Brexit: The Customs Challenge (European Union Committee Report)

Debate between Lord Dykes and Lord Taverne

Monday 1st April 2019 Lords Chamber

[Lord Taverne (LD)]

My Lords, I was not a member of the committee but, having read its report several times—it is not an easy read—I am impressed. First, as many speakers have pointed out, it provides convincing evidence once again of what would be the disastrous consequences of a no-deal Brexit, and I trust that the Commons will rule out that option conclusively.

The report should be, or should have been, compulsory reading for those who plan to vote for the Clarke amendment, for a form of customs union presumably on the lines of the facilitated customs arrangement analysed in this report. This, the Government claim, would enable the UK to control its own tariffs for trade with the rest of the world. It is the option which seems to be the present favourite to win the Commons beauty contest to be voted on today.

However, that option has many serious snags. As pointed out in chapter 5 of the report, the present EU customs union requires a common commercial policy—in effect, a single market. To allow for the freedom to make separate trade agreements with the rest of the world, the customs union proposed by the Government, and, one must assume, by the Clarke amendment, seeks to avoid this. But the committee tells us that, for this kind of customs union to work and for us to enjoy a frictionless border with the EU as a non-member, there would still have to be convergence of regulations. We would, we were told, become “a regulatory satellite” of the EU. Would this be acceptable to most Brexiteers, or to those who support a soft Brexit? Instead of winning back control, we would, we are told, be subject to control by satellite.

The facilitated customs arrangement would also be immensely complex, involving different tariffs for EU and non-EU countries, including possible payments and repayments collected or paid on behalf of other countries. Compliance would, as many other speakers have pointed out, be a very hard and costly task for small to medium enterprises. Being part of a customs union without being a member would also require very complex negotiations, which are hardly likely to be welcomed by the 27 after their recent experience of endless delays and changes of tack by a succession of incompetent Brexit negotiators.

But what all Brexit advocates—even soft Brexit advocates—ignore is the most important development of all, to which the noble Lord, Lord Dykes, referred. There is strong evidence that the people’s will has changed since the referendum and is no longer the people’s will today. The evidence is not just the march by over a million people, or the petition to revoke Article 50 signed by some 6 million. Professor Curtice, who is much invoked by the Government and Brexiteers, long maintained that opinion had not shifted. He has now changed his view. A vote today, according to his findings, would be 54% to 46% in favour of remain; according to YouGov, it would be some 56% to 44%.

This shift should not come as a surprise, and there is every reason to suppose that it will grow. Nearly all Brexit news is bad: on overseas investment; a growing number of manufacturers and service companies which are planning to leave the UK; a likely crippling shortage of nurses and other professionals in the NHS, caused by the exodus of EU citizens; and so on. It is true that there are lots of leavers crying, “We want out”, and “Why haven’t we left yet?” No evidence will change their minds. However, there must be many of the 52% who voted leave who care about the future of their jobs and the prospects for their children, and they will not be impervious to what manufacturers such as those in the motor industry and Airbus tell us.

There was an extremely extensive poll of intending leavers on the eve of the referendum about the reasons why they intended to vote “out”. Many gave different reasons, but they all agreed that leave would have no downside—no prospect but that of life in the sunlit uplands. Now it is becoming plain what Brexit means: any form of Brexit, however soft, will make us poorer, especially the most vulnerable. It would be a strange twist to the present confusion if we left the EU because MPs believed they were obeying the people’s will, when—

[Lord Dykes]

I am sorry to interrupt the noble Lord, as I agree strongly with his words, but in the context of what he was saying two sentences ago can he estimate the number of people who accompanied Nigel Farage on his long trip from Sunderland?