European Union (Withdrawal) Act

Debate between Lord Hammond of Runnymede and Robert Neill

Thursday 6th December 2018 Commons Chamber

[Mr Hammond]

Let me say this frankly to my hon. Friend: there is no deal that is negotiable that involves leaving the EU and maintaining the financial services passport. That is a fantasy world outcome. There will not be passporting. What we have negotiated with the European Union is an enhanced equivalence approach that will allow us to maintain our vital financial services networks with the European Union in the areas where there is significant financial services trade between us and to do so in a way that will provide the reassurance that commercial companies need in London to continue operating.

A mere equivalence finding is of no use to a company operating a book of derivatives worth several trillion dollars when there could be an abrupt ending of the equivalence arrangement unilaterally by one side. There has to be a more structured basis for that co-operation in the future. We have agreed that with the European Union, and I absolutely agree with my hon. Friend’s point that, even though we will not have direct influence over new European Union rules, we can have a significant influence over the shaping both of the global rules and, indeed, the European rules.

Over many decades of membership of the European Union, the UK has had a huge influence over the EU’s financial services regulatory environment. We have done that not through voting power, but through the skill, the diligence and the commitment of our civil service and industry teams who have engaged in Brussels and who have provided their expertise to try to shape the European Union’s financial services regulation in a way that is effective and that works for us all, and we will carry on doing so in the future.

[Robert Neill (Bromley and Chislehurst) (Con)]

I am very grateful to my right hon. Friend for giving way and I very much appreciate the realistic point that he makes about what is on offer to my constituents in the financial services sector. Does he agree that it is precisely because this is the best deal that we are likely to get and that it gets us into transition where these important technical matters can be resolved that it has been welcomed by all the representative bodies of the financial services sector across the country?

[Mr Hammond]

That is exactly right. It has been welcomed by all the major bodies. It has been welcomed by the City of London. First, this deal gives us the transition period, which is a vital respite for business in preparing for the future, and it gives us a commitment to a future deal that will protect our economy and, in particular, our financial services sector.

At the Budget in October, I made a Brexit prediction. I predicted that a deal that creates confidence in a smooth transition and a close future partnership will not only protect our jobs, businesses and prosperity in the long run, but deliver a short-term deal dividend for Britain. The Bank of England last week published its modelling of a range of scenarios to assess the potential impact as the economy makes the necessary adjustment to reflect the new trading relationship between the UK and the EU. The Bank estimated that a negotiated deal could boost British GDP by 1.75% in the short term, as businesses and consumers alike express their confidence in the future, while leaving the EU on WTO rules and without a transition period could cause a recession, with GDP reduced by up to 7.75% and unemployment rising to 7.5%. The Bank of England is clear: a no-deal exit would mean jobs lost, food prices up, house prices down and wage growth lower.

Businesses have made their views clear. The Federation of Small Businesses called this deal

“a welcome step back from the no deal cliff edge.”

The Institute of Directors warned that only 14% of its members

“would be ready to cope with a no deal outcome in March”.

The CBI has described no deal as a disaster for the economy.

This House has before it a deal that can deliver the certainty that will unlock the potential of our economy and assure Britain of the brighter future it craves. Let us not be the generation who have to explain to our children and grandchildren why we let that opportunity slip from our grasp. Let us choose now to move on to that brighter future, not to go back to square one with continuing uncertainty, division and disharmony.

As we make this decision and exercise our solemn duty in this Parliament in the interest of the nation, let us not forget the progress that we have made and what we would be putting at risk with no deal: eight straight years of growth; employment at a record high; 3.3 million more people in work; higher employment and lower unemployment in every region and every nation of the United Kingdom; wages growing at their fastest pace in nearly a decade; and the proportion of low-paid jobs at its lowest for at least 20 years. Britain is leading the world in breakthrough technologies—from biotech to fintech, and from robotics to genomics—and at the cutting edge of a technological revolution that will underpin our prosperity and success for decades to come, if we get Brexit right.

Oral Answers to Questions

Debate between Lord Hammond of Runnymede and Robert Neill

Tuesday 3rd July 2018 Commons Chamber

[Mr Hammond]

The overwhelming majority of the over 1,000 new jobs a day that have been created since the 2010 general election have been conventional jobs; only a tiny fraction of people in the workforce are on zero-hours contracts—less than 2.8%. Zero-hour contracts do have a role to play, but the Government have taken action to make sure they are not abused, and we will continue to take action to make sure that the flexibilities that are essential to the operation of our labour market and the attraction of the UK for international investment are not abused.

[Robert Neill (Bromley and Chislehurst) (Con)]

19. Businesses in my constituency have been telling me that as we leave the EU they want to have the assurance and clarity of security of their supply chains, not to be burdened with undue regulation and paperwork in relation to customs, and in financial services both clarity and certainty of alignment and regulation; they also want the ability to fly in key personnel across our EU markets to advise clients. Does my right hon. Friend agree that their views should be treated with respect and seriousness?

[Mr Hammond]

Yes, the views of business, which is the great generator of employment, wealth and prosperity in our country, should always be taken very carefully into account. We should listen to what business is telling us and make sure that we deliver a Brexit that delivers on the needs of business.

Oral Answers to Questions

Debate between Lord Hammond of Runnymede and Robert Neill

Tuesday 24th October 2017 Commons Chamber

[Mr Hammond]

The Government made commitments on the personal allowance and higher-rate threshold in their previous election manifesto. We reiterated them in the 2017 manifesto, and we remain committed to those policies. Of course, I will take into account all the representations I receive from right hon. and hon. Members, and I shall take the hon. Lady’s comments on the work allowance as such a representation.

[Robert Neill (Bromley and Chislehurst) (Con)]

2. Whether his Department has made an assessment of the potential merits of recommendations from the London Finance Commission on fiscal devolution for London.