EU: Future Relationship

Baroness Wheatcroft Excerpts

Wednesday 23rd September 2020 Grand Committee

[Baroness Wheatcroft (Non-Afl) [V]]

My Lords, when he was electioneering back in December last year, the Prime Minister promised that:

“We have an oven ready deal, put it in the microwave as soon as we get back after the election on Friday 12th December and get it done.”


I know that rash promises are sometimes made before elections—indeed, they are sometimes made after elections; the “world-beating” test and trace system comes to mind—but today, we are discussing the UK’s approach to negotiations with the EU. Can the Minister say what the Government’s approach to that oven-ready deal has been? Did it ever exist? The withdrawal agreement was a framework, though not a perfect one, that is now being torn up, but the oven-ready deal that electioneering led people to expect is not in sight. The Government’s preparations for leaving the EU are about as close to oven-ready as the turkey that has just been hatched.

Others, most notably the noble Lord, Lord Judd, reminded us that the EU is about far more than trade. I accept that we have left the EU; now what we need is a good deal. Trade deals are never easy to negotiate but it is clear that a deal with the EU is what we need most. In 2018, 49% of our trade was with the EU. It is potentially great news that we have concluded a trade deal with Japan, but Japan accounts for just 2% of our trade and we do not yet know the details of that deal. There are questions over quite what we have given up, particularly on state aid. I find it incomprehensible that a Conservative Government should be prepared to risk our future relationship with our major trading partner over the issue of state aid. I would be grateful if the Minister could tell the House what state aid the Government are so desperate to provide that they are prepared to sacrifice such a crucial relationship.

As the noble Lord, Lord Berkeley, pointed out earlier, we learned this week that if we leave without a deal there could be 7,000 trucks piling up outside Dover, causing chaos and delaying deliveries by up to two days. It seems now that there is even to be a border around Kent. Michael Gove said this afternoon in the Commons that there would be a “Kent permit” for all lorries that needed to enter the county and without such a permit they would not be allowed in. Last week we learned that Logistics UK—formerly the Freight Transport Association—was told that the Government’s smart freight system, designed to reduce the risk of cargo delays, would still be in “testing mode” in January. Well, at least it has been traced.

It turns out that life outside the EU is harder to organise than this Government appear to have imagined. Their gung-ho talk is just that—delivery is the problem. Being a member of the EU brought numerous benefits beyond the smoothly flowing travel of goods and people. Take GPS, now such a crucial part of modern life. The Galileo system, of which we were beneficiaries through our EU membership, worked efficiently but the Government did not want any part of Galileo. We would go it alone. Earlier this year, this gung-ho Government spent £900 million on buying 45% of OneWeb, a bankrupt US tech company, which had attempted to build a constellation of 650 satellites. This was to be the basis for our very own GPS system. Just months later, that project is being abandoned.

Tobias Ellwood, the chairman of the House of Commons Defence Committee, dismissed the scheme as a “vanity project”. It takes vanity on a monstrous scale to blow what adds up to more than £1 billion on feeding it. However, it is not merely the waste of public money that is appalling, it is the risks that a lack of such a system causes. According to Mr Ellwood, if we do not have the back-up of Galileo we are going to have problems. We will be extremely vulnerable from a security point of view. In the continuing negotiations with the EU, will access to Galileo be included?

This afternoon, the president of the CBI, the noble Lord, Lord Bilimoria, spoke eloquently of the need for business to have a deal. He explained that Covid had wrought havoc on our companies. It has eaten into their cash resources, if they had any, and into their material stockpiles. Companies have struggled to get through the last six months, but this week brought the news that restrictions could last another six months. An avalanche of redundancies looms. Is this the time to embark on what even the noble Baroness, Lady Noakes, accepts will be an uncomfortable process?

This afternoon Michael Gove told the Commons that there might be a few bumps in the road. I was delighted to see the noble Lord, Lord Rooker, back in fighting form and even more pleased to have listened to what he had to say. If only our Prime Minister would read that speech in Brussels next month. Extending the transition period is the sensible thing to do, but this gung-ho Government do not do sensible. Michael Gove stated this afternoon that 24% of businesses believe that they are ready for 31 December, and acknowledged that flows across the critical short strait crossings could be reduced by 60% to 80%. Nevertheless, an extension of the transition period will not be contemplated. In a pre-Covid era, it would be mad to press on in such circumstances. As the country struggles to cope with Covid, it is simply incomprehensible.