EU-UK Summit

(Limited Text - Ministerial Extracts only)

Thursday 22nd May 2025 Westminster Hall

[Anneliese Dodds (Oxford East) (Lab/Co-op)]

It is a pleasure to speak with you in the Chair, Ms McVey, particularly in a week when the Government acted in our national interest by ensuring a deal that is good for business, bills and the security of our borders. By contrast, the one struck by the Conservatives was, as I put at the time, thin as gruel. It has been particularly catastrophic for our exports, which have crashed by 21%. The new agreement finally starts to set that right. The measures on carbon trading will boost the Treasury’s coffers while reducing businesses’ outgoings, and the commitments on defence will help to deliver for more communities the kind of once-in-a-lifetime reindustrialisation that we are seeing rightly take place in Barrow.

The proposed measures on youth mobility are not a return to freedom of movement; they are a ladder to opportunity. I would urge the Minister, as they are developed, to particularly focus on ensuring that low-income and working-class Brits can benefit. I benefited from a brief period studying in France. I hope that the hon. Member for Boston and Skegness (Richard Tice) will not mind if I mention that I believe it is a matter of public record that he worked in France. I do not believe the ladder to opportunity that we both benefited from should be kept down on the ground for others.

I am aware that many elements of this deal are still being worked on. I commend my hon. Friend the Minister for his endeavour in that regard. In the remainder of my hopefully brief speech, I want to underline two critical areas of additional focus for the Government. First—this has already been remarked on by my hon. Friend the Member for Walthamstow (Ms Creasy)—it is important that the automotive industry’s concerns, given the integrated nature of its supply chain, are at the front of the Government’s mind. I understand the head of the Society for Motor Manufacturers and Traders has rightly said:

“The EU remains the UK automotive industry’s largest and closest trading partner”.

In his words,

“progress…towards a deeper strategic partnership is significant”.

As we move forward, I urge the Government to keep engaging with the SMMT, as I know my hon. Friend the Minister has been, and with the broader automotive sector—yes, on the critical issue of rules of origin, as my hon. Friend the Member for Walthamstow rightly mentioned, but also on the development of the battery value chain and the improvement of supply chain resilience. I hope those discussions can also include relevant trade unions, and I know that workers at BMW Cowley are rightly keen for that to be the case.

Secondly, I have also already called in this place for the Government to consider undertaking a structured dialogue on tech regulation and the defence of democracy with the EU. That is not so we take on each other’s rules and regulations. We have distinct rules and regulations in this area; our Online Safety Act 2023 is not the same as the Digital Services Act, although they share many similarities. A dialogue would enable us to share information, particularly in the face of the kind of onslaught of disinformation and misinformation that our democracies have not seen for decades.

The reality is that the leadership of many tech companies believe they are above accountability to democratically elected national Governments. I saw that painfully last week when I was in Moldova with a Conservative colleague for an Inter-Parliamentary Union visit; it has been subject to sustained Russian-sponsored disinformation campaigns. We have seen the same kinds of campaigns, albeit at far lower intensity, in many other democracies, including in our country and many EU nations. We have to recognise that the kind of free and fair elections that are the right of people in our country are also an essential element of our security, just like the other matters covered in this propitious deal.

[Dame Meg Hillier]

My right hon. Friend is making a compelling point. In contrast to the hon. Member for Boston and Skegness (Richard Tice), she seems to be leaning into co-operating in order to protect. That does not mean rule-taking, surrendering or being stupid; this is leaning in and working with others to protect us all on our own terms.

[Anneliese Dodds]

I could not agree more with my hon. Friend; she is absolutely right that sadly we face the same threats from autocrats and those who seek to support them and disrupt free and fair elections. We need to ensure that we are sharing information, particularly given the speed of change. It has already been mentioned that, with the development of AI in particular, we are seeing increased threats to our democracies. We need to make sure that we are sharing information in that regard. I hope the Government will keep discussions on these matters open. I commend this deal.

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[Sir Bernard Jenkin]

We were told by the Office for Budget Responsibility that there might be a 4% reduction in what our GDP would otherwise have been. That has not occurred—the OBR was wrong. Our economy has continued to grow at roughly the same rate as the other EU economies. Of course, there have been adjustments because the economy has a different trading relationship with the EU. We now have a very deep and comprehensive trading relationship with the EU, as opposed to being in the single market, but there are swings and roundabouts. There have been gains in other areas. The other big advantage is that our contribution to the European Union, which used to be very substantial, pushing up to £20 billion a year, is now right down, which is a huge advantage.

Given all the exaggeration about how bad Brexit was going to be and how bad Brexit is, how seriously should we take what the Government are now saying about the huge benefits of this so-called reset?

[Anneliese Dodds]

Will the hon. Gentleman give way?

[Sir Bernard Jenkin]

I will give way once more, because I need to be brief.

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[Anneliese Dodds]

I am listening carefully to the hon. Gentleman, and I want to ask him specifically about goods exports—this relates to the comments made by the hon. Member for Mid Buckinghamshire (Greg Smith). I just looked at the House of Commons Library analysis, which states:

“Goods exports to the EU exceeded £215 billion in 2017, 2018 and 2019 but have not done so in any calendar year since”—

that came out in April 2025—

“and were £177 billion in 2024”.

Our goods exports to non-EU countries have not recovered, either. Does the hon. Gentleman recognise those figures?

[Sir Bernard Jenkin]

The Library does not say that Brexit is the cause of those declines. [Interruption.] It does not say that, and there are all sorts of factors. For example, we are closing down the North sea and exporting far less fuel. We used to import a lot of uncut diamonds and then export them to the EU, but we do not do that any more. That was worth £1 billion a year.

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[The Paymaster General and Minister for the Cabinet Office (Nick Thomas-Symonds)]

It is a real pleasure to serve under your chairmanship, Mr Vickers. I thank the Backbench Business Committee for allowing this debate, and pay tribute to my hon. Friend the Member for Walthamstow (Ms Creasy) and the hon. Member for Boston and Skegness (Richard Tice) for securing it.

We are here at the end of three weeks in which the post-Brexit independent trade policy that Conservative Members spent so long arguing for has been exercised. We have been exercising our sovereignty. We have agreed a trade deal with India; hon. Members may recall that a previous Prime Minister promised a UK-India deal by Diwali—to be fair, he did not say which Diwali, but none the less, we know he did not deliver it. This Government did. What about an economic deal with the United States? The Brexiteers promised it year after year. Did they ever deliver one? No, they did not. This Government did. Now, for the hat-trick, we have the improved deal with the European Union.

After all their years of arguing for an independent trade policy, one would think that, when a Government successfully exercised one, Conservative Members would have something positive to say about it—but sadly not.

[Sir Bernard Jenkin]

Will the Minister give way?

[Nick Thomas-Symonds]

I will certainly give way to the hon. Gentleman, but I want to make some progress first.

I did enjoy the shadow Minister’s speech. After hearing his comments in the middle about both the youth experience scheme and working in Europe, if he wants me to go and see his leader and put in a word for him to keep him in his job, I am more than happy to do so. I am not sure that the Back Benchers here got the memo about the line he was going to take, but I am sure they will become a bit more coherent in due course. My hon. Friend the Member for Walthamstow quoted the “Frozen” song “Let It Go”, but I am afraid, looking at the Conservative party, it is more a case of “Let the storm rage on”—that is clearly what they are doing today.

The hon. Member for Boston and Skegness said what a significant week it was in parliamentary history, and I entirely agree with him. Whenever we have these debates on UK-EU relations, people with a real interest in and passion for it turn up. My sparring partners are here: my good friend, the right hon. Member for South Holland and The Deepings (Sir John Hayes), whom I frequently spar with on these matters, and the hon. Member for Harwich and North Essex (Sir Bernard Jenkin), who I will give way to in a moment once I have made some progress. He often intervenes on me, and he is always here making the case—but, in this significant week, where is the hon. Member for Clacton (Nigel Farage)? In a supreme irony, he is in the European Union.

The hon. Member for Boston and Skegness also spoke about youth mobility. For me, what makes the difference are the experiences that I hear about from people whose lives have been transformed by having a year or two overseas. I want hon. Members to listen to the story of a young man and what he went on to do, because he spoke about two exciting and challenging years he had spent in France. He had really engaged while there. He said this:

“Living in Paris and working in Paris, taught me a lot”.

That young man became the hon. Member for Boston and Skegness. Given the amount of time that both he and the hon. Member for Clacton spend abroad, I am astonished that they want to deny the same opportunity to everybody else.

I know that the shadow Minister is at heart a sensible, pragmatic man. The Conservatives and Reform have made a decisive choice in the last week. We have secured a deal that will lower household bills—hon. Members need not take my word for it; they can take the word of most major supermarkets and retailers. I do not hear their voices in support of the position of the Conservatives or Reform. Energy bills are coming down—here hon. Members can take the word of Octopus Energy, which is saying just that, and the support of the major energy firms for the Government’s position.

The right hon. Member for South Holland and The Deepings is right about the Five Eyes relationship. Nobody could deny the additional tools and information that we will get from this deal to tackle the boats in the channel and to deal with serious and organised crime. That is the deal this Government have secured—good for jobs, borders and bills. Both those parties will go into the next general election promising to reverse it, and they will have to tell each and every one of their constituents why they want to erect trade barriers, put prices up and make our borders less secure.

[Mike Wood]

I very much admire the Minister’s confidence. The Government have already guaranteed that energy prices will be £300 lower by 2029. Given his confidence that this deal will further lower energy bills, how much lower can we expect household electricity and gas bills to be in 2029 than the £300 reduction they have already promised?

[Nick Thomas-Symonds]

I look forward to that debate in 2028 or 2029 with the hon. Gentleman, and indeed with the hon. Member for Boston and Skegness.

Let me come to the other speeches. My right hon. Friend the Member for Oxford East (Anneliese Dodds), who also benefited from a year abroad, quite rightly spoke about the importance of the automotive sector.

The hon. Member for Mid Buckinghamshire (Greg Smith) talked about scrutiny, an issue also raised by the hon. Member for Harwich and North Essex. On that, the SPS agreement will require primary legislation; I am sure I will have a continuing debate with Opposition Members during its passage.

My hon. Friend the Member for Tamworth (Sarah Edwards) spoke about the wide business support for the Government’s position. When the Conservative party used to win general elections, it used to claim to be the party of business; it most definitely is not any more.

Now let me come to the hon. Member for Harwich and North Essex. I should start by saying that I am getting slightly concerned about him, because not once in his speech did he talk about increasing Conservative votes. He talked about increasing Reform votes. He referred to the hon. Member for South Basildon and East Thurrock (James McMurdock) as his hon. Friend rather than the hon. Member. Are we to see this as a new political direction for the hon. Gentleman? I do not know—but his speech certainly leaned in that direction.

The hon. Gentleman also asked about a democratic mandate. The democratic mandate for what has been agreed with the EU comes from the Labour manifesto. It respects the result of the 2016 referendum: no return to the single market, no return to the customs union and no return to freedom of movement. That is the basis on which this Government have negotiated. People said, “You need to have a Norway deal. You need to have a Swiss deal. You can’t negotiate a bespoke deal for the United Kingdom.” But that is precisely what this Government have delivered within 10 months.

[Sir Bernard Jenkin]

Where in the Labour manifesto did it say that we would start contributing to the EU budget once again? How much are we going to have to pay and when will we know?

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[Nick Thomas-Symonds]

We will not be contributing to the general EU budget. We will be contributing on a value-for-money basis in specific areas, just as the last Government did when they started contributing to the Horizon research programme. I supported that when I was in opposition. I do not know whether that was one of the bitter things the Government did that the hon. Gentleman could not stomach in all those years. Where there is a value-for-money case and it is in Britain's interest, that is precisely what Britain would do. It is not about ideology; it is about a ruthlessly pragmatic approach, and that is what we will pursue.

My hon. Friend the Member for Cities of London and Westminster (Rachel Blake) spoke about the deal working for the whole of the United Kingdom. She is absolutely right. The Government have secured, for example, the removal of steel tariffs, which is just one example of how different parts of the country will benefit. The SPS agreement on agricultural products, food and drink will benefit constituents up and down the land, as will the work on energy bills.

[Richard Tice]

To prove that he is so confident the agreement will not mean a return to freedom of movement—given that the vast majority of those who moved under freedom of movement were under the age of 30 and could therefore qualify for a youth experience scheme—will the Minister give us an indication of the sort of number the cap is likely to be set at? Is it 30,000, 50,000 or 200,000 per annum?

[Nick Thomas-Symonds]

The scheme will be time-limited and capped. I will make two points on that. First, it will be introduced in the context of the Government’s pledge to reduce net migration over the course of this Parliament. Secondly, I see it in the same way as the 13 schemes that already exist and are working perfectly well. I do not detect from Conservative Members—although one or two Back Benchers might have a different view—any particular desire to undo those agreements. Nobody is remotely suggesting that because we have a youth mobility arrangement with Uruguay, for example, we have freedom of movement with Uruguay. That would be absurd.

The right hon. Member for South Holland and The Deepings knows I respect him. We often spar across the Dispatch Box in the House. As ever, he put his finger on a fine historical parallel when he quoted Joseph Chamberlain at the start of his speech. Over a century ago, at the start of the 20th century, Joseph Chamberlain began a debate about trading arrangements that the British public thought would increase the cost of food. That led to a landslide Conservative defeat in 1906 and no pure Conservative Government for 16 years afterwards. Joseph Chamberlain’s campaign on trade caused absolute havoc on the right of British politics. Does that sound familiar?

[Sir John Hayes]

Let us save Joseph Chamberlain’s reputation, if we can. Joe Chamberlain was an almost legendary figure in the city of Birmingham. In the first half of his life, he gave that city slum clearance, clean water and unparalleled welfare standards. Later, when he came into Parliament, he began as a radical and ended up as a supporter of the Tory Government. In his age, Chamberlain represented was the defence of what he saw as the national interest. I cited him because, as I said, I believe that the national interest should be supreme. May I say to the right hon. Gentleman that I suspect that is what the vast majority of his constituents and mine think, too?

[Nick Thomas-Symonds]

I would not disagree at all when it comes to Joseph Chamberlain’s record in Birmingham. The right hon. Gentleman knows that I do not doubt for a moment the sincerity of his belief in the national interest, but I am sure that he respects the sincerity of my belief as well. We take a different view as to what actually constitutes the national interest.

My hon. Friend the Member for North Somerset (Sadik Al-Hassan) talked about the huge benefits of the deal for the farming community. I am sure that the reduction in trade barriers will be welcomed.

I have been passed a note written by the hon. Member for Strangford (Jim Shannon), who is no longer in his place. I will make two quick observations. First, the SPS agreement will be of great benefit in reducing the level of checks across the Irish sea. Secondly, I will happily write to the hon. Gentleman on the other method issues he raised.

My hon. Friend the Member for Bishop Auckland (Sam Rushworth) raised the issue of fish. First, we have stability; and secondly, 70% of our catch is exported to the EU market, and that will be able to be done far more easily. To make sure that our fishers have the opportunity to take advantage of that greater market access, £360 million will be made available to upgrade the fishing fleet.

I give credit to the hon. Member for East Wiltshire (Danny Kruger) for his candid assessment of the previous Government as having made a lot of mistakes. On that, he and I agree 100%. But as I said to the hon. Member for Harwich and North Essex, the red lines—not rejoining the single market or customs union, and on freedom of movement—have very much been observed.

I agree with my hon. Friend the Member for Edinburgh East and Musselburgh (Chris Murray) that this should not be about nostalgia. It is about making a forward-looking, hard-headed and ruthlessly pragmatic assessment of what is in our national interest now.

[Greg Smith]

Will the Minister give way?

[Nick Thomas-Symonds]

I will, but as we are running out of time it will be the last time.

[Greg Smith]

As the Minister is talking about pragmatism and the national interest, perhaps I can set him a very brief maths test. On dynamic alignment on carbon trading, the EU’s carbon price today is £58.84 per metric tonne, while the UK’s price is £38.13. Does that increase or decrease costs on British business?

[Nick Thomas-Symonds]

If we are not part of the emissions trading system, we will not be able to get an exemption from the carbon border adjustment mechanism, which would cost British business £800 million. If the hon. Gentleman is saying that he wants British businesses to pay those taxes, he should be honest with the electorate about it.

My hon. Friend the Member for Halesowen (Alex Ballinger) spoke about bringing down costs. Things such as the export health certificate—£200 per consignment —were meaning that we were talking about thousands of pounds to get some lorries to move. Those are the kinds of things that we can sweep away.

It must be said that the hon. Member for Richmond Park (Sarah Olney), speaking for the Liberal Democrats, provided a measure of balance to what was said by those sitting to her right. Nevertheless, I have to agree with my hon. Friend the Member for North Somerset that if the Conservatives and Reform are in one position, and the Liberal Democrats are in another, it suggests that we have got the balance absolutely right.

I will conclude because I am conscious of the time. I know that we have gone over the allotted time, Mr Vickers, and my hon. Friend the Member for Walthamstow needs to sum up the debate. We have made our choice—a ruthlessly pragmatic choice in negotiation. Our choice is that we are going to lower bills and have a situation that is great for jobs. We are getting more tools and information to secure our borders. If Opposition Members wish to be against that, good luck to them.

[Martin Vickers (in the Chair)]

Before I call Stella Creasy, I point out to the Minister that he referred to the Member for Clacton by name.

[Nick Thomas-Symonds]

Forgive me, Mr Vickers. I will forever reference the hon. Member for Clacton.

[Martin Vickers (in the Chair)]

I am sure he will not take offence.