Honda in Swindon

Debate between Lord Clarke of Nottingham and Greg Clark

Tuesday 19th February 2019 Commons Chamber

[Greg Clark]

For over 30 years, Japanese companies investing in our automotive sector have been able to count on a bipartisan commitment to talking about the advantages of investing in Britain: our skills, our commitment to innovation and the efficiency of our operations. Members on both sides of the House know that I and my colleagues have worked intensively, including with trade unions, to ensure that we get investments that recognise those advantages. I hope that we can send to companies considering investment a clear determination, across both sides of the House, that we will continue to keep faith with that tradition of stability.

I think it was evident in my remarks that I share the dismay of the hon. Member for Salford and Eccles (Rebecca Long Bailey) at the decision and the consequences for the excellent workforce in Swindon and their suppliers. We will do everything we can to ensure that they have good opportunities in future.

The hon. Lady asked about Brexit. The company said that the decision was not about Brexit and clearly we must accept that. She asked about its market share. In truth, it has a small market share in Europe compared with the markets in which it said it was expanding. Those are the reasons that it has given. However, I have always been clear with the House that the motor industry, Japanese investors and particularly Honda have made it clear for many months that Brexit is an additional worry at a difficult time. They have been instrumental in shaping the deal that has been negotiated. If there is one message all of us in the House can give that they want to hear it is that the deal should be ratified.

Ford Motor Company said:

“A no-deal Brexit would be a catastrophe…It’s important that we get the agreement ratified that’s on the table at the moment.”

Aston Martin said of the deal,

“it’s obvious that… it meets the needs of all the requests we put forward as an industry and as Aston Martin”.

McLaren said that the withdrawal agreement would

“provide urgently-needed certainty and an implementation period that allows us to plan for the future”.

Toyota said:

“We welcome the announcement of a deal. It would provide business with the certainty”

that it needs. I could go on. The clear message from the automotive companies is that we should get on and ratify the deal.

The hon. Lady asked about the industrial strategy. She will know that our commitment to it, and through it to the future of mobility, has been at the heart of our policy and has been widely recognised. The £250 million investment in the Faraday challenge to make Britain the best place in the world for new battery technology has resulted in the national battery manufacturing centre being established in the west midlands. We already have the biggest-selling electric vehicle in Europe—indeed, one in five electric vehicles in Europe is made in Britain. The fact that Honda’s R&D facility will continue to be in the UK and that companies such as Ford are moving their R&D to the UK underlines the strategy. The London Electric Vehicle Company is making taxis powered by electricity, not just for London but for export around the world. Aston Martin has invested £50 million in its new electric engine facility in Wales. Cummings is investing £210 million in its R&D in the automotive sector.

The hon. Lady asked about the charging network: £200 million is being invested in new, fast-charging networks for electric vehicles. Our reputation for automotive innovation and exports is strong and growing. That is one of the reasons why it is particularly frustrating that Honda has made this decision, when other companies are recognising the fruits of those investments and investing in Britain.

The announcement comes at a time of disruption and change in the industry. Veterans of the industry say that this is the biggest period of change in most of their careers. That reinforces how right we are to invest in the future and in promoting Britain as a place to develop the next generation of vehicles. I hope that in the weeks, months and years ahead, the whole House will support us in promoting those advantages, not just for Honda, but for other companies that can invest in this country.

[Mr Kenneth Clarke (Rushcliffe) (Con)]

I accept, as the Secretary of State does, Honda’s statement that Brexit played no significant role in the decision. We must avoid a childish debate every time there is an industrial announcement, whereby one side or the other leaps on how far Brexit has been involved in complex decisions. However, the fact remains that when I served at the Department of Trade and Industry under Margaret Thatcher, and at the Treasury under John Major, I was involved in pursuing the policy of those Governments to draw foreign investment to this country to revive our manufacturing base by presenting Britain as the most attractive and business-friendly country in the European Union, through which companies could gain access to the single market. The Blair Government pursued that policy with equal vigour. As my right hon. Friend has just said, it is no good people ignoring the warnings of every leader of the car industry, most of our foreign investors and all our business leaders that we must seek to retain that reputation. Will he therefore confirm that, in line with the withdrawal agreement, we are pursuing a customs arrangement and a regulatory alignment that will not put new barriers in the way of trade with our biggest, most important market? If we fail to do that, there will be a succession of announcements of this kind, and Britain will cease to be of any particular attraction to international investors seeking a European market.

[Greg Clark]

I acknowledge my right hon. and learned Friend’s contribution as part of a succession of Ministers on both sides of the House who have given confidence to investors from Japan and around the world. A particular admiration has been accorded to Britain for the stability and predictability of our arrangements. In a turbulent world, the sense of continuity that we have been able to offer, especially to investors who invest for the long term—and any automotive investment is for the long term—is important. It is essential that we recover that.

It is also important that we listen to and respect the evidence of people who employ hundreds of thousands of our constituents. We have consistently done that. In my response to the hon. Member for Salford and Eccles, I set out the almost unanimous view of investors that the deal that has been negotiated meets their needs. That is not a surprise because they have been consulted during the negotiations. However, this is a moment when the House needs to reach a resolution. The Japanese ambassador is very active on these matters. He summarised his views in a letter to the UK and the EU:

“What Japanese businesses in Europe most wish to avoid is the situation in which they are unable to discern clearly the way the Brexit negotiations are going, only grasping the whole picture at the last minute.”

We should heed that advice. We have the opportunity to bring negotiations to an orderly conclusion. I hope that, for the sake of jobs in constituencies throughout the country, we will do that.

Leaving the EU: Airbus Risk Assessment

Debate between Lord Clarke of Nottingham and Greg Clark

Monday 25th June 2018 Commons Chamber

[Greg Clark]

I recognise that the hon. Gentleman has more than 6,500 people employed in his constituency in good jobs, and many more in the supply chain. Members from all parts of the House have constituents whose prosperous careers and excellent opportunities come from working in this important sector. Let us be clear: this sector is one of our proudest strengths and it is expanding. The opportunities around the world grow every year and the excellence that we have needs to be nurtured and cherished. I take seriously the representations of all businesses because we are talking about not speculation or visions of the future, but the reality of the lives of many hundreds of thousands of people across the country, which is important.

It is the case that we should listen to businesses. Of course, what Airbus has said was consistent with what it has said before and consistent with what it has said to Select Committees of this House. Very importantly, it was addressed equally to the European Commission and to member states of the European Union. It is very clear that, in order to have the agreement that we seek, it is necessary that both sides of the discussions should participate. Airbus has been clear that it is in the interests of the whole country and the whole company that that should be the case. I hope that that message will be heard in Brussels as well as in this country.

The hon. Gentleman asked questions about listening to business. All Government Members recognise that the livelihoods of millions of people, and the prosperity of our country, depend on business being successful. We will not always agree with everything that businesses say, but they have the right to be heard. The hon. Gentleman was rather one-sided in his representations; I think that he should direct some of his recommendations to his own Front Benchers, who have not been a picture of clarity on what they would like from these negotiations.

[Mr Kenneth Clarke (Rushcliffe) (Con)]

Will my right hon. Friend explain to some of his Cabinet colleagues and others that it is simply not going to be possible to opt into most of the benefits of the single market and the customs union, while rejecting every trade rule and regulatory arrangement that the member states of the EU accept as part of that deal? Does he also agree that if, at the end of our negotiations, we start erecting new tariff barriers, new customs procedures and new regulatory divergences, it is perfectly obvious that we are going to deter inward investment from companies such as Airbus, BMW, Siemens and many others, with long-lasting damage to our economy?

[Greg Clark]

It is imperative that we do not do that. I am actually more optimistic than my right hon. and learned Friend about the prospects of a deal that will avoid that. Part of what this company and others have said is that it is strongly in the mutual interest of this international business that there should be an orderly agreement that allows a very successful company to continue to trade without friction. I think that that is in prospect.

We are leaving the European Union; that decision has been clearly taken. The task before us is to make an agreement that implements that decision and which, at the same time, ensures that these avoidable threats of frictions and tariffs do not take place. That is absolutely within our grasp and it is what the whole House should back during the months ahead.