Legislating for the Withdrawal Agreement

Lord Swire Excerpts

Monday 10th September 2018 Commons Chamber

[Colin Clark]

It is worrying that free movement into the rest of the United Kingdom has continued strongly during the Brexit debate but has fallen in Scotland. That prompts us to ask what it is about the Scottish economy and the Scottish Government that is putting people off coming to work in Scotland. It is deeply worrying that people are not moving from the south, from other countries, to work in our NHS. We are still bereft of doctors. But I will not go into that further, because to do so would diverge substantially from the subject that we are discussing.

An FTA would mean customs declarations, but let me respond to the issue raised earlier by the hon. Gentleman. The British people did vote to leave the customs union, and they did vote to leave the single market. They did that in the full understanding that it was in exchange for the return of sovereignty and self-government, and a proven free trade agreement would respect that.

We must remember that other countries that do not have FTAs do more exporting to the EU than we do. Only 12% of the UK economy and 5% of UK businesses even trade with the EU; 60% of our trade is with the rest of the world, and most of the world’s fifth largest economy—ours—is domestic. The reality is that even the EU single market for services barely exists. The European Commission’s 2014 single market integration report shows that trade integration stands at only 5% for services, compared with 22% for goods.

When the transition period begins, we will have 18 months in which to negotiate the details of an FTA or CETA-style deal. That will be mostly in the area of services, and financial services in particular. TTIP contained advanced provisions for services: the framework is there. We have an opportunity to cut and paste what already exists. As the Minister said, the purpose of the transition period is to provide certainty and consistency, and that is what my constituents in Gordon and businesses in the north-east of Scotland want to see.

[Sir Hugo Swire (East Devon) (Con)]

There has been much talk of a second referendum. I think that it would take Parliament eight or nine months to legislate for that, and would it not just mean a further negative in terms of inward investment and confidence in the British economy? Would it not be the worst possible outcome of all those that are being discussed?

[Colin Clark]

I could not agree more. The last thing that the country needs is more doubt about its politicians. The same applies to the referendum in Scotland. The people vote and trust us to represent them in a democratic system, and that is what we are here to do. We are here to make the difficult decisions, and we must be brave enough to do that.

Non-trade agreements can be made for aviation, customs and security. They can cover non-trade items such as Horizon 2020, Erasmus, or the European Aviation Safety Agency. North sea helicopter operators are a subject close to my heart, because the airport from which they fly is in my constituency. EASA needs associate access. The Government have already proposed that, but it requires an agreement, not a no deal.

A CETA-style FTA is not backward looking. It could free the UK to do its own free trade deals throughout the world. As has been said, 90% of growth over the next 10 to 15 years will be outside the European Union, and the Minister recognised that. We can build on those 65 bilateral deals the UK supported in the EU.

No deal is not an alternative; an internationally-tested FTA would be. It is said that the EU has never signed an FTA containing significant liberalisation in financial services, but the point is that it has; it has had deviations in the past, and therefore we should be ambitious about having them in the future.