European Union (Withdrawal) (No. 6) Bill

Lord O'Donnell Excerpts

2nd reading (Hansard): House of Lords
Thursday 5th September 2019 Lords Chamber

[Lord O'Donnell (CB)]

My Lords, I would like to build on what many of the previous speakers have said, particularly my former boss, the noble Lord, Lord Kerr, who covered many of the areas that I want to speak on, and the noble Baroness, Lady Bull. I completely support what she said on the economic costs of no deal; other institutions have also looked at that, such as the Institute for Fiscal Studies and Trade Knowledge Exchange—but I must refer to the register of interests, because I am all over both of those.

I should also warn the House to be careful of listening to me. The noble Lord, Lord Kerr, referred to the No. 10 spokesman role, and the fact that the No. 10 spokesman occasionally has to prevaricate and possibly not answer questions as fully as one might like to, as I had to for four or five years. However, the number one rule is “never lie”. I really worry about the implications of the 15 August thing concerning Prorogation. Was that civil servant knowingly not telling the truth, for which the implications are fairly clear—the person should be sacked—or were they being told untruths? That is important. It builds on the question of trust and on the “good chaps” theory of government, which the noble Lord, Lord Howell, mentioned.

Alas, we do not have with us to talk about his own theory my very good friend the noble Lord, Lord Hennessy of Nympsfield, but it is worth remembering that, when talking about the decline of the “good chaps” theory, he said that it fell into fragments on 28 August at Balmoral. To my mind, there are wider implications. I was here throughout the events of last night, listening—I would not say “happily”. I was listening to my former colleague, the noble Lord, Lord True, who, when we were in No. 10 together, would speak passionately on policy and the importance of the rules under which this House operates. In the past, he was a bit more concise. I am not a fan of filibusters or guillotines. These are symptoms of the decline in trust.

It is crucial that we trust our Prime Ministers, and I worry that we are in a really dangerous world now. Let me give some evidence. When people are asked about trust, as has happened most recently, there is one profession whose trust rating has had the biggest rise of any over the last 35 years. I am very proud to say that it is the Civil Service. However, the latest survey reveals the biggest ever gap in the public’s mind between the extent to which they trust civil servants and trust Ministers. That is not a good place for our democracy to be. This whole process is causing great problems of that kind.

The other constitutional point that is really important to remember about this Bill is that we have the Conservative/Liberal Democrat coalition to thank for our being able even to consider this question. If it were not for the Fixed-term Parliaments Act, the Prime Minister could have just stopped it all, allowed us to leave with no deal and had an election after that date. I am the first person to admit that that Act could be a lot better, and I look forward to being part of amending it at some point to correct the things that are not quite right. It was too rushed—let me put it that way—but it is interesting to look back on it.

On the implications of this Bill, the Prime Minister has said that if we take out no deal, it makes it harder for him to get a deal. I believe the opposite is true and would be interested in noble Lords’ reactions to this, because I have said this publicly already. David Davis was absolutely clear that getting rid of the backstop was not enough for him to support any deal that came to the Commons. He implied that we also have to do something on the money and the jurisdiction of the European courts, and that there were lots of other MPs who took this view.

If this is true, I do not think it possible for such a deal to be negotiated with the EU. We have already heard that it is impossible to get all of the backstop done, so to get this and everything else, they are saying, “Prime Minister, go and negotiate a deal. By the way, when you come back, we are going to vote against it”. What does that do for the EU incentive to offer any concessions? Absolutely nothing. What does that do for our process of trying to come up with a deal? It makes it incredibly hard for that to go through. I do not really understand what we are doing here, because if you are an MP in the House of Commons whose preference is no deal, the obvious thing to do, whatever deal the Prime Minister comes back with, is to vote against it. If this Bill did not exist, the default in law is quite clear—that we would then leave without a deal. The incentive is to vote against it, irrespective of what it is.

I am completely puzzled by this but let us try to be constructive. What is the way forward? A number of people have said that Parliament has had plenty of time to come up with not just what it does not want but what it wants, and it has failed miserably. That is true. My solution to this is a new Parliament. We need a general election of some kind. My one plea is that all the manifestos be absolutely clear about what the parties are going to do. That is crucial, because if we are trying to get the people to make an informed choice and we give them fudge, we could end up in exactly the same place as we are now.

I have two final points. First, some people are saying that the EU is a terrible club, but it seems to have a lot of members keen to join it. Secondly, I have spent a lot of time dealing with special advisers, and my general principle is that good special advisers are extremely good for the smooth working of the Civil Service and its relationship with Ministers. Bad special advisers are toxic and, in the end, bring their Ministers down. That is a lesson the Prime Minister might want to consider.

European Union (Withdrawal) Bill

Lord O'Donnell Excerpts

Report: 3rd sitting (Hansard): House of Lords
Wednesday 25th April 2018 Lords Chamber

[The Deputy Speaker (Baroness Garden of Frognal) (LD)]

My Lords, I have to inform the House that if Amendment 32B is agreed to I cannot call Amendment 33 by reasons of pre-emption.

[Lord O'Donnell (CB)]

My Lords, briefly, I would like to thank the Minister and his officials for their work on this and for their constructive approach. I am very happy to drop my amendment.

[Lord Newby (LD)]

My Lords, I too thank the Minister—I fear that that will not necessarily be very common, so I am pleased to be able to do so now. I am sure he will agree with me that these amendments are sensible, appropriate and necessary.

European Union (Withdrawal) Bill

Lord O'Donnell Excerpts

2nd reading (Hansard - continued): House of Lords
Wednesday 31st January 2018 Lords Chamber

[Lord O'Donnell (CB)]

My Lords, this Bill started life as an oxymoron—let us be honest. The great repeal Bill repeals some EU law but transposes it back into UK legislation, and what we have heard today has made it clear that it is not that great either. As many have already pointed out, it has numerous technical and constitutional defects. As a former head of the Treasury, I salivate at the prospect of raising tax via statutory instruments, but that is probably best avoided, as the noble and learned Lord, Lord Judge, pointed out.

The Constitution Committee’s points seem broadly sensible and I hope that the Government can accept them. The treatment of Scotland, Wales and Northern Ireland in the Bill leaves me very puzzled. It is indefensible. I assume that we will be coming up with a new version of Clause 11 and that that will be cleared with the devolved authorities; otherwise, we will be completely stuck on that.

The Bill’s origin dates back to then Prime Minister Cameron’s decision to hold a referendum, which, in my opinion and to misquote him, was a disaster, not a mistake. I am a believer in parliamentary democracy, not government by referendum. However, given where we are now, the only question, to which I will return, is whether two wrongs would make a right. Today, I want to make some points in my role as a former Cabinet Secretary and head of the Civil Service, and in other roles as an economist. I declare various economic affiliations as listed in the register of interests.

I admire, but do not envy, my successor, who is trying to implement the Government’s policy on Brexit, whatever that is. Although there has been an inevitable and much-needed increase in the number of civil servants working on Brexit, Civil Service numbers overall continue to fall as efficiency improvements are delivered. But Brexit is inevitably squeezing out almost everything else.

Despite these challenges, morale in the Civil Service, as measured by the annual engagement surveys—and I like evidence—is at an all-time high. So it is particularly disappointing—I was very grateful to hear the support expressed by the noble Baroness, Lady Blackstone—to see a divided Cabinet resorting to attacking the civil servants who simply want to implement whatever policy Cabinet finally decides upon. The progress made to date and the fact that we have successfully moved on to the next stage of talks is witness to the hard work that is going on behind the scenes. Civil servants across a range of departments are delivering detailed analysis. Businesses, trade unions—as the noble Lord, Lord Monks pointed out—and think tanks have provided their input. The bickering and blaming of civil servants needs to stop. Cabinet needs to formulate a policy for the next crucial stage. The EU 27, and we should learn from them, have been strengthened by having a clear, public negotiating position—we need one as well.

For the next stage, I would say, now is the time for experts. We need Ministers to stay in post for long enough to master their briefs. Listening to the noble Lords, Lord Hill and Lord Bridges, makes me realise how much expertise has been lost. Cabinet should abide by the principle—that very old principle—of collective responsibility. By all means argue in private, but please present a united front in negotiations.

On the economic aspects, I hope that Ministers and civil servants will study the wealth of analyses that is now being undertaken by a number of groups, such as the Trade Knowledge Exchange, which I am involved in, which are all committed to helping us get the best deal possible. Their analysis highlights that the benefits of a good trade deal with the EU are worth far more than the amounts discussed in the first stage talks and, I would argue, far more than deals with third countries. As Pascal Lamy, the former head of the WTO, has pointed out, the big costs in trade terms come from regulatory divergence. Yet the ability to diverge from EU rules is regarded as a big benefit by some. It is also true that trade deals with third countries will require similar regulations. Such deals will be governed by what I would call the tug of regulatory gravity, meaning that the bigger partners, such as the US, China or India, have the biggest say in determining the rules.

The right reverend Prelate the Bishop of Leeds reminded us that there is more to a good life than just prosperity. It is very interesting that those parts of the country with the greatest inequality in self-reported levels of well-being were the areas where the leave vote was strongest, and we should really analyse why this vote took place. We do not have the time to go into that here, but it is a very important point.

Jobs matter for well-being and the recently leaked document on various scenarios backs up most of the public research that has been available for months. It is not new; it has been around for a long time. It has shown that growth will be significantly lower outside the EU than it would otherwise have been. I know counterfactuals do not make for slick soundbites, but the time for those has gone, as the noble Baroness, Lady Smith, has said. Fortunately, the world is going through a period of strong growth, including in our number one trading partner, the EU, so our headline growth figures will not look bad—unless, of course, you compare them with the rest of the world. Lower growth means lower tax revenue and lower public spending, and that has implications for the NHS.

So, assuming this Bill is amended sensibly, I will hold my nose and join my esteemed predecessors, including the noble Lords, Lord Butler, Lord Armstrong and Lord Wilson, who have spoken in this debate, in supporting it. By the autumn we should know more about the kind of deal that is on offer. The noble Lord, Lord Lisvane, gave us that brilliant analogy last night. Will it be more “The Texas Chain Saw Massacre” or “Reservoir Dogs”? We do not know yet.

For me, the issue of how Northern Ireland is treated will be a determining factor. I have absolutely no idea how you reconcile regulatory alignment and no hard border with leaving the single market and the customs union. Whatever is decided, peace must be preserved. When we have all the details of that proposed deal—in the autumn I hope, but I am not really expecting that—then, and only then, should Parliament consider whether the result of the negotiations is so far away from what was promised that the people should be consulted again. But this time we must give the people a clear choice between the terms on which we should remain and leave so that they know exactly what the terms are in both cases.

To conclude, this is, as the noble and learned Lord, Lord Judge, pointed out, an essential Bill—there is chaos without it. But this House can improve it substantially. That will take time, which is running out for the Government, the country and me, so I will sit down.