European Union (Withdrawal) Bill
Lord Callanan ExcerptsWednesday 14th March 2018
(6 years, 8 months ago)
Lords ChamberRead Full debate European Union (Withdrawal) Act 2018 View all European Union (Withdrawal) Act 2018 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 79-VII(b) Amendments for Committee, supplementary to the seventh marshalled list (PDF, 67KB) - (14 Mar 2018)
Lord Adonis (Lab)
My Lords, we are now well into the 11th hour of consideration of the Bill. There has been no break of any kind since lunchtime. I do not believe that noble Lords have been guilty in any way of prolonging the debate unnecessarily; I think the discussions have been perfectly reasonable, and the contributions have been precisely what we would expect of this House. To expect us to carry on with no break whatever is treating the House with contempt. I will oppose this Motion, and subsequent motions, unless the Chief Whip is, very graciously, prepared to allow us to behave in a reasonable manner in respect of the Bill.
The Minister of State, Department for Exiting the European Union (Lord Callanan) (Con)
My Lords, this group of amendments—frankly, I have lost track of who moved what and which ones are in the group, but I will be generous and address all the issues that were part of the original grouping under the amendment tabled by the noble Lord, Lord Adonis, although the noble Baroness, Lady Kramer, has moved Amendment 183—addresses two quite distinct institutions, the European Bank for Reconstruction and Development and the European Investment Bank, including its subsidiary, the European Investment Fund. If the Committee will permit, I will address each of them in turn.
The European Bank for Reconstruction and Development is an international financial institution that is based in London and is subject to its own establishing agreement through a multilateral treaty that was laid before Parliament in 1990. The EBRD is led by a British president, Sir Suma Chakrabarti, who in 2016 was re-elected to serve a second four-year term. The bank is not an EU institution and therefore the UK’s membership is fully independent of EU membership. As such, the European Council does not have dominion over the membership or operation of the EBRD. The UK’s exit from the EU will not have any bearing on the location of the bank’s headquarters in London, which is enshrined in its articles of agreement. The EBRD has also publicly reiterated that Brexit will have no impact on the UK’s membership and the London headquarters. Amendment 167 is therefore unnecessary and would have no effect on UK membership, which will continue unaffected after the UK leaves the EU. The Government have made it clear in recent Answers to Parliamentary Questions that the UK remains firmly committed to the EBRD and that exit from the EU will have no impact on our continuing membership. With that reassurance, although I am not sure whether the noble Lord moved the amendment, I hope that he will feel able not to press it.
Amendment 227BC would create a negotiating objective for the UK to remain a full member of the European Investment Bank. The EU treaty defines members of the EIB as EU member states. It also sets out that only members can hold capital in the bank and participate on its board. That means that in March 2019 the UK will no longer be a full member of the EIB, as it will no longer be a member state of the European Union. However, let me reply directly to the questions put by the noble Lords, Lord Adonis and Lord Tunnicliffe, and the noble Baroness, Lady Randerson. The Chancellor has made it clear that the UK considers that it may prove to be in the mutual interest of all sides for the UK to maintain some form of ongoing relationship with the EIB group after leaving the EU. The UK will explore these options—
Lord Foulkes of Cumnock (Lab)
Why did the Minister say “may” when surely he means “will”? Will he think again about that?
Lord Callanan
If the noble Lord will forgive me, I will use the words as I have said them. These issues are matters for negotiation, so we will use the word “may” instead of “will”. Obviously, we cannot impose our will on our negotiating partners. The UK will explore the options with the EU as part of the negotiations on the future relationship.
Perhaps I may use this opportunity to respond to the question put by the noble Lord, Lord Adonis, on agencies. I think that I indicated to him during the debate that the list issued by the Prime Minister was not necessarily an exclusive one and that we are considering carefully a range of options. Where there is a demonstrable national interest in pursuing a continued relationship with an agency or other EU body, the Government will carefully consider whether we should pursue it, at which point of course it will be a matter for the negotiations. We will continue to update noble Lords on our negotiations, subject to the usual caveat of not undermining our negotiating position.
Amendment 227BC seeks to make it an objective of the Government to achieve a particular outcome in the negotiations on our future relationship with the EIB. It is important that the Government should maintain negotiating flexibility in this and all other areas in order to achieve the best deal for the UK. However, as I said, we have not discounted maintaining some form of ongoing relationship, if that supports an overall deal. I hope that that will be sufficient for the noble Lord not to press his amendment.
Amendments 183 and 187 would require the Chancellor of the Exchequer to publish a strategy for retaining access to the EIB and the EIF. As Parliament has agreed, we will not publish anything that would undermine our ability to negotiate the best deal for the United Kingdom. Any information on potential economic considerations and negotiating strategy is important to the negotiating capital of all parties. Publishing a statement from the Chancellor setting out the strategy for retaining access to the EIB and its subsidiary, the EIF, will ultimately harm our negotiating position. However, as I said in response to Amendment 227BC, I can assure the Committee that we have not discounted maintaining some form of ongoing relationship with the EIB group if that proves to be part of the best overall deal for the UK.
The noble Baroness, Lady Kramer, asked about the British Business Bank.
Lord Dykes (CB)
Can the Minister explain, distinctly and clearly, to the Committee the distinction between demonstrable national interests and the national interest adjudicated by Jacob Rees-Mogg, Bill Cash and others?
Lord Callanan
We are having a serious debate about the EIB. The noble Lord is demeaning the subject before the House.
The British Business Bank has already raised the limit on the amount that it can invest in venture capital funds from 33% to 50%. It has also brought forward the £400 million of additional investment that was announced in the Autumn Statement. As a result, we expect it to have doubled its investment in venture capital this financial year. We have also broadened the range of the UK guarantee scheme by offering construction guarantees for the first time. I hope that that addresses the noble Baroness’s question.
Baroness Kramer
Perhaps I could just press the Minister on that, although I appreciate that he may not have an answer. In terms of volume, what he has discussed does not meet the need. Businesses are concerned that we may not end up with an appropriate relationship with the EIB and the EIF. Are the Government looking at similar programmes but on a relatively minor scale?
Lord Callanan
I do not have an answer to that question. I will come back to the noble Baroness on that. I have only the figures that I outlined to her.
I hope that I have reassured the noble Lord enough not to press whichever amendment he wished to move.
Lord Adonis
The Minister’s response was helpful and I completely accept his reassurances on the EBRD. That issue is clear. My amendment was just a probing one to elicit the response that he has given, which is that there is no relationship with the EU and therefore our position is not affected at all.
The Minister made tantalising remarks suggesting flexibility on a wide range of agencies and the Government’s position on them. He said that this would be a matter for the ongoing negotiations. This will be a big issue for us when we come to Report because, as he knows, a lot of the amendments that we have been going through have sought to elicit from the Government their intentions toward individual agencies. Is he in a position to let us know before Report which agencies the Government will seek either full or associate membership of? Otherwise, I am not quite sure how the House will proceed on Report. We will be presenting amendments that seek continued British engagement with agencies when we do not know whether it is the Government’s policy to share that objective.
Lord Callanan
I understand the noble Lord’s point. As we have gone through the various categories of debate, I think that we have been reasonably clear on where we see the values in certain agencies in the individual sectors that have been talked about. The difficulty with putting any of these requirements to achieve something in statute is that this is a negotiation. We can seek to achieve anything, but if our negotiating partners are not interested in discussing it, it would be very difficult to do. We have gone as far as we can and I do not want to go any further this evening than the statement that I have already given. In her Mansion House speech, the Prime Minister gave some examples of agencies that we would be willing to participate in, subject to the negotiations. That applies to a lot of other agencies that have been mentioned at various stages, so I do not want to go any further at the moment. As soon as we have any information that we can share with the House, we will do so.
Lord Adonis
I do not think that the Minister quite grasped the point that I was making, which was not about whether it is appropriate to have requirements of this kind in legislation. The question was simply about knowing whether the Government seek to negotiate continued engagement in particular agencies so that we know whether it is appropriate for noble Lords to move amendments on Report calling for an objective that, unbeknown to us, the Government may be seeking to achieve anyway.
Lord Callanan
I will take the noble Lord’s statement as an invitation to give some thought to the matter, to consult ministerial colleagues and to see what further information we can share before Report.
Lord Tunnicliffe
My Lords, that was even shorter than my speech. The Government have to accept that they have to come to some sort of accommodation on statutory instruments. We all know that a lot of them will be required, and we have got to have a good system that satisfies everybody, both in this and the other House. The amendment of the noble Lord, Lord Sharkey, sensibly makes that task simpler by making it uniform across the Bill. I am very persuaded by his argument and that of the noble and learned Lord, Lord Hope, and I hope that the Government are as well.
Lord Callanan
My Lords, I first thank the noble Lord, Lord Sharkey, for tabling this amendment so that we can have a discussion about this and for the extremely courteous discussion that he had on this matter with me and my officials.
Many of us here today are opposed, in general, to making sweeping fixes to the whole statute book through one Act. Indeed, that is the cause of many of the concerns about the powers in this Bill, and an issue that the noble Lord, Lord Sharkey, addresses with his amendment. I am therefore wary of inadvertently undermining the delicate and proportionate balances struck within other Acts between haste and scrutiny. The need to deal with the detail of how the Acts differ from one another is, however, what makes these Henry VIII powers necessary.
Nothing in this Bill directly changes the scope or functioning of other delegated powers. The exceptions that this Bill provides are that, within the context of and with the scrutiny attached to the original powers, they can be used to amend retained direct EU law. The Bill also clarifies that it lifts any implied EU-related restrictions from exit day, a necessary consequential step to our leaving the EU’s legal architecture. It is right and proper that, within their context and limits, other powers can be used for the same purposes as Clauses 7, 8 and 9. This amendment, if it is broadly constructed by the courts, could render moot any debate that this House has had or is having on scrutiny provisions in other Bills. This also extends to exit-related Bills and, in this field alone, this could catch the trade, sanctions and customs Bill.
It is I think best to let the sleeping dogs of my noble friend Lord Strathclyde lie, so I shall skate over the very concerning question of how financial privilege would apply under this amendment to the powers to correct deficiencies in the customs Bill.
I call noble Lords’ attention back to the crucial importance of the ability to exercise the powers in the sanctions Bill at speed and the additional information requirements added to that Bill. Even if parallel changes were to be made to this Bill, these would be tailored to the specifics of this Bill.
I stress the Government’s commitment to proper scrutiny of the powers under this Bill; they are a unique, time-limited solution to a unique problem. None of this, however, should be a reason to render irrelevant any specificities of scrutiny that this House has insisted on in other Acts. I therefore urge the noble Lord to withdraw his amendment.
Lord Sharkey
As I listened to the noble Lord, I could not help thinking that we were talking entirely at cross purposes. The House has yet to decide on exactly what method of scrutiny we shall use and how we will amend existing methods—if we do at all—when we consider this Bill. That is not the issue for this evening; that is for Monday’s discussions.
This amendment simply says that whatever we decide is the appropriate method of scrutiny, all other SIs, no matter where they come from, should be subject to the same level and procedure of scrutiny. That is all it does. It does not interfere with anything else, or any workings of the parent Act, apart from the scrutiny procedure itself. It leaves the parent Act entirely untouched in every possible sense. The Minister is greatly overcomplicating what the situation will be. I accept that there may be cases with other Acts where the Government prefer not to have more rigorous scrutiny applied to the SIs generated by those Acts, but that is part of the point of tabling the amendment in the first place. I will withdraw it now, especially at this time of night, but I suspect we will return to this subject on Report. I beg leave to withdraw the amendment.
Lord Callanan
My Lords, in addressing Amendment 204 moved by the noble Earl, Lord Clancarty, at the risk of repeating myself I remind the Committee yet again that the purpose of the European Union (Withdrawal) Bill is to provide a functioning statute book on the day we leave the EU, whatever the outcome of the negotiations. It is our intention that the planned withdrawal agreement and implementation Bill will implement the major elements of the withdrawal agreement, including giving effect to the agreement on citizens’ rights.
The amendment appears to seek to make it an objective of the Government to achieve a particular outcome in the negotiations on our future relationship with the EU and so to tie the Government’s hands on these issues. The amendment is focused on the withdrawal agreement, but these matters are for the future relationship with the EU, which this Bill does not seek to address.
After we leave the European Union, there will continue to be migration and mobility between the EU and the UK. We have proposed a time-limited implementation period based on the current structure of rules and regulations. This means that UK nationals may continue to have the same rights as EU nationals, such as the right to move and reside freely.
Looking to the future, UK citizens will still want to work and study in EU countries, just as EU citizens will want to do here, helping to shape and drive growth, innovation and enterprise. Indeed, businesses across the EU and the UK must be able to attract and employ the people they need. That is why, in our science and innovation policy paper published in September, we said that we will discuss with the EU future arrangements to facilitate the mobility of researchers, academics and students engaged in cross-border collaboration. We are open to discussing how to facilitate these valuable links.
Of course, we recognise the value of international exchange and collaboration, through both study and work placements abroad, in increasing people’s language skills and cultural awareness as part of our vision for the UK as a global nation. We will continue to take part in those specific policies and programmes which are greatly to the joint advantage of the UK and the EU, such as those that promote science, education and culture.
I repeat for the benefit of the noble Earl, Lord Clancarty, and the noble Lord, Lord Hunt, what I said in the debate on Erasmus, although I forget exactly when it was—sometime in the past. No decisions on UK participation in the successor Erasmus+ programme after 2020 have yet been taken for the simple reason that the scope of the future programme has not yet been agreed. The noble Lord is asking me to give him an assurance that we will take part in a programme about whose composition we have no idea. No Government could agree to do that. We will take a decision when we see what the successor programme is. UK participation will form part of the negotiations about our future relationship with the EU. There may be some specific European programmes that we want to continue to participate in as we leave the EU, and that will be considered as part of the negotiations.
Whatever the outcome of those negotiations, including the increasingly unlikely scenario in which we leave the EU without a deal—
Baroness Butler-Sloss
If the noble Lord will forgive me, will the Government continue to take into account the importance of young people’s desire to be able to work freely and move freely through Europe?
Lord Callanan
Of course we will take into account the wishes of young people to move freely, just as we will take into account the wishes of older people to move freely.
We will underwrite successful bids for Erasmus+ submitted while the UK is still a member state, even if payments continue beyond the point of exit. Therefore, applications for funding from UK institutions should continue, and are continuing, as normal.
The noble Baroness, Lady Humphreys, asked me again, as the noble Baroness, Lady Ludford, has done in the past, about the issue of associate EU citizenships. Let me make the point to the Liberal Democrats once again—it seems to have difficulty permeating through to them—that the EU treaty provisions state that only citizens of EU member states are able to hold EU citizenship. Therefore, when the UK ceases to be a member of the European Union, British nationals will no longer hold EU citizenship unless they hold dual nationality with another EU member state.
For those reasons, I hope the noble Earl will withdraw his amendment.
European Union (Withdrawal) Bill
Lord Callanan ExcerptsMonday 12th March 2018
(6 years, 8 months ago)
Lords ChamberRead Full debate European Union (Withdrawal) Act 2018 View all European Union (Withdrawal) Act 2018 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 79-VII Seventh marshalled list for Committee (PDF, 331KB) - (12 Mar 2018)
Lord Mackay of Clashfern
The general principle referred to by the noble Lord, Lord Turnbull, which has been very clearly enunciated by the courts, is that no public authority, including local authorities, has the power or statutory authority to exact money that exceeds the amount that the local authority—or other person making the imposition—sets. The charge the person is required to pay must be just equal to the amount that will be needed to carry out the service, or other thing. If it does exceed it, it is taxation and that covers all forms; it does not matter whether it is a payment, charge, fee or anything else. That is a general principle. Therefore, the provision in Clause 7(7), preventing the regulations imposing or increasing taxation, prevents any local authority or other power having the power to make any such imposition.
On the amendment proposed by the noble Lord, Lord Lisvane, I wonder whether the first part of the clause —Clause 8(1), I think—is the subject of Amendment 126. My noble friend Lord Deben wondered why we were talking about this in a withdrawal Bill, but the clause says that we may have an international obligation that is breached by withdrawal; it therefore seems reasonable to deal with that in the withdrawal Bill because it is a consequence of withdrawal. That amendment implies that this power cannot be used to make any financial settlement that would cause a cost to the United Kingdom because, if it did, it would inevitably require taxation—presumably, whoever makes the settlement does not intend to defray the cost out of his or her own pocket. It is a fundamental restriction on the way in which these matters of international obligation may be resolved. I think I am right in that, but no doubt the noble Lord will tell us its effect on the amendment in due course.
The Minister of State, Department for Exiting the European Union (Lord Callanan) (Con)
My Lords, Amendments 86, 126, 127 and 155—in the name of the noble Baronesses, Lady Hayter and Lady Kramer, and the noble Lords, Lord Turnbull, Lord Lisvane and Lord Higgins—concern Clauses 7, 8 and 9 and the ability to provide for taxation or fees and charges under those powers.
Let me start by saying that the Government are aware of the concerns of many noble Lords about the raising of fees under these powers. On Report, we will look closely at how we can resolve those concerns. Let me explain the various issues, beginning with Clauses 7 and 9. I am glad to be able to reassure noble Lords that the restrictions in Clause 7(7)(a) and Clause 9(3)(a) already prevent Ministers establishing charges of a type that would involve any element of taxation or tax-like provision under these powers. Beyond that specific issue, I want to set out the Government’s intentions with regard to those fees and charges.
Viscount Hailsham
Will my noble friend tell the Committee what, in his view, is the essential difference between a fee, a charge and a tax? The Committee must understand the expressly defined difference.
Lord Callanan
If my noble friend will stay with me, I will come on to that. Beyond that specific issue, I will set out the Government’s intention with regard to fees and charges. We have included the powers in Schedule 4 to provide for fees and charges in order to be clear and transparent. It is, however, necessary for the powers in Clauses 7 and 9 to interact with existing regimes to correct deficiencies within them, and to properly modify them to reflect the withdrawal agreement. Without prejudice to our negotiations, an example of such a correction might be modifying a fee in relation to the authorisation of a credit rating agency so that the fee becomes payable to the UK financial regulators rather than the European Securities and Markets Authority. That might be argued to amount to the imposition of a new fee.
The requirements to pay new fees and charges established under Schedule 4, and the ability to modify existing regimes, will depend on deficiencies being properly corrected and on functions being transferred. Clauses 7 and 9 are not primarily aimed at imposing fees, and they cannot impose other kinds of charges, but sometimes that will be part and parcel of the correction. In answer to the questions about fees and charges from the noble Viscount, Lord Hailsham, the noble Lord, Lord Deben, and the other poachers turned gamekeepers—if I may refer to them as that—on the Privy Council Bench, a fee is a payment only for a service received. By a charge, in paragraph 6(2) of Schedule 7, we mean anything which goes beyond cost recovery. Clause 7 cannot create a charge. In addition, creating either a fee or a charge is subject to the affirmative procedure.
The argument against a tax restriction—
Lord Deben
There is a large number of fees that are paid to, for example, the Environment Agency, to carry out certain services. We have no idea whether those fees are equalled by the amount of work that is done. The Environment Agency says: “We want this amount of money because we need it”. There is no proof. If one were to prove that the agency spent less money than the fee, does it then become a charge or a tax? There is a real issue here. My noble and learned friend Lord Mackay points to the fact that one may define it like this but how does one prove it, and how does the House deal with it? Is it not better to not have this distinction at all?
Viscount Hailsham
I am sorry for my noble friend, but he did say that both the fees and the charges were subject to the affirmative procedure. I know that the fees are, but I am not sure where in the Bill I find the provision that charges are subject to the affirmative procedure. Will he tell the Committee?
Lord Callanan
I do not have the specific clause in front of me, but I am sure that is the case and I will write to the noble Viscount about it. I am not an expert on Erskine May and the precise legal definitions, but I will have a look at the matter towards which the noble Lord, Lord Lisvane, has pointed me.
The argument against a tax restriction on Clause 8, made by the noble Lord, Lord Lisvane, is altogether different. The Clause 8 power is predicated on the fact that when we leave the EU, without further action we may inadvertently end up in breach of certain international obligations which have been affected by our EU membership, as a number of noble Lords have pointed out was said in the other place by my honourable friend Robin Walker. It is possible that some of these obligations may be in the field of tariffs, although it is, of course, impossible to know the full picture until our future relationship with the EU has been negotiated. If Clause 8 had a tax restriction as the other main powers do, we may not have the capability to remedy these breaches in all circumstances. As I hope noble Lords will appreciate, we are committed to international relationships and a key part of that is ensuring that we are fully compliant with our international obligations.
Lord Wallace of Saltaire
That is a very interesting point. Would that be remediable if we were to stay within the European Economic Area, which would classify us as part nevertheless of a regional economic arrangement? Is that one of the things that perhaps we and the Government should take into account in considering this transition?
Lord Callanan
If we were part of the European Economic Area, I assume that we would not need to do that. However, as we are not going to be part of the European Economic Area, it may perhaps be necessary. I hope that the noble Lord will listen to my next point.
In the light of our successful phase 1 agreement, we are increasingly confident that we will secure a deal with the EU and that the prospect of leaving negotiations with no deal has reduced significantly. It is in both the UK’s and the EU’s interests to secure a good deal for both sides. However, as a responsible Government, we have a duty to plan for the unlikely scenario in which no mutually satisfactory agreement can be reached. I hope noble Lords agree that that is common sense. If we do not have this power, and in exiting the EU we are unable to correct a breach of the MFN principle, another WTO member could bring a dispute against the UK in the WTO. That is a situation that we want to avoid, and which could result in a loss of trade for UK business through retaliatory measures by other WTO members or claims for compensation against the UK.
Lord Adonis (Lab)
The noble Lord makes some very good points about how we might need to levy charges or fees, or whatever he wishes to call them, but he has not made any case as to why this should be done by secondary legislation as opposed to primary legislation.
Lord Callanan
Because in such circumstances we will need to react quickly in the light of the events as they happen, depending on—
Lord Callanan
It would be totally appropriate and, indeed, necessary to do so in the circumstances. We are in a difficult position in that we are trying to plan for all eventualities. It is one of those powers that we hope we will never use because, of course, we want, and seek, a good agreement with the EU.
Lord Hannay of Chiswick
There is a different eventuality using the same example that the noble Lord gave—namely, the eventuality of the Government’s proposal for what I think is called an implementation phase; most of us call it a transition or standstill phase—lasting about two years. Is he suggesting that we might be in breach of our WTO obligations if we reach an agreement with the European Union on that basis, because it is about to be reached, is it not?
Lord Callanan
No, I am not suggesting that we might be in breach of our international obligations. However, as the noble Lord knows, we are currently negotiating for the implementation period, and as soon as we have an agreement—I hope within the next few weeks—we will be sure to report back to the noble Lord and others.
For those reasons, which I set out earlier, the Government therefore cannot accept these amendments to Clause 8. The power can be used only for the specific purpose of ensuring continuing compliance with international obligations to which this House has already consented and which would be affected by the UK’s withdrawal from the EU. It is available only for a limited period of time, and any further restriction risks increasing the primary legislative burden on this House and weakening the UK’s promise to the rest of the world that we are ready and able to honour our commitments.
However, having said all that, I repeat the point I made at the start of this debate: that we are listening carefully to what noble Lords have said, that we will look closely at how we can resolve many of the concerns that have been raised by noble Lords throughout this debate, and that we will come back to the issue on Report. In the light of those assurances, I hope that the noble Baroness will feel able to withdraw her amendment.
Lord Adonis
My Lords, will the Minister take the message from this House that we are very happy to have this burden imposed on us? Although we appreciate his concern at the weight of business which we might have to undertake if we had to pay attention to primary legislation in respect of fees and charges, we will be very happy to assume that heavy burden.
Lord Callanan
I take on board the sincere nature of the noble Lord’s assurances on this matter.
Lord Forsyth of Drumlean
Might my noble friend point out to the noble Lord that, if it is about taxation, that burden would not be placed on this Chamber anyway?
Lord Wallace of Saltaire
My Lords, since we are discovering the enormous complexity of all this, on the previous amendment I asked the Government whether they would be willing to share with us their own calculations on the process of policy-making for directives and regulations, some of which are in force but not implemented, and others of which are about to come into force but will not be implemented until after March 2019. What view have the Government formed on those? That would be helpful to us and others in understanding how the Government are coping with this complex process.
Lord Callanan
The noble Lord makes a good point. I was speaking to my noble friend Lady Goldie about the matter when he asked her the question earlier. I will have a look at this for him. I think it is fair to say that most of our negotiating positions on the existing directives and regulations are already public. We share our positions, the issues that are being discussed are transparently available on both our website and the EU’s website, and many of the issues that will come to fruition over the next year or two are already in early formative phases. I therefore genuinely do not think that there is much about this process that is secretive, but I will certainly have a look at the issue for the noble Lord.
Baroness Hayter of Kentish Town
My Lords, I think it will be obvious why I spoke so briefly at the beginning of this debate, as I have now heard far better speeches on this group than I would ever have made. I am sorry that the noble Lord, Lord O’Donnell, who “salivated”—his word at Second Reading—at the thought of being able to raise money by SIs, was not here. However, he and the other “guilty men”, as they were called, who used these in the past, have made the case well that this would be quite a move from our traditional way of raising money. Whatever the name of the charge—the noble Lord, Lord Deben, said that it was basically “taking money out of your pocket”, and the noble Lord, Lord Cormack, called it an “obligation to pay”—we know what we are looking at.
The noble Lord, Lord Deben, said that this had, “not been entirely well thought through”. I hope that that, rather than anything more untoward, is why this power has crept in there. As everyone has said, it is for Parliament to decide whether to raise funds—whether to pay for some WTO obligation or for anything else. The example of the American situation is very valid: it is how, ultimately, you stop Governments doing what you do not want them to do.
Earlier in this debate the noble Lord, Lord Lisvane, said that we need some hard examples. I do not think that the WTO example is the hard example to justify these powers. I think that his second point was that, if we do not get those hard examples to convince the House, surely it is much better that we leave this to the withdrawal (No. 2) Bill, by which stage we will know exactly what in the withdrawal agreement had led to the need to raise a particular fee, charge, imposition or whatever. That seems more appropriate.
Speaking about the WTO, I think that the Minister said that he thought the Government might be in a difficult position. I have to advise him that I think the Government are in a difficult position now on this power in the Bill. I hope that the Government will bring forward their own amendment on Report. That would be a way of taking matters forward. I am sure that there are far more expert noble Lords in the House than me who might meet the Minister to see whether we can find some such amendment. I hope that we do not have to repeat this debate on Report and that the Minister will bring something back because, if he does not, I can assure him that we will. For the moment, I beg leave to withdraw the amendment.
Lord Callanan
My Lords, I had intended to stand up before the noble and learned Lord sat down to respond to his kind invitation. Perhaps it would be to the benefit of the House if I note that, as the noble and learned Lord has pointed out, this issue has been debated previously in the debate on the sanctions Bill. As with the issue we debated last Wednesday—the appropriate test for the use of delegated powers—the solutions found in the sanctions Bill are at the forefront of our minds in this regard and we intend to meet noble Lords to discuss the issue over the coming weeks. I will set out the Government’s views at the conclusion of the debate on this group of amendments. I very much look forward to hearing what noble Lords have to say but I thought it would be helpful to say this at the start.
Viscount Hailsham
My Lords, in view of what my noble friend has said, I can be very brief. I support the first four amendments in this group, to which I have set my name, and have ventured to put forward a sort of default position in my Amendment 340. As the Committee will appreciate, the purpose of the first four amendments is to ensure that the regulatory power now under discussion cannot be used to create a criminal offence, and the noble and learned Lord, Lord Judge, has set out very clearly the reasons for this. Amendment 340, which stands in my name, is the default position, so that if by any evil chance this Committee or your Lordships’ House decided that it was right to create a criminal offence, it should be one that does not attract a custodial sentence.
We need to be quite plain about what we are talking about. The Bill as presently drafted enables the Minister, if he deems it appropriate and subject to the affirmative resolution, to create a criminal offence that attracts a custodial sentence of up to two years. Two years is not an insignificant period, and it is very important that one reminds oneself that the test is whether the Minister thinks it is appropriate. Furthermore, we must go on reminding ourselves that the procedure—that is the affirmative resolution procedure—is simply not subject to amendment. So this is, in effect, the power to introduce a criminal offence which attracts a custodial sentence by fiat or declaration. I find that profoundly unattractive.
As a former Minister who signed an awful lot of statutory instruments, I know that the degree of ministerial oversight is extremely limited. As I said, if this Committee decides that a criminal offence should be creatable in this way, then surely it should not attract a custodial sentence of any kind.
Baroness Hayter of Kentish Town
My Lords, because the case was made so clearly by the noble and learned Lord, Lord Judge, with the added detail provided by the noble Lord, Lord Marks, I shall not try to add anything to the substance of the argument. I just want to express my regret at the lack of preparation and forethought that went into the drafting of this power. Indeed, I was alarmed by it on the very day I first read the Bill and started blogging about it back in the summer. I then tabled Questions for Written Answer in October asking the Government what other instances there were of new criminal offences being created by secondary legislation. In the replies I received on 2 and 23 October, the noble and learned Lord, Lord Keen of Elie, was unable to list any.
I went on to ask the then Minister, the noble Baroness, Lady Anelay, the same question. The noble Lord, Lord Callanan, had by then taken over and replied in her stead on 14 November—but again gave no examples. The letter merely noted that “existing” criminal offences “in our law”—those are his words—which relate to the EU might need to be transferred to another body: for example, an offence not to notify an EU institution of something important relating to health. The letter ended by saying that the offence might have to be changed to a failure to notify the equivalent UK body. I understand that, but that is an existing offence, not a new one, and alters only to whom the report should be made. No case was made for, and no example given of, where new offences might be needed as we leave the European Union—much less one with the threat of up to two years in prison on first offence.
Noble Lords will not be surprised that I did not let this drop. I raised the issue again with the lucky noble Lord, Lord Callanan, who had another meeting with me in January—he has all the fun. On Wednesday last, when we anticipated dealing with this group, just before we broke for lunch I received an email from his department in response to my request in January. But again the email failed to answer why any new offences might be needed. It commented only that,
“existing criminal offences may require widening or amending, or new offences may need to be created to fix deficiencies in retained EU law”—
but provided absolutely no examples. The only example given in the email was of an existing offence where a business fails,
“to provide an EU authority with certain information”,
and therefore such an offence may,
“need amending to ensure they continue to operate effectively post exit day, for example by changing references from an EU authority to a UK one”,
and to ensure that businesses are complying with the law. Again, that is a change rather than a new offence. It is true that the email goes on to state:
“Previous case law”—
here I shall look to others to look into the detail of this—
“has created some uncertainty as to whether actions such as these would amount to creating a new offence rather than amending an existing one, and there could be differing legal views on this point”.
As I read the email, it seems that on that basis alone—that there is possibly a legal issue as to whether an amendment to an offence is a new offence—the Government have written themselves powers to create brand new offences that are punishable by up to two years in prison. So I think we are agreed that that will not do and that these powers have to go. Moreover, they have to go more completely than the Government allowed for in the sanctions Bill because, as was said in the debate at the time, anything there would follow an international agreement to which we would be a party as a Government—so there would have been that earlier stage. But these powers will not be part of that, and therefore I hope that, when the Minister responds, he will say that these powers are going to be taken out of the Bill.
Lord Callanan
First, I thank the noble and learned Lord, Lord Judge, and my noble friend Lord Hailsham for bringing the matter of creating criminal offences under the powers in Clauses 7(1), 8 and 9 to the attention of the Committee through their Amendments 87, 128, 156, 339 and 340, which seek to amend the relevant provisions in the Bill. As I said, I understand that similar concerns were raised during the debates on the Sanctions and Anti-Money Laundering Bill, but that a mutually agreeable outcome has since been reached, with the Government bringing forward a requirement on Ministers to make additional statements alongside their statutory instruments. Of course, the offences envisaged under that Bill were different and carried considerably greater sentences. I hope that I can satisfy the concerns that noble Lords have expressed during this debate. However, the Government are still looking very closely at how the powers in the Bill are drawn and how they will be exercised—and, as I say, we are open to discussion on finding similar solutions in this Bill.
I shall start with the reassurance that the three main powers in the Bill are explicitly restricted from creating a “relevant criminal offence”, which is defined in the Bill as an offence for which an individual who has reached the age of 18, or in relation to Scotland or Northern Ireland the age of 21, is capable of being sentenced to imprisonment for a term of more than two years. A vital part in achieving continuity and consistency for businesses and individuals as we leave the EU is to ensure that criminal offences continue to operate effectively after exit. As such, the Clauses 7(1), 8 and 9 powers can create criminal offences punishable by imprisonment for two years or less. In applying this two-year limit, the Government have sought a balance between appropriately limiting the three main powers and providing a functioning statute book on exit day.
The amendments would see that no criminal offences—or no criminal offences punishable by any term of imprisonment at all—could be created under the three main powers in the Bill. However, it is important that these powers are able to create certain criminal offences, as I shall come on to explain. For example, criminal offences provide an essential function of ensuring compliance with regulatory regimes which provide crucial protections for businesses and individuals. Some of the regimes criminalise particular conduct relating to the EU and some offences may no longer operate as intended after exit day if they are not corrected, particularly where functions transfer to a UK authority. For example, it could be an offence for a business to fail to provide an EU authority with certain information, but after exit day the authority collecting that information might be a UK one instead. Continuity would seem to demand penalties remaining in place—
Lord Beith (LD)
I wonder if the Minister could help us. He seems to be arguing what might be a coherent case for some offences needing to be redefined to have the same effect as they would have had before exit day. Surely it cannot be part of what he is describing to create offences that did not exist simply to ensure that the statute book after exit day has the same effect, in terms of the criminality that people would face, as it had beforehand. Does that not need him to approach this differently and try to find a way of defining the process so that it is not about the creation of new criminal offences?
Lord Callanan
I understand the noble Lord’s concern, which comes on to the same point made by the noble Baroness, Lady Hayter. I will come on to deal with what constitutes a new offence and what does not in a second.
Continuity would seem to demand penalties remaining in place for what would substantively be the same misconduct. Currently, certain types of financial services firms are regulated at an EU level. Depending on negotiation outcomes, we may need to bring such firms into the UK regulatory regime. Under these circumstances, we would want the UK regulators to be able to regulate such firms in a way consistent with their current regulatory framework, in line with their statutory objectives. Where appropriate, this may include bringing firms within the scope of existing criminal offences to which UK financial services firms are already subject.
To give another example, Her Majesty’s Treasury is considering amending the existing offence in Section 398 of the Financial Services and Markets Act 2000 of “knowingly or recklessly” giving a regulator,
“information which is false or misleading”.
This would make it an offence, as a consequence of transferring functions from the European Securities and Markets Authority, for third country central counterparties to mislead the Bank of England in connection with recognition applications. In direct response to the noble Baroness, Lady Hayter, and the noble Lord, Lord Beith, a view could be taken that this creates a new offence as it will be a new function for the Bank of England and extends this offence to central counterparties established in third countries to whom it did not apply before. Her Majesty’s Treasury is also considering making similar provision for the FCA—as a consequence of transferring functions from the European Securities and Markets Authority relating to trade repositories—and similar considerations apply. We therefore need the power in its current shape to provide certainty that we can make such statutory instruments.
As an alternative example, marketing authorisations for medicinal products are currently granted at both EU and UK level. Post exit—again, depending on negotiation outcomes—it is possible that the best way to provide continuity for businesses marketing medicines in the UK will be to convert EU marketing authorisations into UK ones. Under Regulation 95 of the Human Medicines Regulations 2012, it is currently an offence to provide false or misleading information in connection with applications for marketing authorisations as this information is key to assessing the safety, quality and efficacy of medicines. The offence is punishable with a fine or imprisonment for a term not exceeding two years. It is vital that, if we need to, we are able to amend the existing offence or create a comparable one. I think we can all agree that it remains important that false or misleading information is not supplied in connection with the process of converting EU marketing authorisations into new ones, and that the public’s health is protected.
Noble Lords will see from the examples that the intent here is largely to ensure that the same types of conduct carry criminal penalties as before, or that we can create criminal offences to deal with the post-exit world. Previous case law has, though, created some uncertainty as to whether widening an existing offence would amount to creating a new offence, and there could be differing legal views on this point.
Baroness Hayter of Kentish Town
The noble Lord just used a different word—“widening”—but I think his earlier example was making a notification to a different organisation. “Widening” suggests that the scope of what might be a crime would be extended. Is that what he meant?
Lord Callanan
No, that is not what I meant.
It is therefore vital that the Bill can provide for “creating” criminal offences to ensure that no offences that are needed fall away as we leave the EU, and that businesses and individuals continue to comply with the law.
Any statutory instruments made under Clauses 7(1), 8 and 9 which create or widen the scope of a criminal offence will automatically be subject to the affirmative procedure so that they will be subject to a debate and vote in this House and in the other place. The Government accept that this level of scrutiny is important here and, as I said at the beginning of my remarks, I hope we can consider further safeguards. Therefore, I hope that with those assurances I have demonstrated why we think this element of the power must remain part of the Bill and that noble Lords will feel able not to press their amendments.
Lord Judge
My Lords, I am troubled by just one observation made by the Minister. I think someone has been advising him incorrectly. Speaking for myself, I have never come to a mutually agreeable arrangement relating to the Sanctions and Anti-Money Laundering Bill. I have certainly welcomed an advance by the Government relating to these issues, but, as I said at the beginning, I leave open the argument that “good reasons”, which are proposed, should give way to “necessary” and I have added that there is an advance.
Beyond that, I am very grateful to all noble Lords who have taken part in this debate. We really must not return—can we make up our minds now not to?—to the constitutional aberration of unexplained, and effectively unscrutinised, regulations creating criminal offences. That is the constitutional principle. In view of the observations made by the Minister, however, I beg leave to withdraw the amendment.
European Union (Withdrawal) Bill
Lord Callanan ExcerptsMonday 12th March 2018
(6 years, 8 months ago)
Lords ChamberRead Full debate European Union (Withdrawal) Act 2018 View all European Union (Withdrawal) Act 2018 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 79-VII Seventh marshalled list for Committee (PDF, 331KB) - (12 Mar 2018)
Lord Rooker (Lab)
Before the Minister responds, I want to spend a couple of minutes on a highly relevant issue that has not been raised on this Bill at all.
Following the BSE crisis, which was very damaging to the economy, an all-island animal feed arrangement was created in Ireland. It is not generally appreciated that there are a disproportionate number of animals for food production on the island of Ireland, hence its exports to the rest of the world: 15% of the world’s infant formula market is controlled by the dairy industry on the island of Ireland. The animal feed situation, which is crucial, is controlled by the ports around the island of Ireland. After Brexit, the EU will be ultra-sensitive—do not forget that we are the country that gave the world BSE—about the imports of animal feed. Given that there already exists an all-Ireland animal feed arrangement, and all-Ireland control mechanisms at the ports and the mills, how will this work after Brexit for the transport between the north and the south from the feed mills and ports? It simply will not be possible to drive a lorry full of feed across the border into Europe without it being checked. I cannot understand why this issue never gets raised. A third of what we grow feeds animals—it is a huge amount of business. We are what we eat, of course, and the animals are produced that way. What will happen in the island of Ireland to the existing animal feed arrangements? It is highly relevant to this debate.
Lord Callanan
I thank the noble Lord, Lord Berkeley, for this debate on Amendments 104 and 231, which raise the important matter of frontier control procedures and freight transport in relation to the Clause 7(1) power. I am particularly grateful to the noble Lord for his helpful technical and operational suggestions. I would have passed them on to my colleagues in the Department for Transport but my noble friend Lady Sugg has already taken careful note of them and I am sure she would like to take them forward with him personally.
I am pleased to reassure the noble Lord that discussions in this field continue with all those involved in the running of our roads and railways and the freight services that use them. How these services and the procedures involved continue to operate after our exit is, however, a matter to be negotiated with the EU. In the event that there is no negotiated outcome, Her Majesty’s Revenue and Customs will treat EU trade as it currently treats third country trade, which means that businesses trading with the EU will need to comply with additional customs requirements. The Government recognise that this represents a change to how UK businesses currently trade with EU firms and so we will model new customs processes and procedures on the existing Union customs code.
The noble Lord’s amendment would prevent the making of regulations in certain scenarios but it does not, and cannot, do anything to prevent those scenarios arising. This will be determined purely by what happens in the negotiations. All it would do in the unhappy situation that we did not secure a satisfactory agreement with the EU is to leave us unable to reflect that situation in domestic law, which of course would only make the position worse. Furthermore, any report that was carried out before the outcome of the negotiations would necessarily be speculative and so would lack a certain utility.
Happily, I can tell the noble Lord that the transport of goods is incredibly important to both the UK and the EU, as many noble Lords have pointed out, and there is a strong mutual interest in reaching an ambitious agreement which maximises the benefits for all businesses and individuals. As such, the Government aim to negotiate for the most tariff and barrier-free trade with our European neighbours, as the Prime Minister said in her speech last week. The Government will ensure that appropriate measures are taken when implementing whatever may be agreed. It will be done in a phased process, thereby providing businesses with enough time to plan and prepare for the new arrangements, minimising disruption.
Whatever the outcome of the negotiations, the Government believe that it is in the interests of both the UK and the EU to have efficient and effective frontier control procedures to achieve one of the strategic objectives of ensuring that UK-EU trade is as frictionless as possible. We will continue to meet our commitment to keeping Parliament fully informed on these negotiations and allow for proper scrutiny, including through regular statements and in our support for the work of committees in this House and the other place. I hope I have reassured the noble Lord that the Government will work hard on securing an agreement with the EU that works well for all in the road and rail freight sectors and I therefore ask that he will withdraw his amendment.
Lord Campbell-Savours
I asked four questions on trusted trader status. When will I get my answers?
Lord Liddle
The Minister did not answer any of the points that I made about what level of contact the Government have had in Brussels discussing these issues, and why in the interval between the September agreement and March, when the Commission produced its own proposals, Britain appears to have done nothing. Will he please tell us what is going on?
Lord Callanan
We are having extensive discussions with our partners in Europe. We are also having extensive discussions with representatives of the rail freight industry and other players in the sector, but as the noble Lord well knows, the arrangements are a matter for negotiation.
Lord Liddle
If Brussels can produce a proposal, why cannot the British Government produce an alternative proposal?
Lord Callanan
As the noble Lord pointed out, we did produce a customs paper last year. In her speech last week, the Prime Minister referred to two alternative customs arrangements and those matters are being taken forward in the discussions. If the noble Lord reads the Prime Minister’s speech of last Friday, he will see that she referred to them specifically.
Lord Liddle
Of course I have read the Prime Minister’s speech. What do you take me for? I follow these things very closely, but the Minister still has not explained how it is that the Prime Minister simply referred to the principles that were put out last summer. This is a situation of real urgency for the economic actors, so why are the Government not producing proposals? Would the Minister be willing to write to me on this point?
Lord Berkeley
My Lords, I am grateful to all noble Lords who have spoken in this interesting debate. It has been really well informed and I am amazed that the Government have nothing better to respond with other than answers that I think I heard six months ago. As my noble friend has said, time is running out. This is a probing amendment and I am grateful to the noble Viscount, Lord Hailsham, for suggesting that we should have gone harder, and indeed the noble Baroness, Lady Altmann, said the same thing. We have time to have discussions before Report, but it is a sad reflection for all of industry, not only the transport sector. The noble Baroness referred to the manufacturing sector and said that we are no further on. The Commission has produced papers but we just get motherhood and apple pie. I do not think I can take this any further tonight, so I beg leave to withdraw the amendment.
Lord Callanan
My Lords, I am again grateful to the noble Lord, Lord Berkeley, for bringing this important matter before the Committee. The Government are considering carefully all the potential implications arising from the UK’s exit from the EU, including the implications for the UK’s future relationship with the European Union Agency for Railways. The UK’s continued participation in the agency as a third country and its continued co-operation in the fields of rail safety and standards, as well as the implications for the UK’s technical standards regime, is, of course, a matter for the negotiations.
Our domestic railway and the cross-border services that link us with the EU serve an incredibly important function in the transport of goods and people across the UK and between the UK and the EU. In 2016, there were some 1.7 billion passenger journeys facilitated by rail in the UK, while the rail freight industry transports goods that would otherwise require 7.6 million more lorry journeys each year. Equally, the Channel Tunnel was responsible for 25% by value of all trade in goods between the UK and continental Europe in 2014, facilitating an estimated £91.4 billion of trade in total. Passenger services through the tunnel, including Eurostar and Le Shuttle, and international rail freight services, transported an estimated 20.8 million passengers and 22.5 million tonnes of goods in 2016.
As the Prime Minister made clear in her Mansion House speech last week, we want to maintain the continuity of rail services that link us with the EU, which provide important economic benefits to both the UK and the EU. However, our participation in the European Union Agency for Railways is not something that the Bill can legislate for. For decades, we have worked closely with our European partners to develop a regime in the field of rail safety and standards that reflects UK practice. We strongly believe it is in both our and the EU’s interests to ensure continued productive co-operation on safety and standards in the future, regardless of the outcome of negotiations. As I have said, this will be a matter for negotiations. In considering all relevant factors relating to the future rail safety and standards framework, the Government remain committed to our railways continuing to have the highest standards and remaining steadfastly amongst the safest in the EU.
We will continue to take on board the views of industry. The Government have a number of established mechanisms for engaging regularly with the rail sector. These include, for example, the Rail Delivery Group and the Rail Supply Group, whose members include the supply chain, passenger and freight operators, and Network Rail. As we prepare for the UK’s withdrawal from the EU, the Government will continue this engagement with a wide range of stakeholders from across the UK’s rail industry to seek views, which the UK has taken, and will continue to take, into consideration.
In the light of that, I hope I have satisfied the noble Lord that we understand the importance of maintaining the continuity of our important EU rail links, as well as maintaining a safe and effective railway. This will continue to be an important factor as we approach the negotiations. I therefore hope he feels able to withdraw his amendment.
Lord Berkeley
I am grateful to the Minister for that reply. It is not news to me, because, obviously, I am aware of what is going on. Could he possibly write to me quite soon about some information that I have which states that the Department for Transport is looking at which regulations from Europe could be torn up as soon as we leave? It is apparently highly confidential, which probably means that we will end up retaining a mishmash of half European and half British regulations, with a divergence which will be incredibly bad for both our manufacturing industry and operators.
Lord Callanan
My noble friend Lady Sugg will be happy to discuss that with the noble Lord.
Lord Berkeley
I am grateful to the Minister. I beg leave to withdraw the amendment.
Baroness Altmann
I rise briefly to explain why I have added my name to these important amendments. One thing that has not been mentioned in Committee so far is the idea that the arrangements we have with Europe also protect the safety, maintenance and repair facilities around our country for our aviation and aerospace industries. We must maintain alignment of regulation. We have 100 airports and 172 maintenance and repair facilities, and if we jeopardise the standards of safety, if we are not in the open skies agreement and not in EASA, then the US apparently is already planning to send its own inspectors to make sure that our standards are up to scratch. If we cannot reassure people that we will maintain those standards, we will not have a functioning aerospace and aviation industry.
Another important element that must not be forgotten is that if we do not maintain our membership of the open skies agreement and EASA, the flights taken by ordinary citizens will increase in price. One estimate from the consultancy Oxera is that if all flights operated by third country airlines were removed, air fares for UK passengers would rise by between 15% and 30%—a Brexit surcharge which people were never told to expect to pay when they voted to leave the EU. These restrictions cannot be overcome simply by airlines setting up subsidiaries in Europe, because ownership restrictions do not allow non-EU investors to own a controlling interest in EU airlines.
I urge my noble friend the Minister to make a commitment to the Committee that we intend to maintain membership of EASA and the open skies agreement, notwithstanding the jurisdiction of the European Court of Justice.
Lord Callanan
My Lords, to start with, I apologise to the noble Lord, Lord Tunnicliffe, as we are more than happy engage in discussions with interested parties. Before I had this job, I was Aviation Minister and had regular meetings with all the concerned parties in the industry, and my noble friend Lady Sugg has told me she is very happy to continue those discussions. I am sorry if I did not make that clear to him earlier. We are of course carefully considering all the potential implications arising from the UK’s exit from the EU, including the implications for the UK’s future relationship with the European Aviation Safety Agency and the Single European Sky agreement. I thank the noble Lords, Lord Berkeley and Lord Adonis—surprisingly, I see that the latter is not in his place—for their amendment.
Lord Callanan
I will repeat the words that I used, for the noble Lord’s benefit:
“The Prime Minister … acknowledged that an appropriate financial contribution would be necessary and that there will be a role for the Court of Justice of the European Union”.
As I was saying, the precise form and nature of the UK’s future relationship with EASA, as well as continued co-operation with the EU in the field of aviation safety more generally, will of course be a matter for the negotiations. The UK’s geographical position means that, with Ireland, the UK services over 80% of traffic entering or leaving EU airspace from the North Atlantic. Given that, the level of interaction between the UK and the EU demands close co-operation. The Government recognise the need for UK air traffic management arrangements to remain interoperable with the rest of Europe once the UK has left the EU. Safe and efficient air traffic management is a priority for us. The UK’s air traffic management system will remain closely bound to that of our European partners. We seek a close and collaborative relationship in this area, just as in many others. However, NATS will continue to provide the same high-quality service to airspace users that it does today.
The Government also want to avoid disadvantaging industry by imposing additional regulatory burdens. The Bill is part of that: it allows the Government to be clear that we are committed to maintaining a harmonised safety system that benefits both the UK and EU aviation networks and maintains the high safety standards that we all wish to see. I hope what I have said has been reassuring for noble Lords and that they feel able to withdraw the amendment.
Lord Liddle
My Lords, what about the point about the affirmative procedure?
Lord Callanan
I took on board the noble Lord’s question but I am unable to give him those reassurances at the moment.
Lord Berkeley
I am grateful to the Minister for his reply and to all noble Lords who have spoken in this excellent debate. The Prime Minister has made more progress here than in the logistics, customs and railway sectors. My final question to the Minister is: has the European Union agreed this? Until it is agreed, it is not a lot of good. We need to revisit this and, we hope, have regular updates. I hope the Government will push very hard for it to be a priority—as my noble friend Lord Whitty said, to have this signed, sealed and delivered at as early a stage as possible. On that basis, I beg leave to withdraw the amendment.
Baroness Hayter of Kentish Town (Lab)
My Lords, I have little to add but I have tabled Amendments 350 and 351 in this group. I should like to mention the importance of ensuring parliamentary scrutiny, in particular of tertiary legislation which was mentioned by the noble Lord, Lord Lisvane. We will deal with that issue later in a different group. The issue he raises is covered in paragraph 15 of the report of the Delegated Powers Committee. There is to be no time limit on the ability to pass tertiary legislation.
As has been made clear both last Wednesday and today, in seeking to bring into UK law the provisions that are currently effected in the UK by virtue of the 1972 Act and our EU membership, the Government have simply slipped into a belief that they should take control of all of this and have drafted for themselves powers and possibilities that rightly belong in Parliament, not with the Executive. As has been said, these amendments are to ensure that use of the powers will be properly scrutinised, and that they will be used by Parliament, rather than Ministers. I hope that the Minister has heard this often and strongly enough to be able to indicate, even at this late hour of the night, that it should be the Government who bring forward amendments on this on Report, because the arguments have been so well made. We should expect them to take the next step.
Lord Callanan
My Lords, I know that concerns regarding the delegation of legislative power, particularly where that delegation permits sub-delegation or allows for tertiary legislation, are shared by many in the Committee. I know that this debate has been brief because the hour is late, but I am aware of the concerns. I say up front in response to the noble Baroness, Lady Hayter, that the Government understand these concerns. We have listened carefully to this debate and to other representations that we have received, so for Report we will look to see how we can provide additional reassurances and transparency around sub-delegation and additional scrutiny of any fees and charges made under Schedule 4.
I will go into this in a little more detail, if noble Lords will forgive me. I know that it is late, but these are serious amendments on an aspect of the Bill that is of legitimate concern, unlike some of the amendments we discussed earlier. I hope I can do something to put some concerns to rest. I shall first take a moment to clarify that, where a legislative function is being sub-delegated under Clause 7 or any of the other powers in the Bill, that power will also be constrained by the policy restrictions that apply to the delegating power. In the case of Clause 7(1), that includes all the restrictions in Clause 7(7).
Although, beyond Ministers, there are indeed a great number of public authorities in the UK, there are only a very small number to which it would be appropriate for Ministers to sub-delegate legislative functions as an appropriate correction for a deficiency in retained EU law. Again, these will all be subject to the affirmative procedure.
I also restate that any SI providing for legislative sub-delegation will be subject to the affirmative scrutiny procedure and will have to set out what conditions apply to the exercise of that power. Whether scrutinising the sub-delegation of any of the powers in this Bill, the creation of a new, specific and targeted legislative function, or the transfer of any legislative power from the EU, I would expect this House in particular to take a keen interest in these instruments and to have vigorous debates on the appropriateness of the conditions proposed for the exercise of the power before voting on the instrument.
While the Government are listening to the Committee’s concerns about the form that this sub-delegation will take, they believe that conferring powers on public authorities, including Ministers, to allow them to make provisions of a legislative character or other legislation can be an appropriate course of action, either to make corrections to retained EU law or to maintain a regime in the future. This is particularly true where there is a need for specialised, technical rules to be developed, introduced and maintained by a body that has the necessary dedicated resource and expertise.
I will give noble Lords an example. The EU binding technical standards—the detailed technical rules developed by EU regulators for financial services—demonstrate where it might be appropriate to sub-delegate the responsibility for correcting. These standards, which run to almost 10,000 pages, fill out the detail of how firms need to comply with requirements of policy set in higher legislation. The PRA and FCA have already been given the responsibility by Parliament of developing and making the domestic detailed rules needed to ensure that financial services firms are stable, well managed and meet the needs of consumers. These UK public bodies have played a leading role in the EU to develop these standards, so they already have the necessary resources and expertise to review and correct them to operate effectively in the UK from day one of exit.
Baroness Kramer (LD)
Perhaps the Minister could help me with a clarification. As I understand it, the FCA and others have the powers he just described as a consequence of a cascade that comes, as he said, from higher levels of legislation that originated in a democratic process. They therefore have safeguards, frameworks, constraints, mitigations and appeals processes—all kinds of characteristics sitting around them. How do the powers of sub-delegation which the Minister described relate to any of those structures of cascade or framework, since we are supposedly leaving the EU?
Lord Callanan
I am not sure that the powers originated in a democratic framework; a lot of them came from EU legislation introduced by regulation which takes automatic effect through the European Communities Act. We could have an argument about whether that is a democratic framework, but perhaps now is not the time.
Lord Callanan
Let me make some further progress and see whether it responds to the noble Baroness’s questions.
Some of the powers to make legislation that will be transferred under the powers in the Bill are integral parts of regimes currently managed at the EU level; for example, where the European Commission currently legislates to add to or remove active compounds from lists of biocidal products. Where sub-delegated or transferred legislative powers are crucial to the functioning of a regime, it would not be appropriate for those powers to be subject to a sunset. That would only postpone rather than remove the requirement in the limited time available before exit for either a regular flow of primary legislation to keep regimes up to date or a suite of primary legislation to design equivalent powers to those which the Government intend to transfer under this Bill.
Perhaps I may address the three elements of Amendments 350 and 351 tabled by the noble Baroness, Lady Hayter. First, I turn to the scrutiny of the exercise of the powers by Ministers of the Crown in Schedule 4. We have laid out in Schedule 7, which I know we will debate at length another day, provisions for the scrutiny of those powers. Our position is that the powers should indeed be subject to the affirmative procedure where Ministers are creating new fees and charges regimes, or where we seek to grant an authority the power to set its own fees and charges. It is the sort of framework being established in which this House rightly takes a great interest. All this is of course possible under Schedule 4 only in relation to new functions that we are transferring from the EU or setting up on exit under the powers in the Bill. We have not provided for the adjustment of these, or for existing fees or charges, to be subject to the affirmative procedure. In years to come, there will be many such adjustments as technology cuts costs and inflation raises them. This ebb and flow can make a real difference to businesses, but does not normally represent a matter requiring debate and division within this House.
Nevertheless, I accept the point made by the Delegated Powers and Regulatory Reform Committee that the raising of a fee not by 1% or 2% but by, let us say, 13,000% would be a substantial matter. I trust, however, in the expertise of the Secondary Legislation Scrutiny Committee and the Joint Committee on Statutory Instruments to draw this House’s attention to such matters. I remind noble Lords that the negative procedure for statutory instruments does not mean no scrutiny at all, nor does it prevent debate. Nevertheless, if I have not addressed sufficiently the noble Baroness’s concerns on this point, I would be more than happy to discuss further how we might do so. As I said at the start, we are looking closely at this issue and expect to come back to it on Report.
Secondly, these powers are vested also in the devolved Ministers—we do not have the noble Lord, Lord Wigley, with us to make his regular point about devolved matters. While the scrutiny of the powers is important and, as I have just set out, the Government have tried to ensure that the most important of the regulations made under them will be affirmative, it is not for this House to dictate scrutiny to the devolved legislatures. The Bill contains a starting base of procedures for the devolved exercise of powers. While the devolved Administrations are competent to change these following Royal Assent, discussions continue with them about any alterations they may think it appropriate to make in the Bill. It would also not be appropriate for us to require the devolved Ministers to seek our approval for their statutory instruments—I am sure the noble Baroness did not intend this to happen.
My third point regards the sub-delegation of the power to provide for fees and charges. It bears repeating that any instrument providing for this will have to be affirmative, can delegate this power only to a body being given a new function under this Bill, and will have to set out the conditions for the exercise of that power.
Baroness Hayter of Kentish Town
It sounds as though what the Minster is reading out dates from before today’s debate on fees and charges. I had hoped that, in light of that, this continued idea of setting these by secondary legislation had gone from his mind.
Lord Callanan
We said that we would return to this matter on Report, but we are now talking about the sub-delegation of those fees and charges.
Moving on to Amendment 352 in the name of my noble friend Lord Hailsham, I am in total agreement with the principle that the Government should not raise fees or charges from the public, whether businesses or individuals, without considering the impact on those who will pay or the impact on both the payers and the wider economy. I may be wrong but I doubt that many in this Committee, other than the noble Lord, Lord Macpherson, who is sadly not in his place and is of course intimately familiar with it, will have read Managing Public Money. This weighty tome is easily available online and serves as the sacred text of Her Majesty’s Treasury regarding many things, including the setting of new fees and charges. It sets out that charges on the public must be subject to the general practices on consultation and economic and financial analysis. Without this, the consent of Her Majesty’s Treasury to establishing a new fee or charge, required by paragraph 3 of Schedule 4 for all new fees or charges under the Bill, cannot be obtained.
I hope that this long explanation, for which I apologise at this late hour, and my other points have gone some way to reassuring noble Lords. I am happy to continue discussing these important issues, but in the meantime I hope noble Lords will not press their amendments today.
Lord Lisvane
My Lords, I am extremely grateful to the Minister for the detail he went into in his reply, particularly at this late hour. I also pay tribute to him for his customary generosity in being prepared to discuss these matters outside the Chamber. He recommended one weighty tome with which, as a former accounting officer, I am moderately familiar. Perhaps I may recommend to him another weighty tome, Craies On Legislation, edited in masterly fashion by Daniel Greenberg, former parliamentary counsel. I think it is at chapter 3.5.1 that he will find a very good treatment of the dos and don’ts of sub-delegation. That might be something we discuss before we come back to these matters on Report.
Of course, he is absolutely right to say that the consigning of these powers to a body or a person will require the affirmative procedure, and that is fine up to a point, but the exercise of the powers, once sub-delegated, will be free of the trammels of the accepted processes, so it becomes even more important that, in the consigning of the powers, the constraints on how they can be used by the consignee, if I can use that rather unlegislative term, are made absolutely clear. That is something, perhaps, on which we can have further conversations between now and Report. On that basis, I beg leave to withdraw Amendment 110.
Baroness Hayter of Kentish Town
My Lords, I do not think that anyone who has read the excellent December 2016 report Brexit: Financial Services from our EU Committee chaired by the noble Baroness, Lady Falkner, will be under any illusion about the challenge that Brexit poses to this economically crucial sector of our economy. This evening we have heard of the needs both of those in the financial sector and of those who depend on it, and we have heard of one possible way forward, but the most important point is that something is needed urgently.
The British Insurance Brokers’ Association, to which we have just heard reference, the Alternative Investment Management Association, the ABI and TheCityUK have all come to me, and I am sure to other Members of this House, to raise their concerns about Brexit and particularly the wider implications for the legal sector and the insolvency sector and what that means for investors as well as for the more traditional City firms. Along the lines outlined by the noble Lord, Lord Carrington, TheCityUK has called for a bespoke market access agreement based on mutual recognition, regulatory supervision and co-operation, with, as we have heard, particular emphasis on mutual recognition and the enforcement of judgments.
In long-term contracts, legal continuity and certainty are vital for business, as we have heard, but also for consumers, as the ABI has stressed. Retired British citizens in nice warm areas such as the south of Spain need to know whether their annuities and pensions from London-based providers will continue after March next year, and indeed after December 2020.
The AIMA wants to see regulatory frameworks that enable managers to deal with any type of fund vehicle or account, as they now do, as they manage the savings and investments of pension funds and insurance companies. The British Insurance Brokers’ Association—100,000 people are employed in that industry, and they arrange 70% of all general insurance—says that it is “critical” to reach a transition agreement quickly and, following that, a mutual free-trade agreement.
The one word that I want to leave the Minister with is “urgency”, because insurance renewals are already being issued for annual policies renewable on 30 March next year, a date that I know is uppermost in his mind. Any policies running after 30 March next year would result in uncertainty over the legitimacy of that part of the policy that is effective after we leave. So we need these brokers to be able to ensure that there are no interruptions in customers’ cover, and that extends to whether we can be insured when we travel and when we drive our cars abroad, and to travel insurance if the EHIC ends—these are real things that people rely on day by day.
As we know, the UK is the world’s largest exporter of financial services to the EU, which is where I have to disagree with the noble Viscount, Lord Trenchard. He thinks that there is great hope somewhere else, but actually, for us to earn money in the EU and maintain all the customers we serve there, we must first prioritise establishing that we can continue with what we do so well there. Shoring up that business certainty through a formal agreement on regulatory equivalence or something similar is becoming ever more urgent.
We first started debating this report in the House in December 2016. We are now in March 2018, and I fear we are no clearer in knowing what the Government are doing. I hope that at this late hour, not just of the clock but of the calendar in moving towards when we leave, the Government will be able to provide a little more assurance than they have done thus far.
Lord Callanan
My Lords, I first thank my noble friend Lord Carrington for his amendment, which has enabled us to have this excellent short discussion. I also thank the noble Baroness, Lady Falkner, for her contribution. Of course, I know the report of her committee extremely well, as I was a member of the committee when it was produced and I participated in many of the discussions to which she referred, and which she very ably chaired. I thank my noble friend Lord Trenchard for his comments. He made some excellent points and pointed out the global nature of many of the financial services regulations that we are talking about.
The noble Lord, Lord Hunt, made some good points about the insurance industry. I can assure him that we will continue the work that we are doing in consultation and discussions with the industry as we take the negotiations forward.
However, although I thanked the noble Lord, Lord Carrington, for his amendment, I am afraid that we cannot accept it for reasons that I will explain. It would not be practical given that the negotiations on the UK’s future relationship and the eventual arrangements for market access in financial services post Brexit have yet to begin. It will be important that in entering negotiations the UK retains a degree of flexibility as to what the precise arrangements for market access for financial services firms may be. It is imperative that both sides come to the negotiating table with a constructive mind set. That was the essence of the Chancellor’s contribution last week. Agreeing now to set out a report according to the specific and detailed criteria set out in the proposed new clause would prejudge a great deal of the substance that has yet to be discussed by both ourselves and the EU.
I emphasise that the Government share the aims of the noble Lord’s amendment. We are seeking an ambitious relationship that takes account of the fact that the UK and the EU start from a position of total alignment, with unprecedented experience in working with one another’s regulators and institutions. As the Chancellor outlined last week, the UK is a global financial services hub—an engine that powers the real economy and the UK—and it is a real asset for Europe too.
In his speech—this refers to the point made by the noble Baroness, Lady Kramer—the Chancellor set out three key elements for a possible approach to a future partnership: a binding dialogue for establishing regulatory requirements for cross-border trade; supervisory co-operation arrangements that are reciprocal, reliable and prioritise financial stability; and an independent arbitration mechanism that has the confidence of both parties to provide durable dispute resolution. We hope that we would agree that the UK cannot be a rule taker in financial services but, by working together as the Government have proposed, the UK and the EU can preserve market access and strengthen stability and prosperity in the UK as well as the rest of Europe.
Underpinning this is our commitment to upholding the robust standards which are, as the noble Viscount, Lord Trenchard, pointed out, often based on international standards that we have developed since the financial crisis. These aims have consistently been emphasised in government messaging—more recently by the Secretary of State for Exiting the European Union and by the Chancellor. These align with what we have been hearing from the financial services sector in terms of a desirable end state deal. However, the details have to be worked through via the negotiations and the process will require imagination on both sides. This proposed new clause would set out a prescriptive template for the Government to follow. Negotiations are by their nature fluid and we cannot agree to provide a report based on a set of potential end state arrangements, which are predefined and outlined specifically here, that prejudges the outcome of negotiations before those talks have even started.
These issues are extremely important and I hope that the Government’s conduct in negotiations, as well as the clear public stance of Ministers on the significance of financial services to our future relationship, will help to provide reassurance over our commitment to securing agreement on these issues. Once the negotiations conclude, the Government will need to make clear the substance of what has been agreed. This is particularly so in order to enable the industry to understand the provisions for market access and how they sit within the UK’s agreed relationship with the EU on financial services going forward. We will of course, as always, be happy to update Parliament when the appropriate time comes. However, in light of the need to preserve UK flexibility in the negotiations, I hope that the noble Lord will feel able to withdraw his amendment.
Baroness Falkner of Margravine
Before we dispense with the amendment I have a brief question for the Minister. If I have understood him correctly, he has just said that when the negotiations are complete, the Government would set out and clarify their position. Can he tell me what he means by “when the negotiations are complete”? Is he talking about the negotiations on the withdrawal agreement—in other words, by the end of this year—or the agreement on the FTA, in which case we will not know the parameters of the Government’s thinking until very much later when we are into the transition agreement itself? There I would have to agree with my noble friend Lady Kramer that essentially, businesses will have made up their mind and taken the necessary actions, not least because the regulators require them to carry out their contingency planning.
Lord Callanan
I think I mean both. We will update the House on the position at the end of the negotiations on the withdrawal agreement, on the agreement on the future FTA, and if I can add a third criterion to that, of course on the negotiations for the implementation period, for which we hope to be able to provide an update in the very near future. All those factors are important in the provision of financial services. If we get the implementation period agreed in the near future, which we hope and expect, that will provide a slightly longer period for businesses to establish the appropriate stability, but it is hoped that as we get to the end of the year we will have the withdrawal agreement. We expect that to provide the details of the framework for future co-operation. I will be very happy to update noble Lords at all of these stages.
European Union (Withdrawal) Bill
Lord Callanan Excerpts(6 years, 8 months ago)
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Lord Cormack (Con)
My Lords, I wish to make two very brief points. First, I want to endorse entirely what my noble friend Lord Renfrew said. The points he made on the archaeological issues are of very great importance indeed, and it is crucial—I speak as a fellow of the Society of Antiquaries and a former vice-president of that body—that these points are taken into account.
My other point, in a slightly lighter vein—but still with serious intent—is to support my noble friend Lord Deben, who made a splendid speech. As he made it, I could not help but remember an Adjournment debate in the other place, over 30 years ago, when the late, great Reggie Bennett mentioned the problems that he had enjoying his favourite sport of swimming off the south coast. He said, “Mr Speaker, there are very few beaches onto which I can now go and swim. All I can do is go through the motions”. That just brings home, in a very simple but important way, that we owe a lot to directives that have come from Europe and been brought into our laws. My noble friend Lord Deben referred to that in his speech; he played a very important part in that regard. It is easy to bash directives—we have all done it; I have done it—but collectively, we owe a great deal to what has come out of Europe on the environment, and been sustained and endorsed in this country.
The Minister of State, Department for Exiting the European Union (Lord Callanan) (Con)
My Lords, the issue of environmental protection was widely debated during the Bill’s passage through the other place. Of course, it has now been widely debated, with great ability, by many noble Lords here. We have already had a thorough debate on the important topic of animal sentience and I am grateful to noble Lords for their amendments on that issue and on the wider issue of maintenance of EU environmental principles.
Although I welcome the sentiments behind these amendments—Amendments 66 and 108, in the name of the noble Baroness, Lady Jones; Amendments 112 and 113, in the name of the noble Lord, Lord Krebs; Amendment 67, in the name of the noble Lord, Lord Judd; and those in the names of the noble Lords, Lord Adonis and Lord Wigley, and the noble Baroness, Lady Miller of Chilthorne Domer—I believe them to be ultimately unnecessary, for reasons I will now set out.
As my noble friend Lady Byford indicated, on 11 January, the Prime Minister launched the 25-year environment plan. That sets out our determination to leave our environment in a better state than how we found it and outlines steps to achieve this. Launching the plan, the Prime Minister stated:
“Let me be very clear. Brexit will not mean a lowering of environmental standards”.
Of course, we are committed to internationally recognised environmental principles, as set out in the Rio Declaration on Environment and Development in 1992, known as the Rio principles. This declaration includes the ideas behind a number of the environmental principles listed in Amendment 66, including sustainable development, the precautionary principle, the polluter pays principle and access to environmental information. These, as well as other principles, are also features of multilateral environmental agreements to which the UK is a party. For example, the OSPAR Convention—the Convention for the Protection of the Marine Environment of the North-East Atlantic—and the Gothenburg Protocol on air pollution both apply the precautionary principle.
Although these principles are already central to government environmental policy, they are not set out in one place. That is why the Secretary of State for Environment, Food and Rural Affairs announced on 12 November our intention to create a new comprehensive policy statement setting out our environmental principles. The new policy statement will draw on current EU and international principles and will underpin all our future policy-making. The Secretary of State for Environment, Food and Rural Affairs also announced on 12 November our intention to consult on a new, independent and statutory body to advise and challenge government, and potentially other public bodies, on environmental legislation, stepping in when needed to hold these bodies to account and to be a champion for the environment.
In reply to the noble Lord, Lord Krebs, my noble friends Lady Byford and Lord Caithness and other noble Lords, this year we will consult widely on the details of the announcement from the Secretary of State for the Environment—I apologise to noble Lords that I cannot be more specific about a date at the moment. That consultation will explore the precise functions, the remit and powers of the new environmental body, and the nature, scope and content of the new statement on environmental principles. This will be the start of a detailed conversation with stakeholders. There are many stakeholders in this area and it is important to gather their views before coming to any decisions, which is why I cannot be more definitive at this stage on timescales.
Lord Krebs
My Lords, is the Minister familiar with Einstein’s theory of relativity? The reason I ask is because if you do the sums, I reckon that there is just over 12 months to go between now and the proposed date of exit from the European Union. We are talking about a three-month consultation period—starting heaven knows when, because we still do not know when the document for the consultation will be launched—then we have perhaps another nine months to pass an environment Bill through Parliament, if it is to be a statutory body, and then perhaps another six months to set up the organisation, fund it and appoint the staff. That sounds like a minimum of 18 months to go into 12. But of course, as Einstein pointed out, if you can travel at a speed faster than 186,000 miles per second, you can stretch time, so I hope that the Minister is proposing to invoke Einstein’s theory of relativity in ensuring that the body will be in place by the proposed date of exit.
Lord Callanan
I will take that as an observation rather than a question.
Amendments 66 and 67 would prejudge the outcome of the forthcoming consultation by setting requirements in legislation now. The result could be that we need to amend the legislation after we have considered this important input from stakeholders. I will say a few words in response to my noble friend Lord Deben’s points in a second. I am disappointed that he thinks that I am sometimes a little sharp with him; obviously, we do not often agree on many things, but I hope that I am as transparent as I can be with him.
Amendment 66 also goes further than the existing principles set out in EU and UK law today. In particular, it would introduce a new power for courts to declare provisions in primary or secondary legislation to be incompatible with the environmental principles. This power does not currently exist in either EU or UK law.
I will go a little further. The precautionary principle is included in, for instance, the REACH regulation and the invasive species regulation, so it will be preserved by the Bill in those areas. Similarly, the polluter pays principle, referred to by a number of noble Lords, is referred to in the Water Environment (Water Framework Directive) (England and Wales) Regulations 2017, which will also be preserved by the Bill. EU case law on chemicals, waste and habitats, for example, includes judgments on the application of the precautionary principle to those areas, which will, likewise, be preserved by the Bill.
The purpose of the Bill is to convert and preserve the law so that after exit it continues to operate as intended. This includes many of the directives referred to, such as the wild birds and habitats directives, as transposed through domestic legislation. It is not appropriate for the Bill to introduce new powers of this kind.
Lord Deben
My noble friend has explained that some things are already there. Can he give me an undertaking that if we were in consultation to remove from this amendment anything that is additional to where the European Union now is, he would accept this amendment? That is the issue. If we were to do that, would he accept the amendment?
Lord Callanan
I cannot give an assurance that we would do that. This is about legal certainty—taking a snapshot of existing laws and transferring them into UK law as it is. It is not about creating new powers within the Bill. There will be a further opportunity to discuss this when we publish our proposals for the new body.
Lord Deben
I have not said “new powers” or talked about creating legal certainty. He keeps using that phrase. I merely said that if we amend this so that there is no additionality to what is already in European law, will he accept that as an amendment?
Lord Callanan
If a new amendment is put forward, of course we will look at it and consider its legal implications. I can give that assurance.
On Amendment 112, our starting point is that the new statement of principles and the environmental body should cover England and environmental matters that are not devolved. To respond to the point made by the noble Lord, Lord Wigley, if the devolved Administrations would also like to take action on these issues, we are open to co-designing the proposals to ensure they work more widely across the UK. We would need to take account of the different government and legal systems in the home nations, as well as the different circumstances in the different parts of the UK. This amendment risks compromising consideration of these important issues as well as the wider devolution settlement by requiring the UK Government and devolved Administrations to consult jointly on UK-wide proposals for governance and principles.
On Amendment 113, the secondary legislation made using the powers under Clause 7 will be subject to parliamentary oversight, using well-established procedures. This amendment would require us to make all the regulations within one month of Royal Assent. This would not allow time for stakeholder consultation and would also not allow sufficient time to make all the SIs—noting that affirmative SIs take longer than one month to be laid and made.
Many areas of environmental policy are devolved. This amendment would require the Secretary of State to make regulations for all the UK, which would be contrary to the devolution settlement. It would also require the creation and maintenance of a register of functions indicating who is responsible to perform them before leaving the EU and who will be responsible after we leave the EU. This is a bit of bureaucratic procedure that has no added value. The SIs under the Bill will set which UK body will perform functions, such as the various regulatory functions.
On Amendment 108, the UK Government laid legislation transposing the national emission ceilings directive in Parliament on 1 February 2018, demonstrating our clear commitment to improving air quality. This legislation implements ambitious, binding emission reduction commitments for 2020 and 2030 into domestic law. Air quality has improved significantly over recent decades, with the UK reducing emissions of all the major five air pollutants. For example, since 1970 we have reduced emissions of nitrogen oxides by 69%, emissions of PM10 by 73%, and emissions of PM2.5 by 76%. Emissions will continue to reduce thanks to the action we have already taken, and we will publish a new clean air strategy in 2018 setting out how we will work towards our 2020 and 2030 commitments.
The Bill will ensure that the body of existing EU environmental law continues to have effect in UK law. It will be for Parliament—and, in some cases, for the devolved legislatures—to make any future changes in legislation after we have left the EU. The power under Clause 7 will be used to amend legislation to ensure continued operation of legislation, enabling the Government to continue to meet their environmental objectives.
Amendment 186, tabled by the noble Lord, Lord Adonis, and to which the noble Baroness, Lady Brown, spoke, would compel the Government to set out a strategy on the EU emissions trading system. This amendment is unnecessary given that our Clean Growth Strategy, published last year, clearly sets out our guiding principles on reducing emissions. We are considering the UK’s future participation in the EU ETS after our exit. We remain firmly committed to carbon pricing as an emissions reduction tool, while ensuring that energy-intensive and trade-intensive businesses are appropriately protected from any detrimental impacts on competitiveness.
Lord Adonis
The Minister said that the Government are “considering”; does that mean that they might propose to continue our membership?
Lord Callanan
This is a matter for the negotiations but it is certainly one of the factors we are considering. We will seek to ensure that our future approach is at least as ambitious as the current arrangements. Furthermore, we have set ambitious emissions reduction targets framed by the Climate Change Act 2008; leaving the EU does not change that.
As I have said, the purpose of the Bill is to ensure continuity and clarity in our laws without prejudice to the ongoing negotiations with the EU. I do not believe this amendment would help to achieve that, and I hope noble Lords will not press it.
I shall say a word on Amendment 260, also tabled by the noble Lord, Lord Adonis, which seeks to restrict the use of the Clause 17 power to weaken environmental protection. I reassure the noble Lord of the Government’s commitment to maintaining our strong environmental protection as we leave the EU. As such, it is essential that we ensure that the legislation which protects the environment remains coherent and tidy, so that it continues to function effectively after our exit.
While the noble Lord’s amendment is well intentioned, we cannot accept it. This is because it would restrict the Government’s ability to ensure that the consequences of the Bill—most notably the repeal of the ECA—were reflected throughout the statute book. It would also restrict the Government’s ability to bring to an end tidily the law and procedures that the Bill repeals. This is a vital part of providing businesses and individuals with the continuity and clarity needed for when the UK leaves the EU.
I want to make clear that these powers may be used only in consequence of, or in connection with, the coming into force of a provision of the Bill itself, not our withdrawal from the EU. Any changes made to environmental legislation to deal with the consequences of provisions of the Bill will be purely to ensure that the changes caused by this Bill are properly reflected in the statute book. To continue to work effectively and appropriately, the statute book must be tidy. It would not be proper, for example, that once the Act has been repealed, there are still references to the ECA lingering in a ghostly way across the statute book. This does not include adjusting important environmental legislation where—although I cannot imagine how this would diminish environmental protection—there must be no uncertainty as to whether the Government can make these statutes clear and up to date, ensuring their effectiveness by reflecting the consequences of this Act.
Case law and an array of legal authorities provide a very narrow scope for Governments to exercise powers of this type. As such, they cannot be used to make bigger, more substantive changes to equalities, human rights or environmental legislation; if needed, these will likely arise from our withdrawal from the EU and not from the effects of this Bill. They would therefore be made using the Clause 7(1) power where there is a deficiency arising from withdrawal. In this way, both minor technical amendments and more substantial amendments will be subject to appropriate scrutiny procedures. I hope the noble Lord is satisfied that the Government remain committed to maintaining environmental protections throughout the process of leaving the EU, and that this will enable him not to press this amendment.
I turn to Amendment 317, tabled by the noble Lord, Lord Wigley, which proposes a new clause in relation to common frameworks for environmental protection. As noble Lords will agree, protection of the environment is a key concern and I am grateful to him for raising this important issue. Common approaches are being considered in a number of areas, which will help to provide the necessary environmental protections. While the UK Government and the devolved Administrations sometimes make different choices on implementation of some policies, these common rules provide significant benefits, such as making it simple for businesses from different parts of the UK to trade with each other and enabling us to meet our international obligations and, therefore, protect our common resources. This is pertinent to the environmental commitments and protections that he rightly raised.
The proposed new clause would require the Government to publish consultation proposals for the replacement of European frameworks with UK ones. It is not the position of the UK Government, nor of the devolved Administrations, that the existing EU frameworks will be replaced by our own common frameworks in every instance. Noble Lords will be aware that the Government have been working closely with the devolved Administrations to determine where future frameworks—legislative or non-legislative—will be required when the UK leaves the EU. We are making good progress in constructive discussions, which continue to be guided by the principles agreed at the Joint Ministerial Committee on European negotiations in October 2017.
We hope, of course, to make further significant progress over the coming weeks and months. However, I recognise the importance that this is not just a conversation between Governments. The increased scrutiny and input of Parliament, the devolved legislatures and wider stakeholders are therefore welcomed as discussions on these issues move into a greater level of detail. As we move forward, this wider engagement will include stakeholders interested in the environmental issues that the noble Lord has raised. I therefore hope my reassurances will enable him not to press his amendment.
Finally, I turn to Amendment 67A, tabled by the noble Baroness, Lady Miller. I agree that it is vital to continue to support our fantastic farmers and growers as we leave the EU. The Government are determined to grow more, sell more and export more of our great British food and drink. Indeed, such exports reached a record level of £22 billion in 2017. On 27 February, the Government launched a formal public consultation, inviting views on a range of possible paths to a brighter future for farming. Health and Harmony: The Future of Food, Farming and the Environment in a Green Brexit describes how, in future, money can be redirected from direct payments under the common agricultural policy—which are purely based on the amount of land farmed—to a new, more appropriate system of paying farmers public money for public goods such as, principally, their work to enhance the environment and invest in sustainable food production. Other public goods which could be supported include investments in technology and in skills to improve productivity.
The consultation seeks views on the huge opportunities that exist for UK agriculture to improve its competitiveness: developing the next generation of food and farming technology, adopting the latest agronomic techniques, reducing the impact of pests and diseases, investing in skills and equipment and collaborating with other farmers and processors. It also discusses the introduction of an agriculture Bill that breaks from the common agricultural policy, providing the UK with the ability to set out a domestic policy that will stand the test of time. This could provide legislative powers, including measures to create new schemes to promote and increase agricultural productivity and resilience.
The Government are vigorously pursuing the measures needed to create a strong, profitable and sustainable future for food producers in this country. Our plans will be strongly influenced by information and evidence from the very many stakeholders in the industry. I hope my reassurances will enable the noble Baroness not to press her amendment.
Baroness Crawley (Lab)
We understand that consultation has yet to start on this new watchdog—that is, on the type of watchdog that we want in the future. However, perhaps the Minister would give us a clue as to what the Government would like to see as far as powers for this watchdog are concerned. For example, would they like the new watchdog to have the same sanctioning powers on Governments that the European Commission has at the moment, to which my noble friend Lord Rooker referred?
Lord Callanan
I thank the noble Baroness for her interest in this. I am sure she will understand that I cannot go any further at the moment. We hope to launch the paper shortly, but all these matters—what powers it will have, et cetera—will be a matter for the consultation.
Lord Hannay of Chiswick (CB)
The noble Lord has given us a trailer on the consultation for the new agricultural system. Will he tell us which of the elements that he has referred to could not be introduced under the common agricultural policy as it is currently practised?
Lord Callanan
As the noble Lord is aware, I said that the common agricultural policy is based on land-based production subsidies, whereas we can now move to other, different policies instead. This is one of the benefits of Brexit; the common agricultural policy has been one of the worst things the European Union is responsible for.
Lord Wigley
On that very point, if there is going to be a new, overarching agricultural Bill, will the Minister confirm that this would be applicable only to England, since agriculture is totally devolved to the three other nations?
Lord Callanan
Yes, I believe Scotland, Wales and Northern Ireland will be able to pursue their own policies in this regard—which is another benefit of Brexit.
The Minister of State, Department for Exiting the European Union (Lord Callanan) (Con)
The noble and learned Lord, Lord Wallace, will have the opportunity to respond to the question posed by my noble and learned friend Lord Mackay after I have set out the Government’s position.
I thank noble Lords for this brief debate on this extremely important subject. Amendment 70A, tabled by the noble and learned Lord, Lord Wallace of Tankerness, seeks to ensure a firm basis for equalities protections as we leave the EU. In that sense, and in response to the noble Baroness, Lady Hayter, I of course understand and sympathise with the motivation behind the amendment and recognise the noble and learned Lord’s interest, shared by many others on all sides of the Committee. Indeed, the noble Lord, Lord Adonis, tabled Amendments 101A, 133A, 161 and 259 —I thank him for his brevity in not addressing them—which seek to restrict the powers in Clause 7 from making any changes to equalities and human rights legislation.
However, as I will endeavour to set out for the benefit of the Committee, we believe that these amendments are unnecessary given our commitment to maintaining existing equality and human rights legislation and, more widely, to sustaining our strong track record in this area. Amendment 70A would in fact give rise to significant new rights—which is not, of course, the purpose of the Bill—and in all likelihood would raise difficult questions, as my noble and learned friend Lord Mackay indicated, regarding legal certainty.
The Government have already made clear our commitment that all the protections in and under the Equality Acts 2006 and 2010 and equivalent legislation in Northern Ireland will continue to apply once the UK has left the EU. This has been stated unequivocally on several occasions, including in the March 2017 White Paper that preceded the Bill, the equality analysis we published in July 2017, and in the government response of October 2017 to the Women and Equalities Select Committee’s report, Ensuring Strong Equalities Legislation after the EU Exit.
As further assurance, the Government tabled an amendment in the other place—now paragraph 22 of Schedule 7—that will secure transparency in this area by requiring ministerial statements to be made about amendments made to the Equality Acts under each piece of secondary legislation under key powers in the Bill. These statements will in effect flag up any amendment to the Equality Acts and secondary legislation made under those Acts, while also ensuring that Ministers confirm that, in developing their draft legislation, they have had due regard to the need to eliminate discrimination and other conduct prohibited under the 2010 Act. We further confirmed in the other place that similar statements will be made in relation to other Brexit Bills. So we have clearly shown our commitment to maintaining the protections in our existing equality legislation, and ensuring that Brexit will not see the UK somehow regressing in this area. In contrast, Amendment 70A would go much further by creating new freestanding rights which would, indeed, apply in circumstances where the Charter of Fundamental Rights does not. Let me take a few moments to explain this in a little more detail.
First, subsection (3) of the new clause proposed by Amendment 70A takes an element from the Charter of Fundamental Rights, strips it of its original context and creates from it an exceptionally wide-ranging anti-discrimination duty. The effect of this is to go well beyond the requirements of the equivalent charter rights, which, as has been said, apply to member states only when they are acting within the scope of EU law, and well beyond the requirements of current domestic law. It would, for instance, introduce a legal duty on public bodies not to discriminate on grounds of language, property, birth or political opinion. That may sound reasonable on the face of it, but if we consider language for a moment, this duty could, for example, give all non-English speaking users of government services a right to claim discrimination if any of those services is available only in English and not in their own first language. This could ultimately mean that all public services would have to be provided in a very wide array of languages, at a substantial and disproportionate cost, which perhaps would even make some discretionary services unviable.
As many noble Lords will be aware, the key wording of subsection (3) of the new clause proposed by Amendment 70A originates in Article 14 of the European Convention on Human Rights. Again, I want to be very clear on this point: nothing in the Bill affects the Government’s ongoing commitment to the ECHR, which is, of course, given further effect in domestic law by the Human Rights Act 1998. Against this backdrop of clear commitments to the European Convention and to maintaining all the protections in and under the Equality Acts, I respectfully suggest that the concern expressed about the future of equality rights after we leave the EU and the assumption that new freestanding anti-discrimination rights are in some way needed to offset the impact of our exit is misplaced.
The Equality Act 2010 is the cornerstone of our equalities legislation. It covers all the requirements of the four existing EU equality directives but also goes much further. For example, our ground-breaking gender pay gap reporting requirements and our public sector equality duty have no equivalent in EU law. Also, there is no existing EU directive that prohibits, as our Equality Act does, discrimination by providers of goods or services because of age, disability, religion or belief and sexual orientation. We are proud of the UK’s track record on equalities and we do not need to be part of the EU to sustain that excellent record.
Subsection (2) of the new clause proposed by Amendment 70A seeks to establish a legal provision that everyone is equal before the law. However, that very principle is already reflected in the rule of law in the UK and is one of the longest-established fundamental principles of the UK’s constitution. The common law requires public authorities to act reasonably when exercising their powers, and this includes a requirement not to discriminate arbitrarily between different cases.
Finally, subsection (4) of the clause proposed by Amendment 70A would, albeit without directly amending the Human Rights Act 1998, have the effect of linking the new rights created by subsections (2) and (3) to the framework of key provisions in the 1998 Act. Again, with respect, I must say that I do not think that this is appropriate. We believe that it would create legal uncertainty and confusion, not least around the existing prohibition on discrimination under Article 14 of the ECHR, as set out in the Human Rights Act 1998. The bottom line is that substantive new rights are not consistent with the intended purpose of the Bill, which is about maintaining the same level of protection on the day after exit as before. It is not intended to be a vehicle for substantive legislative changes such as those proposed and so we cannot accept Amendment 70A, and I hope that the noble Lord feels able to withdraw it.
It is also to this end that, while we agree with and understand the honourable intentions behind the amendments of the noble Lord, Lord Adonis, we cannot accept them as the legislation that underpins these rights and protections will contain many provisions that will become deficient after our exit. Indeed, the response that the Government put out in October 2017 highlighted some of these deficiencies. For example, the Equality Act refers in several places to EU or to Community law. These references are likely to need to be replaced with the term, “retained EU law”. As such, we believe that it is essential that the Clause 7 power is able to address these deficiencies so that we can ensure that the legislation that safeguards these rights and protections can continue to function effectively—which is what I would have thought we all wanted to see. Without this ability, businesses and individuals may be vulnerable to the resultant gaps in the law, which would be counterintuitive to the intentions of the noble Lord.
Equally, it cannot be the intention of the noble Lord to prevent the Government remedying a breach of our existing international obligations using Clause 8. Both these clauses are subject to the same restrictions on amending the Human Rights Act and the same equalities transparency requirements. In relation to Clause 9, to which Amendment 161, also in the name of the noble Lord, Lord Adonis, refers, one of our clearest similarities with the EU is our shared historic belief in the values of peace, democracy, human rights and the rule of law. It is extremely difficult therefore to envisage that any withdrawal agreement we negotiate with the EU, and by extension the Clause 9 power to implement parts of that agreement, will somehow undermine human rights and equalities law. Rather perversely, Amendment 161 would actually prevent Clause 9 strengthening human rights or equality law on the basis of something agreed in the withdrawal agreement with that effect.
However, as I have already set out, Clause 9 is, like Clause 7(1) and Clause 8, explicitly prohibited from being used to amend, repeal or revoke the Human Rights Act or any subordinate legislation made under it. In the case of Clause 17, I reassure the Committee that these powers may be used only in consequence of, or in connection with, the coming into force of a provision of the Bill itself. We expect that any changes made to equalities or human rights legislation to deal with the provisions of the Bill will be to ensure that the changes caused by the Bill are properly reflected in the statute book and that there is smooth transition in the law. To continue to work effectively and appropriately, the statute book must be tidy. Case law and other legal authorities provide a narrow scope for Governments to exercise consequential and transitional powers of this type. As such, they cannot be used to make truly substantive changes to equalities or human rights legislation.
I hope that what I have been able to say has satisfied noble Lords that the Government remain committed to maintaining equalities and human rights protections throughout the process of leaving the EU and I hope that that will enable the noble Lord to withdraw the amendment.
Lord Cashman
Before the Minister sits down, I asked him a direct question about the sifting committee and whether the recommendations had to be accepted by the Minister. Perhaps he could address that question.
Lord Callanan
I think my noble friend the Leader will be setting out our proposals for the sifting committee in this House. I have not seen the details, but my understanding is that there will be recommendations to the Minister.
Lord Wallace of Tankerness
My Lords, I thank all noble Lords who took part in this debate and I thank the Minister for his reply. He will perhaps not be surprised to learn that I was not wholly satisfied with his reply—although in fairness there was some common ground. He, like me, referred to the White Paper of March 2017 and the commitments that the Government made. Indeed, I accepted and acknowledged that in many cases the rights that have been established in relation to equality in this country have sometimes exceeded those in the European Union. However, that somewhat misses the point, because what I sought to do with this amendment was to ensure that, as we go forward and leave the European Union, these rights will still be there and that no future Government will be able to row back on them without having to give a proper explanation to Parliament.
The Minister made a couple of other points and I will reflect on what he said. I wonder about making the same offer as the noble Lord, Lord Deben, made in the previous debate: if he thinks that some of these go too far, if he and I were to meet and he were to excise the ones he thinks take it beyond what is already there, would he then be prepared to accept an amendment on Report without these? That might be something he would wish to consider.
I also note that while he made the point in relation to subsection (2):
“All individuals are equal before the law”,
as I did in my remarks, that that is part and parcel of our common law, he did not have anything to say about the second part, which refers to having,
“the right to the equal protection and benefit of the law”.
The noble Baroness, Lady Lister, very graphically described the recent case which shows that treating everyone equally before the law does not take account of the fact that some laws might impact disproportionately on some categories of people and end up in discrimination.
European Union (Withdrawal) Bill
Lord Callanan ExcerptsWednesday 7th March 2018
(6 years, 8 months ago)
Lords ChamberRead Full debate European Union (Withdrawal) Act 2018 View all European Union (Withdrawal) Act 2018 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 79-V(b) Amendment for Committee, supplementary to the fifth marshalled list (PDF, 55KB) - (7 Mar 2018)
The Minister of State, Department for Exiting the European Union (Lord Callanan) (Con)
My Lords, I thank noble Lords very much for what has been an excellent debate. I use the word “debate” but only one point of view has been expressed and I have heard the message from all sides. However, I shall address the issues under consideration.
I say, first, to my noble friend Lord Cormack that he has put an intriguing thought into my mind. I will speak to my officials first thing tomorrow morning to find out where I, as a Minister of State, come in this list of 109—I suspect more towards the bottom than the top but we will find out.
The noble Lord, Lord Wilson, asked me about the number of people who will be able to exercise this power without parliamentary scrutiny—a question that I suspect is almost impossible to answer. I think that the main issue is not the number of people but the number of limitations on the exercise of that power. The power is time limited and clearly limited in what it can be used for. It may only prevent, remedy or mitigate deficiencies in EU law, and of course secondary legislation is subject to well-established parliamentary procedures. Where legislative powers are sub-delegated to public authorities, this will always be subject to the affirmative procedure.
I am pleased to have the opportunity to revisit what is clearly a very important issue in the context of the Bill. The Government will place some additional draft examples of statutory instruments or parts thereof in the Library of the House. That is something that a number of noble Lords have asked for in meetings that I have had with them, so I will ensure that that happens—most likely tomorrow.
I have listened with interest to the many contributions today, and to the extensive contributions of the Constitution Committee, which I had the pleasure of speaking to this morning along with my colleague in the other place, the Solicitor-General. I have read the reports of that committee and of the Delegated Powers and Regulatory Reform Committee, which have very much helped to frame our thoughts on this issue.
As a number of noble Lords have said, both those reports go into great detail on the scope of the delegated powers. As many noble Lords will also be aware, they come out with quite different recommendations. As I said at Second Reading, we are approaching this matter in a spirit of collaboration. The Government are looking very closely at how the powers in the Bill are drawn and how they will be exercised, particularly in the light of the committee recommendations and developments in other pieces of legislation.
As the Constitution Committee notes, comparable arguments were made during the passage of the sanctions Bill through this House and a mutually agreeable position was found in that instance. That has clearly informed the committee’s recommendation and we are receptive to the arguments made in its report. I am confident that a mutually agreeable position will be found.
As I will explain in a moment, the Government do not see the DPRRC’s recommendation as workable. However, we would very much like to talk to noble Lords following the debate, with an eye to coming back to this issue on Report.
As noble Lords will appreciate, the situation that this Bill responds to is, quite simply, unprecedented. A vast amount of EU law is being transferred to our statute book, including thousands of EU regulations. As such, the programme of secondary legislation to ensure that this law operates effectively must match that. In the face of such a task, it has always been clear that the Government will need relatively broad delegated powers to deliver a functioning statute book. Indeed, the Constitution Committee outlined in its interim report that “relatively wide” delegated powers were inevitable.
I understand that there are noble Lords who have had concerns about delegated powers for some time, and the Government are keen to continue listening to suggestions in order to improve those areas of the Bill. That listening process started during this Bill’s passage through the other place, where a number of changes were introduced to reduce the scope and increase the parliamentary scrutiny of the delegated powers. However, we cannot significantly restrict the scope of these powers, which, it is acknowledged, need to be broad.
Let me deal directly with the concerns raised by the noble Lord, Lord Wilson. Much of the concern about the delegated powers focuses on the use of “appropriate” to describe the discretion afforded to Ministers when making regulations to correct deficiencies. In case there is some misunderstanding here, let me be clear: “appropriate” in Clause 7 does not give Ministers unrestricted discretion to correct anything that they may wish or like. Corrections must not be appropriate per se; they must be appropriate to correct the particular deficiency they are addressing. The threshold for ministerial decisions is set firmly within the context of those purposes.
I appreciate that there is a degree of subjectivity to these tests—but that is true of almost all tests, and it is important to acknowledge that there are limitations on the power. Parliament polices the Government’s interpretation of its vires to act through the mechanism of the Joint Committee on Statutory Instruments, which I have no doubt will take a keen interest in instruments under this Bill; and ultimately, as a number of noble Lords have pointed out, these tests are litigable in the courts. So we cannot responsibly remove “appropriate” from the Bill.
I will now delve into the detail of the various different permutations of amendments seeking to restrict the scope of the delegated powers. The first amendments I would like to discuss are Amendments 201, 243 and 245, tabled by the noble Lord, Lord Bassam, which attempt to ensure that Ministers have considered that exercises of the main powers are made for good reasons and are reasonable courses of action. These match the Constitution Committee’s recommendation, and a smaller group were added to the Sanctions and Anti-Money Laundering Bill.
Amendments 74, 117 and 139, tabled by my noble friend Lord Hailsham, seek to write into the Bill that Ministers’ consideration of the appropriateness of any exercise of the delegated powers must be made on reasonable grounds. This is the right type of approach in not altering the fundamental scope of the powers.
Lord Cormack
Is my noble friend saying that he has made his mind up—or the Government have made their collective mind up—on retaining “appropriate”?
Lord Callanan
If my noble friend will forgive me, I will discuss that in a second.
Ministers make their decisions on secondary legislation based on reasonable grounds in the normal course of events. The use of these powers will be subject to the usual public law principles designed to ensure that the Executive act reasonably, in good faith and for proper purposes. I accept, however, that noble Lords have principled and legitimate concerns and we will ensure that these are addressed and that the reasonableness of a Minister’s courses of action is made clearer. Given the views expressed today, I would like to engage in further discussions with noble Lords with a view to returning to this issue on Report.
Amendments 71, 72, 76, 77, 78, 79, 116, 118, 140, 229, 253, 254, 257, 258, 264, 265, 276, 277, 290 and 291, which were tabled by noble Lords including the noble Lord, Lord Lisvane—to whom I spoke yesterday and I understand why he is not in his place today—the noble Lord, Lord Foulkes and the noble Viscount, Lord Hailsham, seek to exchange “appropriate” for “necessary”, about which we have had a great deal of debate, in the main powers and schedules in which it can be found. I understand noble Lords’ concerns but, as I have stated, this would have a serious impact on our vital programme of secondary legislation to prepare our statute book for exit day. “Necessary” is a high bar to meet. The courts have said that the nearest paraphrase for “necessary” is “really needed”, but such a test would be too constrictive.
Lord Newby (LD)
Can the noble Lord give an example of where something is not really needed? Surely the whole point of this legislation is only to do things that are really needed—not to do anything that you think, when you wake up in the morning, might be a jolly good idea.
Lord Callanan
If the noble Lord will have a little patience I will get on to that in a second.
If regulations could only make “necessary” provisions, the powers would be heavily restricted to a much smaller set of essential changes. For example, if the Government wanted to change references in legislation from euros to sterling, we would expect such a change to be considered “appropriate” both by the courts and, I hope, by this House, but it might not be considered “necessary”.
We might manage to ensure that our statute book is in a legally operable state, but it would not be in its most coherent form, or arranged in a way that best promotes our national interest. I am sure that this Committee does not intend to restrict the Government from legislating coherently or in the national interest, but that may be the unintended consequence of amendments which swap “appropriate” for “necessary”.
I note that some of the amendments in this group contain wording suggested by the DPRRC in its report on the powers in this Bill. In particular, I was interested in the assertion that:
“The operative test in Clause 7 should be whether it is necessary to deal with the problem, not whether only one solution follows inexorably”.
I first highlight that I do not believe that these amendments break up the necessity process in the way that the committee intends. I also question the merits of breaking up the necessity test in the way that the committee suggests. In its report, the committee cites the example of a deficiency in which there is:
“A requirement to collect and send information that will no longer be accepted by the EU”.
The committee states that it,
“is clearly a deficiency that it is necessary to remove from the statute book: it cannot be right to retain a redundant legal duty that amounts to a waste of time, effort and public money”.
However, I question whether this change is strictly necessary, or whether it is merely appropriate. The committee asserts that it cannot be “right” for this arrangement to continue—and I agree with it—but is it strictly “necessary” that it be removed? What great harm, after all, would be done if the information were still sent? The statute book would continue to function, albeit illogically and not in the public interest. But is it necessary, in a strict legalistic sense, to have the statute book working logically and in the public interest, or are all our changes merely appropriate? In these sorts of instance we cannot with any certainty predict the way in which a court might rule. It is precisely to guard against such a decision that the Government cannot support the suggestion made by the committee.
Viscount Hailsham
Is the Minister saying that he will not accept these amendments because he might be defeated in court? If so, that is a thoroughly bad reason.
Lord Callanan
I think I have made my position clear on that but, nevertheless, I also said that we are listening and endeavouring to satisfy the concerns of noble Lords.
Amendments 73, 119 and 141 tabled by the noble Viscount, Lord Hailsham, and also spoken to by my noble friend Lord Lang, meanwhile used “essential” rather than “appropriate” to limit the discretion of Ministers in exercising the delegated powers. This really is very similar to the amendments which propose the use of “necessary”. I think that a court would likely interpret the meaning of “necessary” and “essential”—in this context—in much the same way and, therefore, I will not repeat the arguments that I have already made.
Lord Cormack
I beg my noble friend to talk to his ministerial colleagues and think again, otherwise the Government will suffer the most massive, crushing defeat when this comes up on Report.
Lord Callanan
I said at the start that I am setting out a position, but I have heard the messages that came to me from all sides of the Committee and I very much take on board the point that my noble friend makes. I shall state again that, despite their breadth, these are not powers designed to deliver major policy changes and they can only be read in light of their purpose. For Clause 7(1), that is to “prevent, remedy or mitigate” deficiencies arising from withdrawal.
Amendment 244A, tabled by the noble Baroness, Lady Taylor, the noble Lords, Lord Beith and Lord Dunlop, and the noble and learned Lord, Lord Judge, touches on a point to which I will return to in more detail later, but I will stress now the risks of introducing additional legal uncertainty by creating new and untested definitions to the law. However, I am conscious of the need for transparency in this process and we will look to see how, in line with developments and other legislation, we can ensure that ministerial decision-making about the appropriate exercise of the powers is more transparent to the Committee.
Amendment 75, tabled by my noble friend Lord Hailsham, allows me the opportunity to expand upon the reasons why we are taking the correcting power and to build upon the arguments made in previous days of debate. Areas of our domestic law, such as those relating to EU obligations, will be redundant when we leave the EU. The Bills repealed by Schedule 9 are an example of this. Some noble Lords will consider that having provisions that do nothing on the statute book is not harmful. Indeed, the Easter Act 1928, which was never commenced, continues to sit on the statute book with no effect and causes no harm. My noble friend Lord Hailsham and the noble Lord, Lord Campbell, also argued that there is no legal recourse under the use of powers under Clause 7. That is not strictly correct. If the threshold set out in the Act is overstepped the regulations can be struck down by judicial review.
Lord Campbell of Pittenweem
The noble Lord was helpful in trying to give an example for something else. Could he give an example of where something that was “appropriate” could not be covered by the principle of necessity?
Lord Callanan
I do not have any additional examples beyond the ones I have already given, but I will certainly write to the noble Lord with alternative information on that.
However, the Government and I believe that a majority of noble Lords in this House will agree that the statute book is not truly effective unless it is tidy. The Bill is designed to provide clarity and certainty on the law; if we cannot remove or correct these redundant provisions this goal will be undermined. However, having said all that, as I have set out, I would be very happy to engage in further discussions with noble Lords. I have very much heard the messages given from all sides of the Committee with a view to returning to this issue on Report. On the basis of those assurances, I hope that noble Lords will feel able not to press their amendments.
Lord Wilson of Dinton
My Lords, I thank the 13 noble Lords who spoke on the amendment, all of whom were unanimous in their support of the need to change Clause 7(1). There was a lot of support for the substitution of “necessary” for “appropriate”. I am not going to go through what was said because, first, I agreed with everything; and secondly, it was said so eloquently that it would be otiose for me to add to it at this hour of night.
The Minister has clearly heard the voices of so many noble Lords in favour of some change to Clause 7(1). I say respectfully that he seemed to be speaking with two voices. One was a clear, fierce defence of “appropriate”. I have to confess that I found some of it surprising. I would have thought, faced with EU retained law expressed in the euro, that that would be a deficiency that one needed to correct and that it would be necessary to correct it. However, I will study what the Minister said with interest. On the one hand he spoke with a fierce voice defending the present drafting. On the other, he referred three or four times to the need to discuss before Report. At one point, he said that he was sure that a mutually agreeable position would be found. We need to study exactly what he said. Against that background, I beg leave to withdraw my amendment.
Baroness Bowles of Berkhamsted (LD)
My Lords, when we discussed Clause 2 and the Constitution Committee’s amendments, I said I did not wish to exclude the three paragraphs that the Constitution Committee wanted to exclude; I wish to exclude them instead from amendment under this paragraph. With the discussion we just had about what is necessary rather than just appropriate, to put as much as possible beyond the temptation of amendment by the Government seems to be a good idea. That was the approach I outlined previously. As far as this clause is concerned, it is in line with the Constitution Committee and with the Bingham Centre report, and in view of the state of my voice, I think it is best if I just say that I beg to move.
Lord Callanan
My Lords, I am tempted to send some cough sweets to the noble Baroness to help her: she certainly has my sympathy, and I suspect the Prime Minister’s sympathy, for the difficult position she is in. I am grateful to her for the amendment and this debate.
The noble Baroness has proposed to limit the Clause 7(1) power so that it is only possible to correct deficiencies in domestic legislation in two circumstances. The first is where the deficiency is of any type provided for in this Bill and that the legislation was a statutory instrument made under Section 2(2) of, or paragraph 1A of Schedule 2 to, the European Communities Act. The second, for all other EU derived domestic legislation, is that inappropriate EU references are the only type of deficiency which may be corrected.
I understand the noble Baroness’s well-intentioned desire to, where possible, protect from amendment legislation which has already been considered in detail by this House. However, while Section 2(2) of the ECA has been a crucial tool in the Government’s implementation of our EU obligations, it is far from the only way the Government have implemented EU obligations in the 45 years of our EU membership. Indeed, many noble Lords have been vociferous in encouraging Governments past and present to do more under primary legislation and specific powers and less under Section 2(2). Furthermore, whether a deficiency is in primary or secondary legislation is not, I believe, a meaningful indication of the type of deficiencies which might arise in it, or the significance of the correction that needs to be made.
To be ready for exit day a large number of fairly straight-forward changes will need to be made to primary legislation in exactly the same way as in secondary legislation made under the ECA. For example, Section 42(5) of the Employment Relations Act 2004, concerning information and consultation, will require amendment as outlined in the draft regulations the Government have already published. This power relates to the implementation of a directive. This directive has already been implemented in our domestic law and the relevant implementing legislation will be converted to retained EU law by the Bill. Once the UK has withdrawn from the EU, this power will have no practical application. I hope noble Lords will accept that we need to be able to make appropriate corrections to such deficiencies. The power therefore needs to be broad enough to allow for corrections to be made to both primary and secondary legislation for the full range of deficiencies. Textual and technical changes must be made in primary legislation if we are to have a functioning statute book on exit day.
The Government’s contention is that what matters is not the status of the law that is being amended but the purpose of the amendment. Indeed, some provisions of secondary legislation made under Section 2(2) are extremely important, which is why the Government have provided for the sifting committee and affirmative procedure to ensure that all regulations are subject to the appropriate level of scrutiny. For example, much of the vital statutory protections of the rights of workers in this country lies in regulations made under Section 2(2) of the ECA. We have already published details of some of the corrections that will be required here, and I hope they have laid concerns to rest. They are also representative of the type of corrections that will arise throughout the statute book and will need to be corrected to ensure that important areas of law continue to function.
I hope I have persuaded the noble Baroness of the Government’s position that it is the substance of the change, not where it is being made, that matters, and that she therefore feels able—if she can do so—to withdraw her amendment.
Baroness Bowles of Berkhamsted
My Lords, I beg leave to withdraw the amendment.
Baroness Hayter of Kentish Town
In the absence of my noble friend Lord Bassam, I just want to encourage the Minister—though I am sure it is already in his notes—to comment on Amendment 244, which appears in this group. It requires that:
“The statement under sub-paragraph (2) must include a certification that the regulation does no more than make technical changes to retained EU law in order for it to work following exit, and that no policy decisions are being made”.
I appreciate that the Minister and other Ministers have said all the way along that this is not about making policy, so it should be an easy certification on this occasion for a Minister to sign. I hope that that might be accepted.
Lord Callanan
My Lords, Amendment 81 in the name of the noble Baroness, Lady McIntosh of Pickering, concerns the core concept of this Bill, namely that it preserves and makes functional the law at the moment of the UK’s exit from the EU. As the long and learned debates in this House and the other place demonstrate, this is of course something much simpler said than done. We can all agree that the law in the UK should not be considered deficient simply because the EU adopts a new law once the UK has left. The Bill reflects that with the provision in Clause 7(4) and, therefore, this would not constitute a valid trigger for the use of the power in Clause 7(1).
It is also the case that the law is not deficient simply because EU law, as is often the case in some areas, contains provisions that are adopted before our withdrawal but only come into force or apply after exit day. This reflects the approach taken in Clause 3, which provides for the conversion of direct EU legislation that is operative in the UK immediately before exit day. As the Government set out when we debated Clause 3, we believe that it is right that we incorporate only that law which is operative at the time of our exit. It is surely not taking back control to this Parliament and the devolved legislatures if we simultaneously preserve the automaticity of new provisions of what was EU law becoming operative in our law, months or perhaps years later. It would be unacceptable for EU law provisions to flow automatically into the UK many years after we have left and would undermine the clarity and certainty this Bill is designed to provide. That is why Clause 3 preserves only the law as individuals and businesses were bound by it immediately before exit day, and why that decision is reflected in Clause 7(4), which makes it clear that the law is not deficient simply because it does not contain planned future changes to EU law. In preserving EU law, the Government have drawn a line in the legal sand on exit day. Wherever the line was drawn, the outcomes would, of course, please some and not others. I note that the controversial ports regulation, although already in force, will enter into application only days before exit day. Clause 7(4) merely reflects this line in the legal sand.
Baroness Hayter of Kentish Town
Although Amendment 244, in the name of my noble friend Lord Bassam, asks for,
“a certification that the regulation does no more than make technical changes … and that no policy decisions are being made”,
I take the point that policy choices may be being made. Although it is not in this group, Amendment 244A says that there would be a certificate saying that either the change was just technical or a policy choice has been made. That amendment may not be in this group, but I am interested whether the Minister is closing his mind to the idea that there should be a certificate from the relevant Minister. That is what this amendment aims to do.
Lord Callanan
No. As I have made clear throughout the Bill, our minds are not closed on many of these matters. I think I gave the noble Baroness an example. It is a difficult distinction to draw about what is making policy or what is a policy choice. As I said, the choice between two regulators can be said to be a policy choice, but it is certainly not our intention to use any of the power in the Bill to massively expand on different levels of policy. It is our intention to impose a snapshot on exit day and ensure that the law is compliant and tidy, as we have said.
Baroness McIntosh of Pickering
My Lords, I am most grateful to the Minister and to all who have contributed to this little group. While I am grateful to my noble friend for his reply, I am not sure that he addressed the question of timings, and I am slightly concerned about the scope for judicial reviews. I end with the comment that the wording I seek to delete refers to the earlier Amendment 18, on which we had a lengthier debate, and to which I will return on Report. However, I beg leave to withdraw the amendment.
Baroness Hayter of Kentish Town
My Lords, I think the good news is that we heard a hint earlier that this might be one of the areas where we are going to hear a bit of movement tonight. If the Chief Whip will allow us to go home after this group, we will be sent home in a very happy mood.
My name is also on these two amendments and I will not make the case again, because the noble Lord, Lord Newby, made the clearest of cases against the use of secondary powers to create new quangos, with others adding similar reasons for why this is not just a power too far but is in breach of government guidelines.
I will add only two points. First—this is a slight gripe, I am afraid—in answer to my Written Question as to whether there were other examples of NGOs established by secondary legislation, the noble Lord, Lord Young of Cookham, said that it was not possible to answer other than “at disproportionate cost”. But the Government must have known why I was asking this Question—they have a brain—and I would have thought that if there were some public bodies set up by secondary legislation they could have found a few examples. This was some time ago. Unfortunately it is an undated letter—like many I get from the Government —but it is HL1651, so I think it was probably last year that I asked it.
My second point—and in a sense it is really the point touched on by the noble Lord, Lord Beith—arises from my experience both as a consumer representative and as a former member of various regulatory bodies set up always by statute. It is simply to say that the very way we establish those bodies—whether it is the Charity Commission, the Competition Commission, the Legal Services Board or the National Consumer Council of which my noble friend Lord Whitty was such an eminent chair until the Public Bodies Act abolished it—affects how they do their job. The founding statute will spell out their task and set out the “have regards to” that influence how they set about their work. It will also define who sits on their boards, how they are appointed, to whom they report and whether, for example, they have a duty to heed consumers in the relevant industry, the regulated industry itself, the employees, the wider social considerations such as the environment or things like that—and indeed their degree of independence from the Government. It is a crucial part of the function of many public bodies.
Such limitations on the powers of those public bodies, and the requirements for how they operate, are written in primary legislation. They can be discussed carefully, they can be amended—as we did before with others, as the noble Lord, Lord Beith, said—they can be debated in this Chamber or in the other place, and they could have pre-legislative scrutiny. For example, setting up a new public ombudsman—as the Member in the other place Mr Jenkins has been recommending—could come by a Bill and could be amended after consultation with the relevant interested parties. That is the way that we should set up public bodies. Instead, this Bill says to a Minister, “Well, you decide. You decide how to set it up; you decide how its board will be established; you decide who to appoint it—probably you could decide to appoint your friends to it”—and Parliament will nod it through. That is not good enough and this power must be dispensed with.
Lord Callanan
My Lords, I welcome the opportunity to respond to the debate, if only to confound all the prejudices of the noble Lord, Lord Adonis, that I am some inflexible hardliner who never gives him anything he might want and that only my noble friend Lady Goldie can—I was going to say “satisfy him”, but perhaps I should not use that word. He could not put a cigarette paper between us, by the way. She might do so with more charm than me, but we are saying essentially the same thing.
I understand that a number of noble Lords are concerned about the scope of this power and I reassure your Lordships that the Government are listening to those concerns. When Clause 7 was drafted, we thought it would be only sensible for the sake of contingency to include in its scope the ability to establish new public authorities to ensure, as many amendments in the other place sought to ensure, against losing any important functions as they are transferred over from the EU, as no such public authority may currently exist in the UK. Certainty and continuity are, after all, the watchwords of the Bill.
We have been clear that our preference will always be, where possible, to transfer any functions returning from the EU to existing bodies in the UK, but it has proven necessary to legislate in parallel with negotiations because of the strict Article 50 timeline. Therefore, we do not know at this stage exactly which functions are returning. We must make this legislation without prejudice to those negotiations, where, as the Prime Minister said in her Mansion House speech last week, we are looking to continue a productive relationship with various EU bodies as part of our deep and special partnership.
The noble Lord, Lord Whitty, asked about our strategy towards the agencies. Where there is a demonstrable national interest in pursuing a continued relationship with any EU body or agency, the Government will consider carefully whether we should do so. However, as he knows, it is ultimately a matter for negotiations. We remain committed to keep Parliament as fully informed as possible without prejudice to our negotiating position.
However, we already know of one function that we expect to return to the UK and which it is agreed does not sit happily with any existing public body: our environmental protections. This prompted the Secretary of State for Environment, Food and Rural Affairs to announce our intention to consult on a new, independent and statutory body to advise and challenge the Government and potentially other public bodies on the environment—we discussed this extensively earlier—stepping in when needed to hold these bodies to account and enforce standards. As such, we need to retain the power until we can be confident of delivering all necessary legislative changes without it.
It is for this reason that I am sorry to say that we will not be accepting Amendments 83 and 94 in the name of the noble Lord, Lord Newby, which seek to remove this ability from the scope of the power. The Government have a responsibility to safeguard against the potential disruption and confusion caused to businesses and individuals as we exit the EU, and we believe that the ability to create new public authorities plays a big part in ensuring this. However, the Government also recognise their responsibility to Parliament in listening to Members’ concerns regarding the legislation it seeks to pass. Therefore, I can assure noble Lords that the Government are working hard on finding a resolution to this matter that will satisfy the concerns of noble Lords—maybe even the noble Lord, Lord Adonis—and we will revisit it on Report. In the meantime, with those assurances, I hope the noble Lord will be able to withdraw the amendment.
European Union (Withdrawal) Bill
Lord Callanan ExcerptsWednesday 28th February 2018
(6 years, 9 months ago)
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The Minister of State, Department for Exiting the European Union (Lord Callanan) (Con)
It is our money.
Lord Foulkes of Cumnock
That is the constant refrain from the leavers. We heard it all through the referendum campaign: “It’s our money”. It is money from all the European countries that comes in according to their ability to pay and goes out to different parts of the European Union according to their needs, and rural areas, transition areas and less developed areas are those which get it. But that is not the argument here; we have had that argument. It has been made and we can have it in another place.
Wherever it comes from, that money is within the European Union budget at the moment and is then allocated to these projects in different parts of the United Kingdom. We are asking for an assurance—we need a guarantee—that, if we leave the European Union, this money will go to the same projects and be funded by the United Kingdom Government. I hope that the Minister will be able to give us that guarantee; such projects will otherwise have an uncertain future. People’s livelihoods depend on them; people who have put their lives into developing them are now faced with uncertainty. The only way in which they can be given some certainty is if the Government accept my amendment or something like it, and make sure that the money that they currently get from those European Union funds will come in future from Her Majesty’s Government.
European Free Trade Association
Lord Callanan Excerpts(6 years, 9 months ago)
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Lord Lea of Crondall
To ask Her Majesty’s Government whether remaining in the European Single Market, post-Brexit, would require the United Kingdom to retain membership of the European Economic Area and associated European Union agencies through re-joining the European Free Trade Association.
The Minister of State, Department for Exiting the European Union (Lord Callanan) (Con)
My Lords, the Government’s position is clear: the United Kingdom is leaving the EU and will no longer be a member of the single market. As such, we have no plans to join EFTA in order to continue to participate in the EEA agreement beyond the implementation period. Instead, we are seeking a bold and ambitious economic partnership that is of greater scope and ambition than any existing agreement.
Lord Lea of Crondall (Lab)
I thank the Minister for that helpful Answer. The customs union and the European single market are, from a practical and industrial perspective in the advanced economies, intertwined—technical standards being a good example. Is not the way to make the best of a bad job to move from where we are now, in Pillar 1 of the European Economic Area—namely, the EU—to Pillar 2, namely EFTA? We would not be at the EU table, it is true, but to make that complaint on the way out is palpably risible. Is not one indisputable advantage that EFTA is a vehicle which actually works, as opposed to one which has not yet been designed, let alone road tested? It has been a nice runner, without any engine or transmission failure since 1959, and we would get it for half price or, to use a different metaphor, for half the annual subscription and country membership.
Lord Callanan
I was not totally clear what the noble Lord was asking me there, but of course not all of the EFTA countries are in the EEA: Switzerland is not. We will clearly want to continue our relationship with the EFTA countries afterwards, as they are close friends and neighbours. After the end of the implementation period, we will of course want to continue our association with them.
Lord Forsyth of Drumlean (Con)
My Lords, could my noble friend confirm that Donald Tusk’s words—
“Nothing is agreed until everything is agreed”—
also apply as far as we are concerned, in particular to the contribution of money to the EU?
Lord Callanan
My noble friend is of course correct. It is a basic factor of all EU negotiations that nothing is agreed until everything is agreed. Having said that, we are a law-abiding country, and when we make agreements, we do not rat on them.
Baroness Hayter of Kentish Town (Lab)
My Lords, I am sorry I ran into the Chamber, but it was because I had been to inspect the border between Camden and Westminster. When I told my noble friend Lady Blood that this morning, she was delighted—she cannot wait for the Tube to be put there, from northern to southern Ireland. Is this level of understanding in the Minister’s department about how a border between north and south would work actually the level of discussion going on there?
Lord Callanan
I am not aware that anybody in my department has said anything of the sort. The point the noble Baroness is referring to is that of course we want no border in Ireland between the north and the south. We are committed to the Good Friday agreement. It has been the basis of lasting peace and prosperity in Ireland, and it is important that we come up with suitable arrangements in future negotiations with the EU to ensure that there is no border.
Baroness Ludford (LD)
My Lords, can the Minister give a precise definition of “ambitious managed divergence” and the other new buzz-phrase, “European traded goods area”? Can he also explain the three baskets, which sectors are in which baskets and whether suppliers to a sector, such as the textile-makers of a car seat, are permanently or temporarily in a basket? Does he agree that so-called EU red tape ain’t got nothing on the bureaucracy involved in the Government’s plans?
Lord Callanan
I am tempted to make a comment about a basket case but that is probably not a good idea. The noble Baroness is referring to the point that when we leave the EU, we will start off with identical rules and regulations, as she well knows. The issue then is how we diverge in the future and how that divergence should be managed, should the EU want to adopt different regulations or should we want to do so. If we do and it does not affect the functioning of the ambitious free trade we want between us and the EU, why should we not be able to? Clearly, there needs to be a mechanism to manage that.
Lord Garel-Jones (Con)
My Lords, now that the leader of the Labour Party does not seem to believe any longer that the European Union is a capitalist conspiracy against working people, does my noble friend the Minister agree that his support for the single market can serve only to undermine the standing of this rather successful organisation?
Lord Callanan
I am slightly confused about what the Labour Party’s position is this week. Last week, they were against the customs union; this week, they seem in favour of it. Perhaps next week they will be in favour of a single market, then against it again the following week. I can say only that I agree with Barry Gardiner, their international trade spokesman, who said in another place that,
“in voting to leave the EU the British people voted to leave both the single market and the customs union”.—[Official Report, Commons, 5/9/16; col. 47-48WH.]
He then went on to write an article in the Guardian—a well-known journal of record—saying that retaining membership of a customs union would be “deeply unattractive” because it would stop us negotiating our own trade deals. He is supposed to be their trade spokesman.
Lord Dykes (CB)
My Lords, bearing in mind that more and more people now think that staying in the customs union is a very good idea—led by that subversive body, the CBI—what on earth will the Government say on Friday to reassure an increasingly desperate public?
Lord Callanan
I am sure that we all await with interest what the Prime Minister has to say in her speech on Friday, but the point about joining a customs union is a serious one. We are the fifth-largest economy in the world and the normal state of affairs in the rest of world is that large countries negotiate their own trading arrangements. It baffles me why people want to contract that out to the European Commission. We collect tariffs that we would then send to the European Commission; we would be totally in its control. Surely, if anything, the EU referendum means that we need to take back control in this country and do not want to contract out our trade policy to another organisation.
Lord Monks (Lab)
My Lords, can I ask about the three baskets? It seems that there is detached, semi-detached and alignment. Which of those baskets will take employment rights and workers’ rights? Can we please be told?
Lord Callanan
I think the noble Lord will have to wait to see what the Prime Minister has to say about the issue on Friday. I am building up the sense of anticipation.
Lord Newby (LD)
My Lords, the Irish Government believe to have a frictionless border, we have to be members of both the single market and the customs union. On what basis do the British Government disagree with the Irish Government on that matter?
Lord Callanan
We think the Irish Government are wrong on this matter. There is already a fiscal border in Northern Ireland but we have been very clear that we are not going to impose a hard border. We set out in a paper last year how we think this could be achieved by various electronic and technological means. However, we accept that this has to be the subject of further discussion, and we look forward to having those discussions. The Taoiseach of Ireland has accepted that that has to be part of the end-state agreement.
European Union (Withdrawal) Bill
Lord Callanan ExcerptsMonday 26th February 2018
(6 years, 9 months ago)
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The Minister of State, Department for Exiting the European Union (Lord Callanan) (Con)
Let me first thank noble Lords very much indeed for bringing this important topic before the House today. I reassure them that the Department of Health and Social Care is actively supporting my department in its negotiations with the EU, including forming part of the negotiation team where the topic is of direct relevance to healthcare. It is also working closely with its arm’s-length bodies, the territorial offices and others across government in preparing for EU exit under all eventualities.
I will address this group of amendments now but I note that the noble Lord, Lord Warner, who I think is not in his place at the moment, has also tabled an amendment on health to Clause 6. This will be responded to formally when we reach that group and I note his specific interest in the subject.
Amendment 11, in the name of the noble Baroness, Lady Thornton, would delay the repeal of the European Communities Act 1972 until such time as the Secretary of State has set out a strategy for ensuring the mutual recognition of medicines and devices between the EU and UK. The Government have already set out a very clear offer to the EU for the UK to continue to work in partnership in the area of medicines. It is in the interests of patients and the life sciences industry for us to find a way to continue UK-EU co-operation on medical regulation, even if our precise relationship with the EU will by necessity change. Discussions are ongoing and the outcome will form part of our future relationship with the EU. We cannot and should not delay commencement of this Act until those discussions have concluded. The UK’s medicines and medical devices regulator, the MHRA, is a strong leader that will continue to ensure that medicines and medical devices are safe and effective, regardless of the outcome of negotiations and any agreement on recognition in this area. Indeed, it is currently recognised globally as an authority in its licensing and inspections.
In response to the questions from the noble Baroness, Lady Finlay, and the noble Lords, Lord Cormack and Lord Davies, I can be extremely clear that the UK’s preferred outcome is to find a way to continue to co-operate on medicines regulation with the EMA. We have made that extremely clear to the EU. Even though our relationship with the EMA will have to change as we leave the EU, it is in our mutual interests to continue to co-operate and share scientific expertise. We believe that desire is shared by the EU.
Baroness Thornton
Can I ask for some clarification from the Minister about his statement about the preferred outcome? What exactly does that mean? If we do not achieve what we want to in that preferred outcome, what exactly happens and what do we do next? What is the timescale for this? That is why the amendment is framed in the way it is.
Lord Callanan
It is obviously difficult for me to speculate on what happens if we do not achieve the outcome that we want. As I said, we strongly believe that since we contribute an awful lot of work through the MHRA—something like 40% of the EMA’s work is contributed to by UK authorities—it is in our mutual interests to continue to co-operate. If that is not possible, we will set out an alternative course of action but we believe that it is and should be.
Baroness Jolly
We have a window of about two years in which to get this right. I was talking to the trade bodies for over-the-counter medicine last week and they were saying that a change to make all over-the-counter medicines UK-based would need about a five-year timescale. It is just not doable, so there is an absolute imperative to get these regulations sorted out in pretty short order.
Lord Callanan
The noble Baroness makes a powerful point. It is one of our priorities. We have a number of priorities in the negotiations but it is important that we get this one right. The MHRA already licenses nationally 90% of all medicines available in the UK but there is a small percentage regulated abroad, so we need to reach a mutual agreement on that.
Amendment 101, tabled by the noble Baroness, Lady Jolly, would prevent the Government making changes to the licensing or regulation regimes for over-the-counter medicines, to which she just referred. The Government will need to correct deficiencies arising from withdrawal in relation to the regulation regimes for over-the-counter medicines, self-care medical devices and food supplements where the UK’s exit from the EU would result in the retained EU law which governs the regimes being deficient or not operating effectively and where manufacturers of these products would have to adapt to divergent UK requirements, potentially leading to a temporary or permanent withdrawal of their product from our market.
The noble Baroness asked a number of specific questions. The Government have already made it clear that we wish to retain a close working relationship after exit. The Government have been engaging with industry and research charities through the ministerial and industry co-chaired life sciences group, and we will continue to work with that group and industry to ensure adequate notice and sufficient time to implement any changes necessary.
Whatever the outcome of negotiations, the principles which will underpin post-Brexit regulation for this sector will be that patients should not be disadvantaged, that innovators should be able to access the UK market as quickly and simply as possible, and that we will continue to play a leading role in Europe and the world in promoting public health. Over-the-counter products will continue to have an important role in relieving pressure on health professionals and promoting consumer choice to improve public health.
In the event that it is not possible to reach a deal that secures ongoing, close collaboration between the UK and Europe, we will set up a regulatory system in the UK that protects the best interests of patients and supports industry to grow and flourish. I hope that my comments will provide the noble Baronesses, Lady Thornton and Lady Jolly, with the reassurance they need not to press their amendments.
Amendments 9 and 205 were tabled by a number of noble Lords, including the noble Baroness, Lady Jolly, and the noble Earl, Lord Clancarty. The Government recognise how important reciprocal healthcare is to the 190,000 UK pensioners who currently benefit from it, to UK tourists who use the European Health Insurance Card scheme and to EU nationals visiting and living in the UK. This point was powerfully made by the noble Lord, Lord Davies. We want to protect reciprocal healthcare arrangements and have made important progress towards this in this first phase of negotiations. It is the intention of the UK and the EU that the final withdrawal agreement will protect reciprocal healthcare rights for UK citizens resident in the EU on exit day and vice versa on a reciprocal basis.
Lord Adonis (Lab)
The Minister said that important progress has been made. Will he tell the Committee what that progress is?
Lord Callanan
The important progress was announced in the agreement reached in December in the first phase of the negotiations. Reciprocal healthcare benefits were guaranteed for existing UK residents in the EU and for existing EU residents here. The next phase is what happens in the future.
Lord Davies of Stamford
The points I raised related not to the important matter of residents, whether continental residents living here or British residents living on the continent, but to travellers—people who may want to travel for a short period for tourism, family reasons or what have you. Has any progress been made on that front? If not, are the Government proposing to make any progress and, if so, what progress?
Lord Callanan
That will be for the next phase of the negotiations. We have guaranteed the right of existing residents from the EU in the UK and for UK residents in the EU. The next phase of the negotiations is for people who will travel there in future.
The Earl of Clancarty
Is the Minister saying that the Government intend to retain the EHIC reciprocal agreement or is he talking about something else?
Lord Callanan
We would like to retain an arrangement similar to the EHIC if possible. We cannot give any guarantee about what might happen in the next phase of the negotiations.
We welcome the progress made, but we are clear that we want a wider agreement on reciprocal healthcare. I am sure that noble Lords will appreciate that this is not something we can simply legislate for in the withdrawal Bill, but must be negotiated with the EU, which is what we have been doing. We are very clear that we want to protect reciprocal healthcare arrangements.
On 8 December, the UK and EU Commission reached an agreement which delivered on the Prime Minister’s number one priority: to safeguard the rights of people who have built their lives in the UK and EU.
Baroness Finlay of Llandaff
I asked the Minister for information about billing across borders to date, because that information must have been available to the Government before they started negotiating over the travel arrangements.
Lord Callanan
I will need to write to the noble Baroness with the exact amount of billing, as I do not have those figures in front of me at the moment.
I turn to Amendment 353, tabled by the noble Lord, Lord Stephen. The Government already keep NHS performance and health outcomes constantly under review, including through the NHS outcomes framework, which measures a number of health indicators intended to form an overarching picture of the current state of health and care services in England. We are committed to positive and productive engagement with the devolved Administrations going forward as we seek a deal that works for the entire United Kingdom.
The Secretary of State for Health and Social Care also publishes an annual assessment on the performance of NHS England, including how it has met its mandate from the Government, as well as an annual report on the overall performance of the health service.
Lord Wigley
As the Minister has confirmed that there is in fact ongoing, detailed monitoring of these matters, can he confirm that we are losing National Health Service staff returning to the European Union and are having greater difficulty in recruiting from Europe to fill the vacant spaces?
Lord Callanan
I am not sure that is the case. Obviously there are people returning to the EU all the time, and different people coming to the UK to take up job offers. We can get into detailed figures, but I do not think there is any large-scale exodus of health service staff.
For the reasons I have set out, this amendment is both unnecessary and risks creating unwelcome new burdens at a time when that is least appropriate. I hope I have been able to provide noble Lords with sufficient reassurance.
Lord Cormack
My noble friend is batting on a difficult wicket. We understand that. He has my total personal sympathy for the plight in which he finds himself, but what he has said this afternoon just ain’t good enough. It is important that he takes on board what has been said during this debate, particularly by the noble Baroness, Lady Finlay of Llandaff, and that when we come to this on Report, he has some substantial and detailed specific progress to report to your Lordships’ House.
Lord Callanan
I thank my noble friend for his comments. A lot of these matters are still to be negotiated in the next phase. We made substantial progress in the first phase, and we will endeavour to ensure that we make good progress to achieve a good working relationship with the EMA and to guarantee the rights of travellers through a system similar to the European health insurance card for those travelling in future. I hope to be able to provide more information on Report.
Baroness Finlay of Llandaff
Following on from the comments of the noble Lord, Lord Cormack, could the Minister provide us with data in writing on the numbers of EU staff who have applied for jobs in healthcare in the last 12 months and the numbers of EU staff who have left? We need to have the data rather than bald statements about what is happening based on anecdotes, because it may well be that the Minister is hearing a quite different set of anecdotes from the ones the rest of us are hearing.
Will the Minister also confirm, or not, my interpretation of his comments on the outcome if there is no agreement? Here I return in part to Amendment 11, but to others as well. If there is no agreement with these regulations, will the Government then simply adopt European regulations de facto? I cannot see any other way for our pharmaceutical and biotech industries to continue to function. We need them for our economy, quite apart from needing them to ensure that there is a supply of medical and biotech advances for our patients. It is particularly important because biotech is an emerging field in which to date, within Europe, the UK has been the leader. I should declare an interest here because my son is a senior lecturer in bioengineering and cardiology, so he is involved in some of this ground-breaking work.
It would be helpful for us to know that and whether, in the context of there being no deal, the Government are already establishing dialogue between different Ministers in the devolved Administrations. As the noble Lord, Lord Wigley, has pointed out, there are very real implications for Wales, particularly west Wales—I declare my interest as someone who lives and works there—because we know there are large gaps there. We have to know how the Government intend to behave in the event of there being no deal at all.
Lord Callanan
The noble Baroness has made some valuable points. On the question of data on EU staff applying to jobs in the UK, if that information is available then we will certainly share it with her.
She asked what happens if there is no agreement. As I said, the MHRA already issues national licences for some 90% of medicines on the UK market. If we are no longer co-operating with the EMA on the regulation of new novel medicines, the UK will ensure that our own procedures do not lead to any delay in patient access to new medicines and are no more burdensome to industry.
The noble Baroness’s point about working with the devolved Administrations is a good one and we will ensure that that happens.
Baroness Thornton
My Lords, I thank the noble Baroness, Lady Finlay, who as always is much more qualified than me and indeed most of the House, for her support. I respectfully suggest that the Minister needs to actually talk to some of these bodies about how complicated, difficult and costly it will be if we do not reach an agreement. That needs to be taken into account.
I thank noble Lords for their support across the House for this suite of amendments. The amendment from the noble Baroness, Lady Jolly, is important and—like my own, I hope—very practical. This is about what medicines people buy over the counter, what health supplements they have access to and whether those will change post Brexit.
The noble Earl, Lord Clancarty, tabled Amendment 205, and I thank him for his support for my amendment. He and I want the same thing: we want this scheme, which protects people’s right to healthcare, to continue, and as the noble Lord, Lord Cormack, said, its current form would be the easiest form for it to do so. It is often the case that the noble Lord, Lord Cormack, makes the observation that you wish you had—in this case, about disease knowing no boundaries. He is absolutely right.
My noble friend Lady Blackstone made an eloquent point about cutting-edge research and the importance that that has for children and the rare diseases that they experience.
I do not deny that the amendment from the noble Lord, Lord Stephen, is important. It will be very important that we know what the impact of Brexit has been, not just a year later but ongoing. However, the argument that we are having on the earlier part of this suite of amendments is about what happens in the negotiations and what happens if they fail. It is about the action that we take now.
The noble Lord, Lord Wigley, is quite correct about the uncertainty that has been created for NHS staff in terms of their retention and recruitment. In fact I asked a Question of the Health Minister about precisely that not so long ago. Those figures have been collected by organisations such as the Royal Colleges so we know that the number of nurses coming from Europe in the last year has fallen by, from memory, around 80%. That is a huge drop in the number of nurses prepared to come and work in this country from Europe.
I say to the Minister that we understand—I agree with the noble Lord, Lord Cormack—that this is a difficult time and the Government are in the middle of negotiations. However, it is a long time since the referendum and we are a short time away from falling off the edge of the Brexit cliff, and issues of licensing of medicines and access of citizens to healthcare can none of them brook a two or three-year negotiation after Brexit because of the suffering that would cause and the impact it would have. That is what the amendments concern.
I hope that, between now and the next stage of the Bill, we will make some progress on both those issues. If we do not, we shall return to them. I beg leave to withdraw the amendment.
Lord Adonis
My Lords, I agree with every word that the noble Lord, Lord Kerr, has just uttered. The noble Lord, Lord Patten, said that we were not expecting miracles from the Minister. I think even the Minister’s most ardent admirers do not credit him with miraculous powers, and he is not going to able to produce any rabbits out of a hat for us this evening. But it is not miracles we need here: all we need is a continuation of the status quo. This is one of those areas we come back to time and again—we had it in the long debate on Euratom last week: all we need to do is to avoid massive, self-inflicted damage.
There is no need to create whole new programmes and ways of working. We have Horizon 2020 and Erasmus; the latter has been going on for the best part of 30 years and is a highly successful programme. When you are doing something well, the usual trick is just to keep on doing it. There are so many things that do not work that the idea that Parliament and Government should be spending their time dismantling things that do is clearly crazy. What we want to hear from the Minister is simply that he is open-minded to continuing with the present arrangements. The sooner the Government are prepared to say that, the better.
The most telling contribution to this debate came from the noble Baroness, Lady Brown of Cambridge. In the higher education world, there is—I shall choose my words slightly diplomatically—a pronounced air of self-congratulation on how excellent everything is in this country and how brilliantly we do it, and if only the rest of world copied us then they would be a great deal better off. In many areas that is true, but in one we have a very poor international record: the propensity of our students to study abroad. According to the Erasmus figures, twice as many European students come to Britain as Brits go abroad. The noble Baroness was right to say there is a big problem with students from poorer backgrounds studying abroad. When I was preparing figures for this debate, I found that it looks as if Singapore, a country less than one-tenth the size of the UK, has about as many students studying abroad as we have in our entirety.
The fact is that we do not have nearly enough of our students studying abroad. When I visited Singapore as Minister for Schools, they were aiming—by about now, so maybe they have achieved it—at requiring all students at the National University of Singapore, regardless of their course, to spend at least six months, one semester, studying abroad. Can your Lordships imagine if we had anything like that commitment here? It might be a good thing if in due course we did. The great irony is that one of the great slogans to emerge from this Brexit policy as it has developed is “Global Britain”—but how can there ever be a global Britain unless far more of our students go and see the rest of the globe and spend time studying there? The first requirement for that is that we should not make the situation worse than it currently is.
The noble Lord, Lord Kerr, was right that what we seek from the Minister is not a miracle; we are clearly not going to get that from the present Minister. We simply expect a commitment to continue with the current programmes, and it is absolutely within the scope of the Government to say unilaterally that the negotiating position of Her Majesty’s Government now, in 2018, is that these programmes will continue with full British participation after 2020. If the Minister does not say that, he is staring at near-certain defeat on this issue on Report.
Lord Callanan
My Lords, I thank noble Lords for another excellent debate. I thank the noble Lord, Lord Hunt, and the noble Baroness, Lady Garden, for their Amendments 10 and 163, which respectively seek clarification on the Government’s future membership of the Erasmus and Horizon 2020 programmes. I am particularly grateful to my noble friends Lord Deben and Lord Patten for their helpful attempts to rewrite my notes for me before I started.
At the December European Council last year, the Prime Minister confirmed that UK students will continue to be able to participate in the Erasmus student exchange programme for at least another three years, until the end of the current budget period. She welcomed the opportunity to provide clarity to young people and the education sector, and she reaffirmed our commitment to the deep and special relationship that we want to build with the EU.
In response to my noble friend Lord Cormack, I say that the Government have made it clear many times that we value the Erasmus+ programme and international exchanges more generally. Cultural exchange helps to build important business, political and diplomatic bridges around the world, not to mention lifelong friendships.
Lord Cormack
I am grateful for that, but if that is the case then why do we not carry on beyond the three years?
Lord Callanan
If my noble friend will have some patience, I will come to that in a second. Supporting young people to study, work, volunteer, teach and train abroad, and supporting their schools, youth and sports organisations to build transnational partnerships, helps us to create a new generation of globally mobile, culturally agile people who can succeed in an increasingly global marketplace.
In response to the noble Baroness, Lady Royall, I say that the UK has a strong offer to EU and international students, with four universities in the world’s top 10 and 16 in the top 100. In fact, as the noble Lord, Lord Adonis, pointed out, we received many more students under Erasmus than we sent. Erasmus is an important programme, but it represents only about half the student exchange programmes we have in the UK.
Our young people get first-hand experience of different cultures, helping them to broaden their horizons and their ambitions. Students who have spent time abroad as a part of their degree are much more likely to achieve better degree outcomes, improved starting salaries and stronger employment prospects, as noble Lords have pointed out. This is especially the case for students from disadvantaged or less represented backgrounds.
In response to the noble Earl, Lord Dundee, no decisions have yet been made about post-2020 programme participation as the scope of that programme has not been agreed. We look forward to the Commission’s proposal, which we expect to be published in May. Participation in the successor to the Erasmus+ programme, which we think is valuable, will form part of the negotiations.
The UK fully participated in the mid-term evaluation of the current programme and we reached broadly the same conclusions as the Commission: the programme works well but there is room for improvement and simplification, especially for smaller applicants. UK respondents to the mid-term evaluation made many detailed comments and criticisms, but few suggested that radical change was needed. The proposal for the next programme will be published in May, as I said, and we are currently shaping the debate and looking forward to further discussions with the Commission about that.
We see future co-operation in education programmes as an area of mutual benefit to both the EU and the UK, provided that we can agree a fair ongoing contribution.
Baroness Royall of Blaisdon
My Lords, what reassurance can the Minister give to students who are beginning their courses in September this year or September next year? Will they be able to participate in Erasmus or does that depend on whatever decisions the Government take after May? Is that not too late for certainty?
Lord Callanan
They will be able to participate in the existing Erasmus scheme up till 2020, should they wish to do so, and, as I said, we will see what the next programme will be. We await the proposals from the Commission in May, and we will discuss our participation in that with them.
As I said, we see future co-operation in education programmes as an area of mutual benefit to both the UK and the EU, provided that we can agree a fair ongoing contribution. We are giving this matter careful consideration as we negotiate the UK’s exit and are listening to the views of the sector.
As many noble Lords are aware, we have proposed a time-limited implementation period based on the current structure of rules and regulations. Looking to the future, we recognise the value of international exchange and collaboration in education and training as part of our vision for the UK as a global nation. That is why we said in our science and innovation policy paper, published in September, that we would discuss with the EU future arrangements to facilitate the mobility of researchers, academics and students engaged in cross-border collaboration. The UK and EU agreed in December that UK entities’ right to participate in current EU programmes for their duration will be unaffected by withdrawal. This includes the Horizon 2020 framework programme for research and innovation.
A number of noble Lords—the noble Lords, Lord Hunt and Lord Wallace, the noble Baroness, Lady Royall, the noble Earl, Lord Clancarty, and my noble friend Lord Deben—have asked me about the future of the Horizon programmes. Horizon will be succeeded by the ninth framework programme, as the noble Lord, Lord Kakkar, reminded us. This programme is also still being developed by the European Commission, and we are participating in discussions on that. The UK has declared that it would like to reach an ambitious science and innovation agreement with the EU that would include future framework programmes. It is too early to speculate on whether the UK will seek to associate to framework programme nine which, as I said, is still being developed.
The Government are deeply conscious of the importance of the Horizon 2020 and the future framework programmes to research in the UK, in which we have an international reputation. We are working hard to secure a research and innovation agreement with the EU that will take effect after Brexit.
Lord Wallace of Saltaire
The Minister says it is too early to decide whether we will co-operate. Can he tell us in what circumstances we will decide that it is not in the national interest for the UK to participate in the next Horizon programme?
Lord Callanan
I very much expect that it will be in our interest to participate in it. As I said, we are taking part in discussions. We have not yet seen the detail of how it will be financed, but, given a fair ongoing contribution, I suspect that we will want to participate. But they are a matter of negotiation. It is fine for us to say that, yes, we would like to take part; we need the EU side, the other side to the negotiation, to say that, yes, they would like us to take part as well. It is a negotiation. We can give a commitment that we would like to; we cannot give a commitment that we will be accepted.
As part of the new deep and special partnership with the EU, we will recognise our shared interest in maintaining and strengthening research collaboration. The UK will seek an ambitious agreement, one that promotes science and innovation across Europe now and in future. For the avoidance of any doubt, in response to the many questions that have been asked, let me say that we support Erasmus, we support Horizon 2020, but, contrary to what many noble Lords have suggested, these are EU programmes. The UK cannot adopt a unilateral stance; there has to be bilateral agreement on them. That agreement depends, first, on understanding the shape of the Erasmus programme in May and framework programme nine, when it is clarified by the Commission, and finding a mutually acceptable financial arrangement. Subject to those conditions, we would be very happy to be able to participate in both those programmes in future.
Lord Hannay of Chiswick
My Lords, I am not sure whether the Minister is drawing to an end, but he has not managed so far to say anything about the movement of researchers and students. Why can he not state categorically that we will not introduce any new impediments to students or researchers offered places in our universities? That would be entirely consistent with the introduction of a work permit scheme, because neither of those two categories come to our universities without a work offer. Why can he not say that now? Mobility is crucial in this area, but he has not said a word about it.
Lord Callanan
I totally agree with the noble Lord that mobility is crucial. I am fairly certain that we would not want to introduce restrictions on mobility in these areas—we want as many students to come as possible—but, as I am sure he is aware, this will be a matter for the Home Office to decide in the immigration policy that will be discussed shortly.
Lord Green of Deddington (CB)
Indeed so. I was hoping that the Minister would say that there is not now, and never has been, any limit on the number of genuine students who can come to the UK. I would have thought that that is bound to continue: this is a false issue.
Lord Callanan
Yes, we have been a proud recipient of and destination for thousands of international students in the past. They are welcome in this country, they contribute greatly to our education services and I am sure that we will want that to continue in future, but I cannot speculate on what a future immigration policy may look like.
Lord Deben
If this is a non-issue, why cannot my noble friend say very simply: “There will be no additional stops or impediments on students”? Does he not understand that constantly saying how wonderful everything is but that he cannot actually tell us anything is very difficult for anyone trying to plan their future and very unfair on young people?
Lord Callanan
As I said, I am fairly certain that we will want to continue to welcome as many students and researchers as want to visit this country in future, but, as I am sure the noble Lord will understand, I cannot speculate on what a future immigration policy might be before it has been announced by the Home Office and published by the Government.
Nevertheless, let me say for the avoidance of doubt that I have heard the message from all parts of the House and I will certainly reflect on these matters before we come back to the issue on Report. I understand that there are very strong feelings from all parts of the House about these issues and we will certainly see what we can do about that.
Lord Hunt of Kings Heath
My Lords, first, let me say that I welcome the Minister saying that he will reflect on this debate, because I think it is the first chink of light from him on any of these important debates in Committee. It has been a remarkable debate. We have heard from many noble Lords about the importance of the Erasmus programme. I agree with my noble friend Lord Adonis: the noble Baroness, Lady Brown, speaking from huge experience as a former vice-chancellor of Aston University of the impact that Erasmus has had on the students who go to Aston and the way it has widened their horizons, is for me one of the most important illustrations of why future participation by the UK in Erasmus is so important.
On research, again, my worry is that the Government are hugely complacent about the UK’s position. Consider the consequences of uncertainty over Horizon 2020, which is having an impact on universities at this very moment in terms of collaboration on future research bids. Even where European Union universities will still collaborate with UK universities—and it is by no means certain that they will continue to do so in every case—they are reluctant for UK universities to be in the lead. Added to the uncertainties about the movement of both academics and students, we are entering a hugely uncertain position for a very important sector.
I listened with care to what the Minister said. To be fair, he has said that the Government value both Erasmus and Horizon 2020 and he repeated the Prime Minister’s comments, particularly in relation to Horizon 2020. He then said that while he values these programmes, the EU is working out the next stage of both Erasmus and Horizon 2020, that the UK is part of some discussion about that but they will form part of the negotiations and that there is nothing more he can say.
I think there is something more that the Minister can say. I think it is without question that it is in our national interest that we continue wholeheartedly to take part in those programmes. Thinking about the negotiations and the UK Government’s tactics, this niggardly, churlish approach does not seem to be getting us very far. This Government would attract a hell of a lot of good will if in relation to just these two programmes they said, “Whatever, we are going to stick with it, and we will make good any deficiency in UK university research programmes if the price of sticking with it means that we will get less than we did in the past”.
The whole Committee—almost all Members—really wants these programmes to continue. We will obviously come back at Report. The Minister has kindly said he will reflect on it. I very much hope that he will do so. I beg leave to withdraw the amendment.
European Union (Withdrawal) Bill
Lord Callanan ExcerptsWednesday 21st February 2018
(6 years, 9 months ago)
Lords ChamberRead Full debate European Union (Withdrawal) Act 2018 View all European Union (Withdrawal) Act 2018 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 79-I(b) Amendments for Committee (PDF, 60KB) - (21 Feb 2018)
The Minister of State, Department for Exiting the European Union (Lord Callanan) (Con)
My Lords, it is a great honour to contribute to the first day in Committee on this historic Bill. Let me say at the outset that I look forward to working constructively with colleagues from across the Chamber throughout the course of Committee to scrutinise and improve this vital Bill in the national interest.
Clause 1 is the shortest of all in the Bill—you would not believe it from the debate—but it could scarcely be more important. This debate has shown the House at its passionate best, but it was not really about Clause 1 at all. I think all noble Lords recognise that, when we leave the EU, we need to repeal the European Communities Act. So we have had a fascinating debate on the UK’s potential ongoing membership of or future relationship with the single market, the customs union, the EEA and EFTA. These are of course issues of profound importance and I understand that noble Lords have strong views on them, but everybody really knows that they are not matters which the Bill is designed to address.
However, I will happily rehearse the Government’s position once again. What this Government seek is a bold and ambitious economic partnership that is of greater scope and ambition than any such existing agreement. We have listened to EU leaders and we understand and respect the position that the four freedoms of the single market are indivisible, and that there can be no cherry picking. For that reason, we do not seek membership of the single market after we leave the EU, and nor do we seek membership of the customs union. By leaving the customs union and establishing a new and ambitious customs arrangement with the EU, we will be able to forge new trade relationships with our partners around the world and maintain as frictionless trade as possible in goods between the UK and the EU, providing a positive and powerful voice for free trade in the world.
Of course, I am talking about our future relationship with the EU. To answer the question which I think came from the noble Lord, Lord Fox, we also seek an implementation period which, we have been very clear, will be based on the existing structure of EU rules and regulations—but during which the UK will be outside the EU.
Let me take this early opportunity to draw the attention of noble Lords to our publication today of our proposed draft legal text for the section of the withdrawal agreement in relation to the implementation period. We have published this in part to facilitate parliamentary scrutiny. It is right, too, that the British public should be able to see our position. The details of that implementation period would be implemented in domestic law through separate primary legislation, after we have reached agreement with the EU and after these Houses of Parliament have voted on that agreement.
In the meantime, a number of amendments in this group seek to mandate our continued membership of one or both of the single market or customs union, presumably in perpetuity. But put simply, this is not something the UK Government could deliver unilaterally, even if we were so minded. The amendments tabled by the noble Lord, Lord Wigley, get around that by proposing maintaining the same rights, freedoms and access within the UK that we have currently, which in practice means staying in the single market in all but name but without any reciprocal guarantees from the EU. That would be the worst of all possible worlds.
Other amendments seek to mandate the Government to take a particular negotiating position or to pursue particular objectives. Leaving aside what I have said about those not being our objectives, the amendments raise constitutional questions about the role of these Houses of Parliament and they raise practical questions too. Who is to say whether the Government have truly made these things their negotiating objectives? How would they be judged? Would we see the courts ruling on the conduct of the negotiations, and what would be the consequences if they did so? I recognise the noble intention behind these amendments, but I do not think we can contemplate making them, especially when the repeal of the ECA or the exercise of crucial delegated powers becomes contingent on them. That is a recipe for undermining the essential certainty that this Bill is designed to create.
Other amendments call merely for reports to be published on certain things. In response to the question asked by the noble Lord, Lord Hain, we have confirmed that when we bring forward the vote on the final deal we will ensure that this House is presented with the appropriate analysis the Government have done to make an informed decision, and we will take such steps as we can to facilitate scrutiny in the interim. But the particular reports and timetables suggested are arbitrary and may not in fact serve Parliament well.
The Government intend to secure a new partnership with the EU. We will legislate in accordance with that and nothing in this Bill threatens that. This Bill is designed only to prepare our statute book; it is agnostic as to the outcome of the negotiations and rules nothing in or out. We will legislate for the agreement reached with the EU in due course.
Finally, let me say something about the EEA and the amendments tabled in the name of the noble Lord, Lord Adonis, and the noble Baroness, Lady Ludford, concerning the EEA. Amendment 152, for example, seeks to make continued membership of the EEA one of the UK’s negotiating objectives, while Amendments 193 and 203 require a parliamentary vote on withdrawal from the EEA before making regulations under the power in Clause 9. Amendment 225 seeks to prevent notification of the UK’s withdrawal from the EEA agreement. On that specifically, our legal position remains unchanged. Article 127 does not need to be triggered for the agreement to cease to have effect.
My noble friend Lady McIntosh also asked about the EEA. In the absence of any further action, the European Economic Area agreement will no longer operate in respect of the UK when we leave the EU. However, as the Secretary of State has said, our existing international agreements should continue to apply during the proposed time-limited implementation period.
Lord Adonis
Will the Government publish the legal advice they have had in respect of that proposed procedure on withdrawal from the EEA?
Lord Callanan
We are not going to publish confidential legal advice. That has been the position of previous Governments, and it is the position of this Government. Our aim is to ensure continuity with international partners
Lord Callanan
No, I have given way to the noble Lord once. I have answered his question. I have referred to his points. If he will forgive me, I will make some progress.
Lord Callanan
I responded to the noble Lord’s question about the legal advice and to the other points that have been raised. I will respond further in my forthcoming remarks.
Baroness McIntosh of Pickering
My noble friend has been most gracious in replying to one part of my question, but not the other part about the status of regulations. He has now accepted that we will remain in the EEA for the duration of the implementation period. The precise content of my amendment relates to regulations passed and decisions agreed by the EEA before the end of the implementation period. What will the status of those regulations be?
Lord Callanan
I understand that the regulations of the EEA will continue during the implementation period. For the period after the implementation period we will seek to negotiate an ongoing relationship with the other three member states of the EEA. Our aim is to ensure continuity with international partners and the EU during the implementation phase and certainty for businesses and individuals. This approach will mean that we seek the continued application of the EEA agreement for the time-limited implementation period to ensure continuity in crucial elements of our trading and non-trading relationship with those three EEA states. Participation in the EEA agreement beyond the implementation period would not work for the UK. It would not deliver on the British people’s desire to have more direct control over decisions that affect their daily lives and it would mean accepting free movement of people. As I have said to my noble friend, once the implementation period ends we will no longer participate in the EEA agreement. We will instead seek to put in place new arrangements to maintain our relationships with those three countries: Norway, Iceland and Liechtenstein. I hope I have made the Government’s position clear, and I hope as a result the noble Lord, Lord Wigley, will feel able to withdraw the amendment.
Baroness Hayter of Kentish Town
There were a number of other questions, such as the one I raised on regulations, that are absolutely pertinent to the Bill. We will come later to how the regulations will be brought over and put into our law, and we will have debates on that on days three, four and five, I think. The question I asked the Minister specifically is: does he know about the work being done by Conservatives, along with Americans, to change regulations to assist a different form of trade? This is relevant to this Bill because we will be coming on to how we secure those regulations and their status in our law. I think the Minister’s understanding of those discussions is relevant today.
Lord Callanan
My Lords, there is a huge amount of work being done by various economists, lobby groups, institutions and think tanks on regulation and various agreements. I am not aware of the specific work the noble Baroness talks about. Of course I know some of the individuals she mentioned—they are good friends of mine—but I am not aware of all that work. Now she has mentioned it, I will go away and have a look at it. I am sure it is very good, but I cannot comment until I have seen it.
Lord Hannay of Chiswick (CB)
The Minister puzzled me slightly just then by saying that once the implementation phase—that piece of Orwellian language —is complete, the object will be to negotiate with the EEA partners of Norway, Iceland and Liechtenstein to preserve our present relationship, but that includes free movement.
Lord Callanan
With great respect to the noble Lord, I do not think I said that we would preserve the present relationship. We will want to establish a new relationship with those states. We have always had close and friendly relationships with them. Ultimately that will be a matter for the negotiations.
Baroness McDonagh
I do not feel that any of my questions were addressed. I apologise to the Committee, but I have to say to the Minister that he has not addressed whether he agrees with the estimate of the Secretaries of State about progress on trade deals. This is paramount information to understand what needs to happen in terms of customs union, single market and so on. I wonder whether my questions can be addressed.
Lord Callanan
My Lords, I thought we were here to discuss the Bill. We have spent three hours and 20 minutes debating so far, and I have listened very carefully to what everyone has said. I have sought to answer a lot of the questions where they were relevant to the contents of the Bill. The clause that we are debating repeals the European Communities Act. I understand that many Members want to raise concerns about the referendum, whether they thought the campaign was right or not and whether various people said various things or not, but I really do not think they are that relevant to the clause of the Bill that we are debating.
Baroness McDonagh
I apologise; I will make another attempt because I do not feel that I am making my questions understood. My questions are based on Amendments 191 and 206, and the purpose of the amendments is to seek answers so that we know whether we need to press them to a vote. My question is very clear: how is progress going? Does the Minister believe that the estimates given by the two Secretaries of State in the other place can be relied upon, and how are we getting on in terms of progress on the trade deal? This is paramount to understand what needs to go in the European Union (Withdrawal) Bill, and those amendments are before the House.
Lord Callanan
I am sure that the statements made by the Secretaries of State in the other place are true and valid and that they will be endeavouring to fulfil them. There will be further legislation, as we have said, on the withdrawal agreement and implementation Bill when we have sought and obtained agreement with the EU, and I am sure that further international trade Bills will follow in due course as well. However, that is not the subject of this legislation, as the noble Baroness well knows.
Lord Bassam of Brighton (Lab)
My Lords, the Minister was on his feet for just 12 minutes dealing with a debate that had taken over three hours. There are four sets of amendments here that deal with delegated powers. He has not addressed that issue at all in this debate but it is very much the focus of those amendments. That is a pretty shabby performance, actually, and this House is entitled to be extremely dissatisfied with the response that we have had. Further, we have had a big debate about the single market and the customs union but the Minister dismissed that in his opening comments. He said the Government were preparing themselves for a customs union-lite type of arrangement but failed to set out any details of what that might look like. This House deserves better explanations to its amendments than that, and I hope this does not give rise to an equally shabby performance on all the other amendments that we have to consider; there are over 300 of them.
Lord Callanan
I realise that. I apologise if the noble Lord is disappointed but I was trying to address what is actually in the Bill. As I said, further legislation will follow. We have spent three and a half hours so far debating one grouping of amendments, and we have eight further groupings to get through this evening on the timetable agreed by all the usual sources.
Baroness Hayter of Kentish Town
I am sorry to say this, but the amendments were taken by the Public Bill Office as being in scope. They are therefore relevant to the House.
Lord Adonis
My Lords, before the Minister finishes after the very short intervention that he has just made, I point out that he did not respond at all to the points made by noble Lords from around the Chamber about the Good Friday agreement. Would he give the view of the Government, since it appears to be in question at the moment, about the future of the agreement and whether he agrees with the former Secretary of State for Northern Ireland who said it had now served its purpose?
Lord Callanan
I am happy to clarify for the noble Lord that we remain completely committed to the Good Friday agreement.
Lord Forsyth of Drumlean (Con)
My noble friend has been accused of not being very experienced. I point out to those Members opposite that we are in Committee but we have had three and a half hours of Second Reading speeches, not speeches on the amendments.
Lord Callanan
I am sorry to disappoint the noble Baroness, but we will be having a number of Brexit Bills, not least of which will be the withdrawal agreement and the implementation Bill, once we have reached agreement. I shall endeavour to respond to all the questions that I have been asked.
Repealing the European Communities Act is an important step to ensure that there is maximum clarity on the law that will apply in the UK after we leave the EU. I cannot see the sense in needing a separate Act to repeal the European Communities Act. This repeal in Clause 1 is front and centre of the Bill; indeed, this Bill was originally called the great repeal Bill. To prevent this Bill from repealing the European Communities Act would undermine perhaps the most important part of it.
I suspect that I have read the intention of the noble Lord, Lord Adonis, correctly when I say that he would prefer the European Communities Act to be repealed in the withdrawal agreement and implementation Bill that was announced by the Secretary of State in November. That Bill would then deal with the implementation period and our relationship to EU law during that period. This may be founded on the misconception that, if Parliament does not repeal the European Communities Act and appoint an exit day, that will somehow prevent the UK exiting the EU. If that is the case, I am sorry that I have to disappoint the noble Lord: our leaving the EU is a matter of international law, and we are leaving no matter what is or is not done to the European Communities Act.
I will address the noble Lord’s question about exit day and procedure. What will become Section 14(4)—currently Clause 14(4)—could be used to change the exit day in the Bill only if the Article 50 period were to be extended; it could not be used to prevent us leaving the EU. That is a matter of international rather than domestic law. The exercise of Section 14(4) to alter the exit day in domestic law in accordance with Article 50 would be subject—in answer to the noble Lord, Lord Tyler—to the affirmative procedure in both Houses. I will give more detail on that in a minute. We do not expect to use this power and we are leaving the EU on 29 March 2019.
The noble Lord, Lord Hain, and the noble Baroness, Lady Hayter, asked further questions about our exit day and the amendment. In the other place we tabled an amendment which set exit day in order to provide certainty and clarity, and we accepted further amendments on the issue, again to provide further clarity. The amendments set the exit day in the Bill as 11 pm on 29 March 2019, while retaining the technical ability to amend the date at a later stage. As I said, that can happen only if the European Council—including the UK, of course—unanimously decides to change the date on which the treaties cease to apply to the UK, as set out in the famous Article 50. We do not intend this to happen.
I will give the noble Lord, Lord Tyler, more detail on his point. Any change to exit day in domestic law under the power of what will become Section 14(4) will be by the affirmative procedure, guaranteeing a vote in both Houses. The affirmative procedure in this instance is provided for in paragraph 10 of Schedule 7.
Providing for the date of the repeal of the 1972 Act in the Bill that implements our withdrawal agreement might seem tidy in certain scenarios, but it would put the legislative cart before the diplomatic horse in what I feel would be quite a dangerous way. Both the withdrawal agreement and the implementation period are, of course, still matters for negotiation. This Bill, being agnostic on the negotiations, is designed to prepare the statute book for our withdrawal. I say to the noble Baroness, Lady Hayter, that there will be additional legislation to implement our withdrawal agreement. As I said a moment ago, this Bill is designed to implement the clearly expressed will of the British people to leave the EU, and therefore the date of repeal is set at the point that the UK will fall out of the Treaty on European Union and the Treaty on the Functioning of the European Union.
There are many demands on parliamentary time, as we know to our cost, and this is the Bill that will prepare our statute book for exit. The amendment would force the date of repeal into the agenda of another Bill. This is the right time and place for the debate on the repeal of the ECA, and the debate should incorporate all the additional context and provisions necessary for a smooth exit. Indeed, if we did not reach an agreement and the second of the noble Lord’s amendments were agreed, we would be in a state almost of paradox. To repeal the ECA, the Government would be compelled to enact a statute for the purposes of Clause 9(1) of the Bill— a clause which itself is predicated on the existence of a withdrawal agreement. So we would be forced to enact a statute enabling us to approve the final terms of the withdrawal agreement and set the date of the repeal of the European Communities Act without such a withdrawal agreement existing. That is too much of a logical conundrum to ask any Bill to bear, and not an acceptable way to go about legislating.
Clause 1 will provide certainty to businesses and individuals that the European Communities Act will be repealed on exit day. Any attempt to change this while negotiations are ongoing would lead only to a lack of clarity on the law that will apply in the UK after we leave the EU. This would run counter to the primary aim of the Bill, so I hope that the noble Lord will be willing to withdraw his amendment.
Lord Tyler
I am grateful to the Minister for seeking to clarify the point about process, and I take on board what he said about paragraph 10 of Schedule 7. But will he give an absolute undertaking to the Committee that there will be no attempt to accelerate the process? I think he would accept that, if the Minister in this case were seeking to do something at speed, for expediency’s sake—surely that would be the only circumstance in which it would be necessary to change the date—it would be extremely difficult to give both Houses of Parliament advance notice and the usual time for consultation. Is the Minister giving us an absolute undertaking that the normal process and timescale will apply and that there will be no attempt to accelerate the process?
Lord Callanan
Yes, I am giving the noble Lord an assurance that the normal timescale of the affirmative procedure for statutory instruments would apply in this case.
European Union (Withdrawal) Bill
Lord Callanan ExcerptsWednesday 21st February 2018
(6 years, 9 months ago)
Lords ChamberRead Full debate European Union (Withdrawal) Act 2018 View all European Union (Withdrawal) Act 2018 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 79-I(b) Amendments for Committee (PDF, 60KB) - (21 Feb 2018)
The Minister of State, Department for Exiting the European Union (Lord Callanan) (Con)
I thank the noble Lord, Lord Griffiths, for his comments and I agree that this matter is totally within the scope of the Bill. I will do what I can to satisfy his requests, but I will probably not be able to satisfy all Members of the House. I understand the frustration on this, but let me take the Committee through our position and where we hope to be when the Committee gets to discuss Clause 11.
We have sought legislative consent from the Scottish and Welsh Governments, and it remains our priority to make a positive case in favour of that legislative consent for this important legislation. That is why we committed to work with the devolved Administrations to find a way forward on Clause 11, and to bring forward an amendment in this House. We will debate Clause 11 fully in Committee, and we will table government amendments before then for noble Lords to consider. Although, without an Executive, there is no way to seek legislative consent in Northern Ireland, the Secretary of State for Northern Ireland is working hard to restore devolved government there as soon as possible. We are committed to working to ensure that Northern Irish interests are represented in the meantime. We have explicitly recognised the role of the Sewel convention in the Wales Act 2017 and the Scotland Act 2016. We also have a strong track record on devolution. I make it clear to noble Lords that we are committed to the devolution settlements and the conventions that have been established.
But these amendments go further than Sewel; as my noble friend Lord Forsyth pointed out, they would prevent this Parliament exercising its sovereignty. They would require this Parliament to seek consent to legislate in some cases that are not within devolved responsibility and do not affect devolved competence. We believe in the importance of this Bill, which is in the interests of the whole of the UK, and will work to deliver it together with the devolved institutions. But it is also not right that one part of the United Kingdom can hold a veto over the decision taken, in the referendum, by the whole of the United Kingdom and risk the certainty this Government are committed to providing.
Let me address directly some of the points that were raised. The noble Lord, Lord Foulkes, asked about progress on Clause 11 and the Joint Ministerial Committee. The Scottish and Welsh Governments asked us to work with them to amend Clause 11, and that is exactly what we have been doing. Officials have worked extensively on proposals and Ministers discussed these in their recent bilaterals in February. We have preserved the space to engage in meaningful discussion and sought to reach agreement with the devolved Administrations. We have not yet tabled an amendment precisely because those discussions still continue. Our proposed amendment will be discussed, as a number of noble Lords have pointed out, at the Joint Ministerial Committee on EU Negotiations tomorrow.
In response to the points made by the noble Lord, Lord Foulkes, but also by the noble Lord, Lord Thomas, and the noble and learned Lord, Lord Wallace, we are fully committed to the JMC process as well as to increasing our bilateral engagement between meetings to strengthen relations. Since the referendum, we have had six JMC meetings and, as I have already mentioned, it will meet again tomorrow. In addition, officials are meeting weekly in order to try to take forward the proposals.
Lord Wallace of Tankerness
The Minister said there have been six meetings since the referendum. Given that at the first meeting of the Joint Ministerial Committee on EU Negotiations the communiqué said that they would meet on a monthly basis and that was in November 2016, by my calculation there have been several more months than six since then. Can the Minister tell us how many official meetings took place between February and October 2017?
Lord Callanan
I do not have information about how many official meetings have taken place. I understand that officials are meeting extensively. They are in regular contact. I am told by my officials that contact with officials in the Scottish and Welsh Governments and discussions are extremely positive. That is not the same as getting political agreement, but we are endeavouring to do that. Proposals have been tabled, after extensive discussion, for the meeting tomorrow. We hope there will be agreement. I obviously cannot guarantee that, but we hope there will be. We remain committed to obtaining legislative consent Motions if possible, and we will continue that dialogue in an effort to do that. That is the responsible way to proceed, but I totally understand the frustration expressed from all parts of the Committee that we do not yet have that agreement. We want to get that agreement. We are endeavouring to get that agreement. We will do our best to get it, but we will table amendments for this Committee to consider before we get to Clause 11.
Lord Forsyth of Drumlean
Given the difficulties, which are understood, of getting agreement to one legislative consent Motion, can the Minister give us an assurance that whatever amendments he tables will not require us to have legislative consent to even more Motions?
Lord Callanan
I am not quite sure I understand that point. I do not think we can give that assurance at the moment. I will have to have a separate discussion with my noble friend on that point.
Lord Thomas of Gresford
What happens if there is no agreement tomorrow? Will the Government’s amendment, the one that they are putting to the Joint Ministerial Committee tomorrow, be published so that we can look at it and so that informed opinion throughout the country, throughout Wales, throughout Scotland, can look at it and comment on it and so that we can see where the problem is? At the moment, it is all obscure. As my noble and learned friend said, there is no transparency whatever in this process. What happens if there is no agreement tomorrow?
Lord Callanan
As I said, we will be bringing forward the amendment at the same time that Members of this House have an opportunity to view it. The public at large will be able to comment on it and discuss it, and I am sure there will be extensive comment on it in the media at that time. The reason we have not published so far is that we want to preserve space for discussion and to try to have the discussions with our colleagues in Scotland and Wales and with officials in Northern Ireland in as confidential an atmosphere as possible. The discussions are positive and are proceeding apace. I cannot guarantee that there will be agreement, but we want that agreement and are working to it. We have compromised on many aspects. As soon as we are able to, we will share it with this House. We will definitely be producing an amendment before Committee. I totally understand noble Lords’ frustrations, but we are endeavouring to produce a solution to this difficult issue as quickly as possible.
Lord Elystan-Morgan
In order that the Joint Ministerial Committee should enjoy its full status, does the Minister accept that it would be desirable if minutes were kept of its meetings, if an agenda were to be published and if it were indeed to agree to meet at least monthly?
Lord Callanan
I understand the noble Lord’s question. I am not a member of the committee; it is handled not by my department but by the Cabinet Office. I will write to the noble Lord giving him details of what agendas are published and whether they are shared with other departments. I do not know the exact format, but I will contact him with it.
With those assurances in mind—limited assurances, I fully accept—I would be grateful if the noble Lord, Lord Foulkes, agreed to withdraw his amendment.
Lord Adonis
My Lords, it is not part of the human condition to think that institutions are marvellous. They can always be improved. But I did not take the noble Viscount’s clarification to be raising the banner for abolishing Euratom because there were going to be such great advantages to the public from us—in the words of the noble Lord, Lord Bridges, to the House a few weeks ago—walking the “gangplank into thin air”.
However, I have a specific question for the Minister. Can he confirm to the Committee that Her Majesty’s Government can withdraw the notice of withdrawal from Euratom under Article 106a of the Euratom treaty and that they can do that unilaterally? As he knows, I am slightly persistent in these matters. I always thought that part of the argument from those who were in favour of Brexit was that we were going to restore the sovereignty of Parliament. It is not too much to expect that Parliament should be able to see and study the legal advice on which Ministers make decisions. I ask him yet again whether he will make available to the House before Report the legal advice which his department has on the legal basis on which the Government can act in withdrawing the notice of withdrawal under Article 106a of the Euratom treaty.
Lord Callanan
My Lords, once again I thank noble Lords for an excellent debate on this important issue. I will respond to the point raised by most people who spoke—certainly the noble Lords, Lord Hunt, Lord Warner, Lord Teverson, Lord Carlile, Lord Liddle and Lord Adonis—about the reasons for leaving Euratom.
The Euratom treaty is legally distinct from the European Union treaty but it has the same membership, which includes all 28 member states, and makes use of the same institutions. There are no precedents for a non-European Union member state being a member of Euratom.
Noble Lords will recall that the decision to leave Euratom formed part of both Houses’ consideration of the European Union (Notification of Withdrawal) Bill, which is now of course an Act. Noble Lords spoke at that time about the unique nature of the relationship between the separate treaties of the European Union and Euratom. As the European Union and Euratom are uniquely legally joined, when we formally notified our intention to leave the European Union we also commenced the process for leaving Euratom.
Lord Liddle
The Minister mentioned that it was a parallel European institution. Before we gave that notice, did we actually ask other members whether we could remain in Euratom as a non-EU member?
Lord Callanan
It is not a matter of getting a political opinion on this. It is the legal position, as I have set out. When we formally notified our intention to leave—
Lord Warner
Before the Minister resumes, can I pursue this issue? The industry is very clear in its legal views, which it is prepared to put in the public arena, that we do not have to leave Euratom if we leave the EU. Have the Government discussed that issue with the industry and what the reasons are for its difference of legal view from the Government’s legal view?
Lord Callanan
My Lords, there has been extensive discussion and liaison between ourselves and industry. I will come on to discuss that shortly but we remain of the opinion, as I said, that when we formally notified our intention to leave the European Union we also commenced the process for leaving Euratom. Having said that, we are determined to continue to have a constructive, collaborative relationship with Euratom. The UK is a great supporter of Euratom and will continue to be so. I am grateful to the noble Lord, Lord Adonis, for his efforts to help me save face—even at 2.30 am—but I regret that I will not be able to give him what he requires this evening.
Let me go on to discuss the details of Euratom and our other plans. I will go into it in some detail, if that is okay with noble Lords, despite the late hour. As the Government have made clear, the UK’s future relationship with EU agencies, including those under the Euratom treaty, is a matter for negotiations. I will come on to the point of the noble Lord, Lord Whitty, later. Requiring the Government to publish a report in advance of negotiations concluding would be neither helpful to Parliament nor in the national interest. As soon as negotiations have concluded, the Government have committed to hold a vote on the final deal in Parliament. This vote will cover both the withdrawal agreement and the terms of our future relationship, and provide Parliament with the opportunity to scrutinise the outcome of negotiations at the appropriate juncture.
In the interests of transparency and providing as much certainty as possible, we took steps during the Commons passage of this Bill and the Nuclear Safeguards Bill to set out our strategy in a Written Statement on 11 January. That Statement made it absolutely clear that the UK will seek a close and effective association with Euratom in the future, and that we are putting in place all measures to ensure that the UK can operate as an independent and responsible nuclear state from day one. This is vital to ensure continuity for industry, whatever the outcome of the negotiations. As noble Lords will be fully aware, the nature of our future relationship with Euratom is part of the next phase of negotiations that has yet to start.
The Statement set out the principles on which our strategy is based: to aim for continuity with current relevant Euratom arrangements; to ensure that the UK maintains its leading role in European nuclear research; and to ensure that the nuclear industry in the UK has the necessary skilled workforce. We will be seeking a close association with Euratom’s research and training programme, including the Joint European Torus and the International Thermonuclear Experimental Reactor projects. We will also seek continuity of trade arrangements to ensure that the nuclear industry can continue to trade across EU borders. Finally, we will seek to maintain close and effective co-operation with Euratom on nuclear safety.
While we have made clear that we will indeed be seeking such an association, it is also essential that we have our own safeguards regime ready to come into place when Euratom arrangements no longer apply in the UK, whatever the outcome of the next phase of EU negotiations on our future relationship. It may be helpful to explain the meaning of nuclear safeguards to inform our discussion of this important but rather technical issue. Nuclear safeguards are non-proliferation reporting and verification processes which states use to demonstrate to the international community that civil nuclear material is not diverted into military or weapons programmes. The UK applies nuclear safeguards because it is a responsible nuclear power. Nuclear safeguards are different from nuclear safety and nuclear security. Civil nuclear safeguards reporting, by assuring the international community about the proper use of certain nuclear materials, underpins international civil nuclear trade.
Lord Carlile of Berriew
I am grateful to the Minister for the explanation that he has given on the issue of medical isotopes. Can he give us one further piece of information? How many meetings have actually taken place so far in an attempt to negotiate with the EU the continuity of the system of importing and exporting medical isotopes from the UK and from the EU?
Lord Callanan
I am afraid I do not have those figures to hand. I cannot tell him how many meetings there have been.
Lord Callanan
I can say that there has been extensive dialogue and discussion with both our EU partners and international partners at official and ministerial level. I can write to him with the exact number, which I can discover.
Lord Warner
Could the Minister respond to a question before he moves on to the important amendment by the noble Lord, Lord Whitty? I stopped believing in Father Christmas and in the tooth fairy some years ago. Can he explain why he thinks there will be a warm working relationship between Euratom and a country that has abruptly and unilaterally withdrawn one-quarter of its budget?
Lord Callanan
I am sorry that the noble Lord no longer believes in Father Christmas. I think there will be a warm relationship for the same reason that we will have a good trading relationship with the EU: because it is manifestly in the interests of both sides to do that.
The amendments from the noble Lord, Lord Whitty, would require the Government to publish a report on how we will engage with a number of EU and Euratom agencies before negotiations had concluded. We believe this would be neither helpful to Parliament nor in the national interest. I can tell him that as soon as negotiations have concluded, we are committed to holding a vote on the final deal in Parliament, and this vote will cover both the withdrawal agreement and the terms of our future relationship, including of course our relationship with various EU agencies.
I hope that I have addressed noble Lords’ concerns expressed through the amendments and that the noble Lord will therefore feel able to withdraw the amendment.
Lord Adonis
My Lords, with respect, the Minister has not answered either of the two questions I put to him. He has not answered the question whether or not the Government are of the opinion that they can withdraw the notice of withdrawal under Article 106a of the Euratom treaty, and he has not told me whether or not the Government will publish or make available to the House in some abbreviated form the legal advice they have on this matter.
Lord Adonis
My Lords, with respect, that is not the question I asked him. I asked him what is the Government’s legal advice on their power to withdraw, which is a very different question.
Lord Callanan
I have given the noble Lord the answer he is going to get on that subject.
Lord Adonis
My Lords, with respect, that is not a good enough answer. When we return to this at Report, I fear that that it will simply be grist to the mill for all those noble Lords who feel that this is a colossal error that the Government will not even tell the House what power they possess to rectify the error which they have already committed.