EU Withdrawal

Lord Callanan Excerpts

Wednesday 13th February 2019 Lords Chamber

Moved by

[Lord Callanan]

That this House takes note of the ongoing discussions with the European Union under Article 50 of the Treaty on European Union.

[The Minister of State, Department for Exiting the European Union (Lord Callanan) (Con)]

My Lords, the Motion before us asks the House to take note of the ongoing discussions with the European Union. These discussions follow from the statutory debate on 29 January in the other place. It was during this debate that the Prime Minister was given a mandate to seek “alternative arrangements” to the backstop. During that debate the Prime Minister confirmed that,

“if we have not brought a revised deal back to this House by Wednesday 13 February, we will make a statement and, again, table an amendable motion for debate the next day”.—[Official Report, Commons, 29/1/19; col. 671.]

The debate on the amendable Motion will take place in the other place tomorrow, but, consistent with the approach taken throughout the process of exiting the EU, it is right that your Lordships should have a chance to comment on and inform the process also.

As always, I look forward to hearing noble Lords’ contributions this afternoon and, as we gather here again, no debate would be complete without an amending Motion from the noble Baroness, Lady Smith of Basildon. I pay tribute to her work and, indeed, that of my opposite number, the noble Baroness, Lady Hayter, for their continued contributions and the scrutiny that they provide.

[Noble Lords]

Hear, hear.

[Lord Callanan]

I knew the Opposition would approve of that. I know that the noble Baroness will wish to speak to her Motion in a moment and so, if noble Lords will forgive me, I shall wait until my closing remarks to address it in full and to set out clearly how the Government will respond to it.

It also will not have escaped your Lordships’ attention that the vote in the other place tomorrow will not be the much-anticipated meaningful vote. As the Prime Minister has confirmed:

“When we achieve the progress we need, we will bring forward another meaningful vote, but if the Government have not secured a majority in this House in favour of a withdrawal agreement and a political declaration, the Government will make a statement on Tuesday 26 February and table an amendable motion relating to the statement, and a Minister will move that motion on Wednesday 27 February, thereby enabling the House to vote on it, and on any amendments to it, on that day”.—[Official Report, Commons, 12/2/19; col. 733.]


Noble Lords will clearly be aware of the statutory role that this House plays under the EU withdrawal Act, and debate will of course be necessary in this House also. The exact timings will be a matter for the usual channels. Nonetheless, as we proceed with today’s debate, I know that the work and the contributions of this House continue to play an important role in informing the deliberations and decisions of the other place. Indeed, the exit Secretary has made it his business from day one in office to work with this House and learn from the unparalleled collection of experience and expertise that resides on these Benches.

I am pleased that he was able to attend your Lordships’ EU Select Committee recently, and both of us met with Members on the Cross Benches earlier today. He is also meeting individual Peers from all sides of the House whenever he can, and his consistent message is that the Government want this House and its committees to continue contributing their wisdom as we shape our approach to the next phase of negotiations. The Constitution Committee heard similarly from the Chancellor of the Duchy of Lancaster last week. I hope that this shows the sincerity of the Prime Minister’s commitment to fuller and deeper engagement with both Houses of Parliament.

Of course, this House is also very busy in its role of scrutinising and passing legislation. I noted the tweets yesterday morning from the noble Baroness, Lady Hayter, which followed the appearance on the “Today” programme of my right honourable friend the Leader of the Commons. I agree that this House is playing a crucial role in considering both primary and secondary legislation. In the last fortnight alone, this House has considered three important Brexit Bills: the Trade Bill, the Financial Services Bill and the Healthcare Bill, which goes through Committee next week.

[Lord Foulkes of Cumnock (Lab Co-op)]

Does the Minister agree with what Andrea Leadsom said on the “Today” programme—that it is possible to get through all the legislation, the Bills and the statutory instruments, by the end of March?

[Lord Callanan]

I think that she said “all the necessary legislation”—so yes, I do agree with the comments that she made. As of today we have made positive progress and laid more than 420 statutory instruments out of the total of up to 600 required before exit day.

[Baroness Hayman (CB)]

Could the noble Lord tell us the difference between the “necessary” legislation and the legislation he has just described as “required”?

[Lord Callanan]

It means that we are confident that we can pass all of the necessary legislation required. I can only repeat the words that my right honourable friend used.

I also heard the remarks made yesterday by the noble Baroness, Lady O’Loan, that there is still much work to be done in scrutinising these instruments. That work is being done to an extremely high quality, and this House is doing the country a great service. I thank noble Lords for that. I pay tribute to her and to all the other members of the scrutiny committees, chaired by my noble friend Lord Trefgarne and the noble Lord, Lord Cunningham. They have an intense workload.

I welcome the beginning of the European Union Committee’s work in considering the programme of international agreements that we are pursuing to ensure the greatest possible continuity, whether or not we are successful in securing the deal we all hope to achieve. The committee and its sub-committees are doing extremely valuable work, and we owe them also a debt of gratitude.

The Motion before us asks the House to take note of the ongoing discussions with the EU. My noble friend Lady Evans, the Leader of the House, set out yesterday the latest position when repeating the Prime Minister’s Statement. Noble Lords will be pleased to know that I will not test their patience by repeating that in detail. As they know, following the mandate given to her on 29 January, the Prime Minister visited Brussels last week, and, as she highlighted yesterday, both she and President Juncker have agreed that our teams should hold further talks to find a way forward.

Of course, the backstop is not something that we would ever want to use. In the event that it was implemented, we would only ever want it to be temporary. Given this, we consider it reasonable to ask for legally binding changes to reflect that temporary nature.

We are at a crucial point in the negotiations. As I have detailed, the Government are engaging with colleagues on all sides to help deliver a deal that the other place can support. This House has played, and will continue to play, a vital role in progressing the debate with scrutiny and expertise as we move into phase two of the negotiations, not least through wider exit preparations, including—as I touched on earlier—preparing our statute book for exit day. There are exit-related Bills and secondary legislation currently before the House and, as soon as possible after the other place has approved the deal, the withdrawal agreement Bill will be introduced to implement the withdrawal agreement in UK law. As we look forward, the Government are committed to ensuring that there is a greater say for Parliament in developing the mandate for the next phase of negotiations.

Noble Lords will be pleased to know that I will not seek to detain the House any further with an exposition of the Government’s policy, as we heard that yesterday. Today is an opportunity for noble Lords to expand on issues raised yesterday and perhaps even to raise some new ones that we have not heard before. I will of course endeavour to respond to as many of the issues raised as I can when I close the debate this evening. I beg to move.

--- Later in debate ---

[Lord Callanan]

My Lords, I am grateful to all noble Lords who have spoken today, and for the many insightful and considered contributions. Indeed, I am particularly grateful to those noble Lords who sought to rise to the challenge of making points that the House had not previously considered. Sadly, many failed in that task, probably including myself, but I particularly enjoyed the contribution of the noble and learned Lord, Lord Hope, and his holding pattern analogy, which was particularly novel and amusing, although I do not agree with it. I also enjoyed my noble friend Lady Meyer’s spirited speech, despite many interventions. She made some excellent new points about the realities of some of the failings of the EU, which, of course, we do not often get to hear in this House.

During the debate, many noble Lords, including the noble Lord, Lord Taverne, and the noble Baroness, Lady Hayter, drew attention to the Prime Minister’s letter to the leader of the Opposition. In particular, a number of noble Lords spoke about the Government’s position on the customs union. As my noble friend Lord Howell pointed out in his speech, the political declaration that we have debated at length in this House explicitly provides for the benefits of a customs union. However, it also recognises the development of the UK’s independent trade policy beyond our economic partnership with the EU. Let me be clear: we are not considering staying in the customs union. We want to play a full and active role on trade policy on the global stage, working closely with friends new and old. From trade remedies to trade promotion and bilateral to multilateral negotiations, the UK will be able to tailor its trade policy to the strengths and requirements of the UK economy and in support of our industrial strategy.

While I am on the subject of trade, I pay tribute to the excellent speech of the noble Baroness, Lady Bull, on the importance of trade in services. While I again did not agree with every point she made, I can tell her that the UK services sector is a global success story. Our internationally competitive sector plays host to world-leading firms, as well as thriving small and medium-sized businesses. The political declaration includes a commitment to conclude an ambitious arrangement for services and investment that goes well beyond WTO commitments, alongside new arrangements on financial services. But leaving the EU will give the UK regulatory flexibility where it matters most for its service-based economy and where the potential trading opportunities outside the EU are the largest. Globally, services trade is growing rapidly and UK services trade with non-EU countries grew by 73% between 2007 and 2017.

My noble friend Lord Cope asked me quite a technical question about whether the UK’s customs declaration process is on track. We will have a functioning customs system on exit. HMRC continues to progress dual running of the customs declaration system and CHIEF, the current customs declaration system. It can process sufficient numbers of customs declarations anticipated in a no-deal scenario. This capability will be deployed alongside the CDS, ensuring we will have a functioning customs system on exit.

The noble Lord, Lord Puttnam, asked whether I was aware of the number of Americans professing to have Irish roots. The answer is yes, I am, because many of them are indeed my relatives. I also have Irish roots. Indeed, I have discussed Brexit with many in the Irish American community. He might find that not all opinion is uniform on that matter.

[Lord Puttnam]

I do not think it is people claiming Irish roots; they are adhering to Irish roots. The Minister might be well advised to read today’s Washington Post, which is very informative on this subject. He will find it more than interesting.

[Lord Callanan]

Indeed I will. I have been preparing for today’s debate and sitting in the Chamber, but I will have a look when I get the opportunity. I can also assure the noble Lord, as he suggested I would, that we have no intention of inflicting any damage on the Irish economy.

Many noble Lords, such as my noble friend Lady Altmann and others, have again asked about Article 50 and suggested that we could simply extend or revoke it. I think she is profoundly wrong on this matter. The Government’s policy has not changed. We will not revoke our notice to withdraw from the European Union under Article 50. We stand by the commitment we made to the British people to uphold the result of the 2016 referendum. To revoke our Article 50 notice would be to dishonour that commitment and to reject an instruction clearly given to us by the British people. On this point I agree with my noble friend Lord Cavendish.

I also do not believe that there is anything like a majority in the House of Commons for such a course of action. Indeed, we might soon find out. I note that there is an amendment tabled by the SNP that, if selected, would put that notion to the test in the other place. Perhaps that would be a useful reality check for those who cling to the belief that they can wish away the referendum as if it had never happened.

I also remind noble Lords, including the noble and learned Lord, Lord Hope, and the noble Lords, Lord Kerr and Lord Hannay, those who would like to extend Article 50, that as they know very well, that is not a unilateral option. An extension would require the consent of all 27 member states, a point well made by the noble Baroness, Lady Deech. As the Prime Minister correctly highlighted in the other place last week, the EU is very unlikely simply to agree to extend Article 50 without a plan for how we are going to approve a deal. To this extent I agree with the noble and learned Lord, Lord Hope. The best way forward, as I have said many times, is to leave in an orderly way with a good deal.

My noble friend Lord Balfe asked me to speculate on potential ratification timetables in the European Parliament. I hope we will be able to secure a satisfactory deal in plenty of time to allow the EP and this Parliament to approve it. I also gently say that we are not proposing to leave the European family—we are proposing to leave the European Union, which is not the same thing.

Unsurprisingly, many noble Lords returned to their favourite subject of a second people’s vote. I include in that number the noble Lords, Lord Judd, Lord Wilson, Lord Davies, Lord Taverne, Lord Hannay and the noble Baroness, Lady Wheatcroft. I am sure it will come as no surprise to any of them to hear me say that the Government stand by their policy to respect the result of the 2016 referendum. This Government made a commitment to the British people that we would respect the result of that referendum; I agree with the points made on that commitment by my noble friends Lord Cormack and Lord Cope. I note that this was a promise made by the Opposition too, and while obviously I have many differences with Jeremy Corbyn, on this matter I pay tribute to him, because he at least, unlike many in his party, seems to want to stick by that pledge made in their last election manifesto.

The only guarantees that another referendum would bring are of more mistrust and uncertainty. I notice that the supporters of a second or indeed, according to the noble Lord, Lord Cope, a third people’s vote, have yet again failed to offer this as an option in the House of Commons votes tomorrow, because they know, as do the rest of us, that there is no majority in another place for a second or, indeed, third vote.

The noble Baroness, Lady Smith, the noble Lord, Lord Newby, the noble and learned Lord, Lord Hope, and in his inimitable style—although indirectly and through the noble Baroness, Lady Smith—the noble Lord, Lord Foulkes, all asked about the legislation to be delivered in advance of exit day. With regard to primary legislation, the Sanctions and Anti-Money Laundering Act 2018, the Nuclear Safeguards Act 2018, the Haulage Permits and Trailer Registration Act 2018 and the Taxation (Cross-border Trade) Act 2018 have all now received Royal Assent. Six other exit-related Bills are currently in Parliament. The Trade Bill, the Financial Services (Implementation of Legislation) Bill, the Agriculture Bill, the Fisheries Bill, the Healthcare (International Arrangements) Bill and the Immigration and Social Security Co-ordination (EU Withdrawal) Bill will be prioritised appropriately to ensure that the measures necessary for a functioning statute book on exit day are in place before the UK leaves the EU.

With regard to secondary legislation, the majority of statutory instruments are needed in either a deal or a no-deal scenario, and they will be deferred to the end of the implementation period if they are not needed on 29 March. This is part of our long-term planning—

[Lord Bassam of Brighton (Lab)]

My Lords—

[Lord Callanan]

I will give way to the noble Lord in a second, if he will allow me to finish my paragraph.

This is part of our long-term planning, with statutory instruments being laid since Royal Assent of the European Union (Notification of Withdrawal) Act 2017.

[Lord Bassam of Brighton]

How many parliamentary days does the noble Lord estimate those six or seven Bills that he has just outlined will take?

[Lord Callanan]

The planning of parliamentary processes and times are matters for the usual channels, in which the noble Lord used to take part, but we remain confident that we will deliver the appropriate and necessary legislation ready for our exit day.

If the noble and learned Lord, Lord Falconer, is in his place—he is—I can tell him that Ministers have been actively engaging key figures in Europe. They include my colleagues the Secretary of State for Exiting the EU and the Chancellor of the Duchy of Lancaster, who were in Brussels and Strasbourg this week. The Foreign Secretary was also in Paris earlier this week. I have spoken to a number of my colleagues in ministries in other European countries as well. Meetings to discuss the ideas put forward by the alternative arrangements working group have taken place, and we are grateful to that group for its work. We continue to explore its ideas.

The Prime Minister set out the UK’s position, strengthened by the mandate that the other place has given her: that Parliament needs to see legally binding changes to the backstop, which can be achieved by changes to the withdrawal agreement. She and the President of the Commission agreed that our teams should hold further talks to find a way forward. The Prime Minister and Mr Juncker will meet again before the end of February to take stock of those new discussions, so our work continues. The noble Lord, Lord Alderdice, made some extremely good points on the need for discussions to continue.

I thank my noble friend Lord Ridley, first, for his compliments and, secondly, for his question about the card reportedly received by Jean-Claude Juncker from the Irish Taoiseach. I had better be careful how much I say about this, but while I have done a lot of leaflet delivery in my time, the letterboxes in Brussels seem to have got a lot larger since I was last there. Perhaps it was an early Valentine’s card from Leo to Jean-Claude. In any case, the Government are fully committed to upholding the commitments of the Belfast agreement. My noble friend also made some very valid points about Commission appointments; much as I am tempted, perhaps I should leave my remarks on them there.

My noble friend Lord Cathcart asked about using Article XXIV of the World Trade Organization’s General Agreement on Tariffs and Trade to ensure that we have tariff-free and quota-free trade with the EU. This provision refers to interim agreements. In order to use it, we would need to agree with the EU the shape of the future economic partnership, together with a plan and schedule for getting there. This would then need to be presented to all 164 WTO members and they would be able to scrutinise it, suggest changes and, ultimately, veto it. This is of course not the Government’s preferred option. The Prime Minister and her team are working hard to agree legally binding changes to the withdrawal agreement, as I said earlier, so that Parliament can unite behind it and the UK can leave the EU with a deal.

The noble Baroness, Lady Smith, asked about CRaG—the Constitutional Reform and Governance Act. As the Prime Minister set out yesterday, it remains the Government’s intention to follow normal procedures if we can. However, if insufficient time remains following a successful meaningful vote in the other place, we will make provision in the withdrawal agreement Bill to ensure that we can still ratify on time, to guarantee our exit in an orderly way. This would of course require agreement in both Houses; noble Lords will no doubt want to consider the arguments carefully. What is important is that Parliament has the opportunity for ample time to scrutinise, debate and vote on the withdrawal agreement. In the circumstance where the House of Commons had voted to pass that agreement, though, it is hard to see why Parliament would want to hold up our exit or to allow MPs or Peers to consider the treaty once more.

I turn to the Motion of the noble Baroness, Lady Smith, which seeks to tie the Government’s hands in negotiations. We cannot support a Motion which mentions “all steps necessary” to avoid no deal without excluding “no Brexit” from the list of necessary steps. The Prime Minister has been clear that the Government want to leave the EU with a deal agreed with the European Union and with the support of Parliament. That is why she has listened to the concerns raised in the other place about the backstop and is working to find a solution that can command the support of MPs. As I said, discussions with the EU are continuing with that aim.

However, as the Prime Minister has said, it is not sufficient just to wish to avoid no deal. The best way for MPs to avoid a no-deal scenario is of course to vote for a deal. When we have secured the progress that we need, we will bring forward another vote under Section 13(1)(b) and (1)(c) of the European Union (Withdrawal) Act 2018. But we do not agree with the timing strictures that the Motion in the name of the noble Baroness proposes. As the Prime Minister said, and as I set out in my opening speech, if the Government have not secured a majority in the other place in favour of a withdrawal agreement and political declaration, the Government will make a Statement on Tuesday 26 February and table an amendable Motion to that Statement. A Minister will move that Motion on Wednesday 27 February, thereby enabling Members of the other place to vote on it, and any amendments to it, on that day.

This has been another good debate on our exit, and it will certainly not be the last. As I made clear in my opening remarks, a clear timetable has been set out for the next steps in Parliament. Tomorrow will see debate in the other place, where MPs will also consider amendments to the Government’s Motion. Noble Lords, as I will, will no doubt be watching with great interest. In closing, however, I reiterate, in case there is any doubt, that this Government are committed to delivering on the result of the referendum. We want this to take place in a smooth and orderly way, which requires securing a deal that MPs can support. The other place has made clear what it wishes to see changed, and that is what the Prime Minister is working to secure in our further discussions with the EU.

Motion agreed.