Exiting the EU and Transport

Wednesday 23rd November 2016 Commons Chamber

15:43

[The Secretary of State for Transport (Chris Grayling)]

I beg to move,

That this House has considered exiting the EU and transport.

If I may crave the indulgence of the House briefly, I would like to say a couple of words about the situation on the railways in the south-west. As you know, Mr Deputy Speaker, there has been considerable disruption as a result of storms, including line closures and very extensive delays. I can inform the House that following the flooding that closed the great western main line between Exeter and Tiverton, the line has now just reopened. The Barnstaple branch is due to reopen this afternoon. The Looe branch is still closed, but I hope it will reopen on Thursday. There was also disruption when the South West Trains route was closed. I am immensely grateful to all the staff at Network Rail. They sometimes get a hard time when things do not work, but they rally around when there are major incidents and deliver solutions quickly. I thank them all very much for their work.

[Johnny Mercer (Plymouth, Moor View) (Con)]

I thank the Secretary of State for speaking to the House about this matter because it is not good enough for the south-west to be cut off again, or to be the poor relation of the national rail network. The report by the Peninsula Rail Task Force that was presented yesterday must be the framework for a fair deal going forwards, so will he commit to doing everything in his power to deliver on this piece of work and to make sure that Network Rail delivers for my constituents?

[Chris Grayling]

I absolutely understand the importance of the task ahead of us. The report, which I have read carefully, shares my view that the No. 1 priority is the sea wall and the cliffs at Dawlish. My hon. Friend will also be aware that last Thursday I announced—this was also in today’s autumn statement—the provision of £10 million for the next stage of the project. I am committed, as is the Chancellor, to making sure that it happens. It is a strategically important project for our nation—the south-west cannot be cut off via its principal railway routes—so I assure him that we will move ahead expeditiously with it.

[Kevin Foster (Torbay) (Con)]

I thank the Secretary of State for his comments and join him in thanking the Network Rail staff who turned the situation from that of two days ago, when there were literally hanging tracks, to one in which trains can run again. I am pleased that the Chancellor today described the £10 million of funding as the first step in this programme, and I thank the Secretary of State for his personal interest in this issue and his commitment to sorting out the issues with our rail infrastructure once and for all.

[Chris Grayling]

This absolutely needs to be done, and we will move ahead as quickly as we can. Following the incident on the Cowley bridge this week, flood protection works are due to start there imminently. It is a shame that the works have not quite started yet, but they will be starting very shortly, and I hope that they will deal with that issue so that such an incident cannot happen again.

Moving to the main business, the autumn statement demonstrates the Government’s commitment to modern infrastructure that can serve the public and support a dynamic economy. Our forthcoming departure from the EU represents a huge opportunity for Britain to carve out a new role in the world and to be a stronger and more ambitious country—a country that is better able to shape its own future in the world and a country that is outward-looking and open for business. That was what I campaigned for in the summer, and it is what the Government will deliver.

Business is starting to share this optimism. Since the referendum, several companies in the transport sector have announced significant investment in the UK. Nissan’s commitment of investment is fantastic news for the British economy, the north-east and the car sector, particularly as it is not just maintaining capacity at the plant, but expanding it. In August, Bombardier received an order for 665 new vehicles from Greater Anglia, which will secure jobs and skills in Derby. When I spoke to the international head of Bombardier’s rail division about a month ago, he said that such was the quality of the work in the UK, Derby was going to become a global hub for its rail business, which is another positive statement of commitment to this country.

Alstom has started work on developing a new site at Widnes, which will create 600 jobs along with, crucially, a training academy. The Spanish firm CAF has said it will now set up a train manufacturing plant in the UK, and Siemens, which manufactures rolling stock and other products in the UK, has committed itself to a continuing presence. Its chief executive said in July, “We’re here to stay.” Alongside Hitachi’s new rolling stock and manufacturing and assembly plant in Newton Aycliffe, which is creating 730 new jobs, this shows that we are becoming a centre for high-quality rolling stock manufacturing, so it is with good reason that I view the future with optimism as we approach negotiations on leaving the EU.

[Sir William Cash (Stone) (Con)]

While, of course, I entirely endorse the Secretary of State’s sentiment, there is an issue regarding British ports. It is a big issue, but I will not go into it now, as I am hoping to catch your eye, Mr Deputy Speaker. However, there are some serious questions still outstanding around qualified majority voting, as I am sure the Secretary of State knows.

[Chris Grayling]

I absolutely agree with my hon. Friend. He and I have discussed this matter in the past. The regulation coming out of the EU on ports is tailored to the particular structure of ports on the continent, but does not fit well with a private port sector such as ours. The opportunity to ensure that we have a regulatory framework that is right for the UK is one benefit that comes from leaving the EU.

[Robert Flello (Stoke-on-Trent South) (Lab)]

If between now and the great Act incorporating European legislation into UK law, as the first step towards unpicking things, the ports services directive comes into being—I am not sure how likely that is—would it not be incorporated straight into UK domestic legislation?

[Chris Grayling]

We have said very clearly that we will fulfil our legal duties while we are still members of the European Union, and that at the time of our leaving, it is our intention to transpose EU law into UK law. However, it is then for this Government and this House to decide what areas of regulation we want to keep and what areas we want to change. Having listened to the representations of Members about the ports directive, I suspect that this House will want to return to this area.

[Mr Andrew Turner (Isle of Wight) (Con)]

How has this regulation, which to everyone’s great pleasure disappeared back in January, now reappeared? Why was it so popular that the House did not need to scrutinise it? Will my right hon. Friend tell me what amendments have been made to the regulation that now make it acceptable?

[Chris Grayling]

The first thing to say is that no piece of European legislation passes through this House unscrutinised, particularly thanks to the assiduous work of my hon. Friend the Member for Stone (Sir William Cash). This is one area where the Government intend that the House has the opportunity of proper scrutiny. It is very much my hope and belief, as I have said, that our decision to leave the European Union will ensure that in respect of ports, for which our model does not conform with that of the rest of Europe, we will have the opportunity to tailor something that is right for this country.

I want to focus on two particular areas, which will be the priorities for my Department in the coming months. At the top of the list is aviation. Our aviation industry is world class, and our airports service the third largest aviation network in the world. UK airlines have seized opportunities globally, including those offered by the European open skies agreement. I am focused on securing the right arrangements for the future so that our airlines can continue to thrive and our passengers have opportunities, choice and attractive prices. When I met the aviation industry, I found that one of its priorities was and remains the effective regulation of safety and air traffic management. That is also a priority for me as we approach the negotiations.

Our connections with Europe are, of course, important, but we need to widen our horizons, too, and we need to make sure that we have continuity for the aviation industry internationally. Leaving the EU gives us more freedom to make our own aviation agreements with other countries beyond Europe, and ensuring that we have that continuity when we leave is an imperative for me and my Department.

I have already had positive discussions with my current US opposite number about the arrangements that we will need after Brexit for the vitally important transatlantic routes. There will, of course, be a new counterpart in office in America in the new year, and I intend to reprise those discussions when the new US Transportation Secretary is in post. Both sides have an interest in reaching an early agreement and I am confident that we will achieve that.

Looking the other way, last month we signed a deal with China that will more than double the number of flights that are able to operate between our two countries, thereby boosting trade and tourism. This country is open for business and open to the rest of the world, and aviation has a big role to play in making that happen. Whether through new agreements or our support for a third runway at Heathrow, I will do whatever is necessary for our industry, businesses and the public. I shall have talks with other countries, such as Canada, where there is an interest in ensuring that we have good arrangements post-Brexit. There is a job to be done to make sure that that happens, but I am in absolutely no doubt that we will secure in good time and effectively the agreements that our aviation sector needs to continue to fly around the world and within the European Union. Not doing so is in no one’s interests. Many parts of the EU depend economically on the contribution made by British airlines flying to regional airports. It is in all our interests that that continues.

[Stephen Gethins (North East Fife) (SNP)]

Given that the Secretary of State campaigned for leave, will he tell us how much preparation regarding this issue the Government of which he was a member carried out before the referendum?

[Chris Grayling]

The hon. Gentleman mentions preparation, but the objective is very straightforward. It is in the interests of the different regions and countries of the European Union that we continue to trade and to have good transport links between us. I see no logical reason for anybody to stand in the way of that. We now have to work out what the best precise arrangements will be. When it comes to aviation, however, the objective is business as usual. That is what is in everyone’s interests.

[Mr Mark Hendrick (Preston) (Lab/Co-op)]

The Secretary of State refers to business as usual, but he will know that aviation emissions are now included in the EU emissions trading scheme. Is it his view that we should remain in a trading scheme once we leave the EU?

[Chris Grayling]

The world has moved on somewhat. The International Civil Aviation Organisation agreement that was reached in Montreal six weeks ago provides a global framework to tackle emissions in the aviation industry. All of us, both inside and outside the European Union, will be part of that as we ensure that the economies of the developed and the developing world can continue to benefit from improved aviation links while, at the same time, we meet our obligations to control carbon emissions.

The second area on which I am focusing is road haulage. We depend on road hauliers—without them, our shops would be empty and industry would grind to a halt. Our logistics industry does a first-class job in getting our goods to the right places, but the vast majority of lorries on the roads never leave the country. As we look to the future and to trade that does leave the country and crosses borders, there is one simple fact that we need to bear in mind. About 85% of the lorries operating between the United Kingdom and the continent belong to EU-owned businesses—international hauliers that are not based in this country.

The member states of the EU and the United Kingdom have a common interest in reaching an agreement. We need sensible arrangements for the future to allow goods to flow freely from and to the United Kingdom. We need to give UK hauliers a fair chance to win business and to be successful. We shall focus on that during the negotiations, ensuring that we achieve the right outcome for the international hauliers that serve this country and for UK hauliers as well. I am talking to all those who are involved in running our roads and the freight services that use them.

[Ian Paisley (North Antrim) (DUP)]

Will that include an aggressive look at freight charges for the movement of goods outside the United Kingdom to faraway markets? I understand that New Zealand, Australia and Canada have freight subsidies that allow them to cut the prices of freighted goods.

[Chris Grayling]

I am not necessarily a great fan of inappropriate subsidies, but I hope and believe that as we negotiate free trade agreements with countries around the world we shall create an environment in which trade and freight haulage are conducted on a level playing field, and that there are no artificial barriers that push up our costs and help others to reduce theirs. Above all, however, we benefit from a world in which trade flows freely. That is clearly in the commercial interests of European hauliers, especially hauliers from the Irish Republic. I am very aware that as we enter the negotiations, we have a particular duty of care to our friends in the Republic. We have a duty to seek to reach an agreement that will ensure that their trade, which frequently involves travel by road through the United Kingdom to other parts of Europe, can flow smoothly. It is in all our interests to ensure that we have sensible cross-border arrangements.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

The Secretary of State mentioned discussions with haulage companies. Is he discussing with them the fact that they currently rely on EU drivers, courtesy of licence harmonisation, and the fact that, even so, it is forecast that there will be a shortage of 40,000 HGV drivers by 2020? Is he having discussions about what the Government can do to plug that skills gap?

[Chris Grayling]

Absolutely. The task is within the remit of the Minister of State, Department for Transport, my right hon. Friend the Member for South Holland and The Deepings (Mr Hayes). Not only is he the Minister responsible for our strategic road network but, as a former skills Minister, he holds the skills portfolio in my Department, and I know that he is very exercised about this issue. Of course, with a managed system of migration, we shall be able to recruit skills internationally when we need them, but I want a new generation of young drivers. There is much that we can do to make the profession more attractive, and my right hon. Friend is working on that at this very moment.

I have talked about the potential for a more tailored regulatory framework for the ports sector after we have left the European Union. We have a thriving and competitive ports sector, strong international investment, and some first-class facilities. I believe that the sector will be an essential part of a nation that is focused on global trade, trading opportunities, and opening up trade links with other countries.

Our railway services through the channel tunnel link us with the continent, but apart from that Britain’s rail network is domestic. Although on day one after exit the rules will be the same as before, in future we shall be able to make our own decisions about changing those rules. We currently have a derogation from many of the EU standards for our existing railways. That is because many of them date back to Victorian times and were built to entirely different standards. That is not the case for new railways, so one example of the kind of challenge that we are dealing with in the construction of HS2 is the fact that European specifications for platform heights are inconsistent with flat access for disabled people on to trains. We have to address that as part of the development of HS2, but it is an example of how, freed from European Union regulation, we can make sure that we do a better job, in this case for disabled people, which I believe that Members on both sides of the House will think is the right thing to do.

I talked about the global opportunity for Britain, and across the transport sector I am determined not only to negotiate the best deal for Britain within Europe, but to find new opportunities for our transport sector around the world. We should support our industries as they sell their expertise and products and seek to win major contracts around the world. We have world-class expertise in this country in the automotive sector, aerospace, logistics, transport engineering, rolling stock manufacture and much more. We need to be confident in offering these services to the world, and we have every reason to be confident: we are doing some great things in this country at the moment, from the first-class work being done to deliver Crossrail in London to the high-quality automotive technology that is developing the new generation of autonomous and semi-autonomous vehicles.

[Nick Smith (Blaenau Gwent) (Lab)]

The Secretary of State talks about Crossrail. The infrastructure gap between London and the rest of the UK remains unbridged, so does he agree that the Cardiff-Swansea section of the great western railway electrification project must be delivered with UK Government funding as soon as possible?

[Chris Grayling]

As I said in the House the other day, I am not at all happy with the progress that has been made on the electrification of the great western main line so far. Actually, right now my priority is to get investment in better services into Swansea as soon as possible. The economy of Swansea and south Wales needs improved services, and that is my focus. I do not want to wait for the future for infrastructure projects; I want better services now. As we re-let the Great Western franchise, I am determined to see improved services to south Wales that provide a real boost to the economy in the areas that the hon. Gentleman and other Members for south Wales represent. Better transport links and improved services to south Wales and to the south-west are essential to making sure that we have a productive economy.

[Ben Howlett (Bath) (Con)]

One of the key hurdles facing a lot of railway companies is the European procurement rules. Has the Secretary of State had conversations with the Department for Exiting the European Union on the procurement opportunities that are available outside the EU?

[Chris Grayling]

Clearly, outside the EU, we have the opportunity to shape our own procurement rules. I do not want to be part of a Government who say that international firms are not welcome in the UK—that would be quite the wrong thing to do—but it is equally reasonable for us to say, for example, “If you’re coming to do business with us by being involved in the construction of HS2, we want you to leave a skills footprint in this country. We want apprenticeships and technical skills, and we want the engineers of the future to be trained and developed, and to be working on these projects so that they can carry on beyond them to build us further projects for the future.” That is our intention.

Let me be clear: Brexit is an unprecedented opportunity.

[Nick Smith]

I am very unhappy that the Secretary of State avoided my question about supporting the Cardiff-Swansea electrification, so I would like a better answer on that in the future, please. I am owed a letter from his ministerial colleague the hon. Member for Blackpool North and Cleveleys (Paul Maynard). Having said that, the Secretary of State did say he wanted to support an economic boost for south Wales, so will the UK Government be supporting the Cardiff metro plans, which are important for getting Blaenau Gwent working again?

[Chris Grayling]

Not only are we supporting the Cardiff metro plans and looking at how to deliver better services to the whole of south Wales—it cannot be just about Cardiff; it has to be about what happens to the west—but I will also be looking at whether we can provide better services to connect with the west of Wales and better services to Swansea. I hope that the hon. Gentleman will forgive me for saying it is not just about south Wales; it is also about how we deliver better services to north Wales. There is a tendency, particularly in the Administration in Cardiff, always to look to the south—there are important things happening there—but we as a Government have not forgotten that there are many different parts of Wales, and the commitment to the north is also very much in my in-tray.

Let me be clear that Brexit represents an unprecedented opportunity to shape our own future, and we will make the most of that opportunity. We will get out into the world and do business right across the globe, and at home we will continue to build a world-class transport system for this country.

[Stephen Gethins]

Will the Secretary of State tell us what meetings he has had with the European Transport Commissioner, given the importance that that relationship will have over the next little while? Will he also tell us what was discussed in those meetings?

[Chris Grayling]

I have already had one meeting with the Commissioner, when we were in Japan, and I will see her again next week at the Transport Council. We will work out the best way to take forward negotiations in due course, but we have had exploratory discussions. Those discussions have been constructive, and I look forward to having further such discussions with her.

I have to be mindful of the need to ensure that we have a structure for the future that will create stability and opportunity for our aviation and haulage sectors, and that takes advantage of the potential freedoms that leaving the European Union will offer this country’s transport sector. We fully intend to take advantage of that opportunity.

16:06

[Andy McDonald (Middlesbrough) (Lab)]

I echo the Secretary of State’s expression of his regard for the workers who have come to the aid of the south-west’s rail system yet again. We have heard other hon. Members express their disappointment that we are still looking at issues of resilience in that area, and I know that they will want that matter to be resolved as quickly as possible.

The Government’s strategy for leaving the European Union—or rather, the lack of one—is causing great uncertainty throughout the transport sector. I do not know who the Secretary of State is speaking to about this, but we, and those in the aviation, rail, road and maritime sectors, are none the wiser about what the Government’s plans might be and what impact Brexit will have on the future of those sectors and all those who work in or depend on them.

[Sir William Cash]

I have already referred to the question of the ports sector. Speaking as Chairman of the European Scrutiny Committee, I can tell the House that it has been well established over a long period that the Government, the Labour Opposition, the unions and every one of the 47 port employers are against ports regulation. What are Labour Members going to say about that during this debate? Are they going to oppose it?

[Andy McDonald]

If the hon. Gentleman can wait six or seven minutes, I will come to that very point.

Today’s debate offers a welcome opportunity for the Secretary of State to provide some much-needed clarity on his plans for transport in a post-Brexit UK. He was one of the leading advocates of Britain leaving the EU, and he now has the privilege of being the Transport Secretary, so if anyone can provide us with a clear picture of what to expect in the months and years ahead, presumably he can.

One of the areas of transport most likely to be affected by the country’s decision to leave the EU is the aviation sector, which is a key pillar of our economy. Taken country by country, the UK’s aviation sector is the largest in Europe and the third largest in the world. It is worth about £50 billion in terms of our GDP, it supports 1 million jobs and it secures the Treasury some £9 billion in taxation each year.

While we accept the result of the referendum and are determined to secure the best possible deal for all the UK, we must not be an inward-looking nation that is cut off from the cultural and economic benefits that come with being an interconnected country. We must be ready to do business with the rest of the world. That means retaining and building on the connectivity that the UK currently enjoys in order to allow the flow of goods and services that will be key to getting the best out of Brexit.

[Robert Flello]

I, too, want Brexit to be a success and for us to get on with it and ensure that we get the best possible deal for our country. However, does my hon. Friend share my concern that the Department for Transport, which has seen massive cuts to its revenue budgets and day-to-day spend, just will not have the staffing in place to be able to deal with the huge number of issues? At the same time as we negotiate Brexit, we will be negotiating different agreements with other countries on matters such as aviation.

[Andy McDonald]

My hon. Friend makes a good point. We have seen the inability to see such things through and deliver them not only on this issue, but through the prism of the franchising system in the rail market. He raises a grave concern about something that we will be watching with great care in the weeks and months ahead.

Through its membership of the EU, the UK currently relies on the EU single aviation market, which allows airlines to operate freely inside the EU without restriction on capacity, frequency or pricing and enables the use of the EU’s external aviation agreements. Leaving the European economic area could mean that we are no longer part of the single aviation market and could lose access to those external air service agreements. That is critical, because unless the position is clarified urgently UK airlines will lose the right to operate within the European Union and airlines will lose the right to fly UK domestic routes. The Government must ensure that Brexit does not damage the UK’s connectivity. The aviation sector has been clear about the importance of retaining an unchanged operating environment.

[Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)]

The hon. Gentleman and others have talked about getting the best out of Brexit as it arrives. Given the seven options for that process, does he imagine that any will be as good as the situation that we have at the moment? People are looking for the best decision, but the question is whether it will be as good as what we have.

[Andy McDonald]

The hon. Gentleman raises a critical point that is the whole focus of this debate. It is our concern in this House that we are simply not going to be able to deliver the same level of interoperability and accessibility as we currently enjoy throughout Europe. In the aviation sector, it is critical to achieve that before we even begin discussions about our trading relationship going forward.

[Nick Smith]

The National Audit Office says that, under this Conservative Government’s watch, Network Rail and the Government have wasted £330 million so far on the great western mainline electrification. Does my hon. Friend agree that the Department for Transport needs to pull its socks up to deliver on future infrastructure projects?

[Andy McDonald]

My hon. Friend makes his point eloquently. That is the sort of wastage from this Department that we have seen in so many areas over the past several years. We have seen smart ticketing costs written off and the Great Western debacle. Everyone in this place is worried about its inability to function effectively.

It is vital that there be not only early assurances from Government, but confirmation that the status of current aviation practices will be guaranteed beyond our formal departure from the EU.

[Robert Flello]

My hon. Friend is being generous in taking interventions. I was slightly reassured by what the Secretary of State said a few moments ago about his planned meetings with the US Secretary of Transportation. My hon. Friend talked about access to the European network, but the danger on the US side is that we will fall back on the Bermuda II agreement, which was designed for a whole different world and certainly not for the 21st century. Does my hon. Friend share my concern that we have more to worry about than just European skies?

[Andy McDonald]

I do share those concerns. Although it is clearly imperative that conversations be had with those across the Atlantic, I was a little anxious to hear from the Secretary of State that that becomes the first port of call, rather than trying to resolve matters within the European Union.

[Chris Grayling]

I have also spent quite a lot of time with my German counterpart and with a number of other European Transport Ministers, and I will be doing that next week.

[Andy McDonald]

I am delighted to hear it.

Will the Secretary of State explain to the House his plans for the UK’s relationship with the European Aviation Safety Agency on leaving the EU? What is his intention? Will he seek to maintain technical co-operation through a bilateral aviation safety agreement approach, as with the United States, Canada and Brazil, or through a working arrangement with the EU, as is currently enjoyed by China, New Zealand and Russia? I urge the Government to confirm that air service agreements will be negotiated separately from the UK’s negotiations on future trade with the EU, as well as specifying the nature of those agreements. I invite the Secretary of State to outline his plans for UK airlines to retain the right to operate within the EU and retain access to the EU’s external air service agreements.

[Mr MacNeil]

The hon. Gentleman has touched on an important point about retaining the work done on the open skies agreement, because if we look back on UK air policy before that time, as I have done, we see that it was about bilateral agreements that specified flying into London airports only. I believe Iceland broke that by getting into Glasgow, because the father of one of the negotiators wanted to go shopping for suits in Glasgow. That absolutely points out the problem we faced when the UK was managing this itself: it was centralised for the benefit of the south-east of the UK, to the detriment of others.

[Andy McDonald]

I do not know where you get your suits, Mr Deputy Speaker—[Interruption.] Neither in Iceland, nor in Glasgow. It appears we should always go to Glasgow. The issue the hon. Gentleman raises is particularly pertinent given the decision we have just had on the additional south-eastern runway, so he makes the point well.

Numerous rail projects in the UK receive support via loans or direct funding as a consequence of our membership of the EU, and now is not the time for the Department to row back on investments in our railways, as we have seen happen repeatedly in respect of electrification works, which hon. Members have spoken about so eloquently this afternoon. I invite the Secretary of State to reassure the House that any funding shortfalls will be made up by the Government and that investment in rail will not suffer as a consequence of Brexit.

The Secretary of State said during the EU referendum that he wanted to take back control. Labour Members very much wish to take back control of our railways from private and foreign state-owned companies, which currently profit from the system at the expense of passengers and taxpayers. Ours is a policy supported by two thirds of the public, but, as the Secretary of State is aware, although running services in the public sector is currently entirely consistent with EU legislation, the fourth railway package may restrict the different models of public ownership that might be available. Does he agree—I believe he said so earlier—that it should be for UK voters to decide how best to order our railways? If so, will he confirm that his Government will not attempt to retain any European requirements in domestic law that would frustrate any future attempts to bring railways back into public ownership? I was delighted to hear what he had to say about HS2, and I suppose that if there is going to be a silver lining from leaving the EU, it will be that we will not be able to blame “them” any longer for any problems we have with disabled people getting access to our railway system.

My hon. Friend the Member for Blaenau Gwent (Nick Smith) has not had an answer to his question, because he made it abundantly clear that he was talking about the infrastructure. The Secretary of State suggested he should be satisfied with improved services, but those will come only with improvements in the infrastructure.

The skills footprint, to which the Secretary of State referred with great regularity—of course we share some of his concerns—should be delivered whether or not we are in the European Union. That is not a consequence of any move. It should be an absolute prerequisite that is woven into everything we do.

Although we have decided as a nation to leave the European Union, co-operating with, and retaining our connectivity to, the EU is vital. We would greatly appreciate it if the Secretary of State enlightened us on what progress is being made to ensure that hauliers from the UK can carry goods between other member states and on whether it is his intention to secure an agreement for British driving licences to continue to be exchangeable with those of EU member states after Brexit.

Finally, let me mention UK ports, which directly employ more than 25,000 people, many of whom voted to leave because of anxiety surrounding EU ports services regulation. Many leave campaigners argued that leaving the EU would ensure full exemption from those regulations. However, the former shipping Minister, the hon. Member for Scarborough and Whitby (Mr Goodwill), was reported as saying that the ports services regulation would still apply under an arrangement that granted the UK access to the European economic area. Can the Secretary of State clarify the Government’s intentions on any withdrawal from ports regulations and guarantee that any exemptions do not inadvertently undermine strong industrial relations and the welfare standards of dock and port workers?

[Sir William Cash]

Whatever the hon. Gentleman may try to infer with regard to the European economic area, it is completely beside the point. The fact is that there is a regulation and, as he knows, it is on the brink of being brought in—I believe it is by the end of this month. All that talk that he has just given us has nothing to do with the issue. The real question is whether the Labour party is going to oppose it. Will it say that it condemns it, because that is what the unions, the Government and, as I understood it, the Labour party wanted?

[Andy McDonald]

I am not sure whether I could have been any clearer. I have just addressed the issue head on. If the hon. Gentleman reads Hansard, he might be a little clearer in his own mind.

My contribution has been full of questions, because so little has been revealed so far that would give any idea of what the Government are setting out to achieve after Brexit and of the mechanisms by which they aim to achieve any such objectives. Huge questions remain over the future of our flourishing aviation sector; over what existing EU legislation will be retained and what that will mean for our railways and ports; over whether EU funding for transport projects will be made up by the Government, and over issues to do with connectivity by road and what Brexit will mean for haulage.

I invite the Secretary of State to bring forward the details of his Department’s plans for Brexit, which have been, so far, so stark staringly absent.

16:22

[Sir William Cash (Stone) (Con)]

My main concern in relation to this debate is with regard to ports services regulation. It is a perfect example of where the European Union has gone completely wrong, and of why, in this particular sector, it is vital that we leave the European Union. I will give a number of reasons for that, which are drawn from those who have the most knowledge of these matters, including those who are referenced in the latest Library briefing.

As has been said by the Major Ports Group, many of the issues that confront UK ports are affected by policy and legislation from the European Commission and the European Parliament. The European Parliament is about to hold a plenary session and, for present purposes, it is assumed that the regulation will go through. It will then go to the Council of Ministers, which is governed by qualified majority voting.

The European Scrutiny Committee and I have been following this for several years, and I will come on to the timetable and my concerns about the failure to have a proper debate on the Floor of the House on this issue exclusively. The port employers say:

“While UK ports receive virtually no financial assistance from the public purse, the situation is very different in most continental ports.”

That is hugely important. We are an island. We have 47 ports. They are incredibly important, and I accept, of course, that the Opposition spokesman, the hon. Member for Middlesbrough (Andy McDonald), has made clear his concern, but it does not alter the basic point: we cannot resolve the question of the port services regulation because of the qualified majority voting system. Even if we vote against it, we cannot stop it. That is the problem, and it is why I had to ask the hon. Gentleman twice about this. I will give a description in a few moments. I understand that that the Opposition have accepted the outcome of the referendum.

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

Not all of us.

[Sir William Cash]

As the hon. Gentleman suggests, the Opposition in Scotland do not accept it, but there are reports in Scotland that many people there will be affected by the outcome of the regulation, so I shall continue. We are an island nation, but this is not just romantic blurb about this sceptred isle and the fact that we are surrounded by a silver sea; this is about whether we in this country can have an efficient port sector. As we are an island, we are heavily dependent on the ports as goods go in and out of them.

[Robert Flello]

For the benefit of the wider House, may I say that over 90% of our trade goes through our ports?

[Sir William Cash]

Indeed, and I know where the hon. Gentleman—my next-door neighbour—has got that figure from. It is from paragraph 6.2 of the Library note, which I can see he has been reading. I am glad that he has been so assiduous. The principle is that, despite the fact that we are an island, we compete with continental ports for certain types of traffic. Those in the ports industry are therefore concerned by a lack of a level playing field between the UK and continental ports.

[Mr MacNeil]

The hon. Gentleman will have probably seen the report published on the front page of the Financial Times perhaps four, five or six weeks ago that the UK might have some difficulty carrying out customs checks at ports and other such points. At the moment, we carry out 35 million checks a year. We as the UK would need to carry out up to 240 million checks a year, but the new system has the capacity to handle about 100 million checks. If this situation emerges, it will cause a huge difficulty post-Brexit and inevitably damage trade, because the infrastructure is not there to do customs checks at ports.

[Sir William Cash]

My response is quite simple: if we do not continue to have an efficient ports system because of the effect of the port services regulation, nothing that the hon. Gentleman says will make any difference to the fact that our ports will be put not only at a severe disadvantage, but in a dangerous situation vis-à-vis the other continental ports. However, despite the fact that there was an attempt to get state aid rules imported into the regulation, the ports employers believe that

“it is essential that legislation aimed at regulating less commercial ports on the continent does not cause unintended damage to the UK’s thriving commercial sector.”

On that basis, there is a matter of principle that affects our whole import and export business that goes through the ports.

The effect that the proposal will have is so obvious that I need not even attempt to explain it. It aims to regulate market access to port services, port charges and financial transparency. The ports employers say:

“The text as a whole”

—this is some time ago, but I will catch up in a moment with what they have said most recently—

“even if heavily amended, cannot deliver on its states aims. Instead, it will create severe legal uncertainty, reduce investment and will ultimately be detrimental to the safety standards and working conditions which currently exist in EU ports. EU ports may have different ownership structures, but all require a high level of confidence in a stable legal and policy framework in the long term if they are to operate safely”,

which is for the benefit of the workers,

“and contribute to the EU agenda for jobs and growth”,

which is vital to everyone, whether they are employers or workers in the ports.

The UKMPG goes on to say:

“The Port Services Regulation proposal does not provide such confidence and risks leaving a legacy of legal and practical difficulties across the EU.”

The UKMPG

“supports a return to the previous EU ports policy approach based round application of the general provisions of the Treaty reinforced, where appropriate, by guidelines on state aids.”

We now have Brexit so, as the hon. Member for Stoke-on-Trent South (Robert Flello) suggested in relation to the great repeal Bill, are we going to reach a point, as I think we must, where we transpose the legislation into UK law but then, through statutory instruments and our own decision within the framework of this Westminster jurisdiction, as a result of the decisions taken by the people of this country, including Government Members and Opposition Members—with the exception, I suspect, of SNP Members, but they will pay a price for this in their ports areas—[Interruption.] They may find this amusing, but there are people in the ports of Scotland who do not like the proposal and will resist it if they can. They will not be allowed to do so if the SNP can get away with it.

The bottom line is that this is an issue of great national interest. The European Scrutiny Committee has been following the matter for several years. We first recommended it for debate on the Floor of the House in July 2014—over two years ago. On 19 October, I wrote to the Minister:

“We understand that it is intended that the European Parliament will adopt this text for a First Reading Agreement at its 12-15 December plenary and we presume that this will be followed shortly by Council agreement.

You will understand, therefore, that the Committee expects that the Government will finally, after a disgracefully long delay”—

which I underlined several times—

“schedule the floor debate on the proposal which it and its predecessor have recommended.”

In fact, there have been two debates, which have been aborted. One of them, I can assure the House, was so shambolic that the Chairman of the Committee had to suspend the sitting. I will not go into the details of that—they are all on the record.

[Kelvin Hopkins (Luton North) (Lab)]

I have been involved in the European Scrutiny Committee for several years. I did not intend to intervene, but I am concerned about this issue. The hon. Gentleman is saying that we will take into British law what now exists as EU law, but we will selectively disapply parts of the EU legislation that do not suit Britain, and this might be one of those.

[Sir William Cash]

That is absolutely right. It is essential that we disapply this, for that reason. The mechanics of it will be left to statutory instruments, but we must reassert our jurisdiction over our ports.

As recently as 17 November, I wrote again to the Minister, saying:

“The Committee has asked me to emphasise to you and the Leader of the House that this debate should take place before the European Parliament adopts the text for a First Reading Agreement and the Council’s subsequent endorsement of this text.

Failure to meet this timetable would suggest contempt for the House and its legitimate scrutiny requirements.”

Although the issue has been going on since July 2014, we still have not had that debate. There is just time for us to have such a debate. Although this is a general debate about exiting the EU, a specific debate is not only recommended but, in effect, demanded by the European Scrutiny Committee, backed by the sort of language that I have had to use, demonstrating the importance of the issue and the need to get on with it. The other point that I must make is this: I have had no reply to those letters. At its meeting today, I am afraid that the European Scrutiny Committee registered its deep concern about the situation.

I received my latest statement from the ports industry this afternoon. I want to read it out, because it is important that the House knows the latest position:

“One further point…is that the UK Government has insisted on pursuing the inclusion in the PSR of a ‘Competitive Market exemption’ rather than the option of having an exemption for the privately financed ports on the face of the Regulation itself”,

which is what the industry has been seeking.

“It is this Competitive Market Exemption provision that was finally agreed in the informal trilogue discussions between the Council, the European Parliament and the European Commission earlier this year and which is now in the final draft version of the PSR due to come before the European Parliament in December. However, this ‘Competitive Market Exemption’ is not an exemption—it is a process by which Member States may apply to the European Commission for an exemption”,

as if they could expect to get it.

“Any application would be determined solely by the European Commission, may be limited in scope or time, and would relate only to certain Articles of the Regulation. In short, it offers no guarantees that the PSR would not be fully binding on UK ports.”

Mr Cooper, the spokesman at last week’s annual parliamentary reception of the United Kingdom Major Ports Group, who is also CEO of one of the largest port companies, also had this to say:

“I will not rehearse the arguments against this wretched piece of wholly unnecessary legislation, but, as the endgame approaches, it remains a totemic example of a Regulation imposed by Brussels which is a one-size-fits-all straitjacket that runs entirely counter to our national interest. In its present form the Regulation is significantly less damaging than it might have been—and, alongside the DfT, the port industry can claim considerable credit for that—but it is not a success that can be guaranteed over the long term. Many of the changes to reduce the scope and impact of the Regulation have been a function of short-term political expediency.”

The problem is this. It is inherent in the procedures of the European Union—in the Council of Ministers, the European Parliament and the European Commission—that we are in this situation. We cannot stop it without leaving the European Union. As the hon. Member for Stoke-on-Trent South says, the timetable in relation to the great repeal Bill is significant. However, this is a very good example. What is for sure is that if we repeal the legislation and follow Brexit to its logical conclusion—this applies to many other areas as well—the United Kingdom will be enabled to regain control: in this case, over its island ports and the business that goes in and out of them. It will do that under the Westminster jurisdiction, on the basis of a new ports Bill, after Brexit and after the great repeal Bill has gone through, for the benefit of people who work in the ports in an executive capacity as well as those working in the docks themselves—the workers, who deserve to be given a fair deal. The Government and the Opposition, recognising this, must appreciate that we need a proper debate about the issue. It is so important that we get this right for the benefit of the United Kingdom as a whole.

16:39

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

We have heard from the Secretary of State for Transport that we should have confidence; he has reassured us that we should have optimism, but, of course, we have heard no details.

The impact of Brexit on the different modes of transport—aviation, maritime and road haulage—will be immense, but its main effect will be on all the people in our communities, with rising costs for goods and mobility. There are also those who want to do business with us or to visit us as tourists. It is wrong for Ministers not to have a full explanation of how exiting the EU will impact on businesses, consumers and passengers.

Nobody doubts that we are facing stormy seas, yet instead of a plan we are told by the Foreign Secretary that Brexit will be titanic. That is scary enough, but time after time, in terms of plans and answers, we find it is just an empty vessel. The Government’s model is less a ship of state and more like the Mary Celeste. So let us see the Brexit rhetoric cast overboard, and let us hear some definitive answers.

People will be affected; they and our businesses deserve to know what the plan is. This failure to provide a plan is simply a plan for failure. People face additional journeys for connections, more expensive tickets, fewer rights to challenge delays and cancellations, additional insurance costs and long queues at border controls. When they call home, their calls could cost more because they will not have mobile phone roaming protection.

The Chancellor said today that he wanted the UK to be the No. 1 destination for business. Well, how are people going to get here? Let us start with aviation. Leaving the EU could restrict operations by UK airlines in Europe, and by EU airlines in the UK, leaving our constituents and visitors to the UK paying the price for Brexit through higher fares. Analysis from the independent Oxera economists states that such restrictions could lead to UK passengers’ airfares rising by 15% to 30%.

As an MP from the highlands, and as chair of the regional airports all-party parliamentary group, I am also extremely concerned about the increased cost pressure on regional airports. These airports have thrived with the increase in low-cost airlines, and the advent of cheap short-haul flights across Europe owes a large part of its success to the EU. As easyJet said:

“the single aviation area gives airlines freedom to fly across Europe and since its introduction passengers have seen fares fall by around 40 per cent”.

Without that agreement, fares will inevitably be higher.

[Chris Grayling]

Earlier this week, I met the proprietor of AirAsia, who has built an extraordinarily successful low-cost airline across south-east Asia. Countries there are not in a European Union-type institution. Can the hon. Gentleman explain to me and to the House why it is not possible to have a low-cost aviation set-up in Europe with us outside the European Union, but it is possible to have such a set-up in a part of the world where there is no such body as the European Union?

[Drew Hendry]

Let me answer that by giving the right hon. Gentleman the words of easyJet itself. EasyJet is currently registered in the UK and can fly largely without restriction from the UK to other member states—France and Germany, for example—and wholly, in terms of the domestic market, within countries such as Italy. EasyJet is now setting up a separate operation outwith the UK to ensure that it can continue to fly without restrictions after the UK leaves the EU. As its chief executive officer, Carolyn McCall, said, current EU flying rights might have to be renegotiated, and the new company will ensure easyJet can operate within the EU. She added:

“We are not saying there will be no agreement. We just don’t know the shape or form. We don’t have the luxury of waiting. But we have to take control of our own future.”

That is in no small part due to the lack of clarity from the UK Government over what aviation agreement the UK will eventually come up with. The Secretary of State and his colleague the Secretary of State for Exiting the European Union have said:

“Market access remains a top priority, and we want to make sure we have liberal access to European aviation markets.”

Strikingly, however, there was no guarantee that the UK would stay within the open skies agreement. The UK Government need to explain to us now how this is going to work. When open skies was agreed back in 2008, the UK market was one of the key attractions for the United States. At the time, the UK accounted for a 40% share of the EU-US market. If the agreement ceases to apply, as was mentioned earlier, will the UK have to revert to the Bermuda II bilateral agreement, signed in 1946 and last amended in 1991?

[Mr MacNeil]

Perhaps there is an opportunity for the Secretary of State to come to the Dispatch Box and tell us whether we will be in the open skies agreement post-Brexit.

[Drew Hendry]

I am happy to allow the Secretary of State to intervene on that point if he wishes to do so, but obviously he does not.

The aviation market has changed considerably since the days of the Bermuda II agreement, and any reversion could cause disruption to UK airlines and transatlantic trade and passenger routes. If this is not the case, then what is the plan?

The implication of new border controls is negative in both ways. Ease of travel within the EU is attractive to our constituents and to those visiting the UK. Undoubtedly, passport checks and processing times for visitors from the EU will impact on our attractiveness to visitors. The fact that EU visitors will need to enter the UK through the non-EEA lines will require Border Force to commit significantly more resources at airports. Even with extra staff, queuing times for European visitors will still almost double to about 45 minutes. Those of us representing constituencies with a significant tourism economy find this extremely concerning.

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

Staying slightly on that topic, will my hon. Friend urge the Transport Secretary to engage with the US Government, who are currently considering Edinburgh airport for pre-clearance travel to the United States, as a positive way of showing the world that we are indeed open for business?

[Drew Hendry]

I thank my hon. Friend for his intervention; he has made his point and I will not follow it up any further.

One can imagine, under the future provisions, being a tourist from Europe, especially in the short break market, with the choice of going to the UK or somewhere else where there is a lot less hassle—somewhere more welcoming. Additional space will need to be allocated to immigration control operations in airports and other ports of entry. It is thought that the costs could spiral into tens of millions of pounds. This cost must be borne by airports and port operators, who then cannot invest that money in increased connectivity and improving the passenger experience. According to the Tourism Industry Council, if the 23 million EU nationals who visited in 2015 were to be subject to full border checks, Border Force would be required to increase resources allocated to this by 200%—on top of the problems that already exist. Manchester Airports Group says:

“Border Force provision at a number of airports is already inadequate, with a lack of long term planning meaning queue times for passengers can already be unacceptably long.”

So what is the plan?

[Ian Paisley]

Before the hon. Gentleman gets into the detail of the hypotheticals of border controls, does he accept that the single largest threat to ordinary travellers in the United Kingdom, and across the entirety of Europe, is none of the things he has mentioned but the package travel directive about to be introduced by the EU, which will put additional costs on every single traveller because they perhaps use sites like Expedia?

[Drew Hendry]

The hon. Gentleman makes a good point. So many issues are facing us that it is very difficult to pick out the single most important item. There are a lot of unanswered questions.

Is the plan to reach an agreement with the EU that the EEA channel will continue to operate in the UK, and that EU member states will allow UK citizens to use the EEA channel in the EU?

Regional airports are vital for connectivity within Scotland, but the reckless gamble with our EU membership has caused great uncertainty for these airports that could have a seriously detrimental impact on our economy. Scotland has a large number of regional airports, many of which are reliant on low-cost airlines and outbound tourism to survive and to be an economic success. The International Air Transport Association predicts that a 12% reduction in sterling would result in a 5% decline in outbound travel, while Ryanair has said that it is scaling back its expansion in the UK.

[Kelvin Hopkins]

Is it not the case that since 23 June, there has been a significant depreciation of sterling and a surge of people coming into Britain to buy things, because everything is cheaper here? Is that not good for businesses in Britain, including those in Scotland?

[Drew Hendry]

I am happy to answer that. When I was a retailer many years ago, the UK Government introduced an increase in VAT. Before that VAT increase hit, there was a rush to the shops to buy goods. After that increase hit, things fell through the floor, and I think we will see a similar effect.

Scotland has a large number of regional airports, many of which are reliant on low-cost airlines and outbound tourism to survive and to be an economic success. As I have said, the International Air Transport Association predicts a reduction in outbound travel. Since the EU referendum, sterling is down 25%. For airports such as Prestwick, it is even more vital that we continue the open skies agreement to maintain the number of outbound passengers, so it is incumbent on the UK Government to give an unequivocal guarantee that the UK will stay in the single aviation market after we are taken out of the EU. With 76% of UK holidays abroad being taken in the EU, outbound tourism is key for the industry. Outbound tourism employs more than 215,000 people across the UK, and it is a key driver in ensuring that our regional airports are successful. Remaining in the open skies single aviation market is vital to ensure that our airports remain economically viable, and low-cost airlines are vital if regional airports are to be a commercial success.

[Callum McCaig (Aberdeen South) (SNP)]

My hon. Friend has talked about airports relying on bringing in tourists. Aberdeen airport is heavily reliant on business traffic, but with the difficulties that the oil and gas industry has faced, the airport has redirected its efforts towards sun destinations in the likes of Spain and towards eastern Europe. What kind of message does the lack of clarity about the plans send to an airport that is looking to diversify its offering?

[Drew Hendry]

My hon. Friend makes a good point, and he underlines the theme that I am working on just now. This uncertainty is bad not only for business, but for consumers, passengers and everybody involved.

[Kelvin Hopkins]

The hon. Gentleman talked about exchange rates. I think that relative to the euro, sterling depreciated by far less than 25%. That is crucial, because that is where we have our serious trade imbalance. With the rest of the world, we have relatively good relations. The strength of the dollar has compounded the depreciation of sterling, but that depreciation will be beneficial to British industry, wherever we trade.

[Drew Hendry]

That is the kind of thing that somebody might want to put on the side of a bus. It has been a trait of previous UK Governments to take forever to make key transport decisions, but UK regional airports, including those in Scotland, do not have the luxury of waiting. For the sake of those airports, our businesses and our commuters, the UK Government need to provide a clear and unequivocal guarantee that any post-Brexit aviation agreement will not lead to a loss of investment and connectivity in Scotland if we end up outside the open skies agreement.

The current aviation policy framework sets out that airports cannot apply for a public service obligation or the connectivity fund because of the 60-minute rule, which means that a number of regional airports lose out. The Government’s EU gamble is putting potential investment in Scotland’s regional airports at risk. They need to think again and, in doing so, give regional airports a fighting economic chance.

The problems are not confined to aviation. Our maritime sector faces similar concerns. We have heard a fair bit about ports, but the maritime sector is worth €12 billion annually to the UK economy, and some 240,000 people are employed in the sector in the UK. Fifty-three per cent. of the UK’s imports and 45% of its exports are from the rest of the EU. It is estimated that approximately 3 million jobs in the UK are linked to trade with the rest of the EU. Currently, there is the freedom to trade. OECD rules could preclude any change, in so far as we are talking about the ability of a ship to call at an EU or UK port and to load and unload cargo and passengers, regardless of its flag and regardless of the nationality of its owner. UK-flagged ships could, however, lose their right to operate in the domestic trades of EU member states that maintain flag-based cabotage restrictions.

The British International Freight Association has said that its main concern is potentially losing the benefits of free trade and customs harmonisation with the EU single market:

“A return to tariffs for UK merchandise exports and imports, if this is the outcome...will be detrimental to UK trade with the EU, and may result in a…reduction in UK-EU maritime volume.”

As we have heard, the UK’s port sector is largely privately owned and run in a competitive environment, and is thus very different from those of many other EU member states. Oxera has also said that changes to the costs of trade with the EU are

“likely to affect the volumes and patterns of freight activity at ports, while the need for new customs checks on imports and exports is likely to cause considerable congestion at UK and mainland European ports.”

It suggests that any negative impact could be mitigated through EEA membership or free trade agreements, although delays in negotiations could mean a significant period trading under World Trade Organisation arrangements. Uncertainty will impact the industry and the people it employs, and drive up the price of goods, so what access arrangements will be in place?

[Sir William Cash]

I hear what the hon. Gentleman is saying, but he will have heard what I said earlier. What is his answer to that with respect to the question he has raised about Scotland? Are Scotland’s ports not equally affected?

[Drew Hendry]

I thank the hon. Gentleman for that; I think we are making a very similar point from very different perspectives. There needs to be a plan for how ports are handled, going forward. The difference in the regulation and operation of UK ports as compared with EU ports provides a significant obstacle. The UK Government have to give us an answer on what they are going to do and how they are going to take forward a plan on that basis.

[Sir William Cash]

Will the hon. Gentleman give way?

[Drew Hendry]

No, I will make some progress.

What access arrangements will be in place? What is the plan for the millions of people connected with this industry? Will UK companies have access to a single European market, with no taxes or duties payable on goods?

There are a lot of potential uncertainties for UK road haulage companies as a result of Brexit, particularly in terms of employment, drivers’ hours rules, access to markets and border controls. Transporting a lorry load of goods from London to Milan in 1988 required 88 separate documents; the internal market replaced them all with a single piece of paper. In response to the balance of competences review, the Freight Transport Association said that the EU had created

“a market that logistics has served for nearly half a century”,

benefiting British businesses; the Road Haulage Association, similarly, felt that for its sector the overall judgment was a fine one. It said that

“‘competences in UK road transport are finely balanced in our sector. Although we have not got a 100% solution in terms of market access we have got the most of what we think the industry would want”.

That is largely a reference to cabotage, the practice whereby a haulier from the UK can carry goods between two other member states—for example, Spain and France. So, what is the plan?

[Chris Grayling]

rose—

[Drew Hendry]

I am happy to give way to hear the plan.

[Chris Grayling]

Will the hon. Gentleman tell the House, first, what proportion of cross-channel traffic is carried by UK hauliers as opposed to hauliers based elsewhere in the EU, and, secondly, the balance of cabotage carried out in the United Kingdom by European hauliers, and vice versa?

[Drew Hendry]

The Secretary of State is trying to make an argument similar to that made during the Brexit campaign about how the EU has to buy cars made here because there is a bigger market for them. That does not square with the facts of what is happening in the European market. For example, what will happen when there is a shortage of drivers in the road haulage industry, as at the moment many of them are EU nationals, supplying our road transport network? We have not heard the plan, and I heard nothing in the Secretary of State’s remarks today to say that there was a plan in this regard.

The EU single market has delivered significant economic and social benefits for Scotland. The four freedoms of the single market—freedom of movement of capital, of people, of goods and of services—have removed barriers to trade and opened Scotland to a market of more than 500 million people. The single market has also generated direct benefit, and there are now unanswered questions about funding. As of October 2016, some £350 million had been legally committed for transport funding, meaning a further £450 million is available as long as it is committed before the UK leaves the EU. Some £13 million of that went directly to Transport Scotland, with the agency being available to seek a further amount from the remaining £450 million. However, there has been not a peep from the UK Government or the Chancellor on whether the funds will be committed up to 2020. Will the UK Government seek to top up the funding to Scotland after we leave the EU?

I will conclude now, but there are many further issues relating to rail and bus networks, including vehicle standards and testing, disabled badges and a whole lot more. There are so many questions on transport in the light of Brexit that I think we will return to the subject again and again. Those questions are being asked not just by me or my hon. Friends, but by industry and the public. They deserve answers. They deserve “the plan”, but instead they see that, on issues relating to maritime, road or air, they have a UK Government who are all at sea, taking the road to nowhere, and booked on an expensive and uncomfortable flight from reality.

17:00

[Ben Howlett (Bath) (Con)]

It is a pleasure to follow the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry). I am not sure if this is entirely parliamentary but, as I am following my hon. Friend the Member for Stone (Sir William Cash), we have had Bill and now we have Ben. I am not exactly sure, however, that we are in the same flowerpot right now.

I am pleased to have the opportunity to speak on the effect of leaving the European Union on our transport sector. Like many colleagues, I would have preferred to have had a debate on the effect of exiting the EU on the single market or the free movement of labour. Nevertheless, this is still an important issue for a number of residents in my constituency and in the United Kingdom as a whole. I note the irony that the House of Commons Library briefing paper on this subject suggests that

“transport post-Brexit may not look wildly different to how it looks now”.

However, given that much remains unclear as we head towards the negotiations, I would like to outline a number of priorities the Government should consider.

The European Union’s common transport policy is focused on a number of policy areas, most notably economic and social matters, environmental improvements and infrastructure investment. There has been a long-running debate on whether the benefits of European Union membership and access to a single market for transport services outweigh the relative burdens of regulation. It is my belief that the development of the common transport policy has benefited the United Kingdom by improving the health of our population and boosting economic growth, while ensuring we have the long-term infrastructure to compete in a global environment. We need to ensure that the UK continues to feel these benefits once we have left the European Union.

I would like to take this opportunity to change tack somewhat from the long conversations we have had about ports and to focus on two key areas: environmental improvements and infrastructure investment. I sympathise with the Government’s position that while Brexit negotiations are ongoing it is important not to make guarantees but, like many sectors, transport is an area that needs certainty. I am sure that we all agree about that.

First, I would like to concentrate on the environmental impact. Bath has a huge problem with air pollution. As colleagues will know, Bath is full of buildings constructed out of the famous Bath stone, which absorbs vehicle emissions. Sadly, high air pollution levels across the city mean many buildings are slowly blackening—hon. Members will be pleased to know that my home has been rendered, so it is not blackening at the moment. In some parts of Bath, air pollution levels far exceed the legal limit and cause problems to my constituents’ health and wellbeing. Of course, this is not a problem for just my constituency; it affects many constituencies of Members here today.

Ensuring that the transport system works in a way that does not have a negative impact on the environment—reducing the impact of noise, pollution, harmful emissions and greenhouse gases—is vital to the long-term health of our population. The transport sector accounts for almost a quarter of all greenhouse gas emissions in the European Union, making it the sector with the second highest level of greenhouse gas emissions, just behind the energy sector. Moreover, transport is the only sector in the EU whose emissions have risen since 1990—by a staggering 22% in total. The Transport Committee has been doing some work on this issue over a number of years.

Alongside our EU colleagues, we have committed to reducing emissions in our transport sector and meeting European emissions standards. It was the UK that pushed hardest on this very issue, so it would be a shame if Britain were to draw back now. It is crucial that such work continues after Brexit. This issue is not isolated in the UK—we share our air with the EU and the rest of the world—yet many are concerned that we will lose the collaborative approach that is critical to solving these pan-national problems when we leave the EU.

I recently visited the low-emissions vehicle research centre at the university in my constituency. Incidentally, it has benefited from £3.6 million of research funding and contracts from EU government bodies.

[Stephen Gethins]

The hon. Gentleman mentions his university, and I am extremely concerned about research funding after 2020. Will he join SNP Members in asking the Chancellor and the Transport Secretary to give greater certainty to the university sector about the post-2020 world?

[Ben Howlett]

Several of us raised that matter during our consideration in Committee of the Higher Education and Research Bill. The announcement that the last few years’ funding will continue after we leave the EU is, of course, welcome, but the university sector is very concerned, for example, about our leaving Horizon 2020, which we have been part of for many years. That would leave a huge hole in higher education funding and it is something that I hope the universities Minister will consider during the Bill’s passage through the other House.

Bath University’s prize-winning research centres are having a hugely positive impact on the measurement and understanding of air quality in not just the UK, but the EU. The Institute for Advanced Automotive Propulsion Systems, which is run and spearheaded by my university, will, I hope, receive some of the funding that the Chancellor announced earlier via the expansion of the local growth fund. This subject is obviously quite topical, given the recent Volkswagen scandal. Britain might end up with an opportunity to bring businesses such as BMW over to the UK to measure its air pollution levels, as Ford and other major international motor vehicle companies have been doing. It is important that, as we set out our position on exiting the EU, we remain committed to meeting our obligations on European emissions standards across the transport sector so that we improve the lives, and the health and wellbeing, of all our residents. I am sure the Government have that at the forefront of their mind as they consider transport policy after we leave the EU.

My second point relates to infrastructure investment. I would like to focus on the importance of maintaining adequate investment in our transport system and particularly in road, rail and aviation, many of which have already been mentioned. I welcome the Government’s commitment to completing the incredibly important HS2 project and their recent announcement on Heathrow airport expansion. Both are vital to the long-term development of our country. In 2014, the European Investment Bank provided lending of more than £6 billion to support long-term investment for a broad range of infrastructure projects across the UK, some 26% of which were in transport and the telecommunications sector, so it is an important funding source for such projects. While we have been instrumental in the creation of the trans-European transport policy and the fourth railway package, which aims to remove the remaining barriers to the creation of a single European rail area, I hope that conversations will take place as we leave the EU to ensure that Britain still has adequate train links with the EU. By removing bottlenecks, building cross-border connections and promoting integration and inter-operability between different modes of transport, we can ensure that the UK benefits from an infrastructure plan that promotes economic growth and job creation.

[Stephen Gethins]

The hon. Gentleman talks about business growth. Does he agree that, just as transport improvements benefit business, so too does continued membership of the single market? Does he support our continued membership?

[Ben Howlett]

I have said on many occasions that I support membership of the single market. How achievable that is will ultimately be for the Government to negotiate with the EU but, fundamentally, businesses—not just in my constituency, but in the devolved nations—would suffer from a reduction in access to the single market. It is the same with the customs union. One thing missing from the speech of my hon. Friend the Member for Stone was a consideration of possible cost implications and of how ports might lose out if we leave the customs union.

Now is not the time to slow down any investment in our transport sector, as we heard today from my right hon. Friend the Chancellor of the Exchequer. With finance still needed for projects in my constituency such as the A36/46 link road and the completion of the electrification of the great western main line, the Government must commit to continuing any lost investment that currently flows from our membership of the European Union.

I hope that today’s debate will give the Government an opportunity to increase transport investment across the south-west as a whole. While there was welcome news in the autumn statement, there is a real opportunity over the next few years to address the imbalance. It was disappointing that a recent Institute for Public Policy Research report concluded that the south-west had the second lowest transport investment per capita and per commuter of anywhere in England. Without wishing to give too much credibility to counter-factual history, I question whether greater investment by the EU in transport infrastructure in the south-west would have led to more residents voting to remain part of the EU.

Transport is one of the EU’s most strategic common policies, and on many occasions we have been the driver for change in this area. Following our exit from the European Union, I hope that the Government will continue to invest heavily in the transport sector while maintaining our commitments to air quality and the environment.

17:11

[Mrs Louise Ellman (Liverpool, Riverside) (Lab/Co-op)]

This is a welcome and timely debate. Transport is vital to all that we do, whether it be the functioning of our economy or people engaging in a good life. It matters to everything we do, but there has been little discussion in public or in Parliament about the implications for transport of our exit from the European Union. In this short debate, I want to flag up a number of issues where there are concerns, some of which have gone unanswered. I shall also seek some further information from the Minister about how these issues are being addressed.

At the beginning of the debate, the Secretary of State made some fairly anecdotal remarks about how he was dealing with some of the issues of concern that have been raised. He referred to meetings that he has had with Ministers at conferences and said that he hoped to meet the President-elect of the USA shortly to discuss some of these issues with him. However, there is a more basic question.

Yes, there are big questions about how the negotiations might be conducted and what the Government’s objectives might be, but one key question is whether the negotiations on transport will be conducted in their own right or only as part of much wider negotiations, so that nothing agreed for transport will be finalised until there is agreement on all the issues involved in our leaving the EU. I have not heard that question properly discussed, but it is an issue of concern. Some transport issues might appear to be negotiated, but they could somehow be lost or given away as part of some bigger negotiation where other factors are under discussion. That is a fundamental issue and I would like to hear more answers from the Government about that. Providing an answer to that question is not really giving away a negotiating position; it is telling us how seriously the Government as a whole view transport issues. It might provide a guide on how far we should pursue some of the matters that have been raised today and that are likely to be raised again.

Members have talked about how different sectors of transport—road, rail, air and sea—might be affected. I shall come on to some of those later. There are also important cross-cutting matters to which very little attention has been given when it comes to Brexit. What of passengers’ rights, for example? Complex compensation packages are being negotiated in Europe, and I believe that one of them was either finalised recently or is nearing completion. It is not at all clear how that would affect British citizens. Would they be covered by those compensation packages, now or in the future? We simply do not know.

What about security matters? Reference has been made to cross-channel transport, of which security is an important aspect. How will that be affected? We have heard little about it. Environmental issues are very broad, but they certainly include transport. How will that affect us?

During the Transport Committee’s recent investigation of the Volkswagen scandal, attention was focused on vehicle type approval, the European system for assessing vehicles in terms of their environmental impact, performance and safety. Although the Volkswagen episode—the Volkswagen scandal;—I must keep using that word, because a scandal is what it was—did highlight some deficiencies in the system, it is important to recognise the importance of having a cross-European system for vehicle type approval. There might be a need to strengthen or change it in certain ways, but having it does matter. How would we be affected in that regard? Would the United Kingdom still be involved? Would we still be party to the system? Would we be partners in it, influencing what happened? Again, we simply do not know.

The question of accessibility to transport for disabled people has been raised briefly, in relation to the blue badge scheme. That scheme, which is very effective and very important here, has a European counterpart. What would happen to that? Has any thought been given to the issue, and has there been any discussion about it? There is a wider question. European directives call for proper access to buses, coaches and trains for disabled people to be implemented by 2020, and European legislation has driven improvements in their access to public transport. Will we still be involved in that, or will the United Kingdom decide that there is some get-out clause so that we do not have to continue to give proper attention to the matter? I hear little about that in the public arena.

Sometimes we are all so involved in talking about the major strategic issues—which are, of course, extremely important—that we forget about the practical issues, but they must not be lost. One way of ensuring that they are not lost in discussions about many other issues is to keep raising them in the House and, indeed, elsewhere.

A number of Members have drawn attention to the aviation sector, which in itself illustrates the importance of the possible impact on the sector of our exit from the European Union, and the importance of the sector itself. Aviation is vital to the economy as a whole, and to business and tourism specifically. In 2015, UK aviation transported 251 million passengers and contributed £1 billion a week to the UK economy, and it supports 1 million jobs. It is not just about transport, either. It is about skills, development, and a wide range of employment. It is literally a gateway to Europe and to the world. The UK currently has agreements to fly with 155 countries, 42 of which have air services agreements through our membership of the EU. That arrangement is critical. What will happen to it?

There are three broad areas of concern relating to aviation that require proper negotiation and a proper solution, rather than the uncertainty that currently hovers over the whole issue, causing great concern in the aviation sector and among the people employed in it. First, the single European aviation market allows EU registered airlines to have a base in another EU state and operate services between other member states and within them. It promotes growth and has reduced fares. It is critical. There may be an answer to what will happen to that as an alternative to our current arrangements. Are we going to consider joining the European common aviation area—we would be able to do that—or is the answer bilateral agreements? We simply do not know, and not knowing causes great uncertainty. It will affect business decisions being made by airlines now about where they want to locate. These are critical decisions about aviation and the people employed in the sector.

[Drew Hendry]

On business indecision, does the hon. Lady agree that businesses are openly saying that they are having difficulty now with their business plans and are absolutely terrified of getting no forward vision from the UK Government about how things are going to work in the future, which is impacting directly on investment?

[Mrs Ellman]

I do agree. That is a key area of discussion within the aviation sector. It is why it is so critical that this is addressed. There is great uncertainty. There might be a solution, but we need to move further on it.

The second area of concern within the aviation sector is the transatlantic aviation agreement, and particularly the EU-US open skies policy agreed in 2007. There are many aspects to that, including that EU airlines can operate to the US from any point in the EU. EU airlines can also lease aircraft to US airlines for use on international routes from the United States to any third country. That was opposed for a long time by the US authorities, but it is now agreed and it is extremely important not just for aviation itself but for this country and—I go back to the common theme of my speech—for employment in the sector and the retention of high-level skills. Will this agreement continue? The general view appears to be that it will, as it is too valuable and important to everyone for it not to continue, but again there is uncertainty. Is that being addressed?

The third aspect of concern is European airspace strategy. The use of airspace is critical and too often when we talk about aviation and runway capacity we do not think properly about airspace strategy. That matters, however; it matters in terms of efficiency and the environment. Capacity and efficiency have been added through having the single European sky. Will that continue in its current form? Will it be part of the negotiating process? Will the functional air blocks—UK and Ireland—be retained? How will this operate? It seems to be so critical that it has to carry on, but in what form, and how will the UK be involved?

I wanted to flag up those three areas of concern. They are well known—I am not saying they are being ignored—but my plea is that we need to know what progress is being made.

Ports are vital because 90% of the UK’s trade goes by sea, and the EU is the UK’s largest single trading partner. Yes, there are global markets and the maritime sector is global as well as European, but Europe is extremely important to it. It cannot be looked at in isolation. Access to the single European market is important to the maritime sector. What impact will discussions on that have on discussions about the ports and the maritime sector? How will changes in access to the single market affect shipping with Europe? Will there be new and complex tariffs? Will there be customs checks? How will transmodal movements be affected? Will there be complexity in paperwork, tariffs and customs? Nobody knows what is going to happen. Some solution has to be found as soon as possible, and the sector needs to know what is happening. We have had silence on these matters for much too long.

There are many other transport issues involved in our exit from the EU that are causing great concern. I have identified just these few issues today because they are critical to the UK’s future. They are important for our trade, for jobs and for the retention of skills, and I urge the Government to get more involved in those sectors and give us more information about what is happening. These transport issues might not be flagged up in the newspapers every day, but they matter a great deal to our economy and to the people of the UK.

17:25

[Mims Davies (Eastleigh) (Con)]

Thank you for calling me to speak in this important debate, Mr Deputy Speaker. I am pleased to follow the hon. Member for Liverpool, Riverside (Mrs Ellman). I have written in my notes the words “road”, “rail”, “aviation” and “the water”, and I feel that she and I have some common—perhaps watery—ground on these matters. We have heard from Members on both sides of the House that it is vital to address the issue of climate change, and I shall focus unashamedly today on how that affects my constituency. Anyone who enters Eastleigh will see the words “Tackling climate change” on the sign, but that feels like a strange irony for anyone sitting in queueing traffic there.

Today we are debating the importance of transport in relation to exiting the European Union. I have been contacted by the Irish embassy, as well as by the States of Jersey and Guernsey, about the vital role played by Southampton airport in trading links between those areas and the UK, and we must now consider how we will work with them in a post-Brexit environment.

Today’s autumn statement has sought to tackle infrastructure deficit and improve our productivity. We have heard from the Chancellor that Departments will—rightly, in my view—meet the Government’s objectives by working with Members, communities, local councils and the devolved Administrations to enable them to tackle key decisions on their priorities and projects locally. I welcome this. I have had meetings in my area to discuss what is affecting the gross value added there. I have already indicated to the Secretary of State that the missing infrastructure in my patch is affecting our productivity. My constituency and those of my fellow Hampshire Members are affected by missing junctions on the M27 and queues on the M3, for example, and I know that the Department would like to focus on working with Highways England to make the area a better place for commuting and for getting around.

This week, the Secretary of State spoke to people working with regional airports, and I welcome the feedback that I have had from Southampton airport on his energy and positivity for the sector and for regional airports, which came through very strongly. We have heard questions raised in the Chamber this afternoon about air passenger tax in relation to our exit from the EU. I ask the Secretary of State to continue to work positively in this area, because that does translate and it does matter. Air passenger duty is a key issue for those travelling through my constituency, whether on business or for leisure purposes. Better connectivity from Southampton airport is also key for heading up to Heathrow or Gatwick. I have also heard from the Irish embassy that Ireland is benefiting from the new route between Southampton and Cork, from where passengers can take transatlantic flights. A clearer future, given the opportunities at Heathrow, is important to that connectivity and to my constituency.

Some 50% of people in my patch travel out for work, generally making a journey of around 12 miles. One would think that that is a short journey, but it can often take about an hour and a half to get from Eastleigh to Southampton or to travel by train between the two cities of Portsmouth and Southampton. I ask Ministers to meet me in due course to look at roads such as the Chickenhall link road, which will tackle pollution and queues, unlock potential sustainable housing sites and provide the opportunity for Southampton airport to get a longer runway, so that bigger planes are able to travel from my patch and people are given a real choice when it comes to getting around.

I am delighted by the opportunities provided by the autumn statement’s infrastructure boost, including, on a basic level for getting around, the seventh successive freeze in fuel duty. Families in my area do not have a choice and must travel by car. East-west connectivity is a challenge and I welcome the continued negotiations on the new rail franchise, because issues with getting between Portsmouth and Southampton in less than an hour are hampering people’s ability to benefit from the opportunities offered by being so close to the port of Southampton. We heard from my hon. Friend the Member for Stone (Sir William Cash) that ports are absolutely key. Southampton represents an opportunity for local success for new businesses springing up in Eastleigh. We must continue to consider water safety as we exit the EU. People want to see marine patrols when they are out and about and to feel secure in the post-Brexit environment.

I look forward to working with the local enterprise partnership, Hampshire County Council and other local departments and areas to ensure that Eastleigh continues to grow and thrive given the opportunities provided by the £1.1 billion for local transport networks. I say to the Department for Transport that such funds could be deployed in my patch to help with much-needed connectivity, to battle air pollution and to increase productivity. I welcome this afternoon’s debate and the interesting points made around the Chamber about air passenger duty, ports and connectivity. I look forward to working positively with the Department based on today’s autumn statement and the opportunities for local infrastructure across Hampshire.

17:32

[Dame Rosie Winterton (Doncaster Central) (Lab)]

As my hon. Friend the Member for Middlesbrough (Andy McDonald) and other hon. and right hon. Members have made clear in this welcome debate, Brexit has huge implications for our whole transport network, but I want to focus on the rail freight sector. I was disappointed that the Secretary of State did not include rail freight as one of his priorities, and I suspect that the rail freight industry will be disappointed, too. When the Minister replies to the debate, I hope he will reassure us that the Government take the industry’s concerns seriously.

I have previously raised in the House the situation of DB Cargo UK, a company with headquarters in my constituency that has recently announced 893 redundancies. In a letter to the trade union ASLEF, the company said that as well as falling demand from the coal and steel industries, Brexit has caused a slowdown in demand for the movement of freight by rail. I have discussed the problems facing the rail freight industry with the relevant trade unions and also this week met the chief executive officer of DB Cargo UK, Hans-Georg Werner. I hope Members and the Minister will agree that rail freight is a key service for those doing business in the UK, enabling the import and export of goods through ports and the channel tunnel and, crucially, the movement of goods within the UK. Rail freight depends on the total volume of UK trade as well as the modal share between rail and road. It is a good barometer of the health of the economy as a whole.

[Andy McDonald]

Does my right hon. Friend agree that sustaining the rail freight industry is vital for the maintenance of the infrastructure itself and that we neglect that issue at our peril?

[Dame Rosie Winterton]

My hon. Friend makes an absolutely correct point. That is why we need to use this debate to highlight some of the infrastructure issues we face and to try to tease out of the Minister what the autumn statement might mean for the rail freight industry.

At the moment, the Government are giving little clarity as to what they are looking for from future trade agreements, but it is clear that some options, particularly those with increased trade tariffs, could be challenging for the UK market as a whole and for rail freight in particular. We know that uncertainty about what trade agreements will be reached in those Brexit negotiations is having a detrimental effect on business. The rail freight industry has been especially affected by the slowdown in the construction industry, where there is a nervousness from investors; as we wait for the Government to set out their negotiating position, investment decisions are being put on hold. Whether we are to remain in the customs union and whether we are to maintain access to the single market could have massive impacts on our customs and excise regime, which would naturally have an impact on points of entry, such as ports.

We must also consider the direct impact of European legislation on the rail freight industry. Much railway legislation derives from European law and provides a number of essential protections for rail freight, for example, on track access and charging. It will be vital that these protections continue in any revised legislation. I know the industry considers it essential that a coherent and holistic approach is taken, with any change in law being specifically linked to a change in Government policy for the railways, rather than having piecemeal changes. That applies to legislation on rail freight through the channel tunnel. Many railway standards are also set at European level, particularly technical standards for interoperability, which aim to improve the cost-effectiveness of railways and the ability to operate across Europe. I hope the Minister can assure me that discussions with the industry are being held about any revisions to infrastructure standards, to protect the ability of freight to operate efficiently.

There is a real need for the Government to provide reassurances to the rail freight sector, so that business confidence remains strong and investment is supported. Rail freight operators need confidence to plan ahead, when buying new wagons, for example, investing in new terminals to support future traffic and looking at expanding in areas such as the automotive industry. Again, the Government need to work closely with the rail freight industry to make this happen and deliver solutions that support growth.

One such solution is, of course, HS2, which has the potential not only to provide business for the rail freight industry during construction, but in the longer term to free up capacity for rail freight. Again, I hope the Minister can assure the House that the Government are talking to the industry about the potential for rail freight in HS2.

There are many other areas of European law that affect the rail freight industry, especially workers’ rights and environmental legislation. Workers’ rights and protection are particularly important in this industry not least because of safety considerations—something of which we are too well aware at the current time. I hope that the Minister can assure me that he is discussing these issues with the relevant trade unions.

My hon. Friend the Member for Liverpool, Riverside (Mrs Ellman), the Chair of the Transport Committee, made some very good points with regard to environmental legislation. Rail freight is vital in cutting emissions, and we need assurances that, once we have left the European Union, we will mirror agreements under the EU and work actively to help the industry by investing, through Network Rail, in projects that increase capacity, improve connectivity and encourage intermodal solutions to help cut emissions. I hope that, in the process of doing that, we will look across Europe for good examples. In Austria, for instance, I understand that subsidies are available for trains that carry road freight vehicles, and we need to consider whether we should be emulating such practices as we go forward. Will the Minister tell us what planning has been done to improve not only freight productivity, but that link with environmental targets?

On the autumn statement, will the Minister tell us what its implications are for the rail freight industry? I am not sure whether I heard the words “rail freight” mentioned during the statement. I know that the Chancellor said that it will be about departmental decisions, but, again, because the Secretary of State did not mention it in his opening remarks, can the Minister shed a little light on what he thinks the Department is looking at with regard to rail freight, and also what the process will be for coming to those decisions? Investment was talked about, but we need to see that applied to the rail freight industry.

As we have seen today, the process of leaving the European Union will be complicated, fraught with uncertainty and might have considerable unforeseen consequences for our economy’s productive capacity. The need to secure the most advantageous deal for business is understood, but of course the shape of that deal is what will be contested over the coming months. I hope that we can agree that there is an overriding need to reduce uncertainty for business as a whole and for the rail freight sector in particular. It is essential that the Government have serious discussions with the rail freight industry and the unions, which represent those who work in the industry, about the post-Brexit future, so that the best possible outcome of Brexit negotiations can be achieved. Again, I hope that the Minister, in his reply, will be unequivocal about his commitment to openness, transparency and the fullest possible consultation with all those involved in this vital industry.

17:43

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

Well, here we are, four months on from Brexit—[Interruption.] My apologies, it is five months. That is not a good start. We have heard from several Members about the many challenges that still face us, and I do accept that there will be some opportunities. Let us look at one element of the Government’s transport strategy and what they consider to be an achievement: the deal that they managed to secure with the car manufacturer, Volkswagen, following the emissions cheating scandal. The United States of America will receive around $1.5 billion in compensation from Volkswagen. Last week, the Minister stood at the Dispatch Box, with an enormous grin on his face, heralding the fact that he has managed to secure a miserable £1 million. Madam Deputy Speaker, do not lose heart in the Minister, because he also informed the House that he would receive the cheque in time for Christmas. If that is a success, I do not what a failure looks like. It does not exactly inspire confidence in me when these are the people charged with the Brexit negotiations.

[Robert Flello]

Did the Minister say which Christmas?

[Stewart Malcolm McDonald]

One hopes that it will be this Christmas, I say to my colleague on the Transport Committee.

I wish to focus my remarks on emissions and the vehicle industry. Although there are challenges, there are indeed opportunities in this field, and I do not necessarily mean just in terms of trade, but in terms of the governance of the industry. For too long—I say this as someone who passionately voted to remain in the EU—the industry has been operating in an almost wild west-like culture, where money talks; and it talks quite a lot, particularly for German car manufacturers. For all that we are proud of the British car industry—of course we are—the German car industry has something that we will never have, or the French or Japanese car industry will never have: the German Chancellor, Angela Merkel. If we look through the lobbying register, we see that the big German manufacturers spend more on lobbying in Brussels than all the other manufacturers put together—and, my goodness, they get what they are after.

[Sir William Cash]

Is there not a really serious problem with the manner in which the Volkswagen emissions disaster was handled? This is about not just efficiency but manipulation.

[Stewart Malcolm McDonald]

The hon. Gentleman is absolutely correct, and that is what I am coming to. The Government now have the opportunity to get a new regime on emissions and safety standards that does not allow the kind of manipulation that he mentions to take place. We can have a situation where car manufacturers do not manipulate test vehicles—for example, by taping up air conditioning units, by changing the wheels and by using all sorts of creative means—so that they get around emissions standards. If they can do that in one EU country, they get away with it in all EU countries. Even though we in the United Kingdom have now chosen to leave the EU, the EU must get a grip on that. So here is the opportunity: the Minister and the Department for Transport can now set up a regime that the EU can aspire to. But for over a year now, the Department’s response to this issue does not exactly fill me with confidence. They could do the same with a new safety standards regime. They could create a new gold standard that even countries such as the United States could aspire to. I guess that the proof of the pudding will ultimately be in the eating.

Members will be familiar with the Vauxhall car fire scandal, with more than 300 Vauxhall Zafira cars catching fire here in the UK. Many of them have done so within about 30 seconds of their engines failing. Let us think about that model of car. The Zafira is a family car. It tends to be used by parents on the school run, during the summer holidays and so on. The people affected tend to have children, and many of them have been in touch with me and other members of the Transport Committee, which has discussed the issue. The Government’s response, in public at least, has almost been to wash their hands of it. I am amazed that the Government are not required to take the issue more seriously. Perhaps we could have new consumer protections relating to vehicle standards, and better compensation standards for consumers. Perhaps we could aspire to standards that even the European Union could aspire to one day.

We do not want to continue with the same system—perhaps EU regulation-lite—whereby we become just another island that is manipulated by an industry in which money talks far too often, and public health interests and consumer interests take a back seat. In addition to all the challenges that the Government face in maritime, freight and air policy, this is one area where the British public are fed up with big business riding roughshod over consumer interests. They will judge the Government on how they respond to the opportunity that Brexit has delivered to put consumers first, rather than to those big vehicle manufacturers.

17:50

[Ian Paisley (North Antrim) (DUP)]

My constituency voted overwhelmingly—62.2%—to leave the EU, despite the fact that with its large agricultural hinterland it receives huge European farm subsidies, and with its manufacturing base it benefits from the opportunity to manufacture and export to the EU. It also has a huge travel base. It is a tourism mecca, and tourists need travel infrastructure. So it is engaged in manufacturing, travel, tourism and transport goods, but despite all that, it voted to leave the EU, and we must ask ourselves why.

Why would so many people in that set of circumstances vote to leave? It is because the EU is seen to be failing them. When we look specifically at transport issues, we can see why. Before we even discuss the EU, there are many things that we could do domestically to assist companies in the transport sector in our country. For example, in my constituency we manufacture buses. The Wrights Group manufactures a considerable number of the buses for this great city and for Scotland—indeed, it recently enjoyed a very beneficial order from Scotland, for which we say thank you to our Scottish cousins. It also manufactures for Singapore and a number of other Asian countries, and employs hundreds of people in Singapore in the assembly of those buses and, importantly, in the maintenance of those buses. It is a significant local employer and a world employer.

The company can benefit more from domestic decisions taken here than it can from EU decisions taken in Brussels. For example, the Government’s Bus Services Bill currently going through Parliament will have a dramatic impact on transport orders for my constituency if it goes the right way. We also have—I say this very gently to those on the Labour Front Bench—a new Mayor of London. I appeal to him through his Front Bench colleagues to come to Northern Ireland as soon as possible to visit that bus company, which transports his citizens around his city, and see the great work that it could do to expand the bus offer in London. I understand that between now and 2021 London will require another 1,000 buses. I hope that that transport infrastructure will benefit from buses manufactured in my constituency. I wanted to put that on the record before I turn to the substance of the debate.

When the Secretary of State opened the debate, he was full of confidence and optimism. I share that optimism. We should approach the issue of transport and Brexit with some optimism because there are opportunities that can be beneficial to us.

There is one issue that could have been addressed in the Chancellor’s statement today. I hope that the Transport Secretary will continue to whisper “airport passenger duty” in his ear between now and the Budget in April. I hope he will keep pushing that little issue. We should not be paying a pernicious, dirty little tax to the Chancellor of the Exchequer just to transport ourselves from one part of the UK to another. It is wrong. It is not the sort of tax that our Government should be levying, and it should be removed soon. I hope that the Chancellor will hear that not just from me but from the Transport Secretary between now and the Budget.

Many people, including our neighbours in the EU, complain about Brexit. We hear it every day and read about it in the newspapers, but those of us who voted to leave the EU did so with a good intention—to bring about good for our country, not bad. I have noticed that those on the remain campaign and those opposed to the action that the United Kingdom is about to take are talking up crisis after crisis—whether a transport crisis or a crisis to do with transport problems with our border in Northern Ireland.

I commend the singular actions of the Secretary of State over the recess. When a crisis emerged in Northern Ireland relating to our one transatlantic fleet operator, United Airlines, it was largely because the Secretary of State got on the telephone to the United States and spoke to the head of the airline and others, pressing them to keep the flights operating in Northern Ireland, that the service was saved.

As a result of the right hon. Gentleman’s conversation with United Airlines and an emergency aid package put in place by the Northern Ireland Executive, involving multiples of millions of pounds, the service was indeed saved—until two weeks ago. Someone in the EU then complained that the actions of the Secretary of State and the Northern Ireland Executive amounted to state aid and were therefore wrong. They objected so much that Europe has now told United that it must reject the multi-million pound aid package. As a result, the airline is now closing its service; the last flights from Belfast to Newark in the United States of America will take place in January next year. That shameful action needs to go on the record.

[Sir William Cash]

In the ports sector, as in many others, there are hidden subsidies. Ports over the whole of Europe are publicly owned. Given the money pumped into them, they also represent the lack of a level playing field. What is sauce for the goose is sauce for the gander. I commend the hon. Gentleman for what he said and what the Secretary of State tried to achieve.

[Ian Paisley]

I agree; the hon. Gentleman has put his finger on the fact that the issue extends not only to airports but to seaports as well.

Last week in the House, I pressed the Secretary of State about the United Airlines issue. He kindly said that the decision was “deeply unwelcome” and that a fair amount of effort had been done by his Department, working alongside the Northern Ireland Office and Northern Ireland Executive, in trying to make sure that this air route was sustained. He went on to say:

“The loss of the route because of EU action is deeply unwelcome and precisely the kind of unnecessary decision from Brussels that led this country to vote to leave the European Union.”—[Official Report, 17 November 2016; Vol. 617, c. 377.]

I say a hearty “Hear, hear” to those words. That action was pernicious and should not have taken place. The company should have been allowed to continue to operate in Northern Ireland. Many people in County Antrim who have seen the benefits of Europe have turned against it because of such decisions. I am glad that we as a nation have woken up to that.

We have also had the allegation that the Irish Republic—our well-known neighbour—wants to be supportive of Northern Ireland as it leaves the EU. Indeed, it has written to many of the hauliers in Northern Ireland to invite them to a tea party hosted by the Taoiseach in Dublin. He has called it the all-island civic dialogue, and he wishes to have a conversation about the implications of Brexit for the Republic of Ireland. Now, I am quite happy for the Taoiseach to do that, and for him to understand the conversation that is going on, but if he targets businesses in Northern Ireland with a view to getting them to go to the south of Ireland and to crank up opposition to the UK’s decision, that is where I draw the line. I therefore commend the words of our First Minister in Northern Ireland, who said that the Dublin Government are poaching some of our businesses, and that includes our haulage businesses. It is right that this House understands that, while we welcome the opportunity to work with our southern neighbours, we can also see when someone speaks out of both sides of their mouth—on the one hand saying they are concerned about our relationship, but on the other hand doing everything they can to undermine that relationship and poach businesses from us. I think we should put that on the record.

It is also important that we identify those EU transport regulations that hurt British businesses. In an intervention on the Scottish National party spokesman, the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry), I mentioned the package travel directive. Expedia is an American company that employs over 2,000 people in call centres and outreach centres in the United Kingdom. It is based in England and Scotland, and it will hopefully soon be based in Northern Ireland. That company employs thousands of people, but it is now faced with the package travel directive. Ordinary business and tourism travellers who use sites such as Expedia or trivago as a one-stop shop for their airline ticket, their hotel, their car rental, the shows they wish to attend or other things they wish to book, such as restaurants, will find that this package travel directive, which comes from the EU to protect huge monopolies, will try to pass on a major charge to the companies—Expedia, trivago or others—or, more than likely, to the customer, because they are using a one-stop shop, when they should apparently be encouraged to use several different operators to place their orders. That package travel directive is wrong, and it should be opposed. That is another reason why many people in the United Kingdom see that, in terms of travel arrangements, we would be better off out of the EU.

[Drew Hendry]

On the point about additional costs to the travelling public, does the hon. Gentleman agree that the absence of the European health passport would mean an increase in insurance costs for UK customers travelling in Europe?

[Ian Paisley]

I do not know whether that is the case, so I cannot say whether it would or not. I would certainly be happy to look at that, but we need to encourage our own insurance industry—perhaps we will have a debate about the insurance industry and Brexit—to pick up those issues to determine whether there is a way in which we can address them.

Companies such as Expedia are faced with this package travel directive. We need to be alive to the fact that Europe is not a great benefactor of the travel sector and that it is actually doing an awful lot to hinder it.

[Sir William Cash]

On the general principle that the hon. Gentleman is addressing—the extent to which directives have an adverse effect on certain industries and the national interests of particular countries—is he conscious, as I certainly am, of what is called regulatory collusion? This has been written about by Professor Roland Vaubel of Mannheim University, who makes it clear that a system is employed in the Council of Ministers and through COREPER whereby decisions are made that benefit certain congregations of countries in a way that is detrimental to others, and that this is not a benign system, but actually the pursuit of national interests in another name.

[Ian Paisley]

I agree with the hon. Gentleman and thank him for making that point. This is about not only helping congregations of countries, but assisting cabals within certain sectors of the industry. For example, the package travel directive helps people who do not use computers to buy their tickets and encourages people to use only shops. I have nothing against travel shops, but they should not be assisted over the heads of people who wish to use the internet to make their bookings. There is a very deliberate attempt to try to destroy that business on the internet.

On road haulage, the Government need to address exporter freight charges. Many of our competitors outside the EU, such as Australia, Canada, New Zealand and countries in Asia, including India, have opportunities to assist the trade in their manufactured goods by reducing the cost of exporting them around the world. In essence, this is about freight charges, not just internally within their own countries, but externally. Our Government need to decide what assistance that system gives and how, when we eventually leave the EU, our companies can have a similar type of assistance or, more importantly, can be encouraged to get round the advantage that those other countries are given.

Let me give the House a few examples. In Australia, the freight equalisation scheme allows for goods shipped around the world to be subsidised when going to their final destinations. That means that a similar good manufactured in New Zealand, for example, suddenly becomes more expensive because its freight charges are included in its shipping, whereas the Australian good has its freight charge subsidised or, in many instances, wiped out. New Zealand opposed Australia when it introduced that scheme, but it is still in place. India has a freight assistance scheme, as well as an enterprise promotion policy, which is about assisting with freight charges.

If these issues of transport costs are not addressed, when we finally leave the EU and have wider export opportunities, we will find that if we try to get our goods—manufactured goods, foods or drinks—to certain markets, they will be disadvantaged because we do not give them a freight subsidy. I know that the Government do not like the word “subsidy” and that they will have to look at this further, but something should be done to assist with those transport costs. It is important that the Government have that in their mind.

I welcome the debate and the comments by the Secretary of State. It is useful that we continue to prod and examine these issues.

18:08

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

Thank you for calling me, Madam Deputy Speaker. I am sorry, but I am feeling a wee bit dizzy because I am not usually so high up the speakers’ list. It is also confusing that there is no limit on our speaking time. Clearly one of the reasons why I have been called so early is the real lack of Back Benchers in the Chamber. Given how many people have told us how bad Europe is and about all the wonderful opportunities that there will be following Brexit, I should have thought that Members would be queuing up to tell us about those opportunities.

[Sir William Cash]

I understand that the hon. Gentleman is about to become a member of my European Scrutiny Committee, so I simply say that I entirely endorse what he has said. Furthermore, many of the remoaners, and the doomsters and gloomsters, are not here defending the positions that they were taking before—I am not just referring to SNP Members. That is where a lot of the problems lie.

[Alan Brown]

I thank the hon. Gentleman for that helpful intervention. Clearly we are part of the remainers, and we represent our constituents. The majority of our constituents across Scotland voted to remain, so we must represent them.

The hon. Member for North Antrim (Ian Paisley) made a bit of a play of highlighting opportunities, but really he highlighted some of the problems with the European Union rather than proper opportunities. He seemed to put a lot of faith in the myth that the Government will invest the money that will not be going to Europe. He trusts the Conservative Government to invest that money. He used the word “subsidy”, although he knows full well that no Tory Government ever volunteer to pay money for subsidies.

This has been a wide-ranging debate. I will focus on road transport, but just before I do, I want to go back to the open skies debate. Prestwick airport, which is in one of my neighbouring constituencies, is a big employer for my area as well as for the constituency it is based in. It would be good if the Minister confirmed that Brexit will not affect Ryanair’s flights from Prestwick and tell us what the Government will do to mitigate any effects. I will throw out one opportunity for Prestwick—to be fair, this is not to do with the European Union—which is its potential as a spaceport. It is high time the Government made a decision about that.

As I said, I will focus on road transport. The Secretary of State said quite correctly in his opening speech that road transport affects us all. Given the proportion of goods that are transported by road to shops, road transport is fundamental to the price of goods. According to Government figures, almost three times as many goods are moved by road as are moved by rail and water combined, which shows us that road is the transport king.

That brings us to the question: what has the EU done for road transport? Apart from the harmonisation of licensing, the harmonisation of vehicle design, European Union-wide regulations for the transport of goods, workers’ rights legislation such as the Working Time Regulations 1998, the Road Transport (Working Time) Regulations 2005, the Agency Workers Regulations 2010 and the Fixed-term Employees (Prevention of Less Favourable Treatment) Regulations 2002, and funding for road schemes in Scotland, the EU has not done much to help road transport.

What else has the EU given us? Apparently, as the guys who are not here continually tell us, the EU has given us endless red tape and regulation. Let us look at how the EU has actually meddled in the pan-European transport of goods by road—this point was touched on by my hon. Friend the Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry). In 1998, a lorry travelling from Milan to London required 88 separate documents. The EU got involved, and after much wrangling, the number of documents now required is one. The number has gone from 88 down to one—that is the red tape that the EU has created for the transport of goods across Europe. In the 1980s, there were 100,000 sets of technical regulations across the member states. Thanks to the EU, they have been consolidated, and there is now one set of EU-level regulations.

We heard about ports earlier. Ports are integral to the import and export of goods for road haulage. As we have heard, ports handle 90% of the UK’s trade. Leaving the EU means that there is a risk that instead of a seamless journey on and off a ferry, there could be extended customs checks, which will slow progress. As we have heard, the infrastructure is not geared up for that, which could mean that ports will require additional parking. Some of the checks need to be repeated for each country that a lorry traverses. Given that the World Bank estimates that the customs clearance process for a single freight container adds around a day to the import process, it is clear that we could face a massive cost and logistics nightmare. Will the Minister therefore confirm that he is fighting for access to the single market and the customs union?

According to the Treasury’s figures, EU membership is estimated to increase trade with EU members by between 68% and 85%. I know that there has been a whole debate about how inflated the figures might or might not be, but even if they are inflated, they still show that there is huge benefit from our membership of the single market.

Has the Secretary of State and/or the Minister discussed the customs union with the automotive industry? At the moment, car components criss-cross the continent before returning for use in final assembly at car plants, so the customs union is a major positive for the automotive industry. The industry is completely appalled by the lackadaisical argument that simply claims that no tariffs will be applied because of the importance of the UK market. It has confirmed that tariffs are its No. 1 concern, so will the Minister touch on that when he sums up?

Nearly 300,000 HGV drivers were employed in the road haulage industry last year. In April 2015, only 1,165 jobseekers recorded their standard occupation as HGV driver, so it is clear that a HGV driver qualification is a pathway to full employment. Even so—we touched on this earlier—the road haulage industry is having to take advantage of EU nationals, using licence harmonisation, to plug the skills gap. There is a predicted shortage of 40,000 HGV drivers by 2020 and the Government do not challenge that figure. That situation will only get worse unless there is a post-Brexit reciprocal licensing arrangement.

I have repeatedly called for the Government to implement a grant scheme to allow small haulage companies to train new HGV drivers. Such a scheme would pay for itself from welfare savings. To date, I have heard nothing from the Government. The Secretary of State said that the idea was with the Minister of State, Department for Transport, the right hon. Member for South Holland and The Deepings (Mr Hayes), who is responsible for skills in the Department for Transport, but it is time we started hearing some concrete plans.

The last key topic I will touch on is road funding, which is particularly relevant to Scotland. Another dividend of the UK Union that we suffered from in Scotland for many years was a lack of investment in our road systems. It has taken an SNP Government coming to power to really push that agenda, in particular with the new M74 and M80 motorways, and the ongoing £500 million M8, M74 and M73 upgrades. It is ridiculous to think that there has never been a continuous motorway connecting Edinburgh and Glasgow; the SNP Government are having to rectify that.

[Drew Hendry]

It is not just the motorways my hon. Friend mentions that were neglected for a long time; many connections to rural Scotland such as the A9 were given no attention. The Scottish Government are now dualling the entire A9 between Perth and Inverness.

[Alan Brown]

I welcome that example and will come on to another shortly.

Investment for the current motorway upgrades came from the European Investment Bank, which drew in other international investment. Will such avenues for investment still be available at affordable rates to the Scottish Government in the future? It would be good if the Minister provided some clarity on that.

Anyone who has travelled to the highlands will know how many roads there are still single track, with passing places for oncoming vehicles. Those roads are lifelines. One example is the Fort William-Mallaig road, the road to the isles, which was completed as a two-lane carriageway only in 2009; previously, it was known as the worst trunk road in Europe. That shows the lack of investment that came to us from Westminster. The upgrade was completed partly with European funding. The allocation included £3 million from the European regional development fund, as well as European transitional fund assistance. That is proof that the EU managed to get money to Scotland that would not have come from direct funding.

Scotland secured a total investment of €941 million from the European structural fund in the 2014 to 2020 programming period. Of that, £14 million has been allocated to the low-carbon travel and transport strategic intervention programme, which helps to fund low-carbon transport hubs and active travel hubs, and £10 million is being invested in the smart cities strategic intervention. ERDF money has also been allocated to Strathclyde Partnership for Transport for various public transport upgrades. What will happen to the money that has not yet been allocated? Again, we do not know, as there are no guarantees from the Government. It is time they started to provide some certainty. The Scotsman reported a couple of days ago that councils in Scotland were worried about the possibility of losing £46 million of EU funding each year. Much of that money goes to local transport-related projects.

I mentioned travel in the highlands earlier and my hon. Friend the Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry) touched on it, too. One common sight is busloads of tourists traversing the country. Many rights of passengers, particularly in relation to disabled passengers, are incorporated in regulations covered by EEA membership. Tour operators entering Scotland and the wider UK may choose not to enter the country in the future because EU passengers might not want to have to apply for a visa as part of a tour package.

It can be argued that many of these issues are not insurmountable, but the fact is that 8% of all travel in the EU in 2014 was attributed to buses and coaches, with 6.5% to rail. The Department for Transport gave very little consideration to buses in its “Balance of Competencies” report released ahead of the referendum, despite the volume of regulations in place to protect coach passengers within the EU.

It is clear that EU directives have made our roads safer and protected the rights of HGV drivers. They have made the transport of goods easier, and therefore cheaper, within the customs union. The free movement of goods and people in conjunction with the licence harmonisation process has been vital for the haulage industry. Without it, there would have been market failure by now. There has even been harmonisation of the blue badge system for people with disabilities. Will that be reciprocated post-Brexit? As I outlined, the EU has contributed funds for much-needed road upgrades in Scotland. It is high time the Government understood that Brexit means a lot more than Brexit, and that we want clarity.

18:21

[Robert Flello (Stoke-on-Trent South) (Lab)]

I draw the attention of the House to my entry in the Register of Members’ Financial Interests.

I am delighted that my constituency neighbour, the hon. Member for Stone (Sir William Cash), is back in his place, as I just want to point out to him that the much-thumbed Library briefing paper I have been referring to is from 29 June, rather than the one in the Library now.

This issue, on a critical industry, is of great importance. I normally find, when I am called to speak so low down on the list, that almost everything I want to say has already been said. However, one thing that has not been said so far is that we are approximately five-and-a-half weeks away from Christmas. The logistics industry makes Christmas happen. It delivers everything. Yes, of course Santa has his part to play, but without the logistics industry the turkeys, the presents and everything else would not happen. We should put on record what we owe to the people in the industry.

During an intervention earlier I talked about staffing. I am concerned about the level of staffing available in the Department for Transport to consider these important issues. The Freight Transport Association, the Road Haulage Association, magazines such as Motor Transport and others are doing a lot of work on the implications of Brexit for some, if not all, of the industry, and I believe they stand ready to help the Department.

As the Minister is in his place, I want to pause to thank him again for the wide-ranging roundtable discussion on skills the other day—a really positive sign for how we can move the whole agenda forward.

I do not want to miss an opportunity to taunt the hon. Member for Stone one more time, so let me say that what has come out of discussions with various sectors of the industry is that a lot of EU legislation is legislation that we wanted in the first place, and, if Members will pardon the pun, it is legislation that we drove forward. The great repeal Bill will not be a great repeal so much as a great domesticisation—if that is a word. It is now.

I will just make a couple of points, rather than delay the House by repeating what has been said many times. The Driver and Vehicle Standards Agency needs more teeth, particularly when we are exiting the EU. At the moment, there are issues with non-UK hauliers. The Minister kindly wrote to me recently about cabotage and access to the database for the DVSA. The response, with the greatest respect, is not clear. At the moment, a lot of vehicles stopped are not flouting cabotage rules. The DVSA does not have sufficient access to the database to spot the right hauliers. It is just a bit random at the moment.

[The Minister of State, Department for Transport (Mr John Hayes)]

I am very happy to continue that dialogue and the roundtables, mindful of what the hon. Gentleman has said.

[Robert Flello]

I am very grateful. I know that the Minister takes these issues seriously. The DVSA needs more powers to tackle non-UK hauliers, particularly post-Brexit.

Several colleagues, including my hon. Friend the Member for Liverpool, Riverside (Mrs Ellman), the Chair of the Transport Select Committee, have talked about vehicle standards, and the hon. Member for Glasgow South (Stewart Malcolm McDonald) talked about standards shopping. It is important that we have a common standard, but it is also important that we stop standards shopping. We should also revisit HGV licensing. Rather than the over-complicated system of C+E licences and all the rest, perhaps it would be better to go back to class 1 and class 2. The certificate of professional competence is another issue that has caused the industry a lot of concerns, problems and difficulties. It is now much more embedded in its culture, but much more work needs to be done in the context of post-Brexit.

The hon. Member for Kilmarnock and Loudoun—I have been waiting hours to say that, although I do not know whether I have pronounced it anywhere near correctly—

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. Have another go: Kil-marn-ock and Loud-oun. [Interruption.] The hon. Gentleman tried very hard. It is not his fault he did not get it quite right.

[Robert Flello]

Thank you, Madam Deputy Speaker. The hon. Member for Kilmarnock and Loudoun (Alan Brown)—[Laughter.] Thank you.

[Calum Kerr (Berwickshire, Roxburgh and Selkirk) (SNP)]

It’s not Welsh!

[Robert Flello]

I’m an eighth Welsh actually. But I am conscious of time and do not wish to go down this cul-de-sac any further.

The point about the 88 documents in one is a good one, but there is no reason post-Brexit why we cannot do our utmost to make sure that it is still only one document. That is an important point.

On HS2, I am afraid that I am not such a great fan. [Interruption.] I know it’s hard to be believe. One of my concerns is that, as I understand it, rail freight will not be allowed on the tracks currently being used for HS2. I also have great doubts about whether we can free up enough capacity on other lines, such as the west coast main line. How, for example, will people get from Stoke-on-Trent to Bournemouth? It will be a tortuous journey if they have to take HS2 into London, only to get another train out, rather than using the current service, which will be cut to free up capacity.

There are big issues on road worthiness and tachos, as they relate to the DVSA. It is also important to note that many firms are hiding behind Brexit over things such as fuel costs and blaming Brexit and the dropping pound for keeping the price of fuel artificially high. I urge the Government to take on board the concerns from organisations such as FairFuelUK about the price of fuel.

I will not dwell on the port services directive. It has been dealt with more than is necessary already. On the security of our border, there have been issues around Sangatte at Calais and, more recently, the Jungle at Calais. This problem might well recur in the future so we need to make sure that we have a good relationship with the French, particularly in northern France.

Members have raised a host of other things, but, you will be delighted to know, Madam Deputy Speaker, that I do not wish to repeat them. I do, however, wish to draw attention to the issue of state aid. In the past, we have seen many airlines funded by other European nations flouting state aid rules, paying the penalty but saving their airlines in the meantime. All too often there has been a willingness among some of our European counterparts to flout state aid rules when it suits them, get the desired outcome and then face the consequences, when, frankly, it is irrelevant, because the issue has been resolved.

I will not detain the House any longer. I am keen to hear the Front-Bench responses, and I think there is one more speaker before that. I go back to my opening comments: the logistics industry is not just important or fairly fundamental to the UK; it is the UK. Without the logistics sector, the UK would cease to exist, nothing would happen; the clothes we wear, the food we eat—it would all end. So we have to accept the fact that transport is absolutely at the heart of the UK. We need to make sure that, post-Brexit, we get the best possible deal for the transport sector.

I look forward to hearing what the Minister says in his winding-up speech. I hope that, like me, he takes to his heart the fact that the transport sector—and, for me, logistics in particular—is the UK’s first and foremost industry. We have to make sure that it is protected. Let us get to work on it, taking help from wherever it is offered.

18:30

[Stephen Gethins (North East Fife) (SNP)]

Having sat through this debate, it has to be said that, once again, we are not much further forward. That applies to transport as it does to every portfolio area. To be fair, it was good to hear the hon. Member for Bath (Ben Howlett) providing an all too rare progressive view from the Conservative Benches on maintaining membership of the single market. After all, that is critical for Scotland’s economy and for the UK’s economy, just as the four freedoms are critical for future success. These areas are vital for growth when this reckless gamble is putting our country at risk.

I give credit where credit is due, and it has been good to see in his place the hon. Member for Stone (Sir William Cash) standing up for his beliefs as usual. Seeing him in his place is all too rare these days, as it is for others who backed the campaign to leave. It is very much a tale of two Governments in these islands. North of the border we have had a Government making clear their plans on membership of the single market, freedom of movement and the status of European nationals who contribute so much to our economy. That compares with the continued nothing that we have seen from the United Kingdom Government.

The Secretary of State, who is not in his place—I apologise, he seems to have returned—has to bear some responsibility. He was a member of a Government who campaigned to leave the European Union, yet did absolutely no preparation for the decision that was eventually taken. That was an act of gross irresponsibility during the campaign, and it continues because he has nothing to say five months on.

I have in my hand an example of what preparation looks like—670 pages of a White Paper prepared during the independence referendum.

[Alberto Costa (South Leicestershire) (Con)]

rose—

[Stephen Gethins]

I knew the hon. Gentleman would not be able to resist.

[Alberto Costa]

Would the hon. Gentleman like to tell the Secretary of State and other Members what currency Scotland would have used had it voted for independence?

[Stephen Gethins]

Here we go! We were so well prepared that that is not just in the White Paper—I know the hon. Gentleman has read it—but we even had a fiscal commission working group. We had 670 pages of the White Paper and a fiscal commission working group setting out three options, including sharing the currency, which one Minister said that we would, of course, be able to do—[Interruption.] As my hon. Friend the Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry) said, that compares to tumbleweed—absolutely nothing—from the Government.

The Secretary of State might want to take notes, because there were 15 pages on transport alone in our White Paper. As the hon. Member for Stoke-on-Trent South (Robert Flello) will be pleased to hear, it set out the areas for high-speed rail. It makes much more sense if high-speed rail goes through to Edinburgh and Glasgow, rather than just to Birmingham. The benefits of specialist transport organisations were mentioned, too.

[Ian Paisley]

How many of the 600 and more pages started with the words “could”, “maybe” or “might”?

[Stephen Gethins]

To be fair, a lot more than in the Government’s plans about the EU referendum. The hon. Gentleman makes a fair point on that, as usual. There were a lot more “coulds”, “woulds” or “maybes” than in the Government’s preparatory documents.

The hon. Member for North Antrim (Ian Paisley) will be pleased to hear that the Government must have been reading our White Paper, because there was talk about the benefits of transitional agreements. Clearly, on the basis of recent press reports of the Government’s plans, they are taking to heart ideas about transitional agreements, which have come straight from the White Paper on Scottish independence. There is also talk about working with our European partners and the EU, where it has responsibility. Of course, Government Members told us that if people voted for Scottish independence, we would not be in the European Union and that the only way to guarantee membership was to vote no. What happened there? The point is that co-operating with Europe is vital.

I am glad to see that the hon. Member for Eastleigh (Mims Davies) has returned to the Chamber. She raised the critical issues of climate change and greenhouse gas emissions. In the context of reducing greenhouse gas emissions, we have many reasons to be grateful for co-operation with our European partners. Everyone who has survived this debate so far continues to benefit from the European Union air quality directives every moment of every day. As for climate change, Scotland’s world-leading Climate Change (Scotland) Act 2009, which smashed its targets when Conservative Members said we could not achieve them, is much closer to Brussels policy than legislation in this place. We have allies and friends who take a similar view.

There is also an important point to be made about the single market. As the Member of Parliament representing, for instance, Pittenweem, Oban and Peterhead, I notice that articulated lorries from European Union countries take fine Scottish seafood to markets across the EU. Driver licensing for EU nationals is especially important in rural areas, be they in the borders, in North East Fife, in Northern Ireland or in the highlands. We want to make those people feel at home, because they contribute so much. Will that licensing continue? Will we continue to have the harmonisation that we have enjoyed?

Our geography in Scotland makes airports and air links very important to us, and I am delighted that the Scottish Government have managed to secure 23 new routes since 2014. We benefit from that, and so do other people. Who would not want to spend their holidays in North East Fife? I am sure that you would, Madam Deputy Speaker, and have done so as well. My hon. Friend the Member for Kilmarnock and Loudoun (Alan Brown) pointed out that Prestwick was nearby. Just the other day, Michael O’Leary said that the UK Government did not have a clue, and it is hard to disagree with him.

European funding for research and development has been and continues to be critical. We need to develop clean, green technologies, and Scotland is well placed for that. Currently, Horizon 2020 has a smart, green and integrated transport fund which is worth €6.5 billion. We need to start planning now for what will happen after 2020. Perhaps Ministers will provide certainty by telling us what their plans are.

It is becoming clearer and clearer that Scotland is closer to Brussels in so many policy areas. Transport is just one of them.

18:37

[Jenny Chapman (Darlington) (Lab)]

In transport, as in virtually every other area of policy, challenges are presented by the UK’s decision to leave the European Union. My right hon. Friend the Member for Doncaster Central (Dame Rosie Winterton) did an excellent job in outlining some of the issues, notably rail freight. May I say what a pleasure it is to hear her voice ring out in the Chamber again? I am sure that her constituents, as well as all Members, welcome it.

Fascinatingly, the Transport Secretary has said that transport will be prioritised in Brexit negotiations. His comment suggests that the Government have developed a plan. If the Government have set such a priority and have decided which areas of policy concern them most, perhaps they could share the outcome of their deliberations with the House of Commons. The British people want to know.

The hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry) said that the Government’s plan was an empty vessel, a point well made. He referred to the Titanic and the Mary Celeste. We must ensure that, unlike those fated vessels, the good ship Brexit sails safely into harbour, although I expect that the waters are likely to be choppy. A failure to conclude negotiations on a deal within the article 50 timetable of two years would be catastrophic for British industry. The Government do not give the impression that they accept this reality and the seriousness of this threat. Will the Minister confirm that he wants to establish a transitional agreement with the EU to prevent aviation and other industries from going over a cliff edge? My hon. Friend the Member for Liverpool, Riverside (Mrs Ellman) rightly challenged the Government to explain whether transport will be negotiated in isolation or as part of a wider deal. Not only do we not know what is going to be done, but we do not know how it is to be done either.

Aviation agreements are not covered under the scope of the World Trade Organisation, so there is no WTO deal to fall back on if a specific aviation agreement is not reached. It is vital that our regional airports, which rely heavily on overseas carriers for international routes, are fully involved in all future negotiations to ensure that the wider interests of the regions are not overlooked. Will the Minister confirm that this will happen?

On our railways, there is a danger that funding gaps will not be filled. UK rail projects receive EU funding as direct funding or as loans. Will the Government commit to match this funding penny for penny? In response to a series of interventions from my hon. Friend the Member for Blaenau Gwent (Nick Smith), we watched the Secretary of State twitching on the end of a line, and I advise him that my hon. Friend is unlikely to let this issue go. I can guarantee that the Secretary of State will not hear the end of it.

[Chris Elmore (Ogmore) (Lab/Co-op)]

On the Welsh context of what my hon. Friend the Member for Blaenau Gwent (Nick Smith) raised and also on road infrastructure, EU funding has been a huge asset for heads of the valleys roads and roads across south Wales. Does my hon. Friend the Member for Darlington (Jenny Chapman) agree that it is important that the Department for Transport secures that funding for road infrastructure so that the Welsh Government can continue to deliver those improvements for roads across the south Wales valleys?

[Jenny Chapman]

That is completely right, and I think the First Minister for Wales—my hon. Friend will correct me if I am wrong—has requested that the funding promised be matched penny for penny. Or will this cash go the same way as the £350 million a week for the NHS, and disappear like a smoke ring from one of Nigel Farage’s cigars?

Rail fares have gone up by over a quarter since the Tories came to power in 2010, which is more than twice as fast as wage growth. There is a danger that the economic consequences of Brexit will mean yet another fare hike for commuters. What are the Government prepared to do to stop fares becoming even less affordable for passengers?

I am going to give credit for this next statistic to my hon. Friend the Member for Stoke-on-Trent South (Robert Flello): over 90% of UK international trade in weight passes through UK ports. UK ports directly employ more than 25,000 people and the sector contributes more than £7 billion to the UK economy. Like every other sector, our ports need to know how the Government intend to proceed. The hon. Member for Stone (Sir William Cash) explained that the proposed port services regulations are deeply unpopular with UK ports, but it is far from clear that the UK leaving the EU will mean that our ports are not going to be subject to these regulations all the same. In fact, the UK Government’s ability to influence the regulations to suit British ports is now virtually nil. How are the Government going to protect our magnificent ports sector?

Similarly, our road haulage sector faces uncertainty as a result of Brexit, and there is no one with more passion for this issue than my hon. Friend. He challenged the Government to ensure that they are adequately staffed to support the haulage sector through the Brexit period.

I do not want to be negative about Brexit, but we are kidding ourselves by pretending that these challenges do not exist or are somehow straightforward to resolve. We need to be up front and honest with the British people about this. The Government should perhaps use these debates to inform the House, and also perhaps do so through the publication of position papers beforehand outlining the Government’s priorities. Today’s debate has been interesting, but I do not think that anyone will leave the Chamber any clearer about the Government’s position on these issues. We are not going to obstruct article 50. We have made that commitment very clear, but I suggest to the Minister that there is now a moral imperative for the Government to act in good faith and to share their priorities and plans with the British people and with this House.

18:45

[The Minister of State, Department for Exiting the European Union (Mr David Jones)]

This has been an excellent debate and I should like to express my personal thanks to all right hon. and hon. Members who have contributed to it. It is clear that everyone realises the centrality of transport to our economy, and it is therefore entirely right that the issue should be debated at length and in detail today. This has been the second in a series of debates on important issues arising in the context of the negotiations to leave the European Union that were promised by the Secretary of State for Exiting the European Union. It will help to inform our consideration of these important issues as we prepare for the negotiations.

[Jenny Chapman]

If these debates are so valuable and informative, perhaps the Minister could give the House an example of how his considerations will have been moved on by what he has heard today.

[Mr Jones]

The hon. Lady will find that out as I proceed with my response. She has to understand that at the moment we are engaged in a process of consultation with not only colleagues here in Parliament but representatives of industry and the wider civil society. Frankly, anyone sensible would expect the Government to be engaging in this sort of consultation and I make no apologies for doing so.

As the Secretary of State for Transport made clear, the Government fully recognise the central role that transport will play. Our transport links with Europe—and, indeed, the rest of the world—are crucial to this nation’s prosperity, and as we develop a new relationship with the EU we are determined to maintain efficient networks that build on the excellent connectivity that we already have around the world. This debate has certainly highlighted some of the challenges that this country faces in the process of the negotiations, but it has also highlighted opportunities. As I have said, this has been an important exercise in helping to inform our position.

I want to touch on some of the important issues that have been raised. My hon. Friend made a point about the port services regulation. As my right hon. Friend the Secretary of State pointed out, the Commission’s proposal in relation to the regulation was clearly aimed at the continental subsidised public sector landlord model and did not sit at all well with the United Kingdom’s thoroughly commercial, diverse and predominantly private sector model. In effect, the United Kingdom’s ports stood to be penalised for having led the way in liberalisation since the 1980s. Our experience shows that competition between ports drives efficiency and investment.

We have engaged successfully with the European institutions to prevent our being penalised in that way, and the near-final text of the regulation is considerably less onerous that what was first proposed. As my hon. Friend the Member for Stone said, this is a good example of how Brexit will enable us to regain control over issues that are important to the UK economy. We must also remember that we will be promoting the great repeal Bill. When enacted, it will absorb the entire corpus of EU law into the body of British law, which will enable us to review that law and repeal or amend it as appropriate. I imagine that he will regard this particular regulation as being ripe for repeal.

[Stewart Malcolm McDonald]

Will the Minister tell us how many of them will relate to transport?

[Mr Jones]

That will of course be a matter for this Parliament. This is about the entire issue of regaining control, which we do not have at the moment. Once we regain control, it will be this Parliament that makes such decisions.

The hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry) exhibited a nice line in transport-related puns, for which I compliment him. He raised the important issue of the effects of leaving the EU on business and travellers. My Department is currently engaging closely with businesses right across this sector and 50 others with a view to gauging their concerns and the opportunities. I apologise that I cannot respond to all the issues he mentioned, but trans-Atlantic routes was an important one. I recently had an interesting discussion with Airlines for America, which clearly has an equal interest in the matter from the other direction. That is an example of the fact that third countries will also play a part in the process. As part of the Department’s consultation, we are engaging with interlocutors not only from Britain but from the continent and third countries.

My hon. Friend the Member for Bath (Ben Howlett) raised several issues, including vehicle emissions. EU environmental law will be fully absorbed into our own corpus of law and we can then decide what arrangements we make with regard to that legislation, including confirming it if necessary.

The hon. Member for Liverpool, Riverside (Mrs Ellman), who chairs the Transport Committee, referred to several important matters, some of which I will touch on. She asked what would be the future arrangements for setting standards for new vehicles, and the Department for Transport is focused on that question. Many vehicle standards are actually shaped in United Nations bodies, and the EU absorbs them into EU law. That process would therefore be absorbed into our domestic law as part of the great repeal Bill process. She mentioned access to the single market, which remains a top priority for the Government. We want to secure the best possible access to the single market—consistent with our other priorities as a Government.



My hon. Friend the Member for Eastleigh (Mims Davies) raised several important constituency issues, including Southampton airport. She welcomed my right hon. Friend the Chancellor’s infrastructure announcements, which will provide a major boost for this country’s transport infrastructure.

The right hon. Member for Doncaster Central (Dame Rosie Winterton) focused her remarks on rail freight. We recognise that rail freight is an important part of the issue that we are considering today, and I can tell her that representatives of the rail freight industry have participated at round-table discussions held with the rail industry more generally by my right hon. Friend the Transport Secretary.

[Dame Rosie Winterton]

Are Ministers also having meetings with the trade unions who represent members in the rail freight industry?

[Mr Jones]

What I can say is that the Department encourages the trade unions, as it does every other part of the community, to contribute to the consultation that we are currently holding. I suggest that the right hon. Lady encourages them to contact us.

The hon. Member for Glasgow South (Stewart Malcolm McDonald), who pronounced himself to be a passionate supporter of the remain campaign, made a remarkably Eurosceptic speech, in which he raised the issue of Volkswagen and what he described as a “scandal”—many in this House would agree with that. As I have said previously, when the great repeal Bill comes through, the EU legislation will be absorbed into our own body of legislation and we can then amend it. It will be up to this Parliament to decide whether it wishes to improve on the current arrangements, and I discern from his remarks that that is something he would welcome.

The hon. Member for North Antrim (Ian Paisley) made an upbeat speech, in which he identified a number of opportunities arising from Brexit. He raised the issue of the package travel directive, and all I would say in response is that we are aiming at a new state of affairs, under which this Parliament can make decisions such as that and not simply accept the directives that come from the EU.

[Ian Paisley]

Is the Minister at a point yet to make a commitment that that directive will never come into force?

[Mr Jones]

Forgive me, I did not hear the question.

[Ian Paisley]

As a person called Paisley, I have never once been told that no one can hear me—I apologise profusely. Can the Minister make a commitment at this point, or at some time in the future, that that directive will never come into force?

[Mr Jones]

I think the answer to that is that it depends on how quickly we complete our withdrawal from the EU and on what this Parliament decides to do. I have no doubt that the hon. Gentleman will be a strong advocate for its non-acceptance of that directive.

The hon. Member for Kilmarnock and Loudoun (Alan Brown) made a contribution relating, inter alia, to the spaceport that he hopes will be located at Prestwick. I had ambitions for north Wales, but I am sure we will both be happy wherever it is located. He also raised the issues of road freight and customs checks, both of which are certainly being taken into account by my Department and by the Department for Transport in the context of our EU exit negotiations.

The hon. Member for Stoke-on-Trent South (Robert Flello) raised the issue of the importance of logistics. I understand that he is the chairman of the all-party group on freight transport, and he has raised a number of these issues in round-table meetings that have been arranged by the Minister of State, Department for Transport, my right hon. Friend the Member for South Holland and The Deepings (Mr Hayes), who has undertaken to maintain that dialogue.

Finally, we heard a contribution from the hon. Member for North East Fife (Stephen Gethins), who spoke about the Scottish referendum.

This has been an important and valuable debate. As I say, it has helped to inform the consideration of my Department and the DFT, and we will continue to hold similar engagements both within this Parliament and with stakeholders from outside the EU. [Interruption.] I make no apologies—I hear the catcalls from Labour Front Benchers—for the fact that this Government are giving proper consideration to the process of withdrawal from the EU. I believe that this Government—

[Jenny Chapman]

rose—

[Mr Jones]

No, I will not give way. Forgive me; I am near the end of my time.

[Jenny Chapman]

There is loads of time.

[Mr Jones]

No, nevertheless. Today’s announcements have demonstrated the commitment of this Government to investing in transport in the UK to help deliver growth and economic security for the whole of the UK. This will remain the case after we leave the EU. The UK remains open for business and industry continues to invest in the UK, as demonstrated by recent announcements such as Associated British Ports’ investment of £50 million in vehicle-handling facilities at the port of Southampton. We will do our best to ensure that transport remains central to our consideration of the issues that arise in the context of our departure from the EU. Once again, I thank hon. Members for their contributions today.

Question put and agreed to.

Resolved,

That this House has considered exiting the EU and transport.

[Mr Alistair Carmichael (Orkney and Shetland) (LD)]

On a point of order, Madam Deputy Speaker. I seek your guidance in relation to a matter, notice of which I have given to Mr Speaker and, indeed, to the Foreign Office. Yesterday, during Foreign Office questions, the Under-Secretary of State for Foreign and Commonwealth Affairs, the hon. Member for Bournemouth East (Mr Ellwood), in answer to the hon. Member for Central Ayrshire (Dr Whitford), concerning the demolition in the Negev of Umm al-Hiran in Israel, said:

“I will be looking at this particular announcement and making a statement on this later today.”

—[Official Report, 22 November 2016; Vol. 617, c. 749.]

At about half-past 6 yesterday evening, my office made an inquiry of the Minister’s office and was told that a statement would be issued as soon as possible. We were told the same thing this morning. We were then told that, in fact, it would be a media statement. At about 5 o’clock, when my office phoned again to give notice that I intended to raise this as a point of order, a very short press release was put on to the Foreign and Commonwealth Office website.

The point on which I seek your guidance is this: is a Minister in compliance with his or her duties to the House by saying that he or she will make a statement and then issuing a press release, given what Mr Speaker has said in the past about the House being told first before the media?

[Madam Deputy Speaker (Mrs Eleanor Laing)]

I thank the right hon. Gentleman for his point of order. He and the House know that it is not a point on which I can make a ruling from the Chair, because, of course, the way in which statements are made by Ministers is ultimately a matter for the Minister himself or herself, but I appreciate the point that the right hon. Gentleman makes. He has effectively drawn the matter to the attention of the House and, I hope, rather more widely, because it is a sensitive and important matter. Mr Speaker has said many times in the past that, when a Minister has something to say, it ought to be said first to the House. I cannot make a judgment or a ruling about the issue that the right hon. Gentleman raises, but one would hope that if a Minister has given an undertaking to come to the House with certain information, he will do so at some point. I thank the right hon. Gentleman for bringing this sensitive issue to the attention of the House.