Leaving the EU: Airbus Risk Assessment

Monday 25th June 2018 Commons Chamber

15:37

[Mark Tami (Alyn and Deeside) (Lab)]

(Urgent Question): To ask the Secretary of State for Business, Energy and Industrial Strategy to make a statement following the publication on Friday of the Airbus Brexit risk assessment report and its implications for future investment and job security in the UK.

[The Secretary of State for Business, Energy and Industrial Strategy (Greg Clark)]

The aerospace sector is one of the UK’s greatest manufacturing strengths. Directly and through its supply chains, it employs in the UK around 300,000 people in high-skilled jobs, with an average salary of £41,000—that is 43% above the national average. Of the sector’s £33 billion turnover, some 90% is accounted for in exports. From Bombardier in Belfast to Airbus in Filton, the supply chain that the sector operates is complex, precise and just-in-time. The industry is in demand around the world and that demand is growing rapidly, with the sector doubling in size every 15 years. Airbus is a very important part of that success, employing 14,000 people across 25 sites, with 110,000 people working in the supply chain of 4,000 small, medium and large companies.

On Friday, Airbus published a risk assessment, in which it stated to suppliers and to the UK and EU member states that if an agreement between the EU and the UK were not reached by 29 March 2019, its production would be likely to be severely disrupted, with a significant impact on the company. It also said that any agreement that involved significant change to customs arrangements would take time to implement through Airbus’s supply chain, and that any agreement that involved new procedures, complexity or frictions would undermine the efficiency of the company’s operations. That is completely consistent with what every part of the industry collectively has been saying directly, as well as through the ADS industry trade body and the international body the General Aviation Manufacturers Association, including in a letter to Michel Barnier at the European Commission earlier this month. Any company and any industry that supports the livelihoods of so many working people in this country is entitled to be listened to with respect.

The Government have been clear that we are determined to secure a deal with the EU that meets the needs of our aerospace firms and the thousands of people whose livelihoods depend on them and that, in particular, products made in the UK can be approved for use across Europe, that there should be no tariffs or any unnecessary friction in the trade between the UK and the EU, and that skilled employees will be able to work across the multiple sites of an integrated operation. Those objectives have been clearly set out by the Prime Minister in public and in our negotiations.

In the months ahead, my colleagues and I will work closely with businesses to ensure that, under the terms of our new relationship, we can continue to enjoy the prosperity that working in aerospace brings to so many people in all parts of the United Kingdom.

[Mark Tami]

I thank you, Mr Speaker, for granting this important urgent question and I thank the Secretary of State for his response.

Does the Secretary of State agree that the continued operation of Airbus in the UK is vital to the UK economy and that we need to take seriously its worries and concerns? Alternatively, does he support the comments of the International Trade Secretary, who said that we should ignore the views of business? Or does he agree with the views of the Health Secretary, who said that it was inappropriate of Airbus to raise concerns? Finally, does he support the more direct approach of the Foreign Secretary, who said, “F*** business”? I know that the Foreign Secretary has to be elsewhere today; I believe that he has gone as far as Afghanistan to avoid the Heathrow vote. Are not those comments indicative of the chaos in Government over Brexit and of the Government’s approach to anyone who dares to raise genuine concerns?

Airbus has been raising those concerns privately for 12 months and getting absolutely nowhere. Can the Secretary of State explain why it is now, when it has done it publicly, that it is shouted down by Cabinet Ministers? Will he meet me and representatives from Airbus to address the serious concerns raised in the report? Does he accept that the lead-in times for investment in aerospace are long and that the sums of money are huge? For Airbus, it is all about securing the next generation of wing work, and these decisions are being taken now.

Is it not the case that, without clarity on Brexit, investment could be placed outside the UK—either in the EU itself or in low-cost producer countries such as China where the company has a plant? Airbus’s concerns are real and shared by many other manufacturers such as BMW and Siemens. The Government need to wake up and listen rather than just address Tory infighting.

[Greg Clark]

I recognise that the hon. Gentleman has more than 6,500 people employed in his constituency in good jobs, and many more in the supply chain. Members from all parts of the House have constituents whose prosperous careers and excellent opportunities come from working in this important sector. Let us be clear: this sector is one of our proudest strengths and it is expanding. The opportunities around the world grow every year and the excellence that we have needs to be nurtured and cherished. I take seriously the representations of all businesses because we are talking about not speculation or visions of the future, but the reality of the lives of many hundreds of thousands of people across the country, which is important.

It is the case that we should listen to businesses. Of course, what Airbus has said was consistent with what it has said before and consistent with what it has said to Select Committees of this House. Very importantly, it was addressed equally to the European Commission and to member states of the European Union. It is very clear that, in order to have the agreement that we seek, it is necessary that both sides of the discussions should participate. Airbus has been clear that it is in the interests of the whole country and the whole company that that should be the case. I hope that that message will be heard in Brussels as well as in this country.

The hon. Gentleman asked questions about listening to business. All Government Members recognise that the livelihoods of millions of people, and the prosperity of our country, depend on business being successful. We will not always agree with everything that businesses say, but they have the right to be heard. The hon. Gentleman was rather one-sided in his representations; I think that he should direct some of his recommendations to his own Front Benchers, who have not been a picture of clarity on what they would like from these negotiations.

[Mr Kenneth Clarke (Rushcliffe) (Con)]

Will my right hon. Friend explain to some of his Cabinet colleagues and others that it is simply not going to be possible to opt into most of the benefits of the single market and the customs union, while rejecting every trade rule and regulatory arrangement that the member states of the EU accept as part of that deal? Does he also agree that if, at the end of our negotiations, we start erecting new tariff barriers, new customs procedures and new regulatory divergences, it is perfectly obvious that we are going to deter inward investment from companies such as Airbus, BMW, Siemens and many others, with long-lasting damage to our economy?

[Greg Clark]

It is imperative that we do not do that. I am actually more optimistic than my right hon. and learned Friend about the prospects of a deal that will avoid that. Part of what this company and others have said is that it is strongly in the mutual interest of this international business that there should be an orderly agreement that allows a very successful company to continue to trade without friction. I think that that is in prospect.

We are leaving the European Union; that decision has been clearly taken. The task before us is to make an agreement that implements that decision and which, at the same time, ensures that these avoidable threats of frictions and tariffs do not take place. That is absolutely within our grasp and it is what the whole House should back during the months ahead.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

Thank you, Mr Speaker, for granting this urgent question. I congratulate my hon. Friend the Member for Alyn and Deeside (Mark Tami) on securing it and on so eloquently setting out the importance of Airbus to our economy and the 110,000 workers whose livelihoods depend on it.

Airbus is not alone. Last week we heard from: BMW, which has 8,000 workers; Unipart, with 6,000 workers; Siemens, with 15,000 workers; and INEOS, which has 18,500 workers. These are the ones that have put their heads above the parapet, to be shot down by their own Government. The Secretary of State may say that he is listening, but the Health Secretary calls Airbus “completely inappropriate”, the Trade Secretary blames the EU and it would be unparliamentary to fully quote the Foreign Secretary, wherever he is.

Businesses are told to shut up when they call for clarity, Labour MPs are accused of scaremongering and Conservative MPs are called traitors. This Government are so insecure—so at odds with themselves and the country—that they cannot stand scrutiny. Their chaotic handling of Brexit is dividing the country, not bringing it together, and it is risking our industrial base. They should abandon their red lines, rule out no deal, accept that a new customs union and single market is in all our interests, and give business and workers the certainty that they need—or step aside for a Labour Government who will.

[Greg Clark]

We listen to the voice of business—large and small, across the country. Let us reflect on the months past. The hon. Lady knows that, around a year ago, business—again, large and small, across the country—said how important it was to have an implementation period. That proposal was put forward, adopted by the Prime Minister and has now been agreed with the European Union.

In her Mansion House speech, again, the Prime Minister responded to what business communicated very clearly in saying that we should be able to continue to be part of bodies like EASA—the European Aviation Safety Agency—which is responsible for aviation safety. That was also something that was recognised. Business recognises that this Government do listen and do act on the advice that business gives during these negotiations. It is an approach that is serious and sober. It recognises the challenges and complexity of the negotiations and addresses them in a responsible way.

I am glad that the hon. Lady calls for a degree of cool-headedness and consensus around this, because 80% of colleagues—80%-plus, I think—were elected on a platform that recognised the importance of leaving the European Union. What is before us is to make sure that the deal that we get is something that can be supported. But at every turn, her party changes its position—not for any reason of substance, but to maximise political advantage: shape-shifting to try to catch the Government out. In the past two years, we have had from Labour, at my last count, 15 tests, five red lines, four bottom lines, 170 questions and four key messages, but no coherent policy. Meanwhile, we in the Government are getting on with the task in hand, and that is precisely what she should do.

[Mr Iain Duncan Smith (Chingford and Woodford Green) (Con)]

May I thank my right hon. Friend for coming so quickly to the House? When he was answering the original question, did he notice the irony that Siemens, among many other companies, has already been showing its faith in the UK even before this, with a £200 million investment in Goole to make sure that it is able to be here because it is where the talent lies? Would he not also consider it slightly ironic if the complaints from Airbus were such that it actually moved its production to China, given that China has never even been in the European Union?

[Greg Clark]

My right hon. Friend is right. I hope that he would acknowledge that my Department and this Government are energetic in promoting the advantages of locating in Britain, and not just at the new facility in Goole—I had the great privilege of opening the Siemens blade factory in Hull, employing 1,000 people. People locate in this country because it is a good place in which to invest. We have an environment of innovation and excellence—it is a tribute to the workforce—and we want to keep it that way. It is therefore incumbent on us, when we have industrial investors who are committing for years ahead, to listen to what they say about the requirements from the negotiation. He and I completely agree that in that relationship, we want to make sure that we do not have tariffs and we do not have frictions. That is what the company wants, that is what we want, and now we need to agree it with our European counterparts.

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

Airbus’s risk assessment is sobering news for those drunk on the fantasies of Brexit. Airbus has forecast “severe disruption” and “interruption of production” in the UK, forcing it to switch investment planning away from the UK. Airbus says that this is not “Project Fear” but a dawning reality. The fact is that business after business is shouting, “Brace, brace.” At the heart of this is the lack of any plan or any sense over the customs union from this Government. This, coupled with no sign of any agreement over the EU-US open skies arrangement, means that Airbus is taking flight while the planes it already has in service could be stuck on the ground here.

The UK Government’s disastrous plan to leave the EU customs union and single market risks 80,000 jobs by 2030 in Scotland. Will the Secretary of State provide details about how the Government will protect 8,000 jobs and £541 million of activity in Scotland indirectly supported by Airbus? What technical discussions has he had with Airbus and sectoral organisations on the impact Brexit will have on the industry? In the light of this, what policy changes, if any, will he take forward?

[Greg Clark]

The hon. Gentleman talks about the impact of Brexit. It may have escaped his attention that we are negotiating the terms of our future economic partnership with the rest of the EU. The representations that have been made by Airbus—as I say, directed at the UK but also at other member states and the Commission —are about what that future economic partnership should look like. I hope there will be a broad consensus in the House that it should be a regime that allows fantastic sectors and companies within them to not only continue to export in a just-in-time system in which any delay at the border undermines the business model, but also to expand production in a rapidly expanding market, not just in Europe but around the world. That is what we are negotiating, and that is the context in which Airbus has given advice to us and the other side of the negotiations.

[Several hon. Members rose—]

[Mr Speaker]

Order. Given that there is a further urgent question to come, thereafter to be followed by a ministerial statement and subsequently a debate on the Heathrow motion, which I can tell colleagues is extremely heavily subscribed, the Chair’s accommodation of the extensive interest in this matter will require brevity from Back and Front Benchers alike—to be demonstrated in the first instance by a co-author of the short questions textbook, Mr John Redwood.

[John Redwood (Wokingham) (Con)]

Does not Boeing’s decision to make a major manufacturing investment in this country show that a complex supply chain can be run with a lot coming in from outside the EU perfectly well and give the lie to the idea that we will not be able to supply the wings to Airbus?

[Greg Clark]

I want Britain to be the best place in the world to produce advanced manufacturing products, and that means we should be tenacious in looking at every way to make the supply chain competitive. Given that our parts go backwards and forwards between the UK and the continent, if we can avoid frictions, as I am certain we can, that enhances our ability to compete, which is to the advantage of Boeing as well as any other company in the industry.

[Hilary Benn (Leeds Central) (Lab)]

Is it not pretty damning that the Secretary of State has had to come to the Dispatch Box today to say that Airbus should be treated with respect when it tells the truth, rather than be criticised? Since the whole House knows that he understands what is at stake here, does he agree that the fact that the Cabinet is still arguing about what kind of customs arrangements it wants two years after the referendum is why a growing number of businesses despair at the Government’s inability to get a grip of this issue?

[Greg Clark]

I disagree with the right hon. Gentleman. On the first point, we are an open economy. Businesses that employ people here are perfectly free to speak out and have a right to do so. It is incumbent on the Government to listen to what they say and factor that into the negotiations we are having. We have been very clear about that.

When it comes to the negotiation of our future customs arrangements, the right hon. Gentleman knows, as Chair of the Select Committee on Exiting the European Union, which has given this extensive scrutiny, that up to now we have been discussing the terms of our withdrawal. We are coming on to talk about the future economic partnership. We are negotiating and setting out what we want to achieve through that, and this was always the time when that would be done. For evidence from Airbus and other companies to come forward at this time is to be expected, given the focus of the discussions over the weeks ahead.

[Anna Soubry (Broxtowe) (Con)]

A small business in my constituency that employs 180 people is part of the Airbus supply chain, so this matters very much to the good people of Broxtowe. I congratulate the Secretary of State on his statement and welcome it, but Airbus is not alone in having grave concerns about what the Government’s position will be on Brexit and seeking clarity. Will he assure people first that the Conservative party remains the party of business, and secondly that when British businesses speak out, they should be able to do so without fear or favour and be listened to with respect?

[Greg Clark]

The answer to my right hon. Friend is: yes, and yes.

[Tom Brake (Carshalton and Wallington) (LD)]

When the Health Secretary suggested that Airbus should get behind the Prime Minister’s position, which of the positions on customs was he referring to: a customs partnership, maximum facilitation or customs arrangements?

[Greg Clark]

If the right hon. Gentleman had read what Airbus said, on which my right hon. Friend was commenting, he would know that it gave a forensic analysis of its requirements when it comes to imports and exports. The import of that was that it needs to avoid frictions and tariffs, which is precisely what the Prime Minister has committed to.

[Sir Desmond Swayne (New Forest West) (Con)]

There are no tariffs on the aerospace industry under world trade rules, are there?

[Greg Clark]

The aerospace sector includes various components that do attract tariffs, and it is very important that we should have zero tariffs on all such components.

[Emma Reynolds (Wolverhampton North East) (Lab)]

I am pleased that the Secretary of State is being sensible and listening to the concerns of business, unlike some of the disgraceful comments of his colleagues. Will the Secretary of State tell the House what assessment his Department has made of the impact on jobs and investment in the aerospace sector, and the impact not only on Airbus, but on companies in the supply chain, such as UTC Aerospace Systems in my constituency, of leaving the single market and the customs union?

[Greg Clark]

The supply chain of Airbus and indeed of every company in the sector is pervasive right across the UK, and many employers—small and large—across many of our constituencies contribute to it. The hon. Lady asks about the impact of leaving the single market. The purpose of the negotiations in the months ahead is to make sure, as we leave the European Union and as we leave the single market—she knows that it is not possible to be a member of the single market and to be leaving the European Union—that we have an agreement that allows us to trade without frictions and without tariffs. That is our purpose, and it is what the Prime Minister has very clearly set out. It is within our grasp, and I am confident we will be able to achieve it.

[Stephen Crabb (Preseli Pembrokeshire) (Con)]

Is not the truth that the kind of Brexit deal that will fully safeguard our industrial base will be one that requires significant compromises? Does my right hon. Friend agree that we are fast approaching the moment when we need to spell out, for the benefit of business and industry, what those compromises look like?

[Greg Clark]

My right hon. Friend is right that any negotiation of course involves give and take. That is true on both sides, and it is important to remember that these observations have been addressed to the European Union as well as to the UK. My right hon. Friend talks about the time. As I said to the Chairman of the Exiting the European Union Committee, the right hon. Member for Leeds Central (Hilary Benn), now is the time when we are moving on from discussing the terms of our withdrawal to what our future economic partnership looks like. This is precisely the time at which we will set out and agree, I hope, a long-term future in which Airbus and many other companies can prosper.

[Darren Jones (Bristol North West) (Lab)]

Airbus and its supply chain are significant employers in north Bristol, so will the Secretary of State set out what assessment his Department has made of the number of jobs that need to be put at risk, the number of families’ lives that need to be devastated and the amount of damage that needs to be done to British industry before the threshold is met for the definition of a duff deal on Brexit, and will he at that stage join me and others in calling for a people’s vote?

[Greg Clark]

I think the hon. Gentleman would be more productive if he engaged with the substance of the negotiation. We are leaving the European Union, and what is required is to reach an agreement that avoids frictions and tariffs. It is perfectly possible to agree such an accord with the European Union. That is our purpose, and we will faithfully implement it.

[Antoinette Sandbach (Eddisbury) (Con)]

Thousands of jobs in the north-west depend on Airbus and its supply chain there. Does the Secretary of State agree that close regulatory alignment is also a requirement to help to ensure that trade is as frictionless as possible?

[Greg Clark]

My hon. Friend is right in alluding to the fact that an aeroplane, which is what we are talking about, is a combination of products from different countries. They need to come together—this is inherently international—so to have standards for wings that are different from standards for engines and parts of the fuselage would clearly be incompatible with having a plane that flies. There is good sense in having an agreement that brings coherence to what is a single product manufactured in different parts of Europe.

[Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)]

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

My constituents, many of whom work at Airbus plants in Newport or across the Severn bridge in north Bristol in the constituency of my hon. Friend the Member for Bristol North West (Darren Jones), also face devastation from the prospects of a hard Brexit. Will the Secretary of State therefore join me in condemning the leader of the Welsh Conservatives for his comments describing Airbus’s remarks as “hyperbole”, “threats” and “exaggerating”, and agree with his ministerial colleague, the Under-Secretary of State for Defence, the hon. Member for Aberconwy (Guto Bebb), who has described senior Cabinet Ministers’ comments as “both unworthy and inflammatory”?

[Greg Clark]

I have said very clearly, as I hope the hon. Gentleman would acknowledge, that it is entirely reasonable for any firm that employs people and pays taxes in this country to contribute its expertise and experience to the discussions that we are having.

[Mr David Jones (Clwyd West) (Con)]

Article 50 provides that the withdrawal negotiations should take into account the framework for the future relationship between the departing member state and the continuing EU. Does my right hon. Friend not agree that the lack of clarity, about which Airbus is quite reasonably complaining, is a consequence, at least in part, of the flat refusal by the European Union to discuss that future relationship?

[Greg Clark]

One of the things that Airbus has set out is what it regards, correctly in my view, as the serious consequences for it of a Brexit without an agreement. It is in all our interests, on both sides of the channel, to have an agreement that avoids that. My right hon. Friend is right that Airbus and the various trade associations, some of them international, to which it belongs, have made the same points to other member states and to the European Commission. I hope that it will be heard in Brussels as well as in every other part of the European Union.

[Several hon. Members rose—]

[Mr Speaker]

As the record shows on urgent questions, I almost always call everyone. Today, I fear, that will not be possible and quite a lot of people will not get in, but the shorter the questions, the more who will. I call Jonathan Edwards.

[Jonathan Edwards (Carmarthen East and Dinefwr) (PC)]

These warnings from Airbus, other manufacturing companies and, indeed, other sectors are not new to the British Government, as their own economic impact assessment shows that leaving the single market and the customs union will be hugely damaging. Is not the reality that for the Welsh economy the UK’s Brexit policy is a game of Westminster roulette where every chamber is loaded?

[Greg Clark]

The hon. Gentleman should be more constructive. Given that the whole country—the United Kingdom—voted to leave the European Union, we should be engaged in making sure that we have the best deal possible. I talk regularly with colleagues in Wales about what is required in the terms of that agreement. He should contribute to that, rather than wishing away the results of a referendum that clearly he did not want.

[Jack Lopresti (Filton and Bradley Stoke) (Con)]

If Airbus makes good on its ridiculous threats—and I do not think it will for one minute—how much of the billions of pounds of taxpayer subsidy, paid for by the British taxpayer, would it have to pay back?

[Greg Clark]

I disagree with my hon. Friend. I think that the company has set out what it requires to be agreed in the negotiations so that it can continue to prosper. It is true that the company, like most companies in the aerospace sector, has been part of a successful investment with the Government in innovation and training. That is one foundation of our success, and I very much want that to continue.

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

Fourteen thousand jobs directly affected; over 100,000 in the supply chain, including in our crucial aerospace cluster in Wolverhampton. What does the Secretary of State think is in the minds of leading Brexiteers when they hear warnings like this, which are anything but ridiculous? Does he think that they take them to the heart, or do they in the end believe that this is a price worth paying, because the overall imperative of controlling immigration comes before any economic or employment consideration?

[Greg Clark]

My experience gives me confidence that the evidence and the facts will ultimately determine the outcome of the negotiations; respect for the facts on both sides of the negotiations will be what determines a solution in the interests of both sides. That is what I am determined to pursue. When companies offer evidence, as others are completely free to do, it should be considered in a serious and sober way, and used to inform those discussions.

[Mr Laurence Robertson (Tewkesbury) (Con)]

The aerospace industry is important to my Tewkesbury constituency. Did the Secretary of State notice, on the day of the announcement, that American company GE Aviation announced that it was going to rebuild its propeller business, which supplies a significant proportion of the world’s propellers, in my constituency of Tewkesbury, here in the United Kingdom? Is that not a vote of confidence in what we are doing?

[Greg Clark]

My hon. Friend is absolutely right. Our right hon. Friend the Member for Chingford and Woodford Green (Mr Duncan Smith) pointed out earlier that companies invest here because it is a good place to invest. My hon. Friend’s constituency and the area around it have proved successful because there is a critical mass—a cluster—of related firms. It is important that we do everything we can to ensure that we maintain and add to the strength of that cluster, and I am absolutely determined to do so.

[Anna McMorrin (Cardiff North) (Lab)]

Ideology before jobs; doctrine before the economy. It used to be that the Conservatives were the party of business, but now they are the party of fears. When will the Government give clarity to business and hard-working families, heed warnings, and commit to staying in the single market and the customs union?

[Greg Clark]

Day in, day out, I meet businesses and persuade them of the advantages of this country. I have to report that one of their concerns is the policies of the hon. Lady’s Front Benchers, which are a very significant deterrent to investment in this country.

[Mr Mark Francois (Rayleigh and Wickford) (Con)]

Some months ago, when I visited Airbus at Broughton, I was briefed in detail about its considerable investment in both capital and skills for specialised wing work. Is it not a fact that it would be extremely expensive for Airbus if it were ever to contemplate trying to relocate that work, be it to Hamburg or Toulouse?

[Greg Clark]

My right hon. Friend takes too pessimistic a view. We do not want Airbus to be located in this country because it is too difficult for the company to go elsewhere; we want it to be here with enthusiasm because this is a good and profitable place to invest. I am determined that the deal we secure and the investment we make through our industrial strategy will add to our strengths and make us even more attractive. We should have a counsel of optimism rather than defensive pessimism.

[Alison McGovern (Wirral South) (Lab)]

Unlike the right hon. Member for Rayleigh and Wickford (Mr Francois), my constituent Kyle Robinson, a Unite shop steward, works at Broughton every day. He wrote to me this weekend to say that the current situation for him and the families I represent is potentially catastrophic. Will the Secretary of State ensure that when he takes up the invitation from my hon. Friend the Member for Alyn and Deeside (Mark Tami) to meet him and the company, the unions get an invite as well?

[Greg Clark]

The company has good relations with the trade unions and meets them regularly, as indeed do I. The hon. Lady should reflect that when the country took the decision to leave the European Union, there was always going to be a period before the negotiations were concluded when anxieties would be felt. Our purpose and determination is that those negotiations should be concluded so that there will be confidence to invest in the future and we can create many more jobs for her constituents.

[Robert Halfon (Harlow) (Con)]

Given what my right hon. Friend the Member for Wokingham (John Redwood) said, and given Boeing’s £40 million investment, is it not important that we listen to all voices in this argument, rather than concentrating on one voice, which may have a different view about Brexit, disproportionately more than others?

[Greg Clark]

Companies in the aerospace sector—big and small—report very similar requirements: we should avoid frictions and tariffs. That is consistent with many other employers who create valuable jobs in this country. It is important that we listen to not just one voice but them all.

[Sammy Wilson (East Antrim) (DUP)]

Since aerospace regulations tend to be made on a worldwide basis rather than on an EU basis, the tariffs on manufactured goods are low or zero, and the UK is an important market for Airbus. Does the Secretary of State accept that we should take some of these warnings with a pinch of salt? If Airbus has concerns, it ought to direct them towards the EU negotiators who seem to be putting every obstacle in the way of the Prime Minister’s objective of frictionless future trade.

[Greg Clark]

We need an agreement. The right hon. Gentleman is right that regulatory standards are increasingly international, but the idea that we would find ourselves unable to operate to the standards required for aircraft produced in Europe would be unacceptable not only to Airbus, but to Bombardier in Northern Ireland, which communicated in very similar terms its requirements for the future.

[Richard Graham (Gloucester) (Con)]

Given that the clear aim of the Government, and indeed Airbus Group, is to achieve a frictionless and zero-tariff exit agreement, has not the statement from Airbus generated more heat than light? Is not the simple truth that we make the engines, wings and landing gear for the Airbus, that it is incredibly important that we continue to do so, and that there is no reason for us not to arrive at an agreement that enables us to do so?

[Greg Clark]

I agree with my hon. Friend. I hope that the House can tell that I regard the prospect of a good agreement as being within our grasp. That is our objective, and it is what this company and many others want from us.

[David Hanson (Delyn) (Lab)]

Airbus makes great play in its statement of the need to remain in the European Aviation Safety Agency, because regulating in that way means that planes can fly. What confidence can the Secretary of State give to my constituents, including the chair of the trade union group and the 1,500 people in my patch who work there, that we will still have that proper regulation after Brexit?

[Greg Clark]

That is precisely what the Prime Minister set out in her Mansion House speech: we want and need to secure an agreement such that we will not require a different set of regulatory standards. I am confident that we will be able to agree that.

[Vicky Ford (Chelmsford) (Con)]

Airbus is also a key player in the space sector, which is important for many jobs in my constituency. Can the Secretary of State confirm that the partnership that we are looking for will cover co-operation on standards and a deal on services, so that maintenance contracts and the like can continue to be fulfilled?

[Greg Clark]

My hon. Friend is absolutely right that there is no hard and fast distinction between manufactured goods and services, and that is especially illustrated in the aerospace sector. If, for example, Rolls-Royce sells an engine, the money that it makes in the years ahead is from maintaining and servicing that engine. That involves skilled engineers being able to travel, so it is very important—again, as part of our agreement—that such services should continue to be supplied uninterrupted.

[Several hon. Members rose—]

[Mr Speaker]

Order. We have very little time left for this, I am afraid, so we will need short questions and short answers.

[Mr Chris Leslie (Nottingham East) (Lab/Co-op)]

Apparently it was at a Foreign Office reception in honour of the Queen’s birthday that the Foreign Secretary applied his four-letter expletive to the concerns of Airbus and business about leaving the single market. I can think of a few suggestions myself, but what four-letter word comes to mind for the Secretary of State when he thinks about the Foreign Secretary?

[Greg Clark]

For all of us, it is “jobs” that we want to secure from our negotiations—good jobs—and we are determined to do so.

[Mr Philip Hollobone (Kettering) (Con)]

Is it not the case that the United Kingdom has attracted more foreign direct investment than most, if not all, our European partners, and is it not the case that today, two years on from the referendum, there is more foreign direct investment in our economy than there was in 2016?

[Greg Clark]

My hon. Friend is absolutely right. He will know that I spend time travelling around the world to encourage overseas investors to invest in our country and our economy. One of the reasons why they choose to do so is that we are a place of skills and ingenuity. We are also a place from which it is possible to export around the world, and we want to be able to maintain that. That is my purpose.

[Jessica Morden (Newport East) (Lab)]

Many of my constituents work in Newport and in Filton. I reiterate to the Minister that the Government’s failure to address the issues that Airbus raised about Brexit mean uncertain times for the workforce, and that includes the 500-plus apprenticeships that have been offered over the last five years in Wales. This is about jobs for our young people.

[Greg Clark]

I am glad that the hon. Lady refers to the 500 apprenticeships because, as she will acknowledge, the sector has prospered as never before during the last few years, during which we have had a fantastic programme of joint investment in skills and in the technology of the future. That has been this Government’s deliberate policy. Through the industrial strategy, we are taking that forward, and I am determined that we will be able to create markets around the world—including the European Union—for those products to be exported to.

[Jeremy Lefroy (Stafford) (Con)]

I thank my right hon. Friend for his comments and for his support for businesses on all sides that wish to make their views known, because it is important that our constituents’ jobs are protected. Will he adopt the same pragmatic attitude towards his input into the negotiations and encourage that from all sides, including Brussels?

[Greg Clark]

I am grateful to my hon. Friend. If one has the privilege, as I and many of us do, of visiting the shop floors and workforces around the country, one sees how important these jobs are. These are good jobs providing careers and opportunities, as well as decent incomes for workers and their families. It is important that we have that always in mind as we approach these negotiations. If we do, a sensible outcome will, I believe, prevail.

[Stephen Timms (East Ham) (Lab)]

Is it not the truth that Airbus has done a great public service by injecting much-needed frankness and realism into this debate, and will the Secretary of State commend it for being willing to do so?

[Greg Clark]

As I have said to colleagues across the House, Airbus and other companies in the sector, like many other companies, have been very consistent in their approach for many months, including in evidence to Select Committees on which some Members in the Chamber sit. This has caught the country’s attention now, but it is consistent with what the company has been saying for some time.

[Iain Stewart (Milton Keynes South) (Con)]

I declare an interest, having visited the Airbus headquarters recently. Airbus has a manufacturing facility in Alabama, USA, which is outside the customs union. It exchanges products, parts and labour without impediment. Does that not give us hope for the future?

[Greg Clark]

In the context of Europe, the company’s arrangements are remarkably effective. It combines products from neighbouring EU countries and, in many cases and in many markets, beats the competition hands down. Why would we want to disturb something that works?

[Karin Smyth (Bristol South) (Lab)]

Bristol, home of Concorde, is proud of its aerospace industry, to which Airbus is critical. It is also critical to the provision of good apprenticeships in my constituency. How will the Secretary of State’s industrial strategy be delivered if companies such as Airbus are not here?

[Greg Clark]

Not only will Airbus be here, but it will be expanding its operation and recruiting more apprentices for very successful careers.

[Robert Neill (Bromley and Chislehurst) (Con)]

May I welcome the Secretary of State’s firm restatement of a properly Conservative position that respects business and puts pragmatism above ideology? Will he make sure that the same applies to negotiations on our key services sector, which represents 80% of the economy?

[Greg Clark]

My hon. Friend is right. It is important that services, which make such a good contribution to our economy, can continue to prosper. That means that, whether in financial and professional services, or in the oil and gas sector in which we have such expertise, we can fly people into other countries, have them ply their trade and give advice and help, and then have them come back again. We can do that at the moment; we need to be able to do it in the future.

[Chris Ruane (Vale of Clwyd) (Lab)]

It was a Tory Government who shed more than 8,000 jobs at Shotton in 1980—the biggest lay-off in one day in British industrial history. We will see history repeat itself, with 6,500 jobs lost at Broughton, if the Secretary of State does not pull his finger out. Why are he and his party prepared to sacrifice those Airbus workers’ jobs and futures for party political ideology?

[Greg Clark]

I am not, but if the hon. Gentleman wants to talk about job losses, he should refer to the periods when his party has been in power and the devastation to the economy that that has caused. We are determined that industries that are successful now will be successful in the future. The policies of Labour Front Benchers, which are seemingly predicated on the idea that if it works, it has to be subsidised, and if it still works, it has to be nationalised, will attract no confidence in this country.

[Charlie Elphicke (Dover) (Ind)]

Has the Secretary of State noticed that the European Union sells us £100 billion more in goods than the other way around? Does that not underline that, rather than following the defeatism of the Labour party, we should be bold and courageous in putting forward maximum facilitation and trade with the EU?

[Greg Clark]

Given my hon. Friend’s constituency, he knows the importance of having no frictions at the border. As he describes, there is a common interest between the two sides of the negotiations, which I am sure will lead to a successful outcome.

[Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)]

Yesterday, the Health Secretary said that it was “completely inappropriate” for businesses such as Airbus to make warnings about moving jobs because of Brexit. Will the Secretary of State confirm that the Health Secretary was wrong and that, in a democratic country, it is entirely appropriate for such businesses to raise their concerns? What will he do to protect the thousands of jobs in the aerospace sector in the north-west and across the country that will be put at significant risk if the Government pursue their plan of leaving the customs union and single market?

[Greg Clark]

As I think I made it clear throughout my statement, I do not agree—unusually—with my right hon. Friend on this point. I think that businesses have a right to speak out if they pay taxes and employ people, and we are determined that they will be able to continue to succeed in the future.

[Kevin Foster (Torbay) (Con)]

Having visited the Airbus facility in Bristol, I am pleased to note the tone and nature of the Secretary of State’s remarks. Will he confirm that the aviation industry is increasingly working on a global basis—there are even direct flights from here to Australasia now—and that that will not change after Brexit?

[Greg Clark]

My hon. Friend is absolutely right. We want to be able to take advantage of increasing global opportunities, but to do so without losing the advantages that we have from what have been very successful trading relationships within Europe.

[Mike Gapes (Ilford South) (Lab/Co-op)]

When the Secretary of State said that there should be no unnecessary friction, was he referring to discussions within the Cabinet or to the economy?

[Greg Clark]

When a matter is complex and requires a forensic attention to what companies require, there will of course be discussions, and sometimes people will not agree with each other. What is important is for those discussions to be concluded in a way that is productive for the whole economy.

[Several hon. Members rose—]

[Mr Speaker]

Order. I apologise to remaining colleagues, but we must move on. I am sure that this matter will arise again, and that those who were not called today will have a chance next time.