Sovereign Defence Capability: Meggitt Takeover

Debate between Baroness Smith of Newnham and Lord Callanan

Wednesday 15th September 2021 Lords Chamber

[Lord Callanan (Con)]

The current takeover is not by an equity fund but a defence contractor. As I said, we welcome investment into the UK but will not hesitate to take action if it threatens or compromises our national security.

[Baroness Smith of Newnham (LD)]

My Lords, Tom Williams of Parker told the Financial Times that he was open to talking to Ministers and, in particular, said:

“We recognise the importance that everybody has around national security and defence capabilities. We want to reassure people that we have no intention of impacting that.”


That is fine in this case, perhaps, but what assessment have the Government made of bids where those wishing to take over sovereign defence capabilities do not have such apparently benign aims?

[Lord Callanan (Con)]

As I said, we have not taken any decision on the current takeover yet, but the UK will always enthusiastically champion free trade, recognising that the vast majority of inward investment into this country is highly beneficial and creates jobs and prosperity for the country. An open approach to international investment, as many other countries have, has to include the appropriate safeguards. We have powers under the Enterprise Act 2002 to intervene in mergers or takeovers that raise particular public interest concerns. As I have intimated in other answers, we have recently strengthened our powers through the National Security and Investment Act, which will commence on 4 January.

Brexit: Preparations

Debate between Baroness Smith of Newnham and Lord Callanan

Monday 21st October 2019 Lords Chamber

[Baroness Smith of Newnham (LD)]

My Lords, I will follow on seamlessly from the noble Baroness, Lady Hayter. I have not had the advantage of seeing the Statement before the Minister repeated it, and so I am responding very much on the hoof.

I note that the Secretary of State suggested that it would have just been for the House of Commons to have voted in favour of this deal to honour the will of 17.4 million people. However, as the noble Baroness, Lady Hayter, pointed out, there were many opportunities: three times, a previous deal was voted down, and one of those who kept voting against the previous deal was the man who is now Prime Minister. The idea that somehow the House of Commons could have, on Saturday, ensured leaving on time is an interesting concept. I understood leaving on time to mean leaving by 29 March 2019. Theresa May, as Prime Minister, said 109 times that we were leaving on 29 March. The idea that, on Saturday, MPs somehow prevented us leaving on time is a little misleading.

If we are to leave the European Union, it ought of course to be done in an orderly way. Preparations for a no-deal scenario make sense. But if preparations for no deal, or to leave at all, were so important, how unfortunate it was that David Cameron prevented the Civil Service even preparing for the eventuality of a vote to leave. How unfortunate that the preparations for a no-deal scenario, which we are led to believe were made in advance of 29 March, were ripped up.

The Minister repeated that freight capacity will be increased from 31 October and that four operators have been contracted for six months to deal with freight. I seem to recall that we spent quite a lot of time earlier in the year asking questions of the noble Baroness, Lady Vere, about the contracts that had been let and subsequently set aside for the previous no-deal arrangements. Will the Minister tell us how much these new contracts cost and what will happen in the event that we do have a deal? Are we contracted to four freight operators for six months whether we need them or not?

It is clearly important to have effective arrangements for a no-deal scenario. Yet it seems that, in the last weeks, the person who has done the most work is Michael Gove. He and his office have been preparing actively for no deal. He is now talking about working seven days a week. How much effort has been put into ensuring that there is sufficient time in the event that a deal is agreed? How much time is being put in place to ensure that Parliament can do its duty? It cannot go forgotten that the Prime Minister tried to prevent Parliament carrying out its scrutiny duty for five weeks by attempting a Prorogation, which was then deemed null and of no validity. That was precisely the time when Members of your Lordships’ House and the other place could have been scrutinising both the prospect of a deal and no deal. That time was wasted.

This afternoon in the other place, quite a lot of time was spent discussing how much time it will have to debate and scrutinise the withdrawal agreement Bill, which, as I understand it, nobody has yet seen. I know that the Minister will throw the Benn Act back at us and say, “Ah! But noble Lords wanted a truncated process”. But the Benn Act was a short and relatively simple piece of legislation. The withdrawal agreement Bill cannot be a short and simple piece of legislation. We are talking about enacting an agreement of over 500 pages. The withdrawal Act of 2018 is extremely detailed legislation. If there is a withdrawal agreement, the Act to bring it into play and to amend the withdrawal Act of 2018 will inevitably be deeply complex. The idea that we can do that within 10 days seems incredible.

Lest the Minister and others on the Government Benches wish to say that this is our own fault, I ask this: how much time are the Government proposing to allow Parliament to sit? Would it not be sensible, as the Father of the House of Commons has suggested, that the Commons sit later into the night and on Friday? It is little use to suggest simply that your Lordships’ House sit on Friday and Saturday. What about ensuring that the democratically elected Chamber has the time to do the job that it is meant to do?

Finally, the noble Baroness, Lady Hayter, talked about a ruse. I wonder too whether there was not a ruse. Are we being told that we must prepare for no deal to make the hysteria so great that MPs feel the need to adopt this deal—any deal—simply to avoid no deal? Surely that is not good decision-making.

[Lord Callanan]

I thank the noble Baronesses for their comments and questions. I will turn first to the noble Baroness, Lady Hayter.

It is important to point out that, in these matters, we are acting on the appropriate official advice. Not to act on that advice would be the irresponsible thing to do. The noble Baroness made the quite incredible statement in her introduction that an extension was guaranteed and that surely we did not have to worry about it. I assume that she has not seen the statements of the President of France, the Taoiseach of Ireland or the President of the European Commission, who all said that an extension was by no means guaranteed. A number of other commentators in Europe have spoken against an extension—so not to prepare would be the irresponsible thing to do.

I repeat that no deal is not our desired outcome. We have negotiated a deal precisely because we want to see it agreed. However, in its absence, 31 October remains the legal default. That was the extension granted previously by the European Union, and of course the solution is in its hands. As I have repeatedly said, if Labour is so keen to avoid a no-deal exit, there is a deal on the table for it to vote for. There was a deal on the table for it to vote for several months ago and it decided not to do so. If it wants to avoid a no-deal exit, the best thing to do is to vote for a deal. However, the suspicion remains that it is not a no-deal exit that Labour is against but an exit at all. It is against Brexit.

I apologise to the noble Baroness, Lady Smith, if she did not get a copy of the Statement in advance. It is very difficult to respond to these matters if one has not seen them beforehand, so she has my sympathy. She also has my thanks, because she was one of the few Liberal Democrats who originally said that the referendum result should be respected—although I think she has changed her mind recently.

As to the freight contracts, these are framework contingency plans. We hope that they will not be required, but they are contingency plans in case there is severe disruption to make sure that we can still get category 1 goods—medical supplies et cetera—into the country. It is our hope and expectation that, with all the mitigations and the extensive and expensive planning that we have put in place with the various local resilience forums, the contingency contracts will not be required.

The noble Baroness made her own point about time for parliamentary scrutiny. She is quite right. I was going to throw the Benn Act back at her. However, I do not need to talk about the hypocrisy of that, because I have already made that point. Again, to be fair to the Liberal Democrats, they have been clear that they are against Brexit at all and not just a no-deal Brexit. However, I am sure that they will want to play their part in the appropriate parliamentary scrutiny.

Brexit: Preparations

Debate between Baroness Smith of Newnham and Lord Callanan

Tuesday 8th October 2019 Lords Chamber

[Lord Callanan]

The noble Lord makes a good point. We are seeking a compromise and have compromised considerably by conceding that Northern Ireland will remain aligned—part of the single market, effectively—for agri-foods and goods on the island of Ireland. We look to the EU to make similar compromises. No nation on earth has an internal customs border in its territory and it is unreasonable to expect the UK to do that.

[Baroness Smith of Newnham (LD)]

My Lords, the Statement addresses the danger of dishonouring the referendum result, suggesting that 17.4 million people voted to end vast financial contributions to the EU and instead invest in people’s priorities, such as the NHS—I seem to remember that being on the side of a bus—and our brave police service. Fine, those investments would be great, but in light of the IFS’s suggestion today that a no-deal Brexit would lead to borrowing at levels not seen for 50 years and to our debt-to-GDP ratio rising to 90%, when will Her Majesty’s Government stop dancing to the tune of the Brexit Party, the Spartans and Mr Dominic Cummings, and acknowledge that the financial costs of Brexit, especially a no-deal Brexit, will outweigh any financial contributions that we have been making to the European Union?

[Lord Callanan]

I accept that the Liberal Democrats are quite open about the fact that they want to dishonour the result of the referendum; if only the Labour Party would be more honest, we might have more of a debate on the subject. We have accepted that there will be costs involved in honouring the referendum result and leaving the European Union. We are doing our best to mitigate those effects.

Brexit

Debate between Baroness Smith of Newnham and Lord Callanan

Wednesday 2nd October 2019 Lords Chamber

[Lord Callanan]

I am not going to take any more interventions on this. I do not wish to go any further. Noble Lords will draw the political conclusions they wish to from the answers that I have given, but that is the Government’s position and I am not going any further than the answer that I have given.

No-deal preparations were raised by many noble Lords, including the noble and learned Lord, Lord Goldsmith, my noble friend Lord Lilley and the noble Lord, Lord Monks. Noble Lords will understand that the Government’s position is that, if it is not possible to reach a deal, we will have to leave on 31 October with no deal. We are committed to preparing for that outcome. As I said at the opening of this debate, we are ramping up the preparations. All necessary funding will be made available, and we will make all the necessary preparations to ensure stability for citizens, consumers, businesses and the economy.

A number of noble Lords, including the noble Lord, Lord Wigley, will be pleased to know that the Government continue to work closely with the devolved Administrations. With regard to the question from the noble and learned Lord, Lord Wallace, we are committed to managing the policing implications of Brexit in the UK through a collective approach, notwithstanding that policing is, of course, a devolved matter in Scotland. I have participated in many meetings with the devolved Governments of Scotland and Wales, and with the Northern Ireland Civil Service, where precisely these matters have been discussed.

Noble Lords, including the noble and learned Lord, Lord Goldsmith, and the noble Lord, Lord Monks, asked about Operation Yellowhammer. Departments have identified a range of measures to mitigate the potential impacts of a challenging no-deal exit, some of which involve the use of existing regulations and powers. Such activities are not uncommon in challenging situations, but, as I said, the Government have no intention of using the Civil Contingencies Act for Operation Yellowhammer. To answer the question posed by the noble Lord, Lord Monks, extensive work to prepare for all scenarios has been under way for more than two years on food supply chains. The Government have well-established ways of working with the food industry on food supply chain issues and we are using these to support preparations for leaving the EU.

Noble Lords, including the noble Earl, Lord Clancarty, raised the vital issue of citizens’ rights. I reiterate to the House this Government’s unwavering commitment to protecting the rights of EU citizens in the UK and UK nationals living in the EU. EU citizens make an invaluable cultural and economic impact on the UK and we thank them for their patience and contribution to our society. Our focus now is on securing reciprocal assurances from our European counterparts—guarantees that supplement existing member state commitments and the steps we have already taken to protect the rights of UK nationals.

As part of securing reciprocity, I can assure the noble Viscount, Lord Waverley, and the noble Earl, Lord Clancarty, that we have legislated for the EU settlement scheme through the Immigration Act 1971. Indeed, as of August 2019, 117,300 Portuguese citizens have applied for the scheme, which will protect their rights in all scenarios—approximately half of the Portuguese citizens living in the UK. To reassure the noble Viscount, my right honourable friend the Brexit Secretary spoke with the Portuguese Minister of Foreign Affairs last month to highlight the steps we are taking to protect EU citizens and called for reciprocal protections for UK nationals in Portugal. This builds on the rights we have already secured. In June I also signed a voting rights treaty with Portugal in Lisbon that means that UK nationals living in Portugal and Portuguese citizens living in the UK can continue to participate in local elections.

The noble Lord, Lord Dubs, asked about family reunification for refugees. I can tell him that refugees from the EU would be entitled to apply via the settlement scheme and have family rights as part of that in line with other EU citizens. The status of non-EU refugees does not change as a result of Brexit.

The noble Earl, Lord Kinnoull, whom I welcome to his new post as chair of the EU Committee, asked about the impact on the EU Committee’s scrutiny process of the Government’s policy of attending EU meetings only where the UK still has significant interest. This policy has already been effective in unshackling officials from meetings that are no longer relevant to the UK to focus on our national priorities. As I made clear in my recent letter to him, the Government will continue to meet their commitments to facilitate the scrutiny process, including preparing EMs and updating the committee on the progress of files under scrutiny. We have also committed to sharing information on which meetings the UK will attend. Of course, I would be very happy to meet with him to discuss this further.

[Baroness Smith of Newnham]

The Minister just suggested that current legislation would not have an impact on the United Kingdom, but if Northern Ireland were to remain in the single market could legislation that is going through not impact on Northern Ireland if the Government get their way? In that case, is it not still an important position for Ministers to attend?

[Lord Callanan]

If there are significant matters—of course we are still currently a member of the EU—then we are attending meetings, but not all EU meetings are to do with legislation. A lot of them are to discuss things that might happen, some of which could possibly impact on Northern Ireland, so we review which meetings we are attending on a weekly basis. I would of course be happy to meet the noble Earl, Lord Kinnoull, to discuss this further.

In concluding this debate, I remind your Lordships that it has been three years since the British people voted in the referendum to instruct the Government to leave the European Union. A number of noble Lords—the noble Lords, Lord Birt, Lord McNally, Lord Taverne, Lord Heseltine and Lord Livermore—spoke of having a second people’s vote. The noble Lord, Lord Shutt of Greetland, even questioned the continued validity of the 2016 referendum. I remind noble Lords again of the Government’s position that more British people voted in the 2016 referendum than for any other course of action in British electoral history. The message from voters in that referendum and the subsequent general election was clear; we cannot continue to second-guess such a clear instruction and we will never support another referendum.

European Union (Withdrawal) (No. 2) Act 2019

Debate between Baroness Smith of Newnham and Lord Callanan

Thursday 26th September 2019 Lords Chamber

[Lord Callanan]

I thank the noble Baroness for her question. I am not going to get into speculating on hypotheticals or what might happen under various scenarios, but we will always comply with the rule of law.

[Baroness Smith of Newnham (LD)]

My Lords, is it not disrespectful to democracy to traduce Parliament in the way that was done in the House of Commons yesterday? To talk about a “dead Parliament” is wholly inappropriate. The House of Commons is the elected Chamber. The Government are not elected directly, as the judgment on Tuesday made absolutely clear; they rest on the consent of Parliament. Does the Minister feel that the Government have that consent and do they respect Parliament?

[Lord Callanan]

The noble Baroness knows that I have enormous respect for her, but what is disrespectful to democracy is trying to overturn the referendum result, which is what the Liberal Democrats are trying to do. They are no longer even making any pretence about having a second referendum, which was their original position; now they just want to overturn the referendum completely. What disrespect would that mean to our democratic institutions?

No-deal Update

Debate between Baroness Smith of Newnham and Lord Callanan

Tuesday 3rd September 2019 Lords Chamber

[Lord Callanan]

I thank the noble Lord for his questions. On his first, about the common external tariff, I did not quite understand the point he was making. The reason the EU’s common external tariff is so high is that that is what the EU has determined. It is the decision of Brussels, or rather the EU, that it should be so high. Of course, under WTO rules, once it has been determined that it is a high tariff, it needs to be applied consistently to all third countries, but I am not sure what point he was making.

On internal security arrangements, we are working extensively to try to mitigate the effects. We have had extensive discussions in the XO committee with all the security agencies. This is one of the areas where we are trying to persuade the EU to take a different approach. There are ways to mitigate the loss of some of these databases—there are alternative sources of information on passenger information records, for example—but we are one of the largest contributors to these databases as well, and not being able to exchange information with other EU member states on terrorism suspects, criminals and so on is a loss for both us and the EU. I hope the EU will be persuaded that this really is a lose/lose situation, that it will see sense and that we will be able to continue exchanging information. As I say, mitigations are in place with regard to some of the databases. We have discussed this with the law enforcement communities and they are working intensively to ensure that we can still make the appropriate interventions in terrorism and crime.

[Baroness Smith of Newnham (LD)]

My Lords, the Statement suggests that six pieces of legislation have been passed, but where are the agriculture, fisheries and immigration Bills? Should they not be made Acts before we leave the EU? Given that the ONS has now requested that our international migration statistics be deemed “experimental statistics”, can EU nationals already resident in the UK really trust the Government to understand and know that they are resident on exit day? Are their rights really going to be guaranteed?

[Lord Callanan]

Yes, EU nationals’ rights are guaranteed. As I said, the rights that we have offered to guarantee to EU nationals are more extensive than those offered by other EU member states to British citizens. Sorry, could the noble Baroness remind me what her first question was?

[Baroness Smith of Newnham]

We have apparently passed six Brexit-related Acts, rather than just SIs. Should we not also have passed agriculture, fisheries and immigration before we leave the EU?

British Citizens’ Rights

Debate between Baroness Smith of Newnham and Lord Callanan

Tuesday 18th June 2019 Lords Chamber

[Lord Callanan]

The noble Lord is confusing two issues: the leadership election in the Conservative Party is a different event from the rights guaranteed for citizens. We are communicating, as I said, with UK citizens abroad—over 1 million of them—and we are endeavouring to ensure that other EU member states provide them with the same guarantees that we have provided to the 3 million EU citizens in the UK.

[Baroness Smith of Newnham (LD)]

My Lords, the Minister suggested that there has been a lot of preparation for no deal, yet in answer to questions a few weeks ago the noble Baroness, Lady Vere, suggested that no-deal arrangements for the ferries and other issues ahead of 29 March had been put in place for that date, and that those arrangements were no longer in place. How much of the work done for a no-deal scenario ahead of March is still in place, and how much will need to be replicated ahead of 31 October?

[Lord Callanan]

A lot of the preparation that was done is still in place. Some immediate urgent actions were put in place in preparation for a possible leaving date in March; these of course were no longer required so the individual communications hubs were stood down, but we remain in full readiness for the next potential leaving date which is 31 October.

Brexit: Free Trade Agreement

Debate between Baroness Smith of Newnham and Lord Callanan

Tuesday 14th May 2019 Lords Chamber

[Lord Callanan]

With the benefit of his great experience, my noble and learned friend makes an important point—that the withdrawal agreement, as negotiated, will not change. I think that even many in the Labour Party accept that it is not going to change, which makes it slightly strange that they voted against it.

[Baroness Smith of Newnham (LD)]

My Lords, what is Olly Robbins doing in Brussels today? Is he seeking to renegotiate, or do the Government have another plan for him?

[Lord Callanan]

I understand that he is exploring possible changes to the political declaration.

Brexit: Date of Exit

Debate between Baroness Smith of Newnham and Lord Callanan

Monday 8th April 2019 Lords Chamber

[Lord Callanan]

My noble friend is right to point out that we have been making extensive preparations across government for no deal, and I think that is a situation we could manage. Nevertheless, we are where we are. The House of Commons has refused to pass the withdrawal agreement and, with its agreement, the Prime Minister has decided that we need to seek a further extension.

[Baroness Smith of Newnham (LD)]

The Minister has suggested that he is not here to answer questions on behalf of the ERG. I hope he can answer a question linked to the letter from the Prime Minister to Donald Tusk, in which she writes:

“The United Kingdom proposes that this period should end on 30 June 2019”.


In line with a question asked by the noble Lord, Lord Shinkwin, when did the United Kingdom decide on this date, given that the European Union has already rejected 30 June? I do not believe that this House or the other place voted for 30 June as a preferred date.

[Lord Callanan]

The Prime Minister and the Cabinet agreed that date. The Prime Minister made the proposal but, as the noble Baroness will understand, given her extensive experience of European law, this is a matter for negotiation with the European Union. The Council of 28 will decide that on Wednesday.

Brexit: People’s Vote

Debate between Baroness Smith of Newnham and Lord Callanan

Wednesday 12th December 2018 Lords Chamber

[Lord Callanan]

I understand the point that my noble friend is making and I realise that this view is widely shared. I must point out, however, that the referendum was agreed to, authorised and voted for by this Parliament. We agreed to ask the people what their verdict was on the European Union.

[Baroness Smith of Newnham (LD)]

My Lords, the Prime Minister was very clear that there would not be a general election in 2017. The Prime Minister and the members of her Cabinet who were dispatched last Friday and even on Monday morning were very clear that there was going to be a vote on the withdrawal agreement on Tuesday evening in the House of Commons. There was not such a vote. Therefore, how certain is the Minister that the Prime Minister will not change her mind and allow a people’s vote, assuming that she survives this evening?

[Lord Callanan]

Very certain, is the answer to the noble Baroness’s question. As she well knows, to hold a referendum—as with the previous referendum—the Government would need to introduce legislation, and we are not going to do that.

UK-EU Future Relationship: Young Voters

Debate between Baroness Smith of Newnham and Lord Callanan

Monday 10th September 2018 Lords Chamber

[Lord Callanan]

None of the positions that the noble Lord takes strikes me as particularly more absurd than any of his other positions.

[Baroness Smith of Newnham (LD)]

My Lords, your Lordships’ House voted for 16 and 17 year-olds to be enfranchised in the 2016 referendum. The then Prime Minister was determined that they should not be enfranchised. As the noble Lord, Lord Foulkes, said, those people have now reached maturity. In a general election, one would expect to be able to vote to kick out the Government and, at the age of 16 or 17, be able to vote at the next general election. The same is not being said of the referendum. For how long is the 2016 referendum meant to be valid? If we stopped holding general elections, I might have stopped the clock in 2010 and we would have had Liberal Democrats in government in perpetuity.

[Lord Callanan]

I am not sure how popular that would have been. Of course, young people who are 16 or 17 will be able to vote in the next general election. No doubt they will have the option, if they are particularly crazy, of voting Liberal Democrats—who may well put the option of rejoining the European Union in their manifesto. We will see how many votes they get on that basis.

Brexit: Negotiations and No-deal Contingency Planning

Debate between Baroness Smith of Newnham and Lord Callanan

Tuesday 4th September 2018 Lords Chamber

[Lord Callanan]

I can send the noble Lord a copy of our White Paper, where we have set out exactly how that can be provided through the facilitated customs arrangement and the alignment on goods. I am sure that, if he read it in full, he would see exactly how that could be delivered.

[Baroness Smith of Newnham (LD)]

My Lords, with reference to the question from the noble Lord, Lord Maude, is it not the case that the United Kingdom has to serve notice to leave the European Economic Area and that that is separate from leaving the European Union? Therefore, unless we technically serve notice and give a year’s notice of leaving the EEA, we will remain members of that organisation.

[Lord Callanan]

I do not think that the noble Baroness’s analysis is correct. The European Economic Area is an agreement between EFTA countries and EU member states, and our membership of it will lapse when we leave the European Union. In order to join the European Economic Area we would have to become a member of EFTA, we would require the agreement of the EFTA countries and we would then need the agreement of the European Union in order to continue in that membership. That presents a number of legal and practical difficulties—but I would be happy to write to the noble Baroness in more detail about how it might not work.

European Union (Withdrawal) Bill

Debate between Baroness Smith of Newnham and Lord Callanan

3rd reading (Hansard): House of Lords
Wednesday 16th May 2018 Lords Chamber

[Lord Callanan]

I am afraid that the noble Lord is simply wrong: we do have agreement on an implementation period. It was announced at the March European Council, agreed by the Government and the European Union.

[Baroness Smith of Newnham (LD)]

My Lords, surely, in the event that there is no deal, we leave on 29 March 2019 and there is no implementation period.

[Lord Callanan]

Obviously if there is no deal, we do not have an implementation period—but we are working towards getting a deal. Each of the stages so far has been announced and agreed. We agreed the issues over the financial settlement and citizens’ rights before Christmas. We agreed the implementation period in March. I realise that that the noble Baroness and many of her colleagues do not want the process of Brexit to proceed, but we are acting as a responsible Government and endeavouring to agree these things in a timely and proportionate manner. We have agreed the details of an implementation period. Each time they declare their scepticism, but we are confident that we will reach a deal at the end of the day.

As I have set out, this is neither helpful nor necessary as the text of the amendment mirrors all of the issues that we are consulting on before introducing legislation that this House and other places will be able to scrutinise. I hope that noble Lords will acknowledge that voting for this amendment would prejudge a significant period of consultation that would go against the principles of good policy-making and be ultimately detrimental to the future protection of environmental law. I hope, therefore—without much optimism—that the noble Lord will see fit to withdraw the amendment.

Brexit: Reports to Parliament

Debate between Baroness Smith of Newnham and Lord Callanan

Monday 8th January 2018 Lords Chamber

[Lord Callanan]

My Lords, I am always suspicious of a question that starts off, “It has been widely reported”. The noble Lord will know that ministerial appointments are a matter for the Prime Minister; I am sure he will be the first to know if she decides to make such an appointment.

[Baroness Smith of Newnham (LD)]

My Lords, in light of the speculation about a “no deal” Minister, what calculation are the Government making about the likelihood of a no-deal scenario? Have they—in the form of any new Minister or the Secretary of State for DExEU—thought about writing a report on the impact of no deal; or is that just to be left to your Lordships’ excellent EU Select Committee?

[Lord Callanan]

I totally agree with the noble Baroness that the EU Select Committee is an excellent grouping. We report to it regularly and I am sure we will be doing so in future. There has been a wide range of discussions with all sorts of parties about what might happen. We already have a Minister in the department—Steve Baker—who is planning for a no-deal scenario, but we hope that will not be the case. We want a full, fruitful and special partnership with the EU and we are continuing negotiations to that effect.

EU Exit Negotiations

Debate between Baroness Smith of Newnham and Lord Callanan

Monday 13th November 2017 Lords Chamber

[Baroness Smith of Newnham (LD)]

My Lords, I am grateful to the Minister for repeating the Secretary of State’s Statement to the other place.

The Secretary of State seems to suggest that there has been a lot of activity and progress in recent weeks. That seems to be rather at odds with everything we have been hearing from Monsieur Barnier and the EU 27. One wonders who has been misled or has misunderstood what has happened in the past few weeks. The Secretary of State suggested that there has been a narrowing to only a few aspects of the remaining issues, which he then goes on to talk about: the budget and what the United Kingdom will have to pay as the divorce settlement; the rights of EU citizens; and the question of Ireland and Northern Ireland. Those are the same three issues that we have been looking at ever since the decision to leave the European Union was taken in June of last year. The idea that there has been a narrowing in these areas is interesting, but it is not yet clear what is really meant. In particular, in the context of the budget, we have heard frequently that the clock is ticking. However, while the clock is ticking, the value of sterling is falling—and every time sterling falls, the amount of money that the United Kingdom will owe in euros rises.

Instability in the Government is hugely damaging to the United Kingdom’s negotiations. What is the Prime Minister doing to ensure that her Government become more stable and secure and give a clearer sense to the 27 that they know what they are doing and that they have the same clarity of purpose as the 27? The Secretary of State suggested that it is important that both sides have confidence in the process and the shared outcome. However, the 27 have a clarity of purpose—we know what they are looking for—but do they know what the United Kingdom is looking for? It is not yet clear that they do.

The United Kingdom has been given two weeks to sort out our budget offer. What plans have Her Majesty’s Government put in place to ensure a solution so that, by December, progress can be made in phase 2? At present we have heard nothing at all from the Secretary of State. Is the Chancellor of the Exchequer in the loop? Is his input being asked for, or is the “flexible and constructive” approach that the Secretary of State is looking for required only of the Prime Minister, with the back-seat drivers of Gove and Johnson telling her what she should say or think?

As the noble Baroness, Lady Hayter, suggested, some thought is being given to putting 29 March 2019 in the Bill. Is that perhaps to do with the Brexiteers trying to pull the Prime Minister’s strings? Putting the date in the Bill is surely one of the worst things the Government could do. It would tie the Prime Minister’s hands and we should not support it.

In June, when we had the unnecessary general election that was supposed to be a Brexit election, the idea was that we would have a strong and stable Government leading the negotiations. How fanciful that now seems. Can the Minister assure us that the Prime Minister, the Secretary of State and the whole Cabinet are united in pushing, with one voice, for the best outcome for the United Kingdom? Do they have clarity of purpose? In getting the best deal for the United Kingdom, can they reassure in particular the citizens of Northern Ireland that the deal will be for the whole of the United Kingdom, and that our kingdom will remain united? It is not the European Commission that is jeopardising the integrity of the United Kingdom but Her Majesty’s Government’s unwillingness to have an agreement that will allow Ireland to remain without a closed border.

It is hugely important that the future relationship is clarified. That can be done only if Her Majesty’s Government have their own view of what that relationship should be. Can the Minister tell the House what the Government’s view is? Is there any clarity of purpose?

Finally, on citizens’ rights, many of us will welcome the idea that Her Majesty’s Government would like EU citizens to be able to vote in local elections. However, the Secretary of State points out that this is one of the rights of EU citizens that is enshrined in the treaties. Yes, it is—many of us passionately believe that we wanted to keep, still want to keep and do not want to throw away the rights of EU citizens. Does David Davis agree with us? Is he reluctant to see British citizens lose their citizenship rights? Would he prefer that the United Kingdom should remain part of the EU treaties? Have we made a huge mistake? Should we retain citizens’ rights by simply not leaving the European Union?

[Lord Callanan]

I thank the noble Baronesses, Lady Hayter and Lady Smith, for their questions. I will deal with them all in turn. Both noble Baronesses asked me about the amendment on the date, tabled in another place. The amendment was in response to amendments tabled by Members of the House of Commons—led by a Labour Member of Parliament, I think—saying that the Government should clarify the exact leaving date. That date was triggered also by the submission of the Article 50 notification letter—approved by both Houses—and will be two years from then. The noble Baroness, Lady Smith, is very keen to abide by EU treaties; as she well knows, the two-year date is set down in them, unless it is extended by the unanimous vote of the other 27 EU members. We are leaving the EU on 29 March 2019, implementing the result of the referendum that was also approved in both Houses.

We recognise the need for specific solutions to the unique circumstances of Northern Ireland and we have made good progress in the negotiations. We have proposed that the UK and EU seek to agree text for the withdrawal agreement that recognises the ongoing status of the common travel area and associated reciprocal arrangements. We have developed joint principles on this, and are drafting joint principles and commitments that will guide the solutions drawn up in the second phase. Both sides agree that the Good Friday agreement on citizenship rights must be upheld, and we are committed to working together on how that is best codified.

The noble Baroness, Lady Smith, asked me a number of questions. We have a good record: we have compromised in all the areas that the EU has thought to negotiate on. Now it is about time we saw some compromise from the EU side. We have compromised on both our budget offer and citizens’ rights. It would be nice to see some support from the parties opposite for the UK position. In terms of the budget, billions of pounds of taxpayers’ money are involved. Are the Opposition saying that we should just hand over a cheque and agree to whatever the European Commission demands? Of course we have to negotiate. The Prime Minister made a very generous offer in her Florence speech, involving considerable amounts of money. Now it is for the EU side to reciprocate with a budget offer of its own. We are very clear that, in all these areas, as set down in the EU negotiations, nothing is agreed until everything is agreed. These areas cannot all be sorted until there is a final agreement on the shape of the agreement and future customs arrangements, which will also help to enlighten our discussion on the border in Northern Ireland.