Brexit: UK-EU Relations (EUC Report)

Lord Desai Excerpts

Monday 2nd July 2018 Lords Chamber

[Lord Desai (Lab)]

My Lords, as I am the last Back-Bench speaker in the debate, there is not much left for me to say. We have an excellent report from the noble Lord, Lord Boswell. As many people have pointed out, we do not have many choices that are pleasant, and we can hope only that when the Cabinet meets and the White Paper is published, it will draw on some of the wisdom that the noble Lord, Lord Boswell, has provided. Indeed, he has provided the optimal solution—and if the Cabinet could not be bothered, it could just say, “The option preferred by the report of the noble Lord, Lord Boswell, is the one to go for”. Of course, chance would be a fine thing.

I will concentrate on something different that is germane to the report. When the referendum was held—we will not debate whether the result was narrow or broad—had anybody in the Government drawn a picture of what it would mean to withdraw? I ask this because there was a famous episode when Harold Wilson became Prime Minister in 1964. The Civil Service had two draft reports for him—one for devaluation of the pound and the other against—and said, “Prime Minister, you have to decide”.

Did Mr Cameron ever have a detailed report on what it would mean to withdraw and what it would mean to stay? We obviously did not have to worry about what it would mean to stay. I ask this because, having lived through the experience—I am sure others will agree—I think a lot of the things that people thought were simple have turned out to be very complicated. People thought that out meant out—that we would have freedom from the bureaucracy of Brussels and could fly the flag of free trade everywhere, and that would be that.

Nobody told them about Northern Ireland. Coming from an ex-colony, that does not surprise me; the English do not always remember the rest of their empire. But they were not worried about Northern Ireland and were not even aware that a withdrawal would mean a major schism between it and the Republic, and that there would be consequences. That is quite remarkable. I have not been to see the wiring and the plumbing here in the Palace, but I presume that what nobody realised was that the community we had joined, the Common Market, was full of tangled wires like that, and that it would be very difficult to risk pulling something out and walking away.

My noble friend Lord Whitty gave the analogy of divorce, which has been used before. Most people thought that our going away would be just like walking out, without saying anything further about the law, responsibility for the children, the division of assets or anything like that. I am puzzled by this, because it says something about the quality of governance in a country. Here we are, travelling through a train wreck: the windows are shut and we cannot get out but we can see the train wreck happening. It is going to happen. The only question is whether it will be a big jolt or a small jolt—but there will be a jolt. There is the problem of governance: at what stage did the Government neglect to find out what it would mean to withdraw?

Did even the hard Brexiteers ever have a document prepared or published in which they knew all the things that would be done? I think that when we had our first debate after the referendum, the noble Baroness, Lady Randerson, spoke from the Liberal Democrat Front Bench to point out that the prospect of British airlines landing at European airports was under threat. I thought, “Nobody has told me that yet”. As has been pointed out, there are also problems with sharing information on terrorists or such simple things as being able or unable to import our daily supplies.

Even when all this is over and we have certainty, we do not know what kind of settlement we will get. That is another thing we have to mention. We all wish for it to be a good one but we must all be prepared for a bad one. I am told that in the City of London, quite a lot of businesses are prepared for the worst-case scenario. One always has to prepare for a worst-case scenario, but let us be there so that we can see what the worst-case scenario is like. Right now, the uncertainty is absolutely crippling. As the noble Earl, Lord Kinnoull, pointed out, everybody in the insurance industry and the banking industry is worried. We ought to have a sort of working party or plan for what to do when we finally know what we have got.

I think a hard Brexit is most likely. I am not an optimist in this respect; I am a pessimist. I think we are going to get a hard Brexit because I do not think there will be sufficient agreement in the Government. But, whatever it is, we ought to be prepared for the consequences of a bad Brexit. How will we cope with a bad Brexit? What would be our options in terms of economic policy for the future? How will we adapt to a bad Brexit? At some stage, if we still have the European Union Committee or some version thereof, that should be its first task—and I hope that the noble Lord, Lord Boswell, will guide us through that problem as well.