Retained EU Law (Revocation and Reform) Bill

Lord Kerr of Kinlochard Excerpts

2nd reading
Monday 6th February 2023 Lords Chamber

[Lord Kerr of Kinlochard (CB)]

Doctrinaire, ideological, subversive of Parliament, a headlong rush, an arbitrary timetable, a blank cheque for government by diktat—this Bill is coming in for a bit of criticism from Conservatives. I am not surprised, because the presumption that change is needed and the proposed method of change do not strike me as terribly Conservative. Lord Salisbury in 1892 defined Conservatism as delaying changes until they become harmless. I have always believed that he also said: “Change? Why should we change? Things are bad enough as they are.” I can get away with that as the noble Lord, Lord Lexden, the real expert on this, is not here; he says it is apocryphal. Here are Lord Salisbury’s successors running a rushed, in-house review of some 4,000 laws with a presumption that change is required because of the laws’ origins, not their effects.

I was there in Brussels during a period of peak legislation with the single market programme. I was there when the European Union was dancing to the tune of a British Conservative initiative, inspired by Margaret Thatcher, prescribed by Arthur Cockfield, pressed by John Major, driven through by Commissioner Leon Brittan. Were they all wrong? Is their legacy now suspect simply because they succeeded in getting the EU to buy their prescriptions for appropriate regulation?

Of course, some of the 4,000 laws could well be overtaken; I do not know. There could be sense in a sift done bottom-up, sector by sector, consulting those affected, balancing the consumer interest with the interests of producers and traders—but not this way; not top-down, in-house, with no consultation, minimal scrutiny, an end-year guillotine and new rules by decree cutting out Parliament.

Business hates this Bill. Business likes certainty. Business wants regulatory predictability. The perception of change for change’s sake is anathema to business. The chemical industry and Defra confirm that the cost of replacing the EU REACH regulations will be about £2 billion. That is just one industry. This Bill and the uncertainty that it creates will affect them all. No wonder the CBI opposes it so strongly.

Lord Salisbury also said in 1879:

“Whatever happens will be for the worse, and therefore it is in our interest that as little should happen as possible”.


As regards this Bill, that seems to be exactly right. It is malign, misconceived, damaging, undemocratic, un-Conservative—and we should throw it out.

Energy Prices Bill

Lord Kerr of Kinlochard Excerpts

Committee stage
Monday 24th October 2022 Lords Chamber

Amendments 22, 24, 25, 27, 29, 40, 41 and 42 relate to powers to make energy licence modifications under Clause 21 and directions under Clause 22. Broadly, the amendments would make these powers subject to the affirmative procedure and implement a sunset provision of two years, subject to future extension. The powers in Clauses 21 and 22 have been included in the Bill to provide the Government with the ability—

[Lord Kerr of Kinlochard (CB)]

Could the Minister give us an example of the circumstances under which the powers in this clause to amend licences would be made by a legislative Act that is not a regulation and would take the form of him just writing down, “Do it”? What circumstances would make this necessary? I find the arguments of the noble Lords, Lord Rooker and Lord Cunningham, rather compelling. The wording of subsection (5) is astonishingly wide.

[Lord Callanan (Con)]

I accept what the noble Lord says about it being astonishingly wide but, if he will have a little patience, I will quote some examples to him shortly, and he will see that they are not the biggest items that he can think of.

The powers in Clauses 21 and 22 have been included in the Bill to provide government with the ability to react at pace to unforeseen delivery barriers. Making them subject to the affirmative procedure could delay the provision of support to consumers this winter and put at risk the point when energy suppliers have certainty over the final delivery requirements.

The approach that the Bill takes to parliamentary procedure is not unprecedented: for example, a direction under the Electricity Act 1989 has already been used to deliver the energy bills support scheme in Britain. Furthermore, the powers in Clauses 21 and 22 may be used only “in response to” the current energy crisis,

“or in connection with the Act”

or with regulations or schemes made under it. They are therefore time-constrained in that respect. Amendment 39 would reduce the sunsetting provision for powers under the cost plus revenue limit from five years to three and a half years. We consider the five-year sunset appropriate for the Government to respond to the immediate effects of the energy crisis, while ensuring ongoing protection for consumers if gas prices remain abnormally high for a prolonged period. The upcoming consultation will allow the Government to further define the intended use of this power.

Amendments 40, 41 and 42 seek to sunset the powers under Clauses 21 and 22 to two years, with an extension permissible by affirmative regulations. The Bill already makes clear that Clauses 21 and 22 must be used only “in response to” the current energy crisis, or “in connection with” the Bill or with regulations or schemes made under it. Generally, those other provisions in the Bill are already subject to sunsetting. A crisis is, by its nature, something extraordinary and temporary. I submit that the circumstances and timing in which the Government can use this power are therefore already appropriately constrained by the Bill.

Three amendments have also been tabled that relate to requirements to consult. Amendment 19

“would require the Secretary of State to consult before utilising … powers”

on the temporary cost plus revenue limit. It is the Government’s clear commitment to consult as soon as possible; therefore, we do not believe that this amendment is necessary.

Amendment 21 would require the Secretary of State to consult on pass-through requirements on intermediaries. As the schemes are being stood up at pace, this requirement could delay much-needed support being passed through to consumers this winter, and therefore could be positively harmful.

Amendment 23 would require modifications to licences under Clause 21 to be subject to consultation with the relevant bodies. As I mentioned, this clause ensures the Government’s ability to react at pace to unforeseen barriers to delivering the schemes. A requirement to consult would, again, simply delay our ability to deliver the schemes effectively and quickly, and therefore would be counterproductive.

Finally, a set of amendments have also been tabled which would remove certain powers from the Bill, including the opposition of the noble Lord, Lord Rooker, to Clause 22 standing part of the Bill. Clause 22 and its powers enable the Government to issue directions to energy licence holders and the Northern Ireland regulator in connection with schemes under the Bill and in response to the energy crises. The ability to issue directions of a general character is necessary to deliver support under the Bill and to tackle barriers to their implementation. Amendment 26 would limit the Secretary of State’s powers to issue directions of a “general character” to those only of a “specific” character. Amendment 28 would remove Clause 22, which provides that, when a direction to a person conflicts with existing requirements in an “enactment or instrument”, such requirements should be “disregarded”. Currently, we envision limited circumstances in which these circumstances will arise.

I will now give the example asked for by the noble Lord, Lord Kerr: the Government may need to issue a direction to the Utility Regulator in Northern Ireland to ensure that the timing of electricity regulated tariff reviews is aligned with similar reviews in Great Britain. This may be necessary to ensure effective administration of the energy price guarantee in Great Britain and Northern Ireland. In doing so, it may be necessary to rely on Clause 22 to resolve any potential conflict between the terms of the direction and the statutory requirements of independence applying to the energy regulators in Great Britain and Northern Ireland, and any existing requirements as to timing in the supplier’s licences, to enable all parties to comply with the direction for tariff review alignment. Without this, licence holders or the Northern Ireland regulator may be uncertain about their legal position, and this could have the effect of households and businesses missing out on appropriate and timely support. This plays to the noble Lord’s points. I realise that there is a suspicion that there is some malign intent behind these clauses, but they are, essentially, designed to deliver support at pace in a fast-moving environment and to provide the Secretary of the State with the powers to ensure that this happens in a legally correct manner. I reassure the noble Lord that there is no hidden agenda here.

[Lord Kerr of Kinlochard (CB)]

I plead innocent to any imputation of malign intent, but it is an astonishingly wide power. The Minister’s explanation related it solely to Northern Ireland. It is not limited as the Bill is drafted to Northern Ireland, but it would be relatively easy by combining subsections (3) and (5) so to limit it. That would cause me to worry much less about this apparently extraordinarily wide-ranging power to overrule the law of the land or all existing regulation without making a new regulation.

[Lord Callanan (Con)]

The noble Lord asked me for an example. I have provided him with an example of one means that we envisage may be necessary. There could be other licensed modifications that we have not envisaged yet. As I said, this legislation has been drawn up at pace, using the excellent resources of lawyers and parliamentary counsel. It has been enacted very quickly. This is a clause that we think is necessary in order to, if you like, cover something that we have not thought of and that we have missed out in the Bill, but it is limited to use in the specific circumstances that the Bill requires.

Energy Security Strategy

Lord Kerr of Kinlochard Excerpts

Wednesday 27th April 2022 Lords Chamber

[Lord Callanan (Con)]

I am sorry that the noble Baroness has ignored the quagmire, as she puts it, of some very important subjects. I am sure we will want to debate them in future. She raised this matter with me yesterday. In principle, I understand the point she is making, but I point her to the website of Ofgem, which does the appropriate sustainability checks on the biomass used in Drax. It is from waste sources, and it is renewable. The Greens are shaking their heads, but I am afraid there is a case for it. It is sustainable and renewable, which is why it qualifies, but it is subject to strict sustainability criteria. They are checked and published.

[Lord Kerr of Kinlochard (CB)]

There is much in the Statement to welcome about the long term but, as Keynes said, in the long term we are all dead. What worries me is that there is not a word in the Statement about how we are going to help people deal with the very real household energy crisis we are in now that will vastly increase in October. The reference period that will decide by how much the cap goes up ends in July. We know now that there is going to be a big increase again; there is no reason for us to wait. It is not very reassuring to be told that

“the Chancellor has promised to review his package of support before October”.—[Official Report, Commons, 19/4/22; col. 75.]

Why is he not doing it now? I suggest that, when he looks at it, he looks not just at little packets of money here and there, but at the possibility of indexing the energy element in universal credit to the energy component in the household expenditure of the people on universal credit. That is the most efficient way of targeting it. It is sad to see a long-term strategy which tells us nothing about onshore wind, storage or the improvements to the grid which are badly needed. The more we invest in wind, the more we will need grid improvements.

[Lord Callanan (Con)]

The noble Lord’s question was somewhat contradictory. He complained that the strategy did not address some of the short-term problems but in the end, he referred to it as what it is: a long-term strategy. The clue is in the title. The reality is that it takes many years to put in place energy infrastructure, and it is right that the Government address these factors and look to the long term to make sure that we are putting in place the appropriate steps, such as the nuclear RAB Bill, to provide the long-term security of supply and power that the country needs. That does not obviate the difficulties that we have in the short term. As I suspect the noble Lord knows very well, I cannot comment on what the Chancellor may do in response before any future fiscal event, before the next price cap comes in. However, I can assure the noble Lord that the problems the nation faces with high energy prices are at the forefront of the Government’s consideration.

Trade Talks with India, Greenland and Israel

Lord Kerr of Kinlochard Excerpts

Wednesday 9th March 2022 Lords Chamber

[Lord Grimstone of Boscobel (Con)]

My Lords, I am very happy to deal with that. Greenland is an important exporter of seafood to the UK, accounting for 40% of the total value of UK imports of cold-water prawns in 2020. For those who enjoy their prawn cocktails, I can think of no better statistic.

[Lord Kerr of Kinlochard (CB)]

While I join the noble Lord and the noble Baroness, Lady Hayter, in congratulating each other on the Government deciding not to resile on trade agreements and commitments made by the noble Lord himself at the Dispatch Box, I do find their letter a little unsatisfactory in that it is limited to trade, thus meaning that we are still much less well informed than we were when Article 218 of the treaty applied. Also, it casts some doubt on the Ponsonby rule, which has governed the Government’s provision of information on international agreements to Parliament for 98 years. Would the Minister confirm that the Government have no intention of resiling from the Ponsonby rule?

[Lord Grimstone of Boscobel (Con)]

My Lords, first, if I may just offer a small correction to the noble Lord, the Ponsonby rule survived for 86 years before it was supplanted by CRaG. I can completely confirm that now that they are governed by CRaG, the Government will abide by CRaG in all the appropriate circumstances.

Onshore Wind Bill [HL]

Lord Kerr of Kinlochard Excerpts

2nd reading
Friday 19th November 2021 Lords Chamber

[Lord Kerr of Kinlochard (CB)]

I think I need to declare an interest and do so very explicitly. The noble Baroness, Lady Sheehan, referred to Scottish Power. I am a director of Scottish Power, which operates 40 wind farms and generates about 2.8 gigawatts at the moment. All our generation is green. When I joined the board, we had two large coal-fired stations and a lot of small combined-cycle gas turbine stations. We have sold the gas stations and closed the coal-fired stations. Between 2020 and 2025, we plan to invest some £3.7 billion in onshore renewable generation—wind, solar and battery—and we have a 3-gigawatt, UK-wide renewable future project pipeline. We also have offshore wind farms.

I say all that because although I cannot match the expertise of those who have already spoken—particularly the noble Baronesses, Lady Worthington and Lady Hayman—I want to be transparent about my interests and establish some credential for what I am going to say about national policy. I know a little bit about what I am talking about.

I very much congratulate the noble Baroness, Lady Hayman, on her Bill. It is badly needed. I could argue that, for example, it would be good to see Clause 1 refer to installing battery storage on wind farms with a single connection point to improve flexibility. I might similarly suggest a reference to installing photovoltaic solar capacity on existing wind farm sites. I might also query the inclusion of Wales within the scope of the Bill because, in my experience, planning works better in Wales.

[Baroness Hayman (CB)]

If the noble Lord will forgive me, the Bill states that it applies to England and Wales. I am advised by the Table Office and the Public Bill Office that this is a convention—that, in fact, the devolution arrangements mean that the planning regime in Wales is for Wales, just as the one in Scotland is for Scotland; and that, in practice, this Bill would apply only to England. I apologise; it was not my choice.

[Lord Kerr of Kinlochard (CB)]

I was puzzled because planning is a devolved function in Scotland, Wales and Northern Ireland.

However, those are small points. The big point about this Bill is Clause 1(1), of course, which calls for a review. The present system—or, rather, the lack of any system—for planning applications in England has created a paralysis that, if prolonged, will inevitably mean the country missing the target of net zero by 2035. My company’s onshore wind programme pipeline is heavily weighted to Scotland, Wales and Northern Ireland because, since 2015, the Government have washed their hands of the approval process in England, leaving it entirely to local opinion. As the noble Baroness, Lady Hayman, said, a single local objection sinks a proposal or delays it sine die. Open-ended consenting timelines that are five to 10 years long and often end without consent obviously deter investment. Between 2011 and 2015, 435 turbines were erected on 108 sites. However, as the noble Baroness said, between 2016 and 2020, applications went down by 96%. Only 16 turbines were permitted in those five years.

This really matters. The analysis I have seen suggests that, to reach net zero by 2035, the country will need a fourfold increase in offshore generation, a doubling of solar generation and a trebling of onshore wind. The Climate Change Committee says that the onshore wind capacity, now some 14 gigawatts, some of which is nearing the end of its operational life, will need to be about 35 gigawatts. This means new capacity of about 1.25 gigawatts a year. Currently, we are installing about 600 megawatts a year, very little of it in England, so we need to go twice as fast as we are now. We will not manage that unless the paralysis of planning in England comes to an end. That is why this Bill is so important and why the Government should welcome it and get behind it. I really hope they do. It is all very well the Government puffing our legally binding targets. If you will the end, you should will the means.

Of course local opinion matters, but going for 30 gigawatts by 2030 would create 30,000 full-time construction jobs and 30,000 full-time operating jobs. We can all think of communities across England, not least those where the Government want to see levelling up, where such jobs would be welcome. Currently, it does not and cannot happen in England because a single objection kills a proposal. Local unanimity is needed, so applications are not made and jobs are not created. Without a predictable future project pipeline order book, supply chains maximising UK content and cutting costs cannot be created. If all this persists, the decarbonisation targets will not and cannot be met.

Pace the Prime Minister, we really cannot have our cake and eat it. One cannot be proudly green, decisive and determinant—rhetorically—and refuse to get one’s hands dirty about delivery. One cannot be laissez faire when one is surely bound by one’s target. One cannot just leave it to one’s successors. If I were to be undiplomatic, which is unthinkable, I would say that that would be almost as hypocritical as—

[Baroness Bloomfield of Hinton Waldrist (Con)]

My Lords, I remind the noble Lord of the advisory speaking time.

[Lord Kerr of Kinlochard (CB)]

—promoting the decarbonisation of transport and, at the same time, freezing fuel duties for a decade. That was very tactless. I urge the Government to welcome the Bill of noble Baroness, Lady Hayman, as I do.

Republic of Cameroon: Economic Partnership Agreement

Lord Kerr of Kinlochard Excerpts

Tuesday 29th June 2021 Lords Chamber

[Lord Kerr of Kinlochard (CB) [V]]

While I sympathise with the spirit of the Motion to Regret, in the name of the noble Lord, Lord Grantchester, like the noble Lord, Lord Bellingham, I cannot support it because our imports from Cameroon are so marginal that to impose any restriction on them would penalise some people in a very poor country without having any effect at all on the policies of their Government. EU sanctions might make a difference; on our own, we cannot. Trade flows with Ghana and Cameroon are marginal for us, but the point I draw to the House’s attention is seriously significant to British business because it is common to all these so-called rollover agreements. It is addressed in paragraphs 11 and 22 of the report that we are looking at today and concerns asymmetrical rules of origin, which seem to me to be one of the principal respects in which the new agreements are worse for British business than the situation before Brexit.

Take Cameroon as an example. It imports five times as much from France and more from Belgium, the Netherlands and Italy than it does from this country. Given integrated EU supply chains, there will have been UK content in these imports from the EU, but because our new TCA with the EU does not permit diagonal cumulation, such content will now disqualify such goods from the EU’s preferential trade arrangements, such as those with Cameroon. So, continental businesses will tend to look elsewhere for their components. It is asymmetrical: Cameroon’s exports to us will, under this agreement, still satisfy our rules of origin, however many European components they contain. More seriously, the same asymmetry applies in agreements with major trading partners such as Japan. Under the trade and co-operation agreement, not only will UK-assembled goods—motor vehicles, for example—not have tariff-free access to the continental market; those assembled here will not qualify for the EU’s preferential deals with third countries if their third-country content, in the first case, or their third-country and UK content in the second case, exceed rather low thresholds. That is bound to have serious economic effects in this country.

The problem was addressed at some length in chapter 3 of the EU Committee’s 24th report, of 25 March, Beyond Brexit: Trade in Goods, but I have not seen any government response and the Minister did not address the issue in the letter he kindly sent us yesterday. I would be grateful if he could now tell us what impact assessment the Government have made of the omission of diagonal cumulation under the TCA and its effects on future third-country trade. Perhaps he could also tell us when the House and the country can expect to see such an assessment.

Turkey: Free Trade Agreement

Lord Kerr of Kinlochard Excerpts

Tuesday 27th April 2021 Grand Committee

[Lord Kerr of Kinlochard (CB) [V]]

I wanted to raise three points and one more general one. First, British goods exporters are now at a disadvantage compared to their EU competitors because we are outside the 1996 EU-Turkey customs union and hence European rules of origin cumulation. I understand that; what I do not understand is why in this agreement, unlike the original 1963 EU-Turkey association agreement, there is nothing on services. The balance of trade in goods heavily favours Turkey, and that is likely to worsen. Could we not have got something in exchange on services? Could the Minister say whether we tried and, if so, why we failed?

Secondly, the agreement contains nothing on human rights, as other noble Lords have mentioned. During our debates on the Trade Bill, the Minister assured us that human rights would be at the heart of trade policy. President Erdoğan’s Turkey, flouting ECHR calls for the release of civil society leaders, is surely a paradigm case, or at least should be. So why the lacuna in the agreement? Did we try to fill it? If so, why did we cave in?

Thirdly, I predict that the Minister will remind us that an enhanced agreement is to be negotiated and the gaps in this one can be filled then—but is that plausible? Precedent is a powerful weapon in negotiation. Passes once sold are not easily recaptured. Moreover, have not we missed the moment of maximum leverage? Precisely because the balance is in the Turks’ favour, they will have been anxious that we should not revert to WTO terms, bringing in new UK tariffs on their goods. Our hand was stronger in 2020 than it will be when negotiations restart. How come we missed the boat?

That brings me to my more general point. When roll- over agreements do not duplicate previous arrangements, they seem on the whole to make them slightly worse. The Mexico agreement is another which leaves UK exporters less competitive than their EU rivals will be. Did the department, in its rush to prove that it can negotiate agreements, sacrifice quality for quantity and content for quantum? Did we put ourselves under time pressure, and are there lessons to be learned from that—for example, for our negotiation with Australia? Are not we again risking seeming overly eager? I look forward to the Minister’s replies.

Economic Partnership Agreement: Kenya

Lord Kerr of Kinlochard Excerpts

Tuesday 2nd March 2021 Lords Chamber

[Lord Kerr of Kinlochard (CB) [V]]

What a pleasure it was to hear the noble Lord, Lord McDonald, and what a good foretaste of what he will bring to our debates. It is obviously a great pleasure to follow him. We have heard how well he manages suaviter in modo; I can assure the House that he is also pretty good at fortiter in re. He is quite tough: after all, he endured a couple of years working for me in Washington. He went on to hold very senior jobs across Whitehall, not just in the Foreign Office, and to be a distinguished ambassador in Israel and Germany. He may well have got the suaviter bit from Patrick, Lord Wright of Richmond, his father-in-law, who was so liked and is so much missed here in this House. Like Patrick, and like me, he served five years as Permanent Under-Secretary. His were more challenging times than mine. He brings us considerable wisdom and experience, and I welcome him very warmly to this House.

I am very glad that we are having this little debate on the agreement with Kenya before it is ratified. Like the noble Lord, Lord Oates, I thank the noble Lord, Lord Grimstone, for his assurance on 23 February on the Floor of the House that it would be inconceivable in future that we should not have a pre-ratification debate if such a debate were recommended by the committee of the noble and learned Lord, Lord Goldsmith. I have long envied American negotiators their ability to argue, during a negotiation, that however admirable a suggestion from our side was, “It will never fly on the Hill.” Our negotiators now have a comparable weapon in their armoury.

In the time allowed to me, I can make only two very brief points about the agreement itself. First, of course the cohesion of the East African Community matters and, as the noble and learned Lord, Lord Goldsmith, said, the compatibility of this new agreement with Article 7 of its common market protocol is not at all clear, but I do not believe that in practice the agreement threatens the cohesion of the EAC. Under the agreement, tariff reductions by the Kenyan Government, which might create a perceived need for customs checks inside the EAC, will start only seven years ahead. By then, I would hope that all five other members of the EAC would have acceded to this agreement or a comparable, improved version of it. I very much hope that the Minister will be able to confirm that that is indeed the Government’s aim.

Secondly, the IAC report drew particular attention to the scrutiny of amendments to agreements. It is important, if we are to avoid future disputes, to devise clear criteria for determining when an amendment—or, indeed, a memorandum of understanding, an exchange of letters or an agreed minute—is of sufficient weight to trigger CRaG scrutiny. I am encouraged by the sympathetic hearing that the noble Lord, Lord Grimstone, has so far given to the concept of a criteria-based approach, and I urge him not to weary in well doing.

Comprehensive Economic Partnership (EUC Report)

Lord Kerr of Kinlochard Excerpts

Thursday 26th November 2020 Grand Committee

[Lord Kerr of Kinlochard (CB) [V]]

What a privilege it is to follow the noble Lord, Lord Darroch, and be the first to congratulate him on an excellent maiden speech. We come from the same Diplomatic Service stable, where, in Washington, Brussels and Whitehall, he served five Prime Ministers with verve and distinction. He was famous in our service for hard work, good judgment, a certain joie de vivre and conspicuous loyalty to his team. I was rather luckier than him in some ways, because the Presidents I watched in Washington were rational and predictable, and all the Prime Ministers I worked for saw loyalty as a two-way street. We have just had an insight to and foretaste of the huge contribution that the noble Lord, Lord Darroch, will, with his wisdom and experience, make in the House. Despite his being a Chelsea fan, I welcome him very warmly.

As a member of the committee, I begin by congratulating the noble and learned Lord, Lord Goldsmith, on his judicious and magisterial chairmanship. I also congratulate the noble Lord, Lord Grimstone, and thank him for his courteous and co-operative relationship with the committee. I particularly congratulate our clerk, Dominique Gracia, who mustered our thoughts graciously, skilfully and fiercely

I am one who welcomes the agreement and think that its principal merit is continuity; it prevents a cliff edge on 31 December. There are small pluses—on digital, on data and on regulatory co-operation, though nothing on investor protection and no separate chapter on digital—and there are minuses. There are minuses on TRQs, as the noble Lord Darroch, has said, and on geographical indicators. I would not make a big deal of these minuses—indeed, I would not mention them at all—but for the fact that the department chose to present them as pluses by comparing the deal not with the status quo of the EU deal that we have enjoyed up to now but with the straw-man of what WTO terms would have been.

I join the noble Lords, Lord Foster, Lord Hain and Lord Darroch, in warning of the dangers of overselling. It is actually unfair to our negotiators, who have produced a perfectly respectable rollover deal, that there should be Twitterstorms and criticisms over claims that are, at best, exaggerated. I think it would be wise, if we are comparing the benefits that we will secure from the agreement, to compare them with the status quo.

These points have been well made and I do not want to labour them. I would like to make a different and more general point. For 40 years, the dominant factor in our economic relationship with Japan has been its inward investment in this country, first in electronics, then in the automobile sector and then more widely. The benefits to us have been enormous, not just in employment but in learning from Japanese production techniques of automation and now digitisation. The Japanese came here because they saw us as a springboard into Europe. I was one of those who, despite strong Italian and French opposition, persuaded Jacques Delors’s Commission that Nissan’s investment in Sunderland would produce European cars, not Japanese cars, and they would be just as European as Fiats or Peugeots. If we had failed, the Japanese would not have come here. What worries me now that Sunderland is outside the single market—which Jacques Delors, Leon Brittan and Margaret Thatcher built—is that the Japanese may be forced to take a different view. Whether Nissan and Toyota now pull back—or, worse, follow Honda and pull out—depends not on the agreement that we are discussing today but on the agreement we strike with the European Union and what it says about rules of origin and what the return of customs formalities and frontier checks means for just-in-time supply chains. We must cross our fingers and hope for a no-tariff deal and minimal frontier friction. If we do not get those, the relationship with Japan will wither.

For all the fine talk of Asian opportunities and the CPTPP, the rule of thumb for trading in goods is that trade halves as distance doubles. That is why the Japanese have chosen to make things here, and if we lose them the European market, we will lose them, full stop. They will make things in continental Europe instead. I hope that the Prime Minister understands that.

United Kingdom Internal Market Bill

Lord Kerr of Kinlochard Excerpts

2nd reading & 2nd reading (Hansard): House of Lords
Monday 19th October 2020 Lords Chamber

[Lord Kerr of Kinlochard (CB) [V]]

I should say that it is a pleasure to take part in a debate with so many distinguished speakers, such excellent maiden speeches and one informed by three such good reports, but it is not a pleasure because, like the noble Lord, Lord Arbuthnot, I feel that we should not be here debating this Bill; it is a bad Bill. Like the Constitution Committee, I cannot see the need for it, and I cannot support the reopening of the devolution settlement, putting new limits on devolved competence or binning the common frameworks. However, for me, the central issue is stark and shockingly simple: a treaty is a contract binding on the states party to it.

Exactly 12 months ago today, Mr Johnson concluded a treaty. Some of us here said that we found its Irish protocol offensive in principle and likely to prove problematic in practice, but Mr Johnson said that we were wrong; it was fine; indeed, it was fantastic—his triumph. He won his majority and he used it to ensure that this Parliament ratified his treaty. It thus became binding on the country and on all of us, whatever reservations we may have had about it: binding in law and binding in honour—I repeat, honour. That is what this is all about; that is what makes it so shocking that Mr Johnson now asks us to empower him to override his treaty—not to seek to change it, just to choose to break it—and require the courts to ignore it whenever he decides they should.

It is no wonder the head of the Government Legal Service, Sir Jonathan Jones, resigned—I pay tribute to him for doing so. I cannot see how this House could in honour collude in legislating to break a treaty. This is not about frontier checks; it is not about Brexit; it is about honour and reputation. For what purpose are we going to throw all that away? The noble and learned Lord, Lord Clarke of Nottingham, pointed out that Mr Johnson has not told us what arrangements he envisages for the border between the EU single market and our single market. If he overrides the protocol, what will replace it? What will sustain the Good Friday agreement? Why, if Mr Johnson believes that he has grounds for complaint against the EU, does he not use the dispute resolution procedures in the treaty he signed? I refer the House to the nine questions in the letter that the noble Earl, Lord Kinnoull, as chairman of the EU Committee, sent to Mr Gove a month ago—they are at the back of the committee’s report. They remain unanswered; I think that they are unanswerable.

It is hard to avoid the conclusion that what we have here is a simple case of buyer’s remorse. Mr Johnson now dislikes what his treaty said. Just as he chose in the current negotiation to tear up the political declaration that he agreed on this day last year, so he proposes to tear out bits of the treaty. What price honour? He gave his word. Moreover, worse, he gave our word when, at his urging, we ratified his treaty. Ours is the responsibility for saving the national reputation, and in honour we must.

I will vote for the amendment in the name of the noble and learned Lord, Lord Judge, and I trust that we will then move on to remove Part 5 and, if necessary, insist with the noble Lord, Lord Butler, and persevere.

“Perseverance, dear my lord, Keeps honour bright.”