European Union (Withdrawal Agreement) Bill

Lord Liddle Excerpts

Report stage & Report stage (Hansard): House of Lords & Report: 1st sitting: House of Lords & Report: 1st sitting
Monday 20th January 2020 Lords Chamber

[Lord Barwell]

It is not for me to speak for the Government, not least because I do not sit on the Government Front Bench. Indeed, noble Lords who have followed the debate closely will know that I do not entirely agree with the position that the Chancellor set out; the previous Government believed that there was a case for aligning with certain EU rules and regulations. But, having said those things, I do not think that the Chancellor of the Exchequer has done what the noble Baroness suggests. If one looks at the slides that the European Commission has published on the level playing field, one will see that, on the vast majority of issues, it is not suggesting that dynamic alignment is required; it is effectively asking for non-regression from existing commitments. There are some areas where there may well be a problem in the negotiation, particularly state aid—I read what it has said as looking for an ongoing commitment to align with EU state aid rules—but I certainly do not think the Chancellor has gone as far as the noble Baroness suggests.

I was interested in remarks that several of your Lordships made: the Chancellor’s comments to the FT came as no surprise to me at all. That has been the clear policy of this Government from the point at which they were formed.

[Lord Liddle (Lab)]

Has not there been a fundamental change in government policy without any putting of that change to Parliament for discussion? There has been a fundamental change from the policy that the noble Lord, Lord Barwell, pursued with the Prime Minister, which was to secure as close a relationship as possible on trade and, if possible, to make it frictionless. The noble Lord and the then Prime Minister thought it very important to try to protect manufacturing jobs with complex cross-border supply chains. Now, it is quite clear from what the Chancellor has said that the Government have chosen something completely different —that it is worth paying a high economic price to secure sovereignty. That is the choice it appears that Mr Javid is announcing, but he does not have parliamentary approval for it and it has never been properly debated. Is that not scandalous?

[Lord Barwell]

I do not intend to get into this debate in detail; I wished to speak briefly. All I will say is that that approach has been clear for some time, and the Government got a clear endorsement for it in the general election. I say that as someone who had a different view.

I conclude my remarks by simply saying this. There is a case in some circumstances for the Government seeking approval for particular positions; it may strengthen their hand in negotiations. But there is also a real danger, as my noble friend said, that if both sides set out their positions in detail at the outset, you rule out possible negotiating solutions.

Irish Border: Checks and Customs Arrangements

Lord Liddle Excerpts

Tuesday 1st October 2019 Lords Chamber

[Lord Duncan of Springbank]

Again, the Prime Minister made it very clear this morning, on the show which we all tuned in to, that that is not what he is proposing at all. There will be no new infrastructure on the border. I hope the negotiations which are taking place right now will lead to a successful conclusion which can be interrogated by this House in due course.

[Lord Liddle (Lab)]

Could the Minister confirm that the Government are abandoning the solemn commitment that they made in December 2017 to ensure regulatory alignment on the island of Ireland?

Gas Tariffs Code (Amendment) (EU Exit) Regulations 2019

Lord Liddle Excerpts

Thursday 26th September 2019 Lords Chamber

[Lord Howell of Guildford (Con)]

My Lords, the noble Lord, Lord Teverson, has raised some very penetrating and expert questions—as one would expect from him—and I will briefly pursue two of them. He referred to our connectors. Of course, most of our interconnectors are for electricity, but there are some important gas connectors. These are part of our gas import scene, which is vastly important, given that domestic onshore gas is not really happening and offshore gas is still not at the level that it was. Post Brexit, will the auction rules on the granting of contracts for developing gas supplies and turbines apply equally to gas that originates inside the EU and comes to us when we are outside it? Remaining in the internal energy market of the European Union would be fine, but it is undergoing considerable stresses and strains—including, notably, the ever-growing appetite of Germany for imported gas, particularly Russian gas, from both existing pipelines and the new Nord Stream, which seems to be going ahead although the Americans oppose it. Will the Minister show a little more of the Government’s hand and their attitude to the internal energy market, which is not working well—it is causing considerable difficulties in eastern and central Europe—and requires a steady hand to ensure that it works for us if we remain in it?

[Lord Liddle (Lab)]

Building on the interventions by the noble Lords, Lord Teverson and Lord Howell, I have a question. The Minister will be aware that gas networks and cross-border supplies are a matter of high politics and security, as well as energy policy. The Russians, in their disputes with Ukraine, frequently threaten to interfere with gas supplies crossing Ukraine. When originally proposed, the new German pipeline that the noble Lord, Lord Howell, referred to, which connects Germany and Russia, was described by Poland and the Baltic states as the economic equivalent of the Ribbentrop-Molotov pact, in that it exposed them and made them vulnerable to discrimination by Russia, to put political pressure on their democracies.

As I understand it, if there was a such a crisis involving Russian gas supplies, we would be protected by the principle of non-discrimination, because we are members of the internal market. In other words, if there was pressure on gas supplies on the continent it would not be legal for suppliers on the continent to turn off the taps to Britain. What will the situation be when we leave the EU: will we have those kinds of legal protections, and will the Minister enlighten us as to what they are?

[Lord McNicol of West Kilbride (Lab)]

My Lords, I join the noble Lord, Lord Teverson, in welcoming the Minister to the Dispatch Box. I am sure that in preparing for this SI, looking through the paperwork and the impact assessment, which says there is no significant impact, he might have thought this was a nice, easy one, but the noble Lords, Lord Howell, Lord Teverson and Lord Liddle, have rightly asked further far-reaching questions on the wider issues of energy and gas supply as we move forward. I shall take the Minister back to the start.

The regulations before us deal with the establishment of a network code on harmonised transmission tariff structures for gas, arising from the UK’s withdrawal from the European Union. This issue was debated at length during the debate on the Gas (Security of Supply and Network Codes) (Amendment) (EU Exit) Regulations 2019. The Explanatory Memorandum makes it clear that today’s instrument is needed because exit day has been pushed back: it therefore amends those regulations. Will the Minister therefore begin by assuring the House that these regulations do not mark any shift in policy towards the regulatory framework relating to gas?

Looking briefly at how these regulations were laid, I need not remind the House that they would not have been debated and passed until next month had the Supreme Court not announced that Prorogation was invalid. In such a situation, can the Minister be certain that they would have completed their passage before exit day? If not, what would the consequences have been? On the drafting of these regulations, the House will be aware that other regulations need to be amended as a result of the change in exit date. Will the Minister explain why these need to be amended? If this instrument is necessary to make such a small change, will he say why the Government chose to pass this through the affirmative procedure?

More widely, the regulatory framework is an important cornerstone of energy policy, and while the subject has been debated at length, I want to return to one core issue. My noble friend Lord Grantchester has been vocal on the transfer of powers relating to energy policy, particularly on the many responsibilities due to be handed to Ofgem, which has faced budgetary constraints under this Government. Can the Minister say whether any further regulations due to be laid before exit day will transfer any energy powers to UK agencies? Going back to a point made by the three noble Lords who spoke earlier, protecting our energy supply is critical to our safety and security in such difficult and troubling times. I agree with the noble Lord, Lord Teverson, that retention of the petroleum reserves is an issue of national security. Although it does not relate directly to the SI, some words about that from the Minister on behalf of Her Majesty’s Government would be appreciated.

Statutory Auditors, Third Country Auditors and International Accounts Standards (Amendment) (EU Exit) Regulations 2019

Lord Liddle Excerpts

Thursday 26th September 2019 Lords Chamber

[Lord McNicol of West Kilbride (Lab)]

I thank the Minister for his introduction to this statutory instrument. Before I come to the substance of the policy in these regulations, I highlight the comments made by the House of Lords Secondary Legislation Scrutiny Committee, which said:

“However, the range and magnitude of the changes are significant: the Regulations make changes to 15 items of legislation and include a sub-delegation of powers to UK regulators and extend a ministerial power of direction”.


The committee is right. Despite the utterances in the Explanatory Memorandum that this instrument exists only to continue the framework of the regulatory oversight and professional recognition of statutory auditors and third-country auditors in the UK, concerns have been raised, as we have just heard, that the regulations extend beyond this. The challenges financial services organisations will face in adapting to these changes are numerous, and were also noted by the SLSC. Can the Minister confirm whether any recent support has been offered to such firms to assist them in adapting to the changes?

In the light of such wide-ranging challenges resulting from these regulations, I draw the House’s attention to the fact that one of the core reasons why the other place divided on this instrument was the absence of a full impact assessment. Although I have no intention of similarly dividing this House, I place on record my disappointment that the Government have chosen not to publish an assessment in the period between these regulations being debated in the Commons and today. Parliament needs to be given the full information on the impact that these regulations will have on the financial sector; without such an assessment, that is not the case.

Moving on, I should like to ask the Minister a number of technical questions about the substance of these regulations. I will speak slowly. First, on Regulation 4, which deals with the loss of the EEA subsidiary exemption, can he confirm the timescale for the issues here to take effect? The legislation does not give a specific timeframe for the implementation of this provision, so I can assume only that further regulations may well be necessary. Secondly, in relation to Regulation 6, which focuses on the EEA qualification for auditors and which the Minister touched on, can he guarantee to the House that EEA-qualified auditors recognised up to December 2020 will retain their eligibility? If I missed that in his introductory remarks, my apologies.

To conclude, the way in which this instrument has been progressed, with little assessment and consultation, is deeply disappointing. It is mentioned in the Explanatory Memorandum for the SI, under paragraph 10 on “Consultation outcome”, that there has been no consultation on this instrument, which is deeply worrying. There also seems to be a thread of ambiguity through the regulations, which I hope the Minister can cast aside with assurances today. On this side of the House, we have agreed that the Government should make preparation through secondary legislation to ensure continuity after exit, but I hope the Minister can confirm that future regulations aimed at doing this will take a different approach.

[Lord Liddle (Lab)]

My Lords, I was not planning to intervene, having not read these papers in great detail, but until my noble friend spoke I was not aware that the Government had not carried out an economic assessment of the impact of these changes. On the face of it, this seems rather worrying.

As the Minister will know, there has been considerable controversy over the role of auditors and accountants in the past five years. The competition authorities in Europe have sought to break up the monopoly of the big five, although I am sure they would not put it as crudely as that. In the UK, the Competition Commission has also pursued these questions. There are also big ethical questions about the combination of roles between accounting and audit, which has resulted in some major scandals about the role of auditors.

Are we content that nothing in what we are doing in any way limits the ability of the authorities to pursue the cause of greater competition and greater separation of powers and duties? One of my really big worries about Brexit is that we may be creating a situation in which a close relationship between an industry and a UK ministry results in arrangements that are not in the interests of consumers or shareholders and that work against the public interest.

Spending Round 2019

Lord Liddle Excerpts

Wednesday 25th September 2019 Lords Chamber

[Lord Liddle (Lab)]

My Lords, it is very enjoyable to hear the noble Lord, Lord Young, having the freedom of the Back Benches, and I hope we are going to hear far more from him in that capacity. We should, of course, be debating the great crisis we are facing in our nation’s affairs, but he was very pungent in his remarks on BBC News yesterday about what the Government should be doing, with which I agree.

This has actually been a very enjoyable debate. I would also like to say how much I enjoyed listening to my old friend, the noble Lord, Lord Horam—I learned a lot from him in his very long political career, particularly in the earlier stages—and he had a lot of interesting things to say.

The document we are discussing is very flimsy, and not backed up by any economic analysis from the OBR. The question is: does it represent a turning point in our attitudes to public spending and tax? Are we finally getting away from the policy of the last decade, which has basically been to hold public spending down below the rate of economic growth so we can achieve a gradual reduction in the ratio of debt to GDP when we think we can get away with that, but cutting taxes instead when we face political trouble? So the question is, are we moving away from that framework? Are we now accepting that both infrastructure investment and some types of social investment by the public sector make economic sense because they add to economic growth potential? One should not just be looking at the pure number of the deficit but should be asking oneself how much within the public spending envelope will add to growth potential and is therefore a sound investment.

Are we facing up—I think none of the political parties is--to the great demographic challenge we will face in the next 10 years?. According to the IFS and the Resolution Foundation, if we are to maintain present standards of pensions, health services and social care, tax as a proportion of GDP will have to rise by 5% because of the challenge of demography. I think that this is where the Government ought to open a public debate.

As we were discussing at the Labour conference in Brighton, the tax burden on the top 1% or 5% can certainly go up a bit; the broadest backs should bear the heaviest burdens. However, the fact is that we will not enjoy a decent quality of welfare state and public services in this country unless we can make the case to the public overall for a general increase in taxation. This is going to be difficult in an environment of Brexit—

[Lord Davies of Stamford]

I am listening to my noble friend with great attention—he is a great expert on these matters. As an alternative to increasing tax, would it not be possible to consider some compulsory universal insurance system, such as happens on the continent?

[Lord Liddle]

I would include compulsory social insurance or hypothecated taxes as part of the general remark that I made. However, we are going to have to find new ways of funding our welfare state because of the demographic challenge. This is going to be difficult if Brexit goes ahead because, even if we avoid no deal, which we have legislated against, the kind of medium-term deal that Boris Johnson has in mind—the Canada-plus, free trade agreement—is not the smooth Brexit that the economic forecasts of the OBR have relied upon. It is a much tougher, harder Brexit than the customs union and regulatory alignment that Mrs May was aiming for. It will have more serious economic consequences for the country, and I worry about that a great deal.

Of course, you could not possibly justify, as a result of Brexit, a temporary increase in the government deficit, but you can only do that for a time. We saw in the 1970s that there had to be an adjustment for the higher price of oil, and we saw after the 2008 financial crisis that there had to be an adjustment for the fact that the deficit had risen as a result of the cost of saving the financial system.

If that will be the case, who will bear the pain? The people who cannot afford to bear the pain, and the people whom this document completely neglects, are poor working families. There is nothing in this document to relieve the burden that they have faced in the last 10 years. This is a gross generational unfairness: I get a nice real-terms increase in my pension every year, but what do the young mother and her children get? They get their benefits frozen as a direct result of the Government’s policy.

Most of these people are not people who do not work. They are not, to use that horrible language, scroungers; they are people who work the living daylights out of themselves, sometimes with two or three jobs, in order to meet the family budget. This squeeze on working families is having a dreadful impact. The Resolution Foundation, one of the best independent think tanks of the past few years, suggests that we will have something like 1.5 million children in poverty— 37% of all children—if we continue on our present policy path on tax credits, universal credit and the rate of benefits. That is unacceptable. Even in the period that we are talking about, there is a 4.1% increase in departmental expenditure in the coming year but further cuts in benefits are going on. It cannot continue. I notice in Cumbria the dreadful impact that is having on the ground. We have a great increase in demand for our children’s services, from parents who cannot cope with bringing up their children themselves, and the costs of our children’s services are rising dramatically. This will become as big a challenge as social care unless we address it.

The big question is: is this a turning point? I hope that the noble Lord, Lord Duncan, from his new position will be able to say positively that the policies of the past nine years have been abandoned.

[Lord Ashton of Hyde (Con)]

My Lords, to make sure that there is time available and that people are here to question the Leader of the House, we propose in agreement with the usual channels to take two more speakers in this debate and then take the Prime Minister’s Statement, followed by the Iran Statement, and then conclude the remainder of this debate.

EU: Trade Agreement on Banana Imports

Lord Liddle Excerpts

Tuesday 7th February 2012 Lords Chamber

[Lord Liddle]

My Lords, on behalf of the Opposition, I thank the noble Baroness, Lady Hooper, for bringing forward this debate and for the charm and conviction with which she introduced it. In the debate, we have had many notable contributions. My noble friend Lord Foulkes made me dream of the white beaches and turquoise oceans, but he also spoke with great knowledge and experience from his time as a Minister at international development. We had the passion of the noble Baroness, Lady Benjamin, while other noble Lords, including the noble Viscount, Lord Montgomery, the noble Lord, Lord Palmer, the noble Earl, Lord Sandwich, and my noble friend Lady Howells were speaking from personal knowledge.

Regarding my own knowledge of this issue, I suppose I should declare an interest. The part of my life in which I came across this was while I was in my noble friend Lord Mandelson's cabinet when, as Peter Mandelson, he was Commissioner for trade. This was one of the issues that came across one's desk then, and it is one of the longest running trade sagas in the history of the European Union. Its origins go right back to the start, when the French won preferences for their colonies against the resistance of Germany. When we joined the Common Market, we were able to get preferences for our colonies, which led to the formation of the ACP group. Since then, however, the brutal facts and realities of free trade have caused great difficulty for the vulnerable communities that have depended on these preferences.

There is an irony here. It is a tragedy that some of the general policies for which we, as a country and as the Labour Party, have fought—for instance, the idea that there be multilateral, supranational jurisdiction on trade issues—are good things but that is what, since 1993, has led to the EU having to abandon its preferences. Similarly, we want a general liberalisation of agriculture. We want to break down the protectionism of the common agricultural policy. So while we want liberalisation of agricultural trade, again, the harsh facts in this case mean very great difficulties for people to whom we owe a moral obligation.

This has been going on a long time. The EU fought a valiant battle to prevent this happening. The first case by the United States was brought in 1993 and the Geneva agreement was reached only in 2010. We stalled for years, first by fighting the idea that we had to give up on the preferences in Europe and then by saying that we proposed a tariff that was quite high in terms of protecting the Caribbean and other producers. Ultimately, because of the pressure from the WTO jurisdiction system, we have had to give way.

I turn to my questions for the Minister. First, what is her assessment of the banana market? What has the impact been? How serious is it in the countries that are affected? What is the Government’s view of what can be done to help? Secondly, the papers refer to the safeguard clauses that are allowed into the EU/Andean association agreement. How have they been implemented? Have they helped to protect the vulnerable producers? Thirdly, as many noble Lords have mentioned, what are we doing to ensure that the €190 million of special support is being wisely and properly spent? How can we ensure that that help is speeded up? What additional help will we be fighting for beyond 2013? I hope that we will regard this as a priority for the EU budget. Lastly, on a point that the noble Earl, Lord Sandwich, made, what pressures are we putting on our supermarkets to try to support fair trade standards in the retailing of bananas, which would help the most vulnerable producers?

These are important questions and this is an important clause. We thank the noble Baroness, Lady Hooper, very much for tabling this debate.