EU: Future Relationship

Viscount Trenchard Excerpts

Wednesday 23rd September 2020 Grand Committee

[Viscount Trenchard (Con)]

My Lords, I thank my noble friend the Minister for giving your Lordships a chance to discuss the Government’s approach to the negotiations with the EU, of which the eighth round has recently completed. Like my noble friend Lord Wei, I believe that the House should offer its strong support to the Government at this delicate stage in negotiations. In spite of the hype and noise made by certain newspapers, especially those of a remain disposition, I believe that the negotiations are being conducted in a more constructive mode than some would have us believe.

My noble friend Lord Frost stated after the last round of negotiations that he and his team have been consistently clear that they want to find a modern free trade agreement between sovereign and autonomous equals that provides for open and fair competition. This does not mean, as Monsieur Barnier still insists, that we must commit to EU standards on social, environmental, labour and climate regulations. He complains that there are too many uncertainties about the UK’s SPS regime, which we debated yesterday in your Lordships’ House. It is unfortunate that noble Lords opposite decided to reinstate amendments previously rejected in another place to commit to retain our existing rules on animal welfare and food production standards. Your Lordships also approved another amendment which, as my noble friend Lord Taylor of Holbeach, who speaks with enormous experience in these matters, said, would make it impossible for farmers to control noxious and persistent weeds and fungal infections on his farm.

Monsieur Barnier wants us to commit to maintain the EU ban on the import of hormone-treated beef. To read the Daily Mail, you would not know that the reason the WTO found that the EU ban on this violates its SPS rules is that it is not based on sound science and that levels of hormones as a result of the treatment are inconsequential. A 3 gram serving of hormone-treated beef produced 0.85 units of oestradiol, whereas the same serving of eggs produced 0.94 units.

During my banking career, I established many relationships with Japanese companies, including a life sciences company that is a major investor in this country and in several EU states. The chief executive of that company told me that he was not best pleased when Brexit came along because he had to spend $7 million on duplicating licences and strengthening his network of companies in Europe. He has now told me that he expects an upside of Brexit: that we should abandon the very prescriptive and cumbersome style of EU regulation and revert to a style which we used to apply, and which is still applied in common-law countries such as the United States and Australia. If we do that, he thinks that the United Kingdom will remain the best country in the world in which a life sciences company like his can research, innovate and develop new products.

That inevitably means that we should diverge from EU regulation, as we must no longer allow the precautionary principle to be applied to a disproportionate extent. Its effects are counterproductive and, over time, increase the risks to people’s health and the environment by delaying or preventing the development and use of beneficial new products. Can my noble friend the Minister confirm that the statements often made by government spokesmen that we will retain our high standards in agricultural and environmental matters do not mean that we will maintain EU-style cumbersome rules in doing so?

I was surprised to hear the noble Lord, Lord Liddle, argue that we are more like our European friends than our American cousins—I do in fact have American cousins. Our strength has been, and is, that we understand both well.

We will soon be debating the internal market Bill in your Lordships’ House. I welcome the Government’s agreement to provide a parliamentary lock on the use of powers which are held to conflict with the Irish protocol to the withdrawal agreement. However, there are ambiguities in the withdrawal agreement that need clarification. The EU’s interpretation would also be in breach of the treaty of union between Great Britain and Ireland of 1800. The Irish protocol also sets out the clear principle that Northern Ireland is part of the customs territory of the UK, so goods should be allowed to flow from Great Britain to Northern Ireland without tariffs. Joint agreement with the EU on goods that are at risk of crossing the Irish border is clearly necessary. It was unhelpful of Mr Šefčovič to react so strongly. How can he argue that the proposal has damaged the Belfast or Good Friday agreement? The introduction of border formalities such as the EU wants to see would clearly cause huge damage to the agreement, and it is disingenuous of the EU to fail to recognise that.

Further, does my noble friend the Minister know why the EU did not punish Germany over its dispute over the legality of the European Central Bank’s bond-buying programme? In fact, the EU has been quite silent over this issue, which contrasts with its feigned outrage over the internal market Bill. Everybody knows that we are negotiating to leave the EU and enter into a free trade agreement as a sovereign nation. The Prime Minister has been consistent from the time he signed the withdrawal agreement that we will not have a substantive border in the Irish Sea, so who could be surprised at this? I do not believe that this matter will lead our present and prospective trading partners to consider the UK to be a dishonest and unreliable partner.

Of course, it may have been a mistake to agree to the EU’s insistence that we should negotiate the terms of withdrawal before our future relationship. Does my noble friend not agree that this was also a breach of international law, because Article 50 of the Lisbon treaty clearly states that the terms of withdrawal shall be negotiated against the background of the future relationship? It is now so clear that it was quite wrong not to agree both the terms of withdrawal and our future relationship at the same time. Perhaps we might not have needed to agree to give to the EU the whole of our share of the retained earnings of the European Investment Bank, to mention but one of the several points where we have yielded to unreasonable EU requests.

I look forward to the Minister’s winding-up speech.