European Union (Withdrawal) Act

Barry Gardiner Excerpts

Thursday 6th December 2018 Commons Chamber

[Barry Gardiner (Brent North) (Lab)]

I congratulate not only Members on my side of the House today, but all those who have spoken in this debate, because what we have shown is testament to the passion and the force of argument and rationality that Members can present the House with at times such as this. I also want to pay tribute to you, Mr Speaker, for the fact that you have shown leadership by staying in the Chair for the entire proceedings of this debate.

The person I wish to start by quoting is not one of my own side, but the right hon. Member for East Devon (Sir Hugo Swire). He said:

“No one ever said it was going to be easy.”

Actually, on 20 July last year, the Secretary of State for International Trade informed the country that an agreement with the EU would be

“one of the easiest in human history.”

[The Secretary of State for International Trade and President of the Board of Trade (Dr Liam Fox)]

If we are going to have a sensible debate and if we are going to use quotes, they should be accurate and in context. As the hon. Gentleman knows, the point I was making was that the trade element—the part we have not yet negotiated with the European Union—should be simpler than most, because we would begin, unlike in most trade agreements, with regulatory alignment and legal alignment in trade.

[Barry Gardiner]

I know exactly what the Secretary of State said. In the following sentence, he said this would happen unless

“politics gets in the way.”

Clearly, politics has got in the way, but it is not the only thing. Yesterday, reality got in the way, with the release of the Attorney General’s written advice to Cabinet. The implications of this legal advice are that we could be locked into a position where the EU negotiates a new trade in goods agreement that might be beneficial for the EU but deeply disadvantageous to the UK. This could be a deal where we have no say in the negotiations but where the UK could be obliged to open up our markets, perhaps to the United States of America, without any reciprocal right of access for UK manufacturers into that US market. I know the Secretary of State will have reflected carefully on that outcome. In fact, earlier this year in his Bloomberg speech, he presaged just such a situation. He said:

“As rule takers, without any say in how the rules were made, we would be in a worse position than we are today. It would be a complete sell out of Britain’s national interests and a betrayal of the voters in the referendum.”

But in a few minutes, he will stand at that Dispatch Box and urge hon. Members from across the House to vote for it. I can only admire his flexibility.

So how did this mess come about? The Chair of the Public Accounts Committee, my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier), excoriated the Government for their failure to prepare. My hon. Friend the Member for Liverpool, West Derby (Stephen Twigg) focused on the rigidity of the Prime Minister’s red lines. Perhaps the most serious error, though, was, as my hon. Friends the Members for Ynys Môn (Albert Owen) and for Rutherglen and Hamilton West (Ged Killen) said, to try to exclude Parliament from the process. The Government tried to exclude us on the triggering of article 50, on the impact assessments, on the right to a meaningful vote on the deal and on the financial modelling, and of course we argued that Parliament had the right to see the full legal opinion prepared by the Attorney General. Their refusal was a blunder that resulted in an achievement unique in a thousand years of our history: a Government being held to be in contempt of their own Parliament—ironic, given that Brexit was supposed to be about the sovereignty of this Parliament.

It is hardly surprising, then, that now that the Prime Minister has finally brought her deal back to the House of Commons, it is a deal that Members on both sides believe is not in the best interests of the country. She used to say, “No deal is better than a bad deal”; now the motto seems to be, “Any deal is better than no deal.” In fact, the Prime Minister’s deal is not actually a single deal at all: it is a package, in which there is one deal with binding commitments by the UK on the things that the EU demanded that we settled before we leave—money, citizens’ rights and the Irish border—and another proposed deal, which contains only a wish list, with no binding commitments on the EU on all the things that the UK would like in terms of our future political, trading and security relationship. Both are packaged up with the transition period, during which the real final deal is supposed to be negotiated.

People have called it a blind Brexit, because we are unable to see what we will get before we leave the EU on 29 March, by which time we will have lost all further leverage. After President Macron’s comments, is there anyone present in the Chamber who thinks that it is mere coincidence that the final date to extend the transition period and avoid the backstop is exactly the same date as that for the ratification of an agreement on access to our waters and fisheries quota shares?

My hon. Friend the Member for City of Chester (Christian Matheson) pointed out that, although the Government say that the technology to avoid a hard border does not currently exist, in a staggering act of faith, they believe that it will be possible to achieve that by December 2020, when the transition period comes to an end. If the future relationship is not agreed by that date, the UK is faced with a stark choice: pay billions of pounds to extend the transition, or enter into the trade purgatory of the backstop arrangement.

Forty years of harmonisation of standards and regulations has resulted in UK companies being deeply embedded in complex supply chains. In the past few months, I have visited factories in all sectors. I have been to the ceramics factories about which my hon. Friend the Member for Stoke-on-Trent Central (Gareth Snell) spoke so powerfully when he told the House about the unions that he met and their fight. They are stressing that we must not have no deal, while not exactly being enamoured of the one that is on offer.

[Vicky Ford]

Will the hon. Gentleman give way?

[Barry Gardiner]

The automotive sector—[Interruption.] The hon. Lady will understand that the purpose of summing up at the end of the day is to respond to all the comments, including hers, that have been made during the debate. That is what I will try to do.

I visited the automotive sector with my hon. Friend the Member for Crewe and Nantwich (Laura Smith). I spoke to the management, the unions and the workers. Their sector represents £18 billion-worth of exports to the EU. It has benefited enormously from our EU membership, and particularly from the customs union, which has allowed companies to streamline their supply chains and employ just-in-time systems.

I am not a pessimist about the future of our country. I do not say that the UK will be poorer if we accept the Prime Minister’s deal. But I do say, with the support of both the Treasury and the Bank of England, that it will be much poorer than we otherwise would be, by approximately 4% of GDP. My hon. Friend the Member for Sheffield South East (Mr Betts) spoke with clarity and passion about the differential impact that this would have on the poorest people and on the forgotten regions of our country, which need infrastructure investment.

Let us examine the potential upside: the new free trade agreement that the Secretary of State is so keen for us to do, particularly with our single largest bilateral trading partner, the United States. We have a trade surplus with the USA—a trade surplus that President Trump is determined to overturn. Last week, he suggested that a deal may now no longer be possible because of the way in which this deal proposes to align with the EU. President Trump made it clear that any trade agreement would involve aligning with American regulations and standards. Yes, of course, that means chlorine washed chicken, but it also means the US “Defect Levels Handbook”, which specifies the level of mice droppings or rat hairs that are permitted in our food—for example, 11 rodent hairs per 50 grams of cinnamon and 20 maggots per 100 grams of drained mushrooms. If anyone in this Chamber doubts it, they can read the handbook for themselves or they can see what is proposed by reading “Plan A+” launched by the original Brexit Secretary and by the hon. Member for North East Somerset (Mr Rees- Mogg) just recently. It proposes to remove parity-pay for posted workers; end limits on the hours that people can be asked to work; end the precautionary principle; say yes to pesticide residues and yes to hormone-disrupting chemicals in genetically modified organisms. Such regulatory divergence from the EU would substantially impact our ability to trade with our biggest, closest market. It would increase the risk profile—

[Dr Fox]

rose—

[Barry Gardiner]

Of course, I will give way to the Secretary of State.

[Dr Fox]

I am grateful to the hon. Gentleman for giving way. Is he aware that because of trade asymmetries—that is the way in which trade flows are measured transatlantically —the United Kingdom believes that we have a trade surplus with the United States, but the way that the US measures trade means that the US already believes that it does have a trade surplus with the UK. That rather undermines his case.

[Barry Gardiner]

Not at all. The Secretary of State will have read what President Trump has said recently. He knows that the President, as a protectionist, wants to put America first, not the UK.

That regulatory divergence from the EU would substantially impact our ability to trade with our biggest and closest market. The Minister for Trade Policy recognised the same. He noted that, “If we come out of alignment with EU regulations in this area, then there is a penalty to be paid in terms of frictionless trade with Europe.” That comes from the Secretary of State’s own team.

Even assuming that new trade deals are possible without these complications, what would these new agreements contribute to our GDP? The Bank of England has quantified any benefit at less than half a per cent—just 0.2% of GDP growth. The Government’s own assessment says that a no-deal Brexit would result in a reduction of 9.3% of GDP. Most MPs are clear: a no-deal Brexit cannot be allowed to happen. None the less, the Prime Minister is presenting her agreement as a binary choice between her deal and no deal. She urges MPs to vote for a deal that they firmly believe is not in the country’s best interest by threatening that if they do not, the consequences of no deal would be even worse. That is not an argument; it is blackmail. Most importantly, it is a false choice.

Earlier today, my right hon. Friend the shadow Chancellor set out an agreement that respects the key reasons why many people voted to leave—namely money, borders and law—and also ensures that we continue to have frictionless trade that protects our manufacturing industry’s just-in-time supply chains and the integrity of the United Kingdom.

We are at a critical point in our history and business needs certainty and stability. Our children need an optimistic future. Our country is deeply divided. I started by quoting the Secretary of State and remarking how flexible he has been in acquiescing to this deal. I conclude my remarks, exhorting him to be yet more flexible still and to recall his own words, which were quoted in The Mail on Sunday on 16 September 2012. He said:

“I believe the best way forward is for Britain to renegotiate a new relationship with the European Union—one based on an economic partnership involving a customs union and a single market in goods and services.”

The Secretary of State may not like it, but it sounds an awful lot like Labour party policy to me.

--- Later in debate ---

[Dr Fox]

Once we get out of the realms of fairy tales and consider reality, we see that the unemployment rate in the United Kingdom is 4.1%—almost exactly half the level in the eurozone, which is 8.1%. Our exports are growing faster than in most other countries in Europe, with the exception of Germany, and investment in our infrastructure is at record levels.

[Barry Gardiner]

rose—

[Dr Fox]

Now that the hon. Gentleman wants to come into the debate, I welcome him.

[Barry Gardiner]

As, indeed, I twice welcomed the Secretary of State. Will he confirm whether he has seen Her Majesty’s Revenue and Customs statistics on regional trade in goods for the third quarter that were published this morning? They show that all regions of the United Kingdom are importing more than they are exporting, and we therefore have a large balance of trade deficit.

[Dr Fox]

I hate to bring this to the hon. Gentleman’s attention—it will no doubt come as a shock—but we have had a trade deficit since the 1980s. In fact, one of the few times when we have not was in February this year, when the UK became a net exporter for the first time in some time. The hon. Gentleman will no doubt be overlooking those facts because they do not suit his narrative.