European Union (Withdrawal Agreement) Bill

Lord Kerr of Kinlochard Excerpts

Committee: 1st sitting (Hansard) & Committee stage & Committee: 1st sitting (Hansard): House of Lords
Tuesday 14th January 2020 Lords Chamber

It is important to note that the power is restricted to making provisions which implement, supplement or deal only with matters arising out of the relevant sections in the agreement relating to social security co-ordination; I reassure the House on that point. That is why we cannot accept this amendment, which would sunset the powers to make regulations only two years after the end of the limitation period, whereas the withdrawal agreement social security co-ordination provisions have no such sunset and potentially may last decades for many people. To put an expiration date on the power could therefore prevent the UK ensuring—

[Lord Kerr of Kinlochard (CB)]

I understand the point the Minister is making and that the scope of action is limited to the areas covered in the withdrawal agreement—I understand all that. However, would it not be more reassuring to recipients if the sunset clause were there, and if changes could be made only after the expiry of the period by primary legislation? I understand the argument, but if the argument is reassurance, surely it is more reassuring to people that changes could be made only by primary legislation than that they could be made using these Henry VIII powers laid out in these provisions.

[Lord Bethell]

My Lords, the point is well made, and I understand the desire of the Houses to keep scrutiny on measures, which is entirely fair. However, in this case, confidence, solidity and a sense of commitment can be promised and delivered by the Government only if they do not have the fear that the pipeline of legislation going through the House might delay important technical changes and hold up the delivery of these benefits. It would put a huge pressure on these Houses of a kind that is not realistic or reasonable to have the entire legislative timetable of our proceedings held hostage to the microchanges and small needs of EU social security regulations and improvements, which may in decades to come affect only hundreds of thousands of people and require small administrative changes in regulations.

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[Lord Keen of Elie]

I am obliged to all noble Lords who have contributed. Like many noble Lords who have already spoken, I am conscious of the sensitivities that surround the devolved settlement that could impinge upon its success in the future.

Let us be clear: Clause 15 is essential to implement our international legal obligation under the withdrawal agreement and under the EEA-EFTA separation agreement, which requires that we establish an independent monitoring authority. I hope that it also demonstrates our commitment to protecting the rights of those citizens covered by the agreements. Therefore, it is necessary for Clause 15 to stand part of the Bill.

Of course, the IMA will offer an important layer of additional protection over and above the wide range of complaint and appeal routes that already exist for EU citizens in the United Kingdom. However, expanding the IMA scope through Amendment 57—as proposed by the noble Lord, Lord Greaves—would, I fear, divert the body’s resources from its important role monitoring citizens’ rights and obligations. Therefore, I would resist such an amendment. It also risks creating unhelpful duplication, with all the confusion and wasted resources that could accompany that, so I invite the noble Lord, Lord Greaves, to withdraw that amendment.

The withdrawal agreement requires that the IMA be established by the end of the implementation period; that is the goal. The appointment of an interim chief executive to the IMA—a point raised by the noble Lord, Lord Greaves—is considered vital to meeting that deadline, as it will be essential from the point of view of staffing and procurement decisions that will need to be taken in advance of that date. Indeed, there have been other examples of interim chief executives being appointed to such bodies in order that suitable preparation can be made for them to be up and running at the appropriate time. Removing that provision through Amendment 47 would jeopardise the timely establishment of the IMA, and risk putting us in breach of our international law obligations. I hope that I have explained the rationale for that approach.

In order to give full and proper effect to our obligations in international law, we have designed the IMA to be robust and independent, in line with the best practice for the establishment of new public bodies. While I understand the intention behind a number of the amendments in the name of the noble Lord, Lord Greaves, which he perceives as strengthening the independence and robustness of the IMA, I hope I can assure him that they are unnecessary. I appreciate that they are essentially probing amendments in order that we can explain the position.

[Lord Kerr of Kinlochard]

Perhaps I may probe a little further. The independence of this authority is important—important because we have agreed to introduce an independent authority and important to those whose affairs it will be keeping an eye on.

When I was a Permanent Secretary, I would have had no difficulty in coming to the conclusion that a number of non-departmental bodies could be abolished and their functions transferred elsewhere because it would be more efficient, effective and economical to do so. The test in paragraph 39(2) of Schedule 2 is not hard for the Executive to meet. Does the Minister think that the body is more likely to be independent, feel independent and be seen as independent if it is continually under the threat of the sentence of death in paragraph 39(1), which says that its powers can be transferred? I agree that it is a habit for quangos to survive long beyond their natural useful lives, but what is the rationale for this power transfer by regulation? Is the Minister convinced that the test of efficiency, effectiveness and economy does not slightly conflict with the requirement for independence?

Brexit: The Customs Challenge (European Union Committee Report)

Lord Kerr of Kinlochard Excerpts

Monday 1st April 2019 Lords Chamber

[Lord Kerr of Kinlochard (CB)]

I will make a small and typically unpolemical point in the gap. This admirable report says at paragraph 17:

“The UK Government has repeatedly ruled out entering into a customs union with the EU on the grounds that this would tie the UK to the EU’s Common Commercial Policy”.


That statement is true, but what the Government say, as reported in that statement, is not true. The customs union and the common commercial policy are completely separate in the treaty. They are legally distinct. The example of Turkey shows that you can have a customs union with the EU without having the EU running your trade policy. The Turks are outside the common commercial policy. Customs union means no tariffs between you and your partners and common tariffs against the rest of the world. It does not mean that the Commission would be negotiating for us with the rest of the world. It does not mean that we would benefit from existing EU free trade agreements. It does not mean that any new EU trade agreements would apply to us.

We know all that; why am I saying it? It is because next door in the other place, the issue of a customs union, as the noble Lord, Lord Taverne, said, is being talked about right now. Do not get me wrong: I still believe that Brexit plus customs union is a complete disaster and a dreadful thing to do, but it would be wrong to argue against a customs union on the grounds that it ties you to the EU’s trade policy, because it absolutely does not, even though the Government have frequently said that it does. We would be entirely free in the areas of services, intellectual property, public procurement, regulatory barriers and data. The only area where we would be bound by the EU’s decisions would be on the level of tariffs in goods—a relatively small proportion of world trade now.

I repeat: do not get me wrong—it is still a very dangerous way to go. However, when the House of Commons considers the customs union amendment written into the Trade Bill, it would be good if the Government, when they took a view on it, took a view on the merits of a customs union. We said nothing in our amendment this time to the Trade Bill or last time in the withdrawal Bill about losing our ability to do trade deals around the world or acceding to the common commercial policy, which is a completely separate question. The question of a customs union should be addressed solely on its merits.

Trade Bill

Lord Kerr of Kinlochard Excerpts

Committee: 4th sitting (Hansard): House of Lords
Monday 4th February 2019 Lords Chamber

[Lord Bates]

I will be glad to do so. In a lot of such agreements, especially for the major manufacturers, the bulk of the value of the trade or the deal is the service package and the support provided thereafter. I will be very happy to write to my noble friend ahead of Report.

[Lord Kerr of Kinlochard (CB)]

In the early part of his speech, the Minister read out an impressive list of points that had been achieved or secured before he moved on to his brilliant ex tempore dealing with the questions raised in debate. I confess that I did not recognise those points. I cannot remember seeing them in the withdrawal agreement. Was he perhaps referring to the relevant part of the political declaration, in which case surely those points have not been secured or achieved and what has been agreed is that all these things may be discussed over the next three, four or five years as the long-term relationship is considered?

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[Lord Kerr of Kinlochard]

My Lords, I support Amendment 77 for the reason that the noble Lord, Lord Lansley, has just given, and I strongly support Amendment 80, for the reason that my noble friend Lord Hannay gave.

Amendment 78, however, is very strange. I support it, but we are in Alice in Wonderland territory here. It is an entirely academic interest, because it seems to me implausible that Mr Barclay and Mr Paterson, and their high-powered alternative arrangements group, would come back to this alternative arrangement—the Chequers proposal—given that they ambushed the Government to take it out by their amendment to the taxation Bill.

It was always rather a fanciful idea anyway. In its brief life, it had several forms. First, it was proposed as a reciprocal arrangement. The foreigners would have to clog up Rotterdam, Antwerp, Hamburg and Bremen collecting our tariffs and operating our quotas, segregating our goods from goods going to the EU, which would be charged EU tariffs and subject to EU quotas. Once segregated, in some magic way, our goods would then proceed to the United Kingdom, having paid UK tariffs at their first European port of entry. That was never going to happen.

The second form, once noises from Brussels had been heard, was that we would do it for EU goods but the EU would not be required to do it for our imports at its ports. It was that, I think, which provoked the ire of the ERG: why should we collect foreign tax? But there was no possibility of the EU at any stage agreeing that we should collect its tariffs at our ports.

There are several degrees of lunacy here, and we have this very strange prohibition on the statute book. I think that the statute book should not contain nonsenses, and so I support the amendment. However, it does not matter. The EU would never agree this proposal in any of its incarnations. Mr Paterson, Mr Barclay and these other trade experts are not going to come up with it as an idea in the alternative arrangements committee, because they were dead against it. Therefore, although I support the amendment, I do not think one need spend a lot of time on it.

[Lord Bates]

My Lords, I rise more in hope than expectation of being able to persuade your Lordships. I pick up the sense from the Committee that this is probably something that your Lordships will want to return to in more depth on Report. Perhaps the best service I can offer at this stage is to put on record the Government’s position, respond to some of the precise points and then await further developments as they may unfold between now and Report.

Amendments 77, 78, 79 and 80 relate to changes passed in the other place during the passage of the Taxation (Cross-border Trade) Act 2018. This Act is important legislation as the UK leaves the EU. It enables the Government to create a stand-alone customs regime by ensuring that the UK can charge customs duty on goods, set and vary the rates of custom duty, and suspend or relieve duty in certain circumstances.

I turn now to the substance of the original amendments to the Act, which these amendments seek to remove. Amendment 77 relates to Section 31(5), which requires further parliamentary scrutiny in the event that the power under Section 31(4) is used to implement a customs union with the EU. The Government support the principle of further parliamentary scrutiny in this case. My noble friend Lord Lansley suggested that this was perhaps reflective of the politics of the movement. As a distinguished former Leader of the House in another place, he will be very familiar with how that side of things works. However, as this House is aware, the Government have made it clear that they are not seeking to be in a customs union with the EU as part of our future economic partnership—I say that without wishing to reopen the many debates we have had on “a” and “the”.

It is important to reflect why the Government have taken this view and to consider what leaving the EU means. It means the ability to strike out on our own to forge new trade deals. In order to do this, one important element is to have the ability to set our own tariffs. Being in a customs union would deny the UK this ability and fundamentally undermine our capacity to negotiate new trade deals with old friends and new partners.

The noble Lord kindly outlined, as he saw it, the way in which Amendment 78 arrived, referencing first the Bill and then the amendment. The Government have been clear in their White Paper that the arrangement they are seeking will ensure that both the UK and the EU get their fair share of the revenues from the rest of world trade. Section 54 of the Taxation (Cross-border Trade) Act is in line with the proposals that the Government set out with a view to achieving just that.

Turning to Amendment 79, Section 55 of the Taxation (Cross-border Trade) Act 2018 requires a single UK customs territory. This is a statement of government policy and ensures that the Government will not act incompatibly with the commitments made in the joint report of December 2017, where they committed to protect the constitutional integrity of the UK.

--- Later in debate ---

[Lord Bates]

It is a challenge when someone with the noble Lord’s intellect begins a sentence by apologising for not being a politician and then asks for clarity at the present time. We are discussing this legislation, but we all know that we are in one of the most fast-moving, dynamic episodes of negotiation that this country has ever entered into. We are gradually working our way through. The White Paper was published at a moment when we were seeking to flesh out exactly what the Government’s position was in response to the Commission saying, “We don’t know what the UK’s position is; we don’t know what they want”. Therefore, the White Paper was introduced at that point. Then there was the clamour for clarity for business—what it would do in the event of no deal—so the technical notices were issued. Then, we got to the position where we reached an outline agreement with the European Commission in December, against many people’s expectations, along with heads of terms for what a future economic partnership might be. That was then presented to the other place and roundly rejected. Therefore, we have now begun another process, so I readily accept that if one wants to score points by stopping the clock at various stages along the process and pointing to certain inconsistencies in it, the Government are pretty easy fare for that.

[Lord Kerr of Kinlochard]

The Minister is making a very gallant effort and I applaud it. I enjoyed many of the things he said, particularly when he referred to a no-Brexit deal. I thought that was a very encouraging concept. I really cannot let him get away with where he is now, in this fast-moving situation he describes. Put yourself in the place of the EU 27: what are they supposed to think when the Prime Minister scuttles her own fleet? She orders her party to vote down the backstop in the treaty. The backstop is 21 articles, 10 annexes and 172 pages. The Prime Minister’s officials have negotiated that line by line, month by month and it is there because we asked for it. Then she decides that the best thing to do with it is to replace it with alternative arrangements, which are now being devised by Mr Owen Paterson and Mr Stephen Barclay. The Minister tells us that this is a fast-moving situation and it is quite hard to keep up with it, but there is nothing happening in Brussels but sheer astonishment at the failure of our system.

[Lord Bates]

That is the noble Lord’s position on this: the reality is that the Prime Minister is seeking an agreement that can command a majority in the other place and that requires compromise. That is what the agreement represents. The House made its view on the withdrawal agreement clear; she is now seeing whether that can be addressed with the Commission. Personally, I wish her well and every possible success, as opposed to my own mis-speaking. Lest it be on the record, I am sure that Sigmund Freud would have observed that perhaps I had momentarily let slip an inner feeling, which, of course, has nothing to do with the position of Her Majesty’s Government, which I consistently seek to put forward from this Dispatch Box and proudly support.

The noble Lord, Lord Purvis, asked about support for government amendments that preclude the facilitated customs arrangements. We would argue that there is nothing about the amendments made to the Taxation (Cross-border Trade) Act in the other place that is inconsistent with the draft political declaration that will inform the future relationship. On the point made by the noble Lords, Lord Hannay and Lord Stevenson, about insufficient focus on VAT implications, the Government have been clear that we are aware of the potential impact on businesses of any move away from the concept of acquisition VAT, but we have also set out that in any scenario we are seeking to avoid any adverse effects. Amendment 80 does not affect that in our view.

Taxation (Cross-border Trade) Bill

Lord Kerr of Kinlochard Excerpts

2nd reading (Hansard): House of Lords & 3rd reading (Hansard): House of Lords & Committee: 1st sitting (Hansard): House of Lords
Tuesday 4th September 2018 Lords Chamber

[Lord Kerr of Kinlochard (CB)]

My Lords, it is a pleasure to see the noble Baroness, Lady Kramer, back in such sparkling form after the holiday, and I very much share her view that it is regrettable that we in this House are not allowed to do our normal job on this Bill. There is a lot of technical stuff in it and our job of scrutinising, of considering possible omissions and anomalies, and of suggesting through the contribution of judicious amendments improvements to enable the other place to think again would seem to make a classic case for a Bill of this size, complexity and detail. The House of Lords would have handled it very well, but it seems that by procedural stratagem we are being denied a substantive opportunity, and that for me is wrong. I very much regret it.

I want to ask two questions about the Bill and draw attention to two omissions. My first question is about the Trade Remedies Authority, which turns up in Clause 13 and has its duties relating to imports thought to be affected by unfair subsidies or anti-dumping cases spelt out in two of the schedules. It surprises me that I do not find the Bill establishing the authority. It does not tell me about the authority’s composition. It tells me about some of its duties but where is the power that establishes it? Can we be told how independent of government it will be? How will consumer and producer interests be balanced in its composition? How will the differing interests of parts of the Kingdom be balanced? The October White Paper spoke about the need for UK-specific thresholds but in the smaller Celtic economies, a producer concern that would not be seen as substantive in relation to the UK economy might loom large in particular sectors. Will the devolved Administrations or Assemblies be able to nominate representatives to the Trade Remedies Authority?

I may have missed something: perhaps these questions have been answered already elsewhere but they are not answered in the Bill and I do not understand why. How will the authority be staffed? The section of the Commission that handles anti-dumping is ferociously efficient and equipped with powerful economic analysis, which you need because producer interests tend to get front-page attention and may not advance national—or EU, in this case—interests. Have we recruited these people? What kind of people are we trying to recruit? Are they capable of carrying out this important task?

Secondly, when will the Government give the country some idea of how they intend to use the power conferred on them by the Bill? In mid-August, we were told that Dr Fox’s department decided to terminate 72 of the 114 EU tariffs currently imposed as anti-dumping measures or because of unfair subsidies. Which 72 will they be? Business might like to know that; it would helpful for planning. How does this relate to the role of the Trade Remedies Authority? Does it exist in shadow form? Has it been consulted? Will it be consulted or is it just being pre-empted by a fiat by the department, in which case my question about its powers and composition may be irrelevant?

This relates to a wider concern about uncertainty. The Minister spoke about the need for certainty; he is absolutely right. Current uncertainties are holding up investment and precluding sensible business planning. Dr Fox is keeping very quiet. Presumably, he sticks to his Heritage Foundation/Adam Smith Institute/Henry Jackson Society principles. Presumably, it is with a light heart that he decides to axe 72 import tariffs because he is a devoted free marketeer, but he is not saying that now. He is keeping quiet about which sections of the economy he would prefer to open up to greater competition. He is not stopping Mr Gove assuring the farmers or the environmental interests that they are going to be protected. Yet, if Dr Fox starts negotiating—as I suppose he will one day—with Canadians, Americans, Australians or New Zealanders, he will find that what they want most of all is access to UK markets for their farm products. This conflicts slightly with the assurances Mr Gove has given, although it might be absolutely in line with what Dr Fox, the free marketeer, and the Adam Smith Institute would like.

I do not know whom to believe. I think the Government are trying to speak out of both sides of their mouth. They are trying to please everybody at present by keeping us all in doubt as to what their import policy would be. Of course, Dr Pangloss of the Sunday Telegraph assures us that the consumers are going to win and prices are going to fall. Meanwhile, the agricultural producers are being assured by Mr Gove that they are going to be all right. Everybody is a winner. This is certainly the view of Pangloss in the Telegraph. It would be good if the Government took a view and told us—perhaps next week, when we will be talking about the Trade Bill—what their import policy is. Is the current balance of producer and consumer interest to change, as Dr Fox would presumably like? On agriculture, is it the farmers and food processors who are going to succeed, or is it the foreigners and consumers? Are any tariffs that matter to farmers and food producers among those which Dr Fox has decided should be axed—the 72 that are condemned? At present, everybody is being assured that all will be okay. It is Pangloss time, but to govern is to choose. In the context of this Bill and of the Trade Bill, the Minister should tell us where on the spectrum—from liberal, open markets to protectionism—the Government are going to stand.

What is missing in this Bill is any provision for the two options spelled out in the White Paper: the highly streamlined customs arrangements or the new customs partnership. Under this partnership, our customs authorities would segregate goods designed for consumption in this country from goods heading for onward export to the EU, charging our duties on the former and EU duties on the latter. I do not mourn either omission. As the former Foreign Secretary’s article in last weekend’s press eloquently expressed, the invisible, highly streamlined frontier is a pipe dream which is easily translated by the press into sound and fury signifying nothing. There is nothing underneath it. It is not possible. The EU will not change the rules for its frontier regime which it, with our active participation, has developed down the years. When we leave the EU customs union, we will be outside its frontier, which will be run according to its rules. The touch has got lighter over the years. The turnaround has got faster over time, but we cannot expect a sudden step change, an entirely new regime or a loophole for the British alone. It is not going to happen.

As for the partnership, I thought it was dead on arrival. I knew it was dead when, as the noble Lord, Lord Tunnicliffe, reminded us, the Government immediately changed the Chequers plan in response to ERG pressure. They demanded that the 27 similarly clog up their ports by segregating their imports too and that they should run a two-tier tariff system, charging our duties on goods in their ports where the final destination was our country and tracking them until they got here. Why should they do that? Why should they impose this massive new friction on themselves? It was never going to happen. It was cloud-cuckoo-land. As M Barnier said at the weekend, it would be a bureaucratic nightmare. He is right.

I have a slightly different take on this from that of the noble Lord, Lord Tunnicliffe. I want to ask the Minister whether he can confirm that the absence from the Bill of any provision for the partnership, the absence of any government amendment which would permit them to introduce the partnership and the acceptance by the Government of Clause 54 mean that they have dropped the partnership and that we can waste no more of our time on it? I hope that that is true, because it would very unwise to waste any more of the negotiators’ time in Brussels in talking about it. It will not fly.

That brings me back to the only practical way I see of avoiding the frictions of a customs frontier with our biggest trading partners and our closest neighbours and friends. When in April this House voted by a large majority to amend the withdrawal Bill to ask the Government to explore the possibility of a customs union with the European Union, it was responding to the concerns of British business, manufacturers, the transport industry, importers, exporters, the CBI, the TUC, Keidanren, the BDI and, of course, anyone awake to the potential problems in Northern Ireland.

As far as I know, nothing has happened since 18 April to change the situation that the House considered then, when it thought it justified to explore the possibility of a customs union, except that it has become clearer that solving the frontier issue will determine whether there will be a withdrawal agreement or we face a cliff edge. It has also become clearer that of the Government’s two options for avoiding the choice, neither work.

I hope that the Government will even at this late stage explore the possibility of a customs union between the UK—if it has left the European Union—and the European Union. I think that this House will have to come back to this question next week when we consider the Trade Bill.

Refugees (Family Reunion) Bill [HL]

Lord Kerr of Kinlochard Excerpts

Committee: 1st sitting (Hansard): House of Lords
Friday 11th May 2018 Lords Chamber

[The Earl of Listowel (CB)]

I speak in support of the Bill and against the amendment. I recognise the concerns that the noble Lord, Lord Marlesford, has raised about pressures on public services, but these children will be in care, so they will need a foster carer or perhaps be in a children’s home. If they have a family member with them, the public purse will benefit in that regard.

From a humane point of view, I worked in a hostel once a week over a period of time and saw a young girl from Afghanistan, and she was always quiet and depressed. She spoke no English—she spoke only a very limited dialect of her language, and the only other speaker was somewhere way off in the East End, so she was very isolated. One evening I arrived and she was in tears, because she had had news that the town that her parents lived in was being shelled, and she was concerned about them. The examples given about the hardship and emotional trauma for these young people ring very true to me. Simply from a humane point of view, anything that can be done to reunite these children and young people with their parents has to be welcomed, so I support the Bill.

[Lord Kerr of Kinlochard (CB)]

I am a little surprised at the amendment, because I have great respect for the noble Lord, Lord Marlesford, and have enjoyed working on committees with him in the past. I think that his concerns are exaggerated.

The noble Baroness, Lady Hamwee, has covered all the points, and I stress just two. First, the category that we are talking about is very limited—it is self-limited. We are talking about only those granted refugee status or humanitarian protection under the Immigration Rules; in other words, we are not talking about economic migrants or anybody here illegally. We are talking about a very small category, clearly defined in Clause 1(1).

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[Baroness Williams of Trafford]

The noble Lord is absolutely right, and I also said that it is difficult to estimate. Of course people could make applications, but they would be doing so under the legislation we have passed. However, I made the point that it is quite difficult to get exact numbers.

I recognise the potential implications of the Bill highlighted by the amendment tabled by my noble friend Lord Marlesford, which would seek to limit the number of family members that could be granted leave under the Bill to a maximum of two. It is a recognition of the wider impacts the Bill may have. As I think every noble Lord mentioned, it could have a divisive effect on families and on the people in the position of having to make those awful decisions. While the current provisions are more narrowly defined in terms of family members who may qualify, this is not limited to a specific number of individuals. I think that is why noble Lords probably took issue with my noble friend’s amendment. This clearly demonstrates the complexities around this issue and why it requires careful consideration, which is what the Government are doing.

My noble friend Lord Marlesford talked about the Home Office being corrupt, which is quite a strong allegation. He then moved on to the capacity of the Home Office—what has the Home Office done to improve vetting and recruitment procedures? The noble Lord, Lord Kennedy, helpfully pointed out that for anyone to get through the Home Office procedures involves a very rigorous process, which is why I am at this Dispatch Box so much, now almost every day of the week, including Friday. As regards vetting in the Home Office, it follows the Cabinet Office vetting process, which is standard across Whitehall. All Home Office staff are bound to adhere to the Civil Service Code, and the Home Office is determined to uphold the highest standards for our staff.

We have all seen the tragic consequences for people, and particularly the terrible sight of unaccompanied children who take dangerous journeys, most likely in the hands of traffickers. While I fully commend its intention, the Bill is likely to place in danger an increased number of those people it seeks to protect. I have not mentioned the P word, because I do not want to dismay the noble Baroness or the noble Lord, but I hope that the noble Baroness will recognise the point I am making. Rather than refugees seeking protection in the first safe country they reach, the Bill creates a perverse incentive for them to make perilous journeys to the UK in the hope of subsequently bringing their family here. We must ensure that we do not put more children in harm’s way, and we are doing this already through resettlement of children and their families direct from the region. We know that policy changes can and do have an impact—

[Lord Kerr of Kinlochard]

The Minister got just too close to mentioning the unmentionable. Is it really plausible that, say in Idlib, if it is under siege in six weeks’ time, the family sits around the dining table, pick a child and tell it that it must set off across the battle lines and the Mediterranean, to try to get into England so that it can then pull the family into England? That is implausible. We are talking about refugee reunion and about children. We really must stop talking about this wildly implausible pull factor. They come here to escape being killed; they do not come here in order to become a magnet for the rest of the family.

[Baroness Williams of Trafford]

I do not dispute a word of what the noble Lord says—that people’s intention in coming here is to flee the terrible things happening in their countries. I am saying that we have all seen the horrible pictures of children who have made these journeys and have either died or got themselves into terrible danger on the way. We talk about this often.

DfID: Tied Aid

Lord Kerr of Kinlochard Excerpts

Monday 11th March 2013 Lords Chamber

[Baroness Northover]

If the noble Lord listens to Bill Gates, for example, he will hear how small contributions looked at globally can leverage an enormous effect. The noble Lord is right that remittances are coming in and there is more inward direct investment and so on, and that is very welcome. We have to make sure that, as the noble Lord, Lord Laming, indicated, the poorest are included in that benefit and that there is the health and education provision to make sure that there is a skilled workforce to benefit from this, because it is in nobody’s interest to have countries with the instability and inequalities that that lack of provision would ensure. It is extremely important that we retain our commitment in this area, but at the same time we must make sure that these other areas, such as direct investment, grow as well and that they are to the benefit of the poorest in these countries.

[Lord Kerr of Kinlochard]

I thank the Minister for repeating the Statement. I was very pleased to hear her strictures on tied aid and her support for competition. Will she confirm that the same applies to consultancies? The only thing that worried me in her Afghan homily was the interjection that investors in mining in Afghanistan were advised by British companies. When such advice from consultancy firms comes from the aid programme is it subject to the same degree of open competition? In developing countries, one sometimes hears that rather a large share of the British aid programme does not go into projects on the ground but into consultants in London.

[Baroness Northover]

The Afghan Government chose to gain their legal advice in the way that I indicated. Consultancies are subject to open competition, so the noble Lord can be reassured in that regard.

Foreign Affairs: Global Role, Emerging Powers and New Markets

Lord Kerr of Kinlochard Excerpts

Thursday 6th December 2012 Lords Chamber

[Lord Kerr of Kinlochard]

My Lords, I thank the noble Lord, Lord Howell, for securing this debate. I also congratulate him on the style and stamina that he showed on the Front Bench, sometimes under grave provocation—sometimes from me. I thank him very warmly.

I had intended to say a word about China but my fox has been elegantly shot—it could not have been better shot—by the noble Lord, Lord Bates. I shall therefore say a word about Korea and make one general point.

Korea is the world’s 12th largest economy—larger than the whole of ASEAN. Last year, it grew faster than any other OECD country and it has the greenest growth strategy in the OECD. It is a major inward investor here. It is a country that the Minister knows very well and, as he knows, Korean markets are now more open to British exports than ever, thanks to the free trade agreement that has come into force.

I need to declare an interest. I am the UK president of the UK/Korea Forum for the Future—a role I inherited from the noble Lord, Lord Richard, when I came to this place. I had inveigled him into doing it when I was Permanent Secretary at the Foreign Office, and the moment I arrived here he passed the role to me with all the dexterity of a Welsh fly-half. In that semi-official capacity, I congratulate the Minister on the Opportunity Korea initiative, in connection with which events will take place in Birmingham, Manchester, Edinburgh, London and Bristol in February. Creating greater interest in this country in the Korean market and in Korean culture is an extremely good idea.

In that context, I hope that the Minister can persuade his colleague, the Foreign Secretary, that it is high time that a British Foreign Secretary visited Seoul. The last British Foreign Secretary to visit Seoul was Douglas Hurd—now the noble Lord, Lord Hurd of Westwell—who did so 20 years ago. Frankly, that is not good enough when we are talking about a relationship with a country which takes us as seriously as the Koreans do, which has such a difficult political environment in its immediate neighbourhood and which is such an important market for us.

People in Korea have a real respect and affection for this country. The foundations of that are partly historical, with the valour of British forces 60 years ago, and partly due to recent partnerships, such as the fact that in Brussels the British were the most powerful supporters of the Commission in securing the free trade agreement. The Koreans know that. They would be delighted if we took more interest in them but they would be disillusioned if we took less interest in Brussels and therefore were able to exert less influence on behalf of the interests that we have in common. Therefore, the last point that my noble friend Lord Hannay made today was very important. I know that Koreans are puzzled at our present stance on the European Union.

I was in Australia last week. Friends there also expressed some puzzlement about our stance on Europe but I was not able to provide an explanation. They asked me why, alone with the Czechs, we chose from the outset to play no part in new EU mechanisms to reinforce the very fiscal discipline which the Chancellor was again preaching yesterday, even though no intra-EU fiscal transfers were envisaged. They have noted that this time we alone—without even the Czechs—chose from the outset to stand aloof from proposed arrangements for improved banking supervision in Europe, arguing that they were relevant only for eurozone member states, even though all other non-eurozone member states will be arguing this week in the European Council for arrangements that will permit them to join and even though our self-exclusion is causing real concern in the City. Noble Lords will have noted the important article by Gerry Grimstone, chairman of Standard Life and TheCityUK, in this week’s FT. I quote:

“British practitioners, politicians and officials need to engage more at the European level and to do so at an earlier stage—building alliances, and proactively informing and shaping the EU … agenda. Whether it is on banking union or on particular markets directives, we need to be at the table with an open, constructive and thoughtful approach. The UK voice needs to be firmly but constructively heard”.

That is the authentic voice of the City, unlike what the mayor was telling us this week, although his motives may be slightly different. He may have personal ambitions rather than the ambitions of the City at heart, and I do not want to go into any piffle.

I now want to make a half point and will then make my final point. My half point is about our global role and the fact that rhetoric is no substitute for resources. What one needs for a global diplomacy is diplomatic boots on the ground: local knowledge, linguistic skills, a real understanding of local markets, and sensitivity to national customs and history. It would be an illusion to pretend that one can be global on the cheap, yet I fear that that is what the Foreign Secretary is being asked to do. If the noble Lord, Lord Howell, were ever to bump into the Chancellor of the Exchequer—as I suppose is conceivable—this is a point that he might want to make to him.

My bigger point about our global role is as follows. When I was a young member of the Diplomatic Service, I witnessed daily battles between the advocates of a blue water diplomacy based on the United States and the Commonwealth and the advocates of being at the heart of Europe. By the time I became head of the service, the battle was long over. All had recognised that the dichotomy was false. It was accepted—not least because our American and Commonwealth friends had gently and persistently reminded us—that we best advance the interests that we have in common with them when we exert maximum influence in the EU. The obverse, by the way, is also true. When in Washington, I discovered that we are heard with greater attention there when it is thought likely that we will be able to deliver EU support for deals that we strike with the Americans.

We do not have to choose—indeed, we must not choose—between a blue water and a continental strategy. They are mutually reinforcing and we need both. If we punch above our weight—in the uncharacteristically belligerent words of the noble Lord, Lord Hurd of Westwell—it is not because of any innate diplomatic skills but precisely because our foreign policy is woven from the twin, mutually reinforcing strands of worldwide reach and continental heft. That is why I can give only two cheers for talk of a new global role. It will deliver among emerging powers and new markets only if they perceive that we are at the heart of all key Brussels debates, building alliances in support of common, and Commonwealth interests, and that we are set to remain their natural influential and permanent point of entry into the 500 million-strong EU market. If we lose influence in Europe, we shall find it hard not to lose influence with them; and if we lose interest in Europe, we may find that they lose interest in us.

European Union Bill

Lord Kerr of Kinlochard Excerpts

Tuesday 22nd March 2011 Lords Chamber

[Lord Kerr of Kinlochard]

My Lords, is it an ineluctable law of coalition government that the Wallaces get all the ghastly jobs? I think we all greatly admired the tact and skill of the noble and learned Lord, Lord Wallace of Tankerness, in extremely difficult circumstances on another Bill, but as I listen to this debate—the score so far is one supporter, two convinced that it does not go far enough and 22 critics, some of them very fundamental, of the Bill—I begin to think that the noble Lord, Lord Wallace of Saltaire, has a more difficult task on his hands. I have the greatest respect for the noble Lord, Lord Wallace. I have learnt a great deal from him down the years. I know what he thinks about the European Union, and I know how difficult is the situation he finds himself in now. He has my sympathy.

Let me say straightaway that I have absolutely no quarrel with Part 2 or Schedule 2. Part 1 is a little more complicated. I find the referendum requirements absurd in conception and damaging in effect. As for Part 3, or rather Clause 18, I think it is certainly spurious and possibly sinister. The Bill is, of course, also very badly drafted. What has happened to Foreign Office drafting? Who could have drafted Clause 18? Nobody in the Foreign Office, I am quite sure. It must have come down from a great political height. The Bill is incoherent. You cannot assert parliamentary sovereignty in Part 3 and demolish it in Part 1, condemning it to a death by a thousand cuts. It does not make sense. Clause 18, which appears to be declaratory, asserts the sovereignty of Parliament. Directly applicable EU laws apply directly to us because Parliament passed the 1972 Act. I agree. If Parliament repeals the 1972 Act, they would no longer apply to us because we would leave the EU using the new procedure set out in Article 50 TEU and the noble Lord, Lord Stoddart of Swindon, could go home a happy man. I agree with that too. Parliament decides, because Parliament is sovereign. However, in Part 1 there is this enormous list of provisions where Parliament does not decide where a referendum requirement is introduced.

The noble Lord, Lord Davies of Stamford, entertained us with some parts of Schedule 1. The one that most puzzles me is:

“Article 346(2) (changes to list of military products exempt from internal market provisions)”.

It is not the substance of the list that we would go to the nation about, it is whether the procedures for deciding the list should be changed. I know what that is about. The internal market competition rules do not apply to certain categories of defence goods, because some countries with inefficient defence industries wish to preserve them, and we wish therefore to have a protectionist situation applying to the goods on the list. The list is decided by unanimity, so it is quite a long list, because everybody who has a tinpot little defence industry that makes something which it would like to buy for its own forces makes sure that the goods in question are there on the list.

We happen to have the most efficient defence industry in Europe. It would be strongly in the UK’s interest to have the procedure for deciding on that list moved to qualified majority. The Government say that they will make sure that that does not happen in this Parliament; and in the next Parliament, the Government say, it could happen, but only if there was a referendum vote in favour of it happening. I do not understand this.

Let us remember that these are mandatory referenda, not advisory referenda. However obscure the issue, however low the turnout, however keen the Government are on the measure, however strong the support for it in Parliament—because, by definition, Parliament will have approved it and the Government will have approved it; they will have signed up to it and the whole European Union will want to do it—but however much it is in our interest, if on a turnout of 20 per cent it is 11 noes and nine yeses, that is it, it does not happen. I do not understand this. It may be, as a minimum, that we need to think about the provision that this House voted for by a large majority proposed by the noble Lord, Lord Rooker, in another context, when we were dealing with another Wallace, almost as distinguished as the one we face tonight.

I am not in favour of mandatory referenda. Actually, I am not in favour of referenda—I will be honest—but I think that mandatory referenda are particularly alarming. The 1975 referendum was not a mandatory referendum, it was an advisory referendum. The then Leader of the House of Commons told the House that it would be,

“wholly consistent with parliamentary sovereignty. The Government will be bound by its result, but Parliament, of course, cannot be bound”.—[Official Report, Commons, 11/3/1975; col. 292.]

That was a Labour Government. From the opposition Front Bench, Mrs Thatcher, in my view totally correctly, said that, “If it was binding, parliamentary sovereignty would be infringed”. Exactly. So what are we doing now?

A second argument about how this Bill would reduce parliamentary sovereignty, has already been powerfully put by the noble Lords, Lord Richard and Lord Taverne. The idea of trying to bind future Parliaments—this whole exercise is irrelevant to this Parliament because the Government have said that they will not agree to anything in Brussels and, therefore, the referendums will not happen during the term of this Government—seems to me to be clean contrary to a fundamental principle of parliamentary sovereignty. So I do not much like Part 1 and Schedule 1.

I should explain why I find Part 3 and Clause 18 spurious and possibly sinister. At the beginning, I did not know why Clause 18 was there. Cui bono? Who wants it? I still do not know. Having read the debates in the House of Commons, it is clear that no one there liked it. Mr William Cash hated it. The House of Commons Scrutiny Committee shares our puzzlement. It concluded that the clause is a,

“reaffirmation of the role of a sovereign Parliament in a dualist state (that is, a state in which external agreements are not self-enacting in domestic law). This principle is neither controversial nor in danger of erosion by the courts; and ‘did not need declaring in statute’”.

I raised that point with the Minister.

So why is it in the Bill? At paragraph 115, the Explanatory Notes assert:

“This clause has been included … to address concerns that the doctrine of Parliamentary sovereignty may in the future be eroded by the courts”.

I have followed EU matters reasonably closely for 25 years. I sit on the Law and Institution Sub-Committee, which was chaired by the noble and learned Lord, Lord Mance, and is now chaired by the noble Lord, Lord Bowness, who I see in his place. They are both powerful, legal experts. Never in 25 years have I come across these concerns. On the streets of Blackburn and Burnley, are they really worrying much about the 2002 argument in the metric martyrs case—which failed in the High Court? Would putting what we all know to be the case on a statutory basis deal with the problem of the disconnect between Europe and British public opinion, about which the Minister spoke eloquently at the start of our debate? I do not honestly think so.

We know that these arguments are spurious. We know that Clause 18 is a tombstone on the grave of the sovereignty Bill, a casualty of the coalition negotiations and agreement. Presumably, Ministers told officials to go off and find something about sovereignty that they could stick somewhere else. Here we have something about sovereignty. I can see that we are required to legislate on matters on which the coalition reached agreement, but I do not see why we have to fill the statute book with tombstones over matters on which the coalition did not agree, particularly when they are nonsense.

If the courts were to find that Parliament is not sovereign, no Act of Parliament could reverse that. If Clause 18 is intended to provide reassurance to the concerned people in the country, that seems to me to be unnecessary because there is no visible concern and because the concern would be absurd. And anyone with concerns about the 2002 case would be seriously misled if he thought that this Bill could set them to rest.

The admirable report from the Constitution Committee, which has been referred to by others, reminds us at paragraph 54 that,

“the idea of such a declaratory sovereignty clause is not new. A similar proposal was in fact made during the passage of the European Communities Act 1972. The then Government opposed the idea and the proposed clause was rejected”.

The then Solicitor-General, now the noble and learned Lord, Lord Howe of Aberavon, who spoke so eloquently earlier in the debate,

“characterised such a declaration as ‘futile … and really a hollow sham ... The position is that the ultimate supremacy of Parliament will not be affected, and it will not be affected because it cannot be affected’”.

I am extremely sorry for the noble Lord, Lord Wallace of Saltaire. I support all Wallaces because I am a Scotsman. I like William Wallace the First who came to a sticky end. I hope the same fate does not await the noble Lord.

That is my argument about spuriousness, but I also think Clause 18 is potentially sinister. I am not a lawyer and perhaps I am being naive, but what other purpose could this clause have? Three elements create a suspicion in my mind. The first is the language of the clause, to which I have already referred. It is curiously convoluted and tautological. Why does it say that it is,

“only by virtue of an Act of Parliament that directly applicable or directly effective EU law”,

has force in this country? Is that “an” specific, or is it generic? It appears to refer to the 1972 Act, which is not controversial, but could it be construed as also referring to other past or possibly future Acts? Is it a dog whistle, a message saying “We want to be able to pick and choose. We want to dine a la carte”? Hoping for reassurance, I looked to the Explanatory Notes for guidance. At paragraph 113 we find the following:

“The words ‘by virtue of an Act of Parliament’ covers UK subordinate legislation made under Acts”.

I hope that the noble Lord, Lord Wallace, will be able to explain that because I cannot understand what it means. What subordinate legislation, and why “Acts” in the plural? That is the second cause of my suspicions.

Let me say why I find all this really worrying. For as long as we remain members of the European Union, we cannot pick and choose which EU laws apply to us and which do not. Nor, as the High Court found in the Factortame case, can this Parliament pass laws inconsistent with EU law. If the suggestion or the subliminal dog whistle implication of the curious language of Clause 18 is that by passing, amending or repealing subordinate legislation or passing or not passing some new Act deemed relevant, we can disapply laws we do not like, that is seriously misleading and dangerous nonsense. Where we have conferred powers on the European Union, directly applicable EU laws apply in this country, overriding any conflicting national laws. I believe that that is because of the 1972 Act and that it could not be reversed by any other Act or subordinate legislation unless that Act repealed the 1972 Act and, using the Article 50 procedure, we left the European Union. So I oppose Clause 18 very strongly. I think it is unnecessary, muddled, misleading and spurious.

The third suspicious feature is easy to describe. The Explanatory Notes say, perfectly correctly, that the clause,

“does not alter the existing relationship between EU law and UK domestic law; in particular, the principle of the primacy of EU law”.

It is declaratory of the existing legal position, but, in a point made by the noble Lord, Lord Hannay, if we agree that that is what it is, why does it not say that? Why do we have these curious, backwards-drafted four lines? We believe in transparency and in the need to reconnect with people, so we give them this curious formula which I find very hard to construe. I am not sure what the public outside would think about it. If it is really only declaratory, alters nothing and has no sinister intent, why do we not drop it? I think we should.

I wish to make one more general point about the Bill. As the noble Baroness, Lady Symons, pointed out at the outset, the referenda requirements here are not about big issues—for example, joining the euro—or major treaty changes such as the Single European Act or the Maastricht treaty. Big changes deserve heavy ratification procedures and, although I do not like referenda, we now seem to be stuck with them on the big stuff. However, as the noble Lord, Lord Davies, spelt out, the lists in the Bill are mainly about Brussels decisions on points of detail and process.

If the Bill passes unamended we shall have signalled to our friends in the other 26 member states that we are highly unlikely ever to agree to any reform, however minor, of EU procedures and processes, institutional arrangements and decision-taking procedures. This point was made by the noble Lord, Lord Williamson, and his analysis is completely correct. Our friends will spot that no British Government, even if they supported some minor proposed reform, would want to have a referendum on it, and therefore would block it. As the noble Lord, Lord Williamson, said, this is not a Bill about having referenda but about not having referenda and, in order not to have referenda, bringing about a paralysis of the institutional structures of the European Union. At least that would be the perception of our partners.

I would greatly regret that. I worked in Brussels for two British Prime Ministers and neither took that view. Mrs Thatcher deserves great credit for the Single European Act, which opened the way to the single market programme. She was extremely tough in negotiations but she was clear that the British should always be in them. As Prime Minister, Mr Major was sceptical about the euro but deserves great credit for ensuring that we were fully involved in its preparation and, although not required to join, had a ticket to do so should we ever so choose.

Being at the heart of Europe is in the British interest. The single market has been good for UK jobs and London has dominated the Euromarket. Conversely, as the noble Baroness, Lady Williams of Crosby, pointed out, the perception of a relentlessly negative approach, entrenched by a referendum requirement on any new issue or proposed reform, could lead our friends and partners to cut us out of discussions on future reform and development. It is perfectly possible for them to do that by engaging in what is called “enhanced co-operation”, for which there are provisions in the treaty, or by concluding intergovernmental agreements outside the treaty framework.

When I raised that risk last week with a Minister, he replied—with a smile—that he thought that the EU was indeed likely to go for more variable geometry in future. He may be right but surely we should at least try to be in the room where the rules get written—as, thanks to Mr Major, we were for the euro. Let us at least give ourselves the option of going on being centrally involved. If the Bill passes, that will be harder to achieve. We shall have excluded ourselves.

I oppose the Bill on grounds of international policy as well as on constitutional grounds. If it is enacted, we will have damaged the national interest as well as parliamentary sovereignty.

[Baroness Verma]

My Lords, forgive me for reminding noble Lords but, if they could, it would be helpful to the House were they to keep their contributions to about 15 minutes. Thank you.