Exiting the European Union: Sanctions

Chuka Umunna Excerpts

Wednesday 19th July 2017 Commons Chamber

[Hannah Bardell (Livingston) (SNP)]

I warmly welcome the hon. Member for Saffron Walden (Mrs Badenoch). She made a fantastic maiden speech, and she is a great credit to her community. Her speech was delivered with verve and class, and a good deal of wit. While I may not have agreed with everything she said, I am sure that her contributions will be very welcome to the Chamber.

The world looks at the United Kingdom as the Brexit negotiations develop, to see how we will manage the situation in which we find ourselves, and what kind of relationship we plan to have with the European Union and, indeed, the rest of the world. Given that the UK is without a coherent strategy and seemingly bereft of ideas—and, as we have seen in recent photos, notes—I suspect that the external image of how things are going is not entirely positive. Our international reputation is on the line. SNP Members, however, welcome the opportunity to debate the real impact that leaving the EU will have on our international influence and clout.

There is a risk that after leaving the EU, the UK will be marginalised and diminished on the international stage. I know that no one in the Chamber wants that to happen, but there will inevitably be a reduction in our ability—if not a complete loss of ability—to impose meaningful sanctions on our own, or to make any meaningful contribution to a progressive international agenda. One of the Government’s own colleagues, the former Foreign Secretary, has called for the UK to keep its seat on the EU’s Political and Security Committee. I hope that the Secretary of State and his fellow Ministers will enlighten us as to whether he agrees with his colleague.

As has already been pointed out, sanctions rarely operate effectively in isolation. Success depends on a combination of dialogue, agreement and conflict prevention between various countries. Clearly, working with the EU presents a broader range of tools than would be available to the UK when operating alone. Giving up our seat at the sanctions table will see the UK lose the ability to apply sanctions with the same breadth and weight. It will also lose access to key forums through which to push for ongoing momentum and accord among fellow EU member states. There must not be any serious divergence from EU partners in respect of sanctions. The UK must not relax any sanctions that are materially more restrictive than existing or new EU sanctions, especially when the UK has significant trade with a particular country.

Many have expressed fears that the UK may be dragged on to the new United States President’s rather unpredictable turf. For example, as President-Elect he severely criticised the Joint Comprehensive Plan of Action with Iran. If he were to impose new sanctions on Iran, there might be pressure on the UK—and our “special relationship”—to follow suit. The new President has also indicated that the US would ease sanctions on Russia. The EU’s foreign policy chief, Federica Mogherini, has indicated that the EU will not change its policy on Russia, even if the US does. The UK must do likewise. Leaning more closely towards an Administration led by Donald Trump creates concern for many. We must hear from the Government that they will continue to take their international obligations seriously, keeping fairness and decency at the heart of any new trade deals and sanctions policies.

As the largest trade bloc in the world, the biggest global aid donor and a notable international investor, the EU adds weight to the UK’s foreign and security policy efforts. Commenting on the possible impact of Brexit on the EU’s own sanctions policy, Dr Erica Moret at the Graduate Institute of International and Development Studies in Geneva recently said:

“A Brexit-weakened EU sanctions policy is likely to intensify the need to employ other, more expensive, controversial or complicated forms of diplomacy, coercion or pressure. It will also likely strengthen Russia’s hand against Europe, as it benefits from a fragmented Europe with a weaker toolbox of security instruments at its disposal.”

Those comments are deeply concerning and should worry us all.

Indeed, a Foreign Affairs Committee report said that the United Kingdom’s relations with Russia gave an interesting insight into trouble ahead for the UK acting alone on sanctions. The report concluded that

“it will be increasingly difficult to sustain a united western position on sanctions, not least if they become a bargaining point during Brexit negotiations.”

Our worry is that there is everything to play for, but also everything to lose.

We should all be concerned, because our international role and responsibilities extend much further than just Russia. On 4 April, the latest in a series of barbaric chemical weapons attacks took place in Khan Shaykhun in Syria. More than 80 people were killed and estimates suggest more than 500 were injured. Just this week in Brussels the UK was able to play a central role in imposing sanctions against those involved in that horrific attack. The EU’s Foreign Affairs Council agreed on Monday that 16 individuals will be sanctioned, their movements restricted and their assets frozen. But after Brexit the UK will be diminished and we will have no clout to impose meaningful sanctions, resulting in the UK losing its opportunity to contribute to a progressive international agenda.

After Brexit the UK will need to establish the necessary independent policy development and sanctions design architecture, for which it has mostly relied on Brussels until now.

[Chuka Umunna (Streatham) (Lab)]

The hon. Lady is making some important points, but does this not underline the arguments she is making about the complexity of imposing travel bans, asset freezes and so forth, and stopping those who are the target of sanctions? Does this not underline the argument for a proper transition period in respect of our withdrawal? The suite of instruments the hon. Lady refers to are complex in nature, not least legislatively. I do not see how we are going to be able to complete the process of putting in place a framework that we can apply independently in the tiny timescale that we have before our scheduled exit from the EU.

[Hannah Bardell]

I am grateful to the hon. Gentleman and think he may have been reading my mind, as will become clear from my next point.

If the UK Government cannot agree among themselves on a transition policy for Brexit and a deal, as we have seen this week with the vastly differing approaches of the Chancellor and the International Trade Secretary, I and others seriously doubt their capacity to design sanctions architecture, let alone agree on what and where those sanctions should be imposed. And even if they do, the effectiveness of UK-only applied sanctions will be severely diminished.

The UK Government’s own White Paper sets out, in pretty stark language:

“The UK needs to be able to impose and implement sanctions in order to comply with our obligations under the United Nations (UN) Charter and to support our wider foreign policy and national security goals. Many of our current powers flow from the European Communities Act 1972 so we will need new legal powers to replace these…It is not possible to achieve this through the Great Repeal Bill, as preserving or freezing sanctions would not provide the powers necessary to update, amend or lift sanctions in response to fast moving events.”

And events are moving fast; we have a short period, so the Government need to think very carefully and give us a response on that transition period.

Any new legislation must be clear about how these powers will be developed and implemented and, further, what infrastructure and regulation will look like to support those new powers. Additionally, the Law Society of Scotland has raised a number of pertinent points in relation to the UK Government’s White Paper. These points are significant because they highlight the complexity—as the hon. Member for Streatham (Chuka Umunna) has just said—and scale of the task at hand, not to mention just how many sectors and areas of competence will be impacted by exiting the EU, and the need for a new set of rules and regulations. It is clear that lawyers, accountants and consultants will be very busy over the next few years—and, no doubt, considerably richer. But what estimate have the Government made of the cost of training lawyers and accountants to deal with the new laws and regulations, and what provision has been considered for the teaching of the new regulations and laws at our universities, colleges and institutions? We need a workforce that will be ready to go when those new provisions arrive.

An interesting point about cross-border jurisdiction also arises on page 23 of the Government’s White Paper. The Law Society of Scotland is very concerned about this. The White Paper identifies special advocates as

“barristers in independent practice of the highest integrity, experience and ability, from civil and criminal practices. They are bound by the ethical standards of the Bar Council.”

I know that many in the profession would like clarity and assurances that special advocates should be able to be drawn from the ranks of not only the Bar in England and Wales but the Bar in Scotland and Northern Ireland, and from suitably qualified solicitor advocates in all those jurisdictions, but it appears that the UK Government have again—whether by accident or intent—failed to recognise at the most fundamental level that the devolved nations exist.

According to the Law Society of Scotland, the Government’s proposed additional power to seize funds and assets in order to freeze them appears to be unrelated to the withdrawal of the UK from the EU. This therefore seems like a curious thing to sneak in. Will the Secretary of State clarify why this has appeared at this juncture? It concerns me and, I am sure, others that the UK Government would introduce new legislation that is potentially unrelated to the UK exiting the EU. This is not good practice, and we need to understand the rationale behind it. It is clear that the UK Government are going to have very little, if any, time in which to do their day job as they deal with the enormity of Brexit, but they have some serious questions to answer on how they will manage and develop their sanctions policy. It is key to our reputation on the global stage, and to how we will work with the rest of the world.

--- Later in debate ---

[Meg Hillier]

The hon. Lady makes an important point. If we add on the other changes in Government Departments—the DWP is going through some changes of property and where jobs might be—that poses a challenge. We face a challenge with skills in this country anyway, and we can add to that our exit from the European Union and the fact that we have so many unanswered questions about what will happen to EU citizens residing in the UK and others who need to come here. We heard only the other day that the NHS needs to bring in a large number of GPs from the European Union because we are unable to recruit in this country. Whatever one might have thought of these policies before, we are now seeing skilled people who are potentially unable to move to new locations and we do not yet have a skills strategy to fill not just those gaps but the others we might see as we leave the EU. A perfect storm is perhaps a polite way of putting it; I could think of fruitier ways of describing it, but I will leave the fruity conversation to the hon. Member for Saffron Walden, who stretched the boundaries further than I will on this occasion.

I will not list every Department and its problems, but we have a long list if other hon. Members are interested in seeing it, given the challenges that each Department faces in its exit from the EU, the lack of planning, and the lack of joined-upness across Government. A problem in one Department, such as HMRC, will have knock-on effects in another, such as the Department for International Trade. We cannot see these things in isolation and there is not yet a coherent plan.

I hope that when he sums up the Minister can reassure me that what I am saying is not true, but the evidence we have seen in Committee suggests that this is the reality. As I have said, senior civil servants acknowledged that they were told very definitely not to plan for the leave scenario, which has put us very much on the back foot.

[Chuka Umunna]

Does my hon. Friend agree that this reinforces the need for proper transitional arrangements? We are talking not only about the time that will be necessary. It seems to me that all the points she has just made are an argument for this country remaining part of the customs union and part of the EEA—the single market—at least in the interim, as we make our way out of the European Union.

[Meg Hillier]

My hon. Friend raises an important point. As we approach the summer recess—with only one Bill published for our exit from the EU, with no serious plans on the table, and with it becoming apparent that when we come back in the autumn we will not get going seriously until October—we are getting to a point at which we will not even have 18 months to get this show on the road. I am assuming and hoping that Ministers will work 24/7 over the summer to get us to a better place, but even then the timetabling of business through this House means that practically—whatever one’s philosophical view—this cannot be done in time.

I am not saying this because I am a remoaner or a doomsayer. I might have been very positive about wanting to stay in the EU, as was my constituency, but let us be practical about the reality. The delay in delivering the sanctions Bill is another of the many concerns.

It is important that I highlight the concerns of many of my constituents who are EU citizens about the uncertainty they are still facing. Even now people are phoning me or coming up to me in the street in tears because of their concerns about their future. We have heard some degree of certainty from the Prime Minister: she has told us that there will be a mechanism for those people already living here who are EU citizens to regularise their stay, but that will not be published until the end of 2018 and there is still no certainty about the costs.

I was a Home Office Minister, and much as I like to gloss the previous Labour Government as one of the best we have ever had, the reality is that the Home Office—then and now—faces huge challenges in the number of people going through its immigration system. I grappled with that as a Minister, and I did not solve it. We grapple with it as Back Benchers. I certainly do in my constituency, where I have a high number of people going through the system. The idea that, between the end of next year and when we leave, all those who so wish will be able to go through a regularisation process is cloud cuckoo land. It is not surprising that those who can afford it are going through the long-winded process of regularising their stay, getting residency and applying for citizenship.

I spoke at the weekend to a constituent, an international banker who has children. It costs £300 to reach the first hurdle in the legal process. She told me, “If I’m not wanted here I might just leave.” For her, leaving is a real option as she could get a good job elsewhere. Other good, skilled people who have given up their lives in other countries to work in the UK and pay taxes feel like turning their back on us. Some who have been settled in the UK for 15 or 20 years, whose children have grown up here, are very concerned about what the future means for them. Despite the Prime Minister giving some words of comfort—late in the day, and I do not know why this could not have been dealt with before—we need to resolve this sooner rather than later.

Sanctions are the main thrust of the debate. I am strongly of the view that UK-EU co-operation needs to be maintained. I say that not because I am trying to rewind the clock on the referendum—much though this is not where I wanted us to be—but because of a simple question: where would we have differed from the EU on sanctions? There are issues with money laundering and our approach to big international questions such as freezing assets across boundaries, travel bans, trade, and market restrictions, which are but a small part of that approach.

The timetabling of a sanctions Bill to fit with the great repeal Bill is another practical problem. For three years, on behalf of the British Government, I negotiated home affairs at the table in Europe with 27 member states. It took long enough to reach agreement but it was possible. However, trying to enact our Bill and align us, where we would normally agree with our European counterparts, will be incredibly challenging. It will be difficult, at this pace, to write that into law.

We must be frank: this House is not very good at legislating. The Government draft legislation—often in a hurry, and quite a lot will now be written in a hurry—the House has little chance seriously to amend it but must instead pick on the bits we can most likely amend, and as a result it often does not hang together very well. We legislate in haste and repent at leisure, taking a long time to unpick things. That is not true in every case, but as Ministers or Back Benchers dealing with our constituents’ problems we have seen it often.

Would the UK seriously go it alone? No, I think we would not, and I hope the Minister will be clear on that. Why do we not find a way of maintaining the status quo, for a transitional period at least? I fear how the Bill will fit in when it eventually comes before the House.

I have some simple questions for the Minister. How do the Government intend to timetable the repeal Bill and the future sanctions Bill, ensuring that they can work together and there is no contradiction? It would be crazy if we ended up legislating on two separate issues related to Europe, only to find that they do not work together.