European Union (Withdrawal Agreement) Bill

Lord Hain Excerpts

2nd reading & 2nd reading (Hansard): House of Lords & 2nd reading (Hansard)
Monday 13th January 2020 Lords Chamber

[Lord Hain (Lab)]

My Lords, this Bill opens the way for a Singapore-upon-Thames race to the bottom by deliberately removing the level playing field provisions designed to prevent the UK undercutting the EU. It also fails to protect our communities from the dangers of future land grabs on the health service from United States drug companies. Rather than Parliament taking back control, the Bill aims to destroy Parliament’s ability to hold the Government to account as the negotiations proceed.

The EU will remain the biggest, richest single market in the world right on our doorstep, with 450 million people compared to the UK’s 66 million. The EU accounts for half of UK trade but the UK accounts for less than one-tenth of EU trade. The UK risks losing not only its membership of the EU single market but also around 70 highly advantageous EU deals with other countries worth another 11% of our overall trade. The Government have been trying to roll these over but Japan, for example, has refused, confident that it can extract better terms from London on its own than it has already with the much larger EU bloc.

The Bill also removes EU protections for the environment, consumers and workers’ rights. By deleting these and other level playing field provisions, which the EU has indicated are essential for a deal, and discarding the opportunity under the latest withdrawal agreement for the UK and the EU to agree an extension before 1 July 2020, the Bill also brings back the real threat of a catastrophic “no trade deal” at the end of the year. The hard-line Brexiteers support such an outcome, but let them bear in mind that no country in the world trades on WTO terms alone without additional agreements, especially with their nearest neighbours.

In just 11 months’ time, and in the absence of a trade deal, the UK could find itself at the mercy of the EU regarding the bilateral trading relationship. The refusal of the US to confirm the appointment of judges to the WTO appeals court means that from 11 December 2019 the WTO can no longer adjudicate on trade disputes. This puts the world at risk of a free trade free-for-all in which the largest blocs can use their economic weight to do as they wish. So, if the UK felt that the EU was imposing vexatious trade barriers, for example, there would be no legal redress for the British Government through the WTO.

A Canada-style free trade agreement favoured by No. 10 means little or nothing on services, which make up 80% of the UK economy and 45% of our exports. The EU, with which we have a trade surplus in services, would have no incentive to grant significant openings to the UK in a free trade agreement because, under the WTO’s rules, it could then be obliged to make similar offers to all third countries with which it already has bilateral free trade agreements.

As the former President of the European Commission, Donald Tusk, made clear in 2018,

“the EU cannot agree to grant the UK the rights of Norway with the obligations of Canada”,

which is exactly what the “cake and eat it” contingent surrounding the Prime Minister seem to expect.

If the UK wants to reach a deal, we have to recognise that it will need to be ratified by the Parliaments of 27 individual EU member states, and some regional bodies too. Trade is about trade-offs, and in fishing, for example, the UK will have to grant continued access to UK waters if our fishing communities wish to maintain their lucrative access to selling into the European Union market, which is critical for the UK’s fish-processing industry. If regulatory divergence begins to occur, EU access would cease. EU producers, meanwhile, would continue to have unfettered access to the UK market in goods, where the EU already has a huge surplus.

The Prime Minister insisted that for goods moving to and from Northern Ireland and Great Britain, there would be

“no forms, no checks, no barriers of any kind.”

I am reminded of Nye Bevan: if the Prime Minister

“is sincere in what he is saying, and he may be, then he is too stupid to be a Prime Minister”.

I fear it is far worse than that, for there will indeed be checks and controls across the Irish Sea, with all sorts of dangerous uncertainties for the island of Ireland if there is no comprehensive deal at the end of this year or no amendment to the Bill as proposed.