Brexit: Preparations and Negotiations

Baroness Wheatcroft Excerpts

Monday 23rd July 2018 Lords Chamber

[Baroness Wheatcroft (Con)]

My Lords, it gives me great pleasure to follow my noble friend Lord Gadhia, as I share many of his concerns. This White Paper represents a step in the right direction. It recognises the harsh realities of the single market and opens the way for a more pragmatic negotiation. But, as I read it, I had in mind the maiden aunts of the noble Lord, Lord Lisvane. Your Lordships will recall that they planned a trip to the cinema, only to be confronted with a choice between “Reservoir Dogs” and “The Texas Chainsaw Massacre”. Did the White Paper promise them something more alluring? The answer has to be yes, but I believe that the noble Lord’s aunts would be as discerning as he, and would quickly realise that, while the programme might not be quite as gory as some, it would be a deeply uncomfortable experience, perhaps more akin to the psychological horror of “The Birds”.

There are elements of the White Paper that Monsieur Barnier has already indicated are for the birds. Most importantly, he has indicated that proposals for enhanced equivalence to ensure that our financial services industry can still flourish will not be acceptable to the 27. Why would they be? Why would they be willing to water down their concept of the single market and the rules that govern it to accommodate our financial services industry? The White Paper acknowledges repeatedly that, even in its suggested version of Brexit, Britain’s access to the EU markets for services would be reduced. I have asked my noble friend the Minister, who sadly is not in his place, if he could give an indication of how much we will have to pay for that reduction in access. I ask again: could we have an estimate of what we will lose?

Financial firms are already moving their operations out of Britain. Brexit would produce a stampede. My friend from the other place, the honourable Member for North East Somerset, is already showing the way, having just launched a second fund in Ireland—a wise move, since he has suggested that any benefits of Brexit could be 50 years away. He has said:

“We won’t know the full economic consequences for a very long time, we really won’t”.


He is in a position to do this, perhaps. As the right reverend Prelate the Bishop of Leeds suggested, wealthy fund managers can afford to gamble and to take such a cavalier action with their own finances, but to suggest that they should bully the Prime Minister into taking such a gamble with the finances of the country seems appalling.

The Bank of China’s UK head, Sun Yu, says that no deal would threaten London’s status as a hub for international banks. Any version of Brexit does that. The no-deal Brexit which some now favour over the White Paper version could create real hardship. The IMF calculates that no deal could cost nearly £200 billion in lost output to this country.

On trade in goods, the White Paper accepts that the price of access to the EU’s markets will be accepting EU rules without any say in their formulation. The aunts of the noble Lord, Lord Lisvane, would be reaching for the smelling salts by the time they reached paragraph 16(b) of chapter 1 of the paper. This attempts to spell out how tariff collection will work. We have already heard about the inevitable tailbacks and the threat to foodstuffs and medicines, but charging the right tariff will be a matter of guesswork. The White Paper envisages that in,

“up to 96 per cent”,

of cases the tariff will be correct, but note the “up to”. For the rest, there will have to be a repayment mechanism. Given that the EU sells us more than £300 billion-worth of goods every year, that provides ample scope for Her Majesty’s Revenue and Customs to be rather bogged down in requests for refunds.

The benefits of being in the EU are huge. The realisation of that is why the White Paper states, somewhat plaintively, that we wish to remain in many EU institutions, even while accepting that we will not have any say in their deliberations.

The benefits were what persuaded the country to join the Common Market in 1971. Incidentally, in an excellent article in the Irish Times, Fintan O’Toole recently pointed out that the 1971 White Paper sold more than 1 million copies. I doubt that this one is such a bestseller. The 1971 White Paper began by stating:

“The prime objective of any British Government must be to safeguard the security and prosperity of the United Kingdom and its peoples … The Government are convinced that our country will be more secure, our ability to maintain peace and promote development in the world greater, our economy stronger, and our industries and peoples more prosperous, if we join the European Communities than if we remain outside them”.


That remains true of our involvement in the EU today.

The calamitous cost of Brexit becomes more evident every day. It is no wonder the public are waking up and a majority have decided that they would prefer to remain in the EU than face a hard Brexit. A customs agreement and single market access, the Norway option, would be less painful and is probably the best that will eventually be on offer, but that means paying through the nose for less than we have now. It is not my idea of a bargain.

I end up in the same place as the noble Lord, Lord Lisvane: faced with two, deeply unattractive options, should not his aunts have a choice to change their mind and not to go to the movies after all? That is why the country should be given a vote on the deal. I have now to declare my interest as a director of the People’s Vote media hub. The country deserves a chance to vote on what is on offer.