European Union (Notification of Withdrawal) Bill

Debate between Lord Brennan of Canton and George Osborne

2nd reading: House of Commons
Wednesday 1st February 2017 Commons Chamber

[Mr Osborne]

I wish to make some progress, and I want others to have a chance to speak, so I will not take interventions.

There is a mandate to leave the European Union, but that was the only question asked of the British people in the referendum. We cannot assume that the British public gave a set of answers to the questions we now face as a Parliament. Indeed, those questions are now entrusted to us as we approach the negotiations.

I call them negotiations but I do not think they are going to resemble the negotiations that we currently read about in the media. The truth is that although Britain is seeking the maximum possible access to the single market for goods and for services, and we hope that the fact we have a trade deficit and a very important financial centre will count in our favour, the Government have chosen—and I respect this decision—not to make the economy the priority in this negotiation. They have prioritised immigration control, which was a clear message from the referendum campaign, and removing European Court of Justice jurisdiction from the UK and, in that sense, asserting parliamentary sovereignty, although I would point out that Parliament can choose to leave the EU, as indeed we are choosing to do in the coming days.

So we are not prioritising the economy, although we hope for the best possible arrangement, and the European Union is not prioritising it either in these negotiations. Having spent the past couple of weeks in Berlin and in Paris talking to some French and German political leaders, it is clear to me that although they understand that Britain is a very important market for their businesses, their priority is to maintain the integrity of the remaining 27 members of the European Union; they are not interested in a long and complex hybrid agreement with the UK. Therefore, both sides are heading for a clean break from the EU for the UK.

The only thing I think the negotiation will come down to in the end is how that break is achieved. The Prime Minister, in her speech of a couple of weeks ago, made it clear that Britain is seeking a transition agreement, and that is obvious because it is simply not possible for this Parliament to introduce all the domestic legislation that is going to be required to replicate the arrangements we currently have with the EU, even with the great repeal Act. We will also need to have some kind of bridge to the free trade agreement that we seek with the EU. At the same time, the EU needs from us financial commitments that it believes we entered into to pay for European projects that were undertaken while we were a member. In practice, that means the negotiation will be a trade-off, as all divorces are, between access and money. We will try to scale down our payments to the EU, while scaling down our commitment to EU rules and access, until we reach that free trade agreement which we hope to negotiate.

[Kevin Brennan (Cardiff West) (Lab)]

Will the right hon. Gentleman give way on that point?

[Mr Osborne]

I will just finish my speech and then others can speak.

That is what the negotiation is going to be like. I suspect it will be rather bitter. I spent four years negotiating with Michel Barnier, and I advise my right hon. Friend the Secretary of State for Exiting the European Union to be well briefed, as he always is, and to pack a packet of Pro Plus, because there will be many long nights ahead.

It is very important that in the bitterness of that discussion we do not forget that there are some fundamental reasons why Britain wanted to be part of a European Common Market in the first place; nor should we allow the Europeans to forget that there was a fundamental reason why they created a European Community, which was to bring the nations of Europe together. We must try to keep those thoughts and hopes alive as we exit the EU.

The final thing I want to say is this: we have made a decision to leave the EU and, as the successful leave campaign put it, to take back control, but that means a series of issues are going to come to this Parliament that completely divide Brexiteers from each other, remainers from each other, Conservatives from each other and members of other parties from each other. We are going to have very lively debates about free trade, as we are beginning to see at Prime Minister’s questions; these are debates about what kind of agricultural produce we want to allow into this country or the kind of public procurement contracts we want. We are going to have a very lively debate about immigration, how many people we want to let into this country, how we welcome skilled people into this country, and how we support our universities and scientific research institutions. We are going to have an argument about agricultural subsidies and whether we are happy for the poorest people in this country to pay taxes to support subsidies to some of the richest. We are also going to have an argument about state aid and whether we should be able to bail out failing commercial enterprises. I will be in those fights in the couple of years ahead.