European Union (Withdrawal) Bill

Baroness Hayter of Kentish Town Excerpts

Committee: 3rd sitting (Hansard - continued): House of Lords
Wednesday 28th February 2018 Lords Chamber

[Lord Adonis]

My Lords, I am afraid we again get into the Alice in Wonderland world here, as we were in the debates on Erasmus and Euratom. My understanding from discussions with the European Investment Bank when I was chair of the National Infrastructure Commission is that if the Government were to wish to stay a member of the European Investment Bank, that might be possible. There are lots of legal issues which would need to be addressed, but it might be possible. However, it is the Government’s policy, as a matter of principle, that we will withdraw from the European Investment Bank because it is seen as a European institution and apparently the instruction from the British people two years ago was that we must withdraw from it for exactly the same reason that we must withdraw from Euratom: it is seen as a European institution and we are supposed be withdrawing from all of them or else Brexit does not mean Brexit.

We are engaging in self-inflicted harm purely for an ideological purpose by choosing not to be part of an institution which has “Europe” in the title. What has concerned the Committee so much in our debates is that sector by sector, area by area, we are committing to policies that are going to make the country worse off bit by bit. The cumulative effect of all this is going to be immensely serious. Where it is possible to not engage in that self-inflicted harm, it seems to me to be just a matter of common sense not to do so. I would be very grateful if the Minister could tell the Committee the Government’s policy in respect of lending currently made by the European Investment Bank and whether it might still be open.

I am constantly encouraging, and we have the more emollient face of the Government responding to the debate in the noble Baroness. I always have very high hopes of her because she sounds so reasonable when she replies. It may just be that she is so practised at doing these things, but I very much hope that she might give us a commitment that the Government will consider remaining a part of the European Investment Bank and not putting this essential investment in the future infrastructure of the country at risk, as appears to be happening at the moment.

[Baroness Hayter of Kentish Town (Lab)]

My Lords, I do not like to start by contradicting my noble friend, but I have not heard the Government ask that we leave the Eurovision Song Contest, so there is one thing they are content with despite the name containing “Euro”.

This amendment is important not simply for the amount of money being spoken about but what it is used for. I think I heard the noble Lord, Lord Callanan, say from a sedentary position “It is our money”, somewhat missing the point of the amendment, which is about having regard to the principles of social and economic cohesion which we signed up to, welcomed and have benefited from. In fact, it is particularly important given the drive to equality whether in this country, Europe or both. The noble Lord, Lord Wallace of Saltaire, reminded us that England has the deepest regional disparities of any country in Europe. That is why it is not just the money, although I will come on to that, but what we want to use it for and how, and the need for a long-term aspect, as my noble friend Lord Adonis said.

This article enables funds to be used in a way that particularly led to our disadvantaged regions benefiting enormously from the Cohesion Fund, the European Regional Development Fund and the European Social Fund. In the period 2014 to 2020, they will have brought £12 billion our way, and it is not simply the money but the way it is aimed to reduce disparities and concentrates on what the EU calls less developed, transition or other regions. These are significant amounts, but it is the aims and objective that are important. They help create jobs, with start-up businesses, and with research and development. They have had a particular impact in Cornwall, west Wales and the valleys—some of us have to declare an interest there. We have heard of particular cases which have already benefited from this sort of money, including through the environmental impact of some of them, as mentioned by my noble friend Lady Young.

The important thing now is to look forward. As we have heard, the Government, in preparing for our departure from the EU, committed themselves to what they call a,

“UK Shared Prosperity Fund … using money returning to the UK from European structural fund”—

if it has not already gone to the NHS or anywhere else. The idea, as laid out in the Conservative manifesto, is to use that same amount of money. The Exchequer Secretary, Robert Jenrick, promised,

“to consult widely ahead of its launch”.

However, he did not commit to matching ERDF funding after Brexit, so the consultation would presumably be about its use. We have been told:

“The design … is currently being considered, including its funding arrangements, and further details will be set out in due course”.


Although he is not replying to this amendment, the Minister often reminds me that in a year and a month today, we are due to leave. That is not much time for getting these details, even in draft form, let alone for consultation or beginning to think about how people might use these funds. There is undoubtedly some urgency.

I hope that we could maybe have that detail from the noble Baroness as well as the basis on which the Government are planning to allocate the money. Will it be, as we heard suggested, under the Barnett formula, which is on a per head rather than per need basis? Will it be long term? What will the other attributes be? Will it be whoever wants matching funding or something else? Will it be concentrated in the same sort of areas as before? These are important questions, as I am sure she appreciates. It is a matter of funding, otherwise we might lose £8.4 billion from the sort of work that has been done to reduce inequalities. We need to know not just the amount but that it will be targeted towards achieving the same sort of ends as Article 174.

[Baroness Goldie (Con)]

My Lords, first, I thank your Lordships for a genuinely interesting and very helpful and useful debate. I particularly thank the noble Lords, Lord Foulkes, Lord Judd and Lord Wigley, for the amendment to which they put their names. I again thank the noble Lord, Lord Adonis, of course for his kind remarks, although I fear he will dismiss me as a huge disappointment when he listens to my observations. I will try to deal with the points raised, because the amendment raises a very important issue, around which numerous very legitimate questions arise. I do not dispute that for one moment. Although I will not be able to answer every point raised in detail, I will do my best to try and give a helpful—I hope—indication of the direction of travel.

I know the amendment is well intentioned, but I shall endeavour to argue that, with the existing proposals which the Government have put in place, it is unnecessary. I will explain that in greater detail and expand on that proposition. The Government have an industrial strategy that covers many of the areas of cohesion policy and, as numerous noble Lords mentioned, are developing a new UK shared prosperity fund, which will replace EU structural funds. Furthermore, existing legal powers in place in this country in our domestic law already cover some of these issues, and I shall expand upon that.

To reassure the noble Lords, Lord Foulkes, Lord Wallace of Saltaire and Lord Judd, who all referred to this, I say that the Government have a manifesto commitment to replace cohesion policy funding with a new UK shared prosperity fund. It will reduce inequalities and raise productivity across our four nations, and we shall engage extensively with the devolved Administrations on that fund later this year.