EU: Future Relationship

Viscount Waverley Excerpts

Wednesday 23rd September 2020 Grand Committee

[Viscount Waverley (CB) [V]]

The noble Lord, Lord Rooker, is always a hard act to follow. The Minister saying that life is “better understood backwards” reminds me of the Irishman who, when asked for directions, replied, “If I were you, I would not be starting from here.”

We should have exercised our minds on EU negotiating strategy four years ago. Positions appear, regrettably—from afar anyway—to be well entrenched, with now limited manoeuvrability. Fighting one’s corner on a principle is coming to an end, with the direction of travel and endgame becoming clear. It seems probable that we know where we are going to end up; doomsday scenarios will have to be replaced with innovative solutions in the national interest. That does not mean that much does not remain to be done.

I wish to address two specifics: trade policy and relationship building. I start at the outset with a question to the Government, and I would be grateful if the Minister would undertake to write with a considered response and place a copy in the Library. Simply, what is the UK’s trade policy? Many around our country are deeply concerned on that lack of clarity. I would welcome a considered response. My remarks should be perceived not as negative but rather, I hope, as attempting to be constructive. This applies equally to a newly formed APPG this week for trade and export promotion, which I have the honour to co-chair. The first three buckets under consideration are veering towards trade policy, trade finance and trade export promotion, addressing—as an example—SME export strategy for new FTAs. We look forward to the opportunity to engage with government in all these matters. Endeavour was made to ensure that representatives from all quarters of the union are serving officers.

It appears that we have launched into negotiations with some of our largest trading partners, the EU, the United States and Japan, without a clear position on what is wanted to be achieved—and, specifically, what people wish for, for or from across the European Union. It should be acknowledged also that, within the private sector, unions, consumers and civil society are all equal stakeholders in the UK’s future. That the mantra is to deliver and get Brexit done is clear, but at what cost? I advocate a retrenching exercise, bringing together all the disparate bubbles that exist in our country—industry representatives and multipliers—to sort ourselves out in advance, knowing all that all hearts and minds are behind an implementation strategy. That should include government looking closely at what its principal functions are and focus on delivery of them, recognising the strengths of the private sector as paramount, and have that firmly at the policy table. Government should focus on where it adds value, not competing and undermining the private sector. In a word, we need a more inclusive process in the decision-making process.

The time has come to review what the role of government is in providing trade support. The private sector has long been undermined by heavily subsidised services when it can in many cases deliver the job better. We are also now faced with Henry VIII powers in the Trade Bill with clauses that would feel more at home somewhere between Russia and China. No serious independent trading nation delivers trade policy and support in this way.

To date, beyond the two substantive deals with Switzerland and Japan, the remainder are continuity deals to avoid disruption. They will all need to be negotiated as proper deals at some point. We need a strategy on trade in services through every trade negotiation, whether bilateral or multilateral. We need a trade strategy that reflects our obligations to climate and sustainable development goals. We need a legal reform programme that unlocks growth and removes barriers to digital trade. We need action to tackle the growing trade finance gap, which has doubled during Covid to $5 trillion. We need a strategy that invests in our Commonwealth relations and bridges the gap between developed and developing economies, while articulating what we want in trade in services, which accounts for 80% of our economy. A plan for what we want at multilateral level and how to use bilateral negotiations to achieve that is also urgently required. It is not as though our future is about just doing trade deals. It is about having a more inclusive decision-making process so that deals that are done succeed and have better long-term outcomes for everyone.

Public trust must be the centre of rebuilding in trade, and Parliament must play a critical role in scrutinising the process and ensuring that everyone’s voices are heard. We must come to terms with the fact that we are no longer part of the three big trading blocs, but we can play to that as a strength by being an influencer in the next tier with the likes of Japan, Australia and Singapore and a broker between developed and developing nations and between the large blocs advocating for pragmatic process on trade liberalisation, as a country that stands for the rule of law, best practice and high standards. We can no longer be woolly about these things. We need to regroup, get the right strategy in place that upholds the values for which we stand, and from that point execute a clear negotiating position.