could do so. If that mechanism had been in place, we would not be in the Brexit situation we are in today, after the vote in Northern Ireland and in Scotland. In the 1978 referendum on the Scottish Assembly there was a 40% rule, which admittedly we disagreed with. Nevertheless, only 37% of the electorate voted to leave, and if that rule had been in place in this referendum, it would have meant that Brexit could not go forward.

One of the reasons for the divergent results was the divergent campaigns. The woeful campaign in England and Wales stands in contrast to the positive campaign that took place in Scotland, with unanimity among Scotland’s MPs and party leaders and overwhelming support for remaining among our MSPs and councillors. Like the hon. Member for Edinburgh South, my constituency voted 78% in favour of remaining. I take some of his points about a divergence in areas of greater deprivation. Nevertheless, even areas of deprivation in Scotland have benefited from the EU, and that is visible. I have made the point several times, but the road I cycled to school on when I was growing up in Inverness was built with European money—it would never have been built by Thatcher’s Government. I think that visibility of European infrastructure in Scotland added to the existing support.

We have heard from different Members about the responses from different areas of the UK. The Welsh leave result was a disappointment to many Members, including our friends from Plaid Cymru, who cannot be here today, and to the Labour First Minister. Much like the Mayor of London, he outlined a range of priorities to protect jobs and economic confidence and to ensure that the Welsh Government play a full part in discussions on the European withdrawal, retaining access to the single market and so on. Likewise, the hon. Member for Poplar and Limehouse (Jim Fitzpatrick) has put on record the Mayor of London’s demands. The hon. Gentleman is welcome to maintain his European citizenship—as a Glaswegian by birth, he will be entitled to Scottish citizenship once we become independent.

[Alistair Burt]

I get it through my nan.

[Patrick Grady]

There we go. There are plenty of people in the House today.

[Stewart Malcolm McDonald]

Come one, come all.

[Patrick Grady]

There we are; it is an open invitation. Northern Ireland voted to remain, which would also have triggered the four-nation lock mechanism, had it been introduced.

But we are, as others have said, where we are. I take some of the points that the hon. Member for Edinburgh South raised about the potential impact on domestic policy and reform and on the broader need to re-engage our populations in the democratic process. I think we did that quite effectively in the 2014 Scottish independence referendum, which may explain the different tone of debate that took place during the European referendum. On the question of more powers for the Scottish Parliament, our preference, as my hon. Friend the Member for Livingston (Hannah Bardell) said, is for Scotland to influence those powers as a full member of the EU at the top table, where those decisions are made. If that is the outcome and that is the only way of protecting Scotland’s place in Europe, that is what we will have.

The right hon. Member for North East Bedfordshire (Alistair Burt) made some considered remarks and reflections. They were not necessarily direct questions to the new Minister, but the fact that he is asking those questions reflects the fact that the UK Government really are playing catch-up on the result. They were not fully prepared for a Brexit result, which stands in contrast to the initiative and the momentum shown in Scotland. The First Minister, who spoke so eloquently—she was quoted by my hon. Friend the Member for Ross, Skye and Lochaber (Ian Blackford)—was immediately out the hatch, reaching out to leave voters and welcoming European citizens and assuring them of their continued welcome in Scotland. She then travelled to Brussels, where the President of the European Union, Jean-Claude Juncker, said:

“Scotland won the right to be heard in Brussels”.

It therefore stands to reason we should also have the right to be heard in the UK. The First Minister had a mandate to do that, with the Scottish Parliament passing a resolution saying that it

“welcomes the overwhelming vote of the people of Scotland to remain in the European Union”

and

“mandates the Scottish Government to have discussions with the UK Government, other devolved administrations, the EU institutions and member states to explore options for protecting Scotland’s relationship with the EU, Scotland’s place in the single market and the social, employment and economic benefits that come from that”.

[Ian Murray]

The whole debate today is about which destination we wish for the negotiations. The Member for North East Fife (Stephen Gethins), who is the SNP’s Europe spokesperson, said on “Good Morning Scotland” this morning—and I quote— “Untrammelled access to the EU’s single market is much more important to Scotland than access to the UK’s”. Does the SNP spokesperson today agree or disagree with his hon. Friend?

[Patrick Grady]

I heard the interview to which the hon. Gentleman refers; it was a useful preparation for today’s debate. It is clear that we want to maintain our access to—exactly as the Scottish Parliament resolution says—

“Scotland’s place in the single market and the social, employment and economic benefits that come from that”.

In order to help to prepare for the transition, the First Minister moved quickly to put in place a standing council of experts to provide advice to her Government on how best to achieve our EU objectives. It is chaired by my constituent, Professor Anton Muscatelli, who is the principal of the University of Glasgow. That council is made up of specialists in finance, economics and European and diplomatic matters. It encompasses a range of political and constitutional opinions and was designed to provide the Scottish Government with access to a wealth of knowledge that has been built up over the years. The council will consider the impacts of the proposed changes to the UK’s relationship with the EU on Scottish interests and will advise Scottish Ministers throughout the coming negotiations on the best way to ensure that we achieve those Scottish objectives.

The Prime Minister met with the First Minister, and we welcome that willingness to listen and to commit, which she emphasised again at Prime Minister’s questions yesterday, but there is some need for clarity over the UK Government’s plans. The Prime Minister said article 50 would not be triggered until there is a UK-wide approach on the objectives of the negotiations, but the Secretary of State for Brexit has said that article 50 will be triggered early next year. It would be useful to have some clarity on that.

We have to recognise the result in Scotland. My hon. Friend the Member for Ross, Skye and Lochaber spoke about the sovereignty of Scotland, and we have a debate in Westminster Hall on the Claim of Right after the summer recess. If Brexit means breakfast in the UK—sorry, if Brexit means Brexit; I have made a bit of a dog’s breakfast of that—then in Scotland, remain should mean remain. The former Prime Minister said in his statement to the House after the referendum that his county of Oxfordshire had voted to remain, and implied that was somehow comparable to the result in Scotland, but Oxfordshire is not a devolved Administration. Oxfordshire County Council did not sign an Edinburgh agreement with the UK Government recognising in principle Oxford’s right to become an independent country should it choose to do so. Scotland did.

That is why the FM has said the option of a second independence referendum

“must be on the table”

for Scotland, and if independence is found to be the only way to secure Scotland’s place in Europe, a referendum would be “highly likely”. Any such referendum would have to command cross-party support in the Scottish Parliament, which is why it would be unacceptable for the UK Government to stand in its way. But we are not there yet. The Scottish Government have signalled their intention to work constructively with the UK and with EU institutions and member states during the negotiations following the referendum result, but the result in Scotland was not for Brexit. It was for remain, and that result must be respected.

14:39

[Catherine West (Hornsey and Wood Green) (Lab)]

It is an honour to contribute under your chairmanship, Mr Bailey.

It is quite right today for the devolved regions of the UK to exert influence, particularly as the democratic mandate in favour of their remaining in the EU is so strong. I do not need to welcome the new Minister—we have already been in this Chamber debating Gibraltar this week, and some of the arguments are not dissimilar—but I would highlight the lack of planning in advance of the vote on 23 June. It seems rather irresponsible for a Government who knew a year in advance that they were going to have a referendum not to put any preparations in place. That is unforgivable.

May I thank my hon. Friend the Member for Edinburgh South (Ian Murray) for securing this debate? I am pleased that it will be followed by one in early September, as soon as we return, so that we can have the argument at greater length, once the team has had some time to establish itself and maybe recruit some negotiators. My hon. Friend was quite right to say that many of us are disappointed to even be having this debate. There certainly was not a “punch the air”, independence day feel following the result in my constituency, where 75% of people voted to remain in the EU.

We know what the impact has been on the economy, in terms of the volatility produced and IMF forecasts being revised downwards. The impact has been felt particularly in low-income parts of the UK, producing the opposite result to what one would have thought. There is a lot more political work for many of us in the House of Commons to do—not necessarily in this place, but in those communities.

My hon. Friend was also right to emphasise the importance of protecting public services and to comment on the currency options, about which there is a lot of uncertainty, and on our future relationship with the EU where young people are concerned, particularly in terms of university funding and in science, research and development. I am pleased that Lord Falconer, who is an expert in these matters, and Lord Kerslake will be trying in the other place to establish a way forward, to help our deliberations not only in the devolved Administrations but here in Westminster, so that we can move forward with some kind of consensus.

I was very pleased to hear the hon. Member for Ross, Skye and Lochaber (Ian Blackford) mention the 173,000 EU residents living in Scotland. Indeed, many Members of Parliament across the UK have been contacted by EU citizens who not only feel a lack of certainty about their jobs and livelihoods, but feel that they were used as a bargaining chip in relation to expats living abroad. This is a quite unsatisfactory situation and one that I am pleased we have debated twice in the Chamber. I am sure we will be debating it again in the autumn.

[Ian Blackford]

What has changed since we had those debates in the Chamber is that we have a new Prime Minister. It would be good if the Government now reflected on the debates that have taken place and the uncertainty that exists for all EU citizens living throughout the UK. Can we not remove that cloud of uncertainty for them, so that they feel welcome, as they are, and can look forward to having a future as part of our communities?

[Catherine West]

The hon. Gentleman makes an excellent point. Sadly, it was the Prime Minister, when she was in her Home Office role, who failed to provide that clarity. It is down to us to put more pressure on the Government in order to create clarity. Does the hon. Gentleman agree that we are seeing a slightly negative climate in relation to EU citizens and those who come from abroad?

[Ian Blackford]

indicated assent.

[Catherine West]

I am an immigrant myself, and there is a slight sense that people are not welcome. Indeed, we have seen an increase in violent abuse against people from abroad. All Members of this House certainly would want to stamp that out; I think we are united on that point.

My hon. Friend the Member for Llanelli (Nia Griffith) made some excellent points about agriculture and fisheries. It is very important for Welsh farmers to be right at the front of these negotiations. I am sure that she, through her offices, will be making the point again and again about the importance of the tariff situation being clarified as soon as possible for basic products such as fish, beef, lamb and other exports. We know what a fragile situation many farming communities find themselves in. It is crucial that we in this House put their case again and again, because a lot of false arguments were made in the debate on the referendum. Farmers were told they were going to get part of the £350 million a week, as were the NHS and a number of other priority areas. We all know that money cannot be spent twice. We seek urgent clarification on agriculture, which is such a precious sector and yet is constantly being eroded and corroded. I look forward to the Minister clarifying his position on that.

I was also pleased to hear my hon. Friend the Member for Llanelli speaking in support of universities in Wales. We know what a crucial area of the economy education is as an export for Wales. There is a question mark over the position of EU nationals throughout Wales, be they teachers, students or in the workforce, where security is desperately needed. There is a delicate balance needed between the workforce not only in slaughterhouses and in fruit picking, but in more skilled occupations—for example, for nurses and doctors in the national health service. In some areas, up to 50% of the workforce are EU nationals—the right hon. Member for North East Bedfordshire (Alistair Burt) could probably tell me the exact figure. We have a very high number of EU workers across the UK, and their position needs clarification.

My hon. Friend the Member for Llanelli mentioned steel investors. We want to know exactly how the UK will replace the high-level negotiations that the EU undertakes on behalf of its members on steel. We would not want any sense of uncertainty to give an excuse to potential investors not to invest in our steel industry in Wales and other regions.

I know you want us to be brief, Mr Bailey, so I will be. The right hon. Member for North East Bedfordshire made a number of important points and was super understanding of the Minister—I am not quite as understanding; I want answers. The shortage of negotiators is appalling. That is what I meant by a lack of planning. If we know we will have to make changes, we should get people on board to do that. The Foreign and Commonwealth Office is very hard-pressed, and I would like to see much more funding for it. I am worried about the separate Departments mushrooming, competing and all saying slightly different things. That is a risk for what the right hon. Gentleman called the plumbing—I used to call it re-wiring—in terms of the way things are done, not only in the Palace but across the piece in the senior civil service. This debate has led, I am afraid, to a shopping list of issues for the Minister, but I know he will be up to the task.

Finally, as a London MP, it was a delight to hear from my hon. Friend the Member for Poplar and Limehouse (Jim Fitzpatrick). We are very proud of our new Mayor, Sadiq Khan, who is quite right to say that taxes raised in London—or a small proportion of them, anyway—could be spent more effectively in London. London Councils, which is now chaired by Councillor Claire Kober from the Borough of Haringey, says that we need to see more money that is raised in London spent on vital infrastructure such as transport and housing, because we know it contributes in the longer term to the prosperity of the whole United Kingdom.

[Mr Adrian Bailey (in the Chair)]

Minister, if you could leave a little time at the end for Mr Murray, that would be helpful.

14:39

[The Parliamentary Under-Secretary of State for Exiting the European Union (Mr Robin Walker)]

I will do my best. It is a pleasure to serve under your chairmanship, Mr Bailey—not for the first time. I well remember serving under you on the Business, Innovation and Skills Committee where, among other things, we visited Scotland to look into another referendum. I thank hon. Members present from all parties for their kind welcomes and congratulate the hon. Member for Edinburgh South (Ian Murray) on securing this debate, which is both timely and extremely valuable.

Before I go into the substance of the debate, I want to make a few opening remarks on the role of this new Department, because this is only the second debate that our new Department has answered. I am delighted to be joining the Department for Exiting the European Union, working with three new Ministers, led by my right hon. Friend the Member for Haltemprice and Howden (Mr Davis), who is our Secretary of State. Our Department will oversee exit negotiations and shape the new relationship between the UK and the EU. I particularly welcome the request from the hon. Member for Glasgow North (Patrick Grady) for a debate in the main Chamber, which I will ensure is fed back, and I suspect he will not be disappointed when the House returns.

Our new Department has four main aims. The first is to lead the policy work to support the UK’s negotiations to leave the EU and to establish the future relationship between the EU and the UK. The second is to work closely with the UK Parliament, devolved Administrations, overseas territories and Crown dependencies and a wide range of other interested parties on what approach we should take to negotiations. I would like to reassure the hon. Member for Poplar and Limehouse (Jim Fitzpatrick) that London will be certainly included in that. The third is to conduct the negotiations in support of the Prime Minister, including bilateral discussion on EU exit with other European countries. The fourth is to lead and co-ordinate cross-Government work, liaising with many Departments—including on agriculture, which was mentioned by the hon. Member for Llanelli (Nia Griffith)—to seize the opportunities and ensure a smooth process of exit on the best possible terms.

The new Department will equip the UK to prepare to make a success of leaving the EU: to meet its challenges and to seize the opportunities it represents. In my role as Minister in this new Department, it is essential that I have a good understanding of the interests and concerns of Members, the constituents they represent and the devolved Administrations. I am grateful to have heard today from so many Members from such a variety of parties.

This debate is timely and has been informative. It is just the start of a long process of consultation and I look forward to many more such debates, but I hope that I will not have to camp out permanently in this Chamber, as has been suggested. We have heard from both sides of the Chamber. My right hon. Friend the Member for North East Bedfordshire (Alistair Burt) was extremely welcome with his enormous parliamentary knowledge. I suspect his plumbing skills will be much appreciated in the months to come.

Like 62% of the population of Scotland, 56% of the population of Northern Ireland and, I think, almost every Member in the Chamber, I voted for remain, but the decision has been made across the UK and we should no longer talk in terms of leavers or remainers. It is the responsibility of us all to secure the best possible outcome in the national interest of all UK citizens. We all need to work together to pursue this bold and positive agenda.

I recognise the point made by the hon. Member for Edinburgh South about least-affluent areas, which is certainly reflected in my constituency. Now, more than ever, we must work to make sure those areas can thrive.

The Prime Minister made clear her passionate belief in the United Kingdom and her commitment to engage fully with the devolved Administrations as we prepare for negotiations on the UK’s exit from the EU. I wholeheartedly share those sentiments and I look forward to working closely with colleagues from the devolved Administrations and Members of this House representing their constituents as we shape the future for the whole UK.

I have touched on the points made by the hon. Member for Poplar and Limehouse. It is great that the hon. Member for Ross, Skye and Lochaber (Ian Blackford) spoke about respect. I assure him that whenever we have disagreements with his party, the Government have absolute respect for the Scottish National party and its role.

[Ian Blackford]

I am grateful to the Minister for giving way; I know that he is short of time. I thank him for his remarks, but given that the Scottish Parliament has mandated the First Minister to negotiate on Scotland’s behalf to secure its place in the EU, will the Government respect that? If the Parliament in Edinburgh ultimately votes for a referendum, will the Government in London consent to that?

[Mr Walker]

I think the hon. Gentleman realises that my remit in this Department does not cover the full breadth of constitutional issues, but there is certainly respect for Scotland’s position and the First Minister. The fact that the Prime Minister broke up a reshuffle to go to Scotland to meet the First Minister is an indication of that respect.

I repeat my personal commitment and that of the Prime Minister and the whole Government to involve fully the devolved Administrations in the preparations for the important and complex task ahead of us. There can be no doubt that we are working towards securing the best possible deal for the whole UK and that to achieve this we will need to work openly and collaboratively with colleagues in the devolved Administrations at official and ministerial level.

It has been useful to hear hon. Members’ thoughts this afternoon on how the devolved Administrations can be involved in the negotiations, but I am sure that they understand that the format of the negotiations has yet to be decided.

[Ian Blackford]

Will there will be role for the Scottish Secretary? I am not sure what his role may or may not be.

[Mr Walker]

The Scottish Secretary, like many interested parties, will of course be consulted and, as part of the Government, feed into the Cabinet process to inform the Prime Minister in her negotiations. The Prime Minister said when she met the First Ministers of Scotland and Wales that, as we prepare for the process, we will fully engage their Administrations to ensure we achieve a shared understanding of their interests and objectives. Detailed discussions have already begun at an official level.

Although I am an inexperienced and new Minister, I am not a complete stranger to the devolved Administrations. As I said earlier, when I served on the Business, Innovation and Skills Committee, we visited Scotland. I also served for a number of years on the Select Committee on Welsh Affairs with the hon. Member for Llanelli—I am grateful for her welcome—and, towards the end of the previous Parliament, I served as Parliamentary Private Secretary to the Minister of State at the Northern Ireland Office. I am looking forward to renewing friendships in each of the devolved Governments over the coming months. I have also enjoyed engaging with Members for all three devolved legislatures as a member of the British-Irish Parliamentary Assembly.

Today, my right hon. Friend the Member for Clwyd West (Mr Jones), the Minister of State in our new Department, is attending the Royal Welsh show, where I have no doubt he will engage widely with the rural and farming interests of Wales mentioned by the hon. Member for Llanelli, and perhaps with some of the exporters she mentioned. The Secretaries of State for Northern Ireland and for Wales, as well as the Minister of State in my Department and the Parliamentary Under-Secretaries of State for Scotland and Northern Ireland, will be attending an extraordinary meeting of the British-Irish Council later this week. That demonstrates the UK Government’s commitment to understanding the priorities of the devolved Administrations, as well as our other partners in the Republic of Ireland and the Crown dependencies. There will be many more ministerial discussions and, I suspect—to reassure my right hon. Friend the Member for North East Bedfordshire—a great deal more parliamentary scrutiny of all sorts in the months to come.

It has been very good to hear hon. Members’ thoughts on potential settlements for Scotland, but the Prime Minister has been clear that the Union is very important to her and to this Government. She was also very clear with the First Minister that some of the ideas being brought forward are, in her view, impractical, but she is willing to listen to options that are proposed, and we will be engaging fully with the devolved Administrations. A number of hon. Members referred to Lord Falconer’s involvement. I can assure them that his suggestions will be given proper consideration.

I heard with interest the five priorities that the hon. Member for Edinburgh South set out. I can assure him that they will all be given consideration and that the Department recognises the urgency of responding on the EU nationals issue. If he consults Hansard, he will see that I asked questions on that before my appointment to this role. We all want to see, as he said, securing the position of EU nationals in this country and UK nationals in the EU right at the top of the list of priorities.

I would like to reiterate the words of the hon. Member for Edinburgh South in an article that he wrote on 4 July:

“We all need to pause and reflect whilst the picture becomes a little clearer in the coming weeks and months.”

There is a long and complex period of analysis ahead of us. That starts now, and there have been very useful contributions to it in this debate.

I want to touch on EU funding, which was particularly mentioned by the hon. Member for Llanelli. I know that many hon. Members have expressed concern about it. Let me reassure them that I recognise how sensitive and important that issue is, and it is one of the Department’s top priorities. UK Government officials have already begun talks with devolved Administrations, and those discussions have started well. Of course, as long as we remain in the EU, those payments will continue, but I recognise that for the long term there is some uncertainty. For the longer term, a whole range of decisions will have to be made, including on funding. I am happy to commit to involving devolved Ministers and officials fully in that work.

I recognise also the points made by the hon. Member for Llanelli on steel. Very importantly, this Government are working closely with Tata, bidders, the Welsh Government and trade unions to support a sale and support a long-term future for the steel industry in Wales and across the UK. The former Prime Minister spoke with Carwyn Jones on 7 July about the situation, and we will continue to work as closely as we can with his Administration.

[Catherine West]

Will the Minister give way?

[Mr Walker]

I will not, as I have only one minute to try to sum up.

As the debate has demonstrated, a range of sensitive and complex issues are involved in the UK’s exit from the EU. It will be the responsibility of myself and ministerial colleagues in the Department, working with colleagues across the UK and in the devolved Governments, to make this process work for all parts of our country. It remains the Government’s position that it is in the best interests of Scotland, Wales and Northern Ireland to remain part of the UK. We are at the start of a process of consultation, analysis and negotiation. I reiterate my commitment to involve the devolved Administrations fully in our preparations. Together, we should be able to realise a bold, positive vision of the future for the whole UK.

I welcome the comments by the hon. Member for Edinburgh South about optimism. In wishing him and all hon. Members in the Chamber the very best for the summer recess, I can assure him that the Department will be setting out optimistically to work through the summer in the interests of all parts of the UK.

14:58

[Ian Murray]

It was remiss of me not to welcome the Minister. Perhaps it was because of his charm and the way he is willing to work together that I thought he had been in his ministerial post for some time.

Let me reflect on the debate. It has raised many questions. The right hon. Member for North East Bedfordshire (Alistair Burt), in his contribution, raised the competing challenges that we have. I would throw Scottish whisky into those sectoral challenges, which may be slightly different from other challenges.

The negotiations all go back to the building blocks and the destination. The destination for me, for the Scottish Labour party and for the Labour party as a whole is to ensure that Scotland’s position in the UK is assured but we do not lose sight of the advantages that we get from the EU. Those are the two mandates that the Scottish people have given us, and to disregard one mandate for the other would be wrong.

I have mentioned a number of times in the debate my early-day motion. It now becomes clear that the SNP will not sign it, because it says at the end that we want the Scottish people’s mandates to be upheld and to

“remain in the EU and the UK.”

The fact that the SNP does not want to sign that or to give us any indication—in the contribution from the hon. Member for Glasgow North (Patrick Grady)—of where it wants to go with this perhaps highlights the fact that our destinations are different. I hope that the Government reflect on that.

Question put and agreed to.

Resolved,

That this House has considered devolved governments and negotiations on the UK leaving the EU.

15:00

Sitting adjourned.