(1 year, 8 months ago)
Lords ChamberI am sorry to interrupt the noble Lord but I do not believe that he was here at the beginning of the Statement.
I shall look into it but I do not think that I agree with that point. As I said, I think the devolved Administrations have been kept on board with the negotiations that have been going on—I really do. I certainly would like to reassure noble Lords further on that point.
I am sure that the devolved Administrations were informed in the sense that they were told that there had been a round and various things had been discussed, but it is clear that the result came as a surprise—that there should be such an asymmetrical deal on farm products. I do not myself believe that it is a disaster, but it certainly came as a surprise. Would the Minister agree that it would be better if the documents that the Government published at the start of a negotiation—the negotiating objectives documents—were a little more specific? They are cast in such broad-brush terms that it is very difficult to deduce from them what a likely outcome might be, so the risk of a surprise is quite high.
I would like to park that—I am not going to be drawn into it—but I would like to move on to discuss scrutiny, which is probably along the lines of the noble Lord’s question. This is an important matter, raised by the noble Viscount, Lord Waverley, and the noble Lords, Lord Purvis and Lord McNicol. Again, I hope I can give some reassurance on this.
The Government have made extensive commitments to support robust scrutiny of the new free trade agreements. As the International Agreements Committee acknowledged in its report, we have upheld those commitments. In particular, the Government committed that we would ensure that there would be at least three months for Parliament to scrutinise the agreement and for Select Committees to produce reports before the formal scrutiny period under CRaG. In fact, there was six months of scrutiny time prior to commencing CRaG, and I was very pleased to receive the IAC’s report on 23 June. In addition, we published the advice of the Trade and Agriculture Commission on 13 April, two months before commencing CRaG, and our own Section 42 report on the impact of the agreement on relevant domestic regulatory standards on 6 June. Of course, I am delighted that we are here today taking the opportunity to debate the agreement as part of that scrutiny process. In total, by the end of the CRaG period, the agreement will have been under the scrutiny of Parliament for over seven months and benefited from the formal views of three Select Committees.
(2 years, 2 months ago)
Lords ChamberMy Lords, the noble Lord, Lord Davies, asked all the right questions, and I greatly look forward to the Minister’s reply—
I am sorry, but I was not aware that the noble Lord was down to speak.
I do not think anyone was aware that the noble Lord intended to do so but, with the House’s indulgence, maybe we can allow the noble Lord to speak for four minutes.
I was saying that I greatly look forward to the Minister’s reply to the questions from the noble Lord, Lord Davies. I hope that what I am going to say now will not be taken as any criticism of her; she defends her department’s brief in this House with style and stamina.
However, I have to ask: where is the Secretary of State for Transport? He is Macavity, the mystery cat: when things go wrong, he is never there. We have gridlock at Dover, chaos at the airports; queues at the pumps; a tube strike and a looming train strike, and it seems that none of this has anything to do with the Government and there is nothing they can do to put it right. The Government’s job is to govern. When problems like these arise, it is time for Mr Shapps to step forward.
I heard a rumour that he is moonlighting—that he has something else. Perhaps he is running for the leadership of his party, or maybe he is doing as he did when he first came into Parliament: running, under a pseudonym, a private business offering to make one very rich in return for sending him a small cheque. Whatever he is doing, he should stop it and revert to the job of the department and try to put right the problems so clearly set out by the noble Lord, Lord Davies. I greatly look forward to the Minister reassuring me that that is indeed what will happen.
(2 years, 3 months ago)
Lords ChamberThe Queen’s Speech said that we
“will lead the way in championing security around the world.”
In “Yes Minister”, the Permanent Secretary would have said, “Very bold, Minister”. It is quite a bold assertion. We used to be good at understatement. Conservative Foreign Secretaries such as Alec Douglas-Home, Peter Carrington, Geoffrey Howe and Douglas Hurd tended to speak rather softly, although they still carried quite a big stick. They tended to get their way. The stick is now a little smaller, as the noble Baroness, Lady Davidson, convincingly reminded us, but we seem to be shouting rather loudly and not getting our way quite so often.
I want us to be trusted. Trust is quite a good thing to have. I want people to believe that, if they conclude a deal with us, that deal is likely to stick. This makes it easier to conclude a deal. I would like people to think it unthinkable that we would break a treaty commitment and start a trade war. I must say to the noble Lord, Lord Frost—I am sorry he is not here to hear it—that this House still champions the rule of law. I think we showed that during the passage of the then internal market Bill and, if we have to, we will show it again in connection with a Brexit Bill.
The Queen’s Speech does not say anything at all about development; the noble Lord, Lord Collins, was absolutely right to pick that up. The slick brochure published by the Foreign Office this week is unconvincing and alarming. It is alarming because it is clear that we are switching aid away from multilateral to bilateral, back to more tied aid. We will give less support to the international agencies fighting the causes of global insecurity, such as famine, disease, unrest and mass migration. Three out of every four cross-channel migrants and refugees come from a country fighting severe famine right now, but it seems from the Foreign Office publication that we plan to cut back on what we do to stem the flow at source—although, of course, the Queen’s Speech said that we will be hard on refugees. Apart from the moral imperative, is it not in our self-interest to do more, not less, through the multilateral agencies?
The noble Lord, Lord King, was absolutely right—as he usually is—in pointing to the imminence of the global famine. It is here already, but it is going to get much worse. Before Putin’s invasion, 80% of Egypt’s wheat came from the Black Sea; 75% of Sudan’s; 75% of Lebanon’s; 50% of Libya’s; and 50% of Tunisia’s. Global stocks were already at their lowest for seven years. The World Food Programme was already telling us that we were facing an unprecedented global hunger crisis before Putin’s invasion. As the noble Lord, Lord King, pointed out, protectionism in India and Indonesia —export bans—means that it is not just wheat that will be in very short supply in the Middle East. There are 9 million people in Tigray who are starving right now. The WFP says that there will be 20 million in Sudan within three months.
Should we not be urgently doing more, not less, for the WFP, the FAO, the UNDP, the UNHCR and the WHO? The WHO says that Covid has already killed 6 million and is still killing 1,000 a day. Those are probably underestimates, because the statistics are patchy. Some 75% of us are fully vaccinated, but only 23% are in Uganda, 19% in Ghana, 6% in Tanzania and 5% in Malawi. These disparities shame and threaten us. Do we not owe it to our Commonwealth friends and to ourselves to do more to help them do better?
It is not just them. In tragic, war-torn, blockaded Yemen, only 1% of the population has been vaccinated at all. Are we using our undoubted influence in Riyadh to persuade the Saudis that lives must be saved in the Yemen? I hope so, but I do not know.
The key global responder is the WHO. Some 80% of its finance comes from voluntary national contributions. Are we up there as global leaders showing the way? No, we are way down the pack. Up at the top are Germany and Japan; we are down with New Zealand. Global Australia contributes more than global Britain; the Gates Foundation contributes more than global Britain. Should we not put that right? It is a global pandemic and, if we aspire to be champions of global security and lead the way, should we not be doing something about global insecurity and its root causes?
My last point harkens back to my first. When working in Washington and Brussels, I was lucky enough to witness a virtuous circle: the more the White House trusted us, particularly because of our policies on Northern Ireland through John Major and Tony Blair, the more our perceived influence in Washington strengthened our hand in Brussels—and the more we were seen to deliver on common purposes with our friends in Europe, the more the White House listened to us. I worry about the very real risk of a vicious circle, which works the other way. Picking fights with the 27, particularly over Northern Ireland, is the best way of losing friends in Washington. The more we drift away from both Europe and America—
My Lords, it is a very long last point and I do urge the noble Lord to conclude.
My noble friend makes some good points, and he allows me to reiterate that, below the surface, there is a lot of extremely important and constructive work going on to ensure that what we have said—what we have promised and guaranteed—will indeed be undertaken.
The problem is that “pacta sunt servanda”. However unattractive we may find it—like the noble Lord, Lord Empey, I find it very unattractive—the fact is that for 15 weeks now, we have been under a legal requirement to establish Mr Johnson’s frontier in the Irish Sea by the end of the year, with two-way checks, and to help the EU supervise its new single market frontier inside our United Kingdom. Yet we seem to have done nothing and to still be in denial. It seems that we are even refusing to let the EU have a base in Belfast. How come, since “pacta sunt servanda”? When will the Government come clean with Northern Ireland about all this?
First, my Latin is not so good. But there are no plans, and there is no wish, to allow the EU to have an office in Belfast. Originally, that was for diplomatic purposes. I understand that the intention is more for doing monitoring and checking. I also reiterate what I said earlier: there is no need to change the dates for the transition period.
There were several questions from the noble Lord, so I will not be able to answer all of them, but I say at the outset: the respect is there between the two countries—it always has been. We have very strong and close relations with the US for a whole range of reasons and there is no reason why that will not continue in terms of our negotiations. In fact, as I said earlier, talks in the working groups have been extremely constructive, and we very much hope they will continue in the same vein. Having said that, I have no doubt that the US will talk tough. We are prepared to talk tough and have said that we are prepared, if necessary, to walk away from negotiations if we feel that any of the issues that we are negotiating on do not fall in with the national interest.
My Lords, I think we risk being a little churlish. What we have here is what I recognise as a White Paper. We have a serious document with some serious economic analysis resulting in some serious consultation with a serious attempt to quantify the effects of the policy the Government chose to follow, broken down sectorially, geographically and in different categories of citizen, and there has been consultation with the devolved Administrations. In all these respects, this is admirable and in striking contrast with what we got last week about the negotiation with the European Union, which started today.
I think that one should give the Government credit for being honest about how small the likely scale of increase in trade would be if one managed the scenario that is sketched out here. If, optimistically, one achieved what is here, one would be gaining, after 15 years, a fraction of 1% of GDP, whereas, with the European Union, the Government’s own economic analysis shows that they would be some 5%, 7 % or 8% down in GDP. So this is small stuff.
I also agree with the noble Lord, Lord Lilley, that what matters is what the traders do. More than two-thirds of transatlantic trade in goods is intra-company trade, so it is issues such as taxation that matter as much as any of this here. I also find the optimism of this quite striking. I was always struck, when in America, that the land of the free is not the land of free trade: it is the land where might is right. Remember that the Jones Act is still on the statute book in the United States, that we are the small party—the demandeur—and that the United States is out to, “Make America Great Again”. It is out to bring home jobs; it is not out to support jobs in this country, even though we are a close ally.
It is an admirable document; I see no harm at all in the attempt the Government are making, but let us be realistic. The noble Lord, Lord Howell, is right: it is in Asia, not America, that there are the real prospects for expanding trade. In America, we will come up against fierce protectionism: America is the most protectionist economy of all our trading partners.
It is praise indeed that the noble Lord, Lord Kerr, has said that the document is admirable and I am pleased to have been able to listen to that very carefully. I take note of what the noble Lord says about the US and our prospects, but I do not agree. If we take, for instance, SMEs as one particular issue, there are 5.9 million small businesses, but relatively few export to the US. This new deal will provide a tremendous opportunity for SMEs to do business in the US. From the analysis we have done—the noble Lord will have probably read the document—we believe we have more to gain in the UK in terms of business with the US than the US has in return. I think it is exciting and I am not at all dismissing the point made by my noble friend Lord Howell and the noble Lord, Lord Kerr, about the importance of the Far East. The point is that, as we have left the EU, and as we go through this transition period, the opportunities are absolutely tremendous in terms of what we can do in global deals generally, but it makes sense for us to start with the US.
(6 years, 11 months ago)
Lords ChamberMy Lords, I want to make two points, or rather two pleas: a plea for realism on the issue of the border and a plea for greater political engagement to save the Good Friday agreement. The border is well covered in the excellent report from the European Union Committee. The most amazing thing about the report, which is exactly nine months old, is that it has not dated at all. It has not been overtaken in any way by events. It says at paragraph 85:
“Despite ministerial recognition of the substantial implications Brexit could have for cross-border economic activity on the island of Ireland, there is still significant uncertainty over how the UK plans to mitigate these effects”.
That is still precisely true, as the noble Lord, Lord Hain, pointed out.
Having read both the little reader’s digest essays published in August—we cannot call them “negotiating documents” because there was nothing in them for a negotiator to get his teeth into, but they are nice little aspirational essays—I can say they both bear on this debate and they still do not give us any idea of the UK Government’s concrete proposals. There are not any concrete proposals.
The impression given is that it is time that Brussels came up with some helpful suggestions here, and we occasionally suggest options, or avenues that might be pursued, and then if they do not go terribly well, we can always say, “Oh, that was just blue-sky thinking”, and put them back in our pocket again. This is not the basis for a negotiation. An honourable exception is the paper on citizens’ rights, which was a much more substantive paper and provided the basis for a real negotiation. It looks to me as if there is a real negotiation going on on citizens’ rights and I would expect sufficient progress by October on that dossier, but I cannot see it on this dossier, on the basis of the documents that we have put forward. The trouble is that the 27 do not think that it is for them to put forward solutions. They think that we created this Brexit problem, we are demandeurs for a solution, so we had better come up with some. And they are still waiting.
Another, greater difficulty on the border issue is that we are actually, in practical terms, between a rock and a hard place. This is not so much on controls on people. If we want to change our immigration policy, if we want to make it more employment related, if we want to say, “Well, let’s not worry so much about the frontier”, we can do that. The non-UK, non-Irish EU citizen may pop across to Dublin, pop up to Belfast, pop across, and we could turn a blind eye to that if we want to. That is not the problem: on controls on people it is really for us to say what we think we need, but on controls on goods it is absolutely not for us to say. When the inner-Irish border becomes the frontier of the customs union, it will be the duty of the Irish Government. They will hate it, but it will be their duty to apply the rules that apply at all the external frontiers of the European Union.
Two-thirds of the member states of the European Union have the duty of controlling a part of the external frontier of the European Union. Many of them, too, have a region just across the frontier, just outside, with which they have very close ties—a region in the neighbouring country—but they nevertheless have to apply the rules that they have all agreed: rules of origin, customs checks, sanitary checks, health checks, environmental checks, all the procedure at the border. Do not blame the Commission. It is the member states that have agreed this and if there is to be any change in respect of Ireland, it is going to be very hard to persuade these people that they should not have a change too. So it seems to me to be an unlikely way to proceed.
It is also the case that technology is not going to save us. I am sure the EU Committee’s report is correct when it says, at paragraph 105:
“The experience at other EU borders shows that … while the burden and visibility of customs checks can be minimised, they cannot be eliminated entirely. Nor, while electronic solutions and cross-border cooperation are helpful as far as they go, is the technology currently available to maintain an accurate record of cross-border movement of goods without physical checks at the border”.
The Swedes are the world leaders at this kind of technology and they say that that is correct. For their border with Norway, which is the border of the customs union, they do have to conduct spot checks, which means that the border has to be manned, and X proportion of the trucks have to be stopped and investigated—I do not know what X is. The report is not coming up with a judgment, it is a fact, and magical thinking will not magic it away. It probably means that some of these 300 roads will have to be blocked. It certainly means that the roads that stay open across the frontier will have to have some sort of control. It will not be our control, unless we want one, it will be the European Union’s control which the Irish will have to operate. All of us saying, “This is going to hurt Ireland”—that is true, of course it is going to hurt Ireland—is not going to save Ireland. Ireland is going to be required to do it because Ireland will be manning the external frontier.
I understand the Government’s difficulty in admitting this. If you are in partnership with the DUP—a party that wants out of the single market, wants out of the customs union and absolutely does not want a hard border—you have a problem. The combination is an impossible one and that will become clear, even to the DUP, at some stage. I do not know what will happen then. I am not surprised the DUP wants an impossible combination because it was what it was told by the then Secretary of State for Northern Ireland was going to happen. Ms Theresa Villiers promised that there would be absolutely no change at the border after Brexit. I am not surprised that some in Northern Ireland thought that might be true. It cannot be true.
I recall when the noble Lord, Lord Lawson—who is not in his place, sadly—then leading the leave campaign, had the intellectual honesty to slap down Ms Villiers. She replied that he was improperly briefed. He was not improperly briefed. It is the case that if we leave the customs union there will have to be some kind of hard border. What is puzzling is that although Ms Villiers left the Government, the Government seem to be still singing the Villiers song, not the Lawson song.
Of course, I understand why the unionist community —the noble Lord, Lord Trimble, made the point eloquently, as did the noble Lord, Lord Empey—absolutely rejects the slightly less implausible alternative of a special regime for Northern Ireland, with checks on movement to and from the rest of the United Kingdom. That is unacceptable. I am afraid I do not think that the solution proposed by the noble Lord, Lord Empey, that Ireland should leave the EU’s customs union in order to have a customs union with us, is legally feasible, and I do not think it is or is likely to become the policy of the Government in Dublin, although I am sure they will be grateful for the suggestion.
If one rules out the impossible, the unacceptable and the fanciful, the choice for the United Kingdom is really quite simple: either we are in customs union with the EU or we are not. That is the choice. If we are in, the border can be reasonably frictionless. If we are out, I am sorry, it cannot. We have to be realistic about that and fudging the choice by talking of association with the customs union only excites suspicion in Brussels. How comprehensive, binding or long-lasting would such an association be—could it be, given Dr Fox’s remit and Mrs May’s rhetoric? In Brussels it sounds like cherry-picking, free riding—having the cake and eating it. It also sounds, including to me, WTO non-compliant because unless EU concessions to us covered substantially all trade, which Dr Fox would hate because it would cramp his style, or the EU offered the same deal to all its other trading partners, which obviously it would not do, the WTO would not have it. It would have to be one or the other.
I cannot see the EU buying any of this anyway, even if we put it forward a lot more concretely, convincingly and committedly than in our little August note, and even if we could persuade Mr Varadkar to act as its advocate in the European Council. I have seen no evidence that we have even tried to convince Mr Varadkar. We do not appear to be talking to Mr Varadkar very much. Yesterday his Foreign Minister dismissed the paper on the border issue as unrealistic. Dr Varadkar gave his own view on the issue when he visited the Canadian-American border. His interests are the same as ours—he does not want a hard border either—but his policy deductions seem a bit more realistic. We and Northern Ireland need to listen to him, because the European Council will. At the moment when the European Council takes its decision on this, we will not be in the room but he will. At the moment when people ask, “Are we making sufficient progress on the Irish question?”, he will be the man who speaks first. If he says, “Yes, I think so”, then the odds are that they will agree but if he says, “Actually, we’re not getting anywhere on the frontier because we’ve had no serious proposals from the Brits”, that is it—we are stuck.
This brings me to what I want to say about the Good Friday agreement.
My Lords, bearing in mind the late hour I wonder whether the noble Lord might conclude his remarks.
I realised the hour was late. Nevertheless, I would like to say something quite serious about the Good Friday agreement.
I am alarmed. Although the Government’s policy on Brexit and Ireland is no clearer than it was when the Select Committee’s report was published, the situation has worsened in at least three ways. First, the strand one institutions are, as we know, in abeyance. I say to the noble Lord, Lord Howell, whom I am glad to see in his place, that whatever the reality is—and I do not know—the perception matters, and many in Northern Ireland will think it is more difficult for the Government to play the role of honest broker, cracking the present impasse, now that they have a political alliance at Westminster with the DUP. That may not be the case but it will be the perception of some. It is more difficult for the Government to appear to the nationalist community to be impartial. I put it no higher than that.
The second development was in the point so movingly put by the noble Baroness, Lady O’Loan.
My Lords, the noble Lord should consider concluding his remarks pretty rapidly, as he is on 14 minutes. The guide time for speeches is eight minutes and the hour is late. I hope that the noble Lord will agree to that.
I will bow to the House if it feels I should say no more. I want to make two more points but if the House thinks that I should not make them, I will sit down. Shall I carry on?
My Lords, I apologise for having to get up a third time but I invite the noble Lord to conclude his remarks immediately. I hope that it is the mood of the House that he should do so.
I shall say three sentences. What we need from the Government today is a clear policy which delivers a soft frontier across the island of Ireland, and that means a customs union. What we need to make sure that we do not let the peace process wither on the vine and the Good Friday agreement fall into complete abeyance is active, high-level UK Government political engagement, including with the Taoiseach, to protect the interests of the north and the interests we all share in active co-operation on a basis of equality across the Irish Sea.
My Lords, I understand the general points made the noble Lord, Lord Mitchell, and I have considerable sympathy for them. However, I do not understand their relevance to Clause 71, which is about remuneration reports. The problem with remuneration reports is that the degree of detail now required in them means that they have become rather long and complex. An additional requirement to include a comparison between payments made to two categories of staff, neither of which is within the scope of the remuneration report, would add further complexity without the justification of relevance. Remuneration reports are about the remuneration of directors and senior executives. The amendment calls for the inclusion of factual material on individuals who are neither directors nor senior executives.
Such complexities have costs. Take two plcs with 70 and 100,000 employees across the world in, say, 50 to 85 countries. I am thinking of two examples which I know well. Is it really necessary, for the purposes of the remuneration report, to require them to establish with each of their businesses in each country where they operate which are the lowest pay rates paid, presumably to the most junior, temporary staff of that country, then take appropriate exchange rates and try to work out the unluckiest 10 in any of their operations anywhere across the world? The remuneration report is about the directors and senior executives. The purpose of a remuneration report must surely be to explain to shareholders the company’s remuneration policy and the result that it has produced for the senior individuals that the report is required to cover, and to do so as simply and clearly as possible. Would this amendment assist that? I do not think so.
Amendment 84AHAA seeks to require that companies report on high and low pay outside the board. Taking high pay first, the issue of high pay outside the boardroom is most relevant in the financial services industry, as was mentioned earlier, where poorly designed remuneration structures can incentivise excessive risk-taking. We remain committed to having the most transparent financial centre in the world and we have already taken significant steps forward. During ongoing negotiations with Europe over new regulations for the banking sector, we have argued strongly for further improvements to the disclosure of pay below board level. As a result, the current EU proposals would require banks to disclose the aggregate pay of senior managers and material risk-takers in bands, as well as further information about how much is paid in total in fixed and variable pay. We await the outcome of these discussions before deciding whether additional UK regulation is necessary.
The noble Lord, Lord Mitchell, raised the issue of disclosure of pay below board level in banks and asked why the UK does not regulate. We argue that it does not make sense to proceed with UK regulations until we know the precise details of the European rules. Once this is confirmed, we will decide whether we need to go further. It is not a major issue in other sectors. In our consultation on this, shareholders were clear that requiring all companies to report on high pay below board level would create an unnecessary regulatory burden and so we will not pursue this. The noble Lord raised the issue of pay below board level in non-banking sectors, which we acknowledge is an issue. In the end, pay reports are produced for shareholders, so they should be designed to include information that they want. We should not clutter them with information that they do not find useful. Shareholders and the Government share the view, however, that high pay below board level is not a major issue in other sectors. In our consultation, shareholders were clear that requiring all companies to report on high pay below board level would create an unnecessary regulatory burden, so we will not be pursuing it. That point was made eloquently by the noble Lord, Lord Kerr of Kinlochard.
One matter that shareholders are increasingly interested in is how board pay relates to that of the wider workforce. That is why companies will have to say more about how they have considered pay across the whole of the company workforce. They will also be required to publish the percentage increase in pay of the chief executive officer compared to that of the workforce. I can directly answer the question raised under the previous amendment by the noble Lord, Lord Lea of Crondall. It is something that investors are asking for and is comparable across companies, but we have no plans to mandate that companies adopt a standardised ratio for top to median pay because it is clear that this measure has limitations. It is difficult to compare between different companies and sectors. For example, an investment bank with many highly paid staff will have a much lower pay ratio than a supermarket.
New regulations will implement these proposals. Noble Lords will have the opportunity to debate these regulations later in the year. I conclude by making an overarching general point about trends in pay. It is pleasing to note, although I acknowledge that there is still much work to do, that in 2012 several firms, including Aviva, WPP, Centamin, Pendragon and Trinity Mirror failed to win majority backing for their pay reports, with several senior executives stepping down in the face of shareholder opposition. Voting results from AGMs in 2012 suggest that the average vote against the remuneration report was 8.9%, up from 6% in 2011. So, there is more work to be done but the trends are going in the right direction. I therefore ask the noble Lord to withdraw his amendment.