European Union (Withdrawal) Act

Colin Clark Excerpts

Thursday 6th December 2018 Commons Chamber

[Mr Hammond]

The deal that is on the table provides the key elements that we will need to maintain our trading relationship with the European Union. It makes a commitment to maintaining our borders as openly and free-flowingly as possible. It eliminates tariffs, quotas, fees and charges. It will protect the vital supply-chain business that is at the heart of our trading relationship with the European Union.

[Colin Clark (Gordon) (Con)]

Does the Chancellor agree with the Governor of the Bank of England that stress tests have shown that under every scenario the financial system is robust? That should give the Government confidence to be equally robust with the EU in future negotiations.

[Mr Hammond]

The Governor is of course absolutely right. The modelling that the Bank has done has been tested against the financial policy committee’s stress tests to ensure that, even in the worst-case scenario, our financial system would be resilient. The work that we have done since 2010—including increasing banks’ capital ratios and introducing risk-reduction strategies around banks and financial institutions—has ensured that the system will be resilient, even against the most extreme circumstance that the Bank of England has modelled.

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[Colin Clark (Gordon) (Con)]

I rise to remind people that it was only two months ago that there was a debate on “Legislating for the Withdrawal Agreement”, when I cited the then Secretary of State, my right hon. Friend the Member for Esher and Walton (Dominic Raab), and his ambition for

“a smooth transition to a comprehensive future economic and security partnership for business and citizens”.

It was admirable and convincing, and it recognised the 2016 referendum. That day, I argued that we should look for a free trade arrangement—perhaps Canada plus—because I believed that that was deliverable. The Prime Minister said that she was more ambitious than that, and we now have a different deal before us.

Industries in my Gordon seat have embraced Brexit. They have prepared for change and considered the solvable problems of Brexit, and they have done so in good faith. Today, we can consider supporting the withdrawal agreement, fundamentally because of good faith.

In the Treasury Committee hearing yesterday, I asked the Chancellor whether, had we prepared in 2016, we could have had regulatory and certification preparation in place for WTO rules. That, at least, would have given us a realistic backstop from which to negotiate.

The industries in my constituency—the oil and gas majors, which employ 280,000 people, plus farming, the food sector, tourism and the financial and service sectors—need us to behave like grown-ups. They need us to recognise that they need a deal that works for businesses and jobs.

The Bank of England has run comprehensive stress testing, which the Chancellor recognised earlier. The good news is that under every circumstance and every scenario, our financial system is safe and robust. As I said to the Chancellor earlier, in future negotiations we should be extremely robust with the EU.

The stress tests were not forecasts. I have heard many Opposition Members say how damaging Brexit will be to our GDP, but I would like to remind them why this country is the second highest destination for foreign direct investment: it is among the top 10 freest markets in the world and it has a legal system and rule of law that mean that people want to be based here. In the first half of 2018, only China had higher levels of FDI than the United Kingdom; we were in front of the US, Singapore, Hong Kong, Spain and Holland. This is a country in which people are investing now and will invest in future.

What are the upsides if we get an agreement with the EU? The foreign exchange has discounted the pound so significantly that we could see a currency bounce. The stock market is falling again today because of the concern about no deal. As a businessperson, I recognise that concern. There is pent up investment in the system of potentially hundreds of billions of pounds, because companies have held back.

Fundamentally, I can support this deal because I support the Brexit vote. Being a Scot, I was involved in another referendum. Opposition parties seem unwilling to recognise that the people have spoken. I believe, democratically, in what they have said.

[Giles Watling]

Does my hon. Friend agree that yet another referendum would cause greater degrees of pain, uncertainty and delay, when what we need to do is move on?

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[Colin Clark]

My hon. Friend is absolutely right. That is particularly true in Scotland, where the SNP rejected the result of the independence referendum and said that it would call another. We do not need that uncertainty and we do not need our people back at one another’s throats; we need some sort of stability and to be able to move on.

Fundamentally, this comes down to good faith. In the words of the Attorney General:

“This risk must be weighed against the political and economic imperative on both sides to reach an agreement”.

I absolutely agree with that. We should not listen to the siren voices. Let us not cast ourselves on the rocks. We should be a confident country. Scotland and the whole Union demands better. The United Kingdom demands leadership, backbones and guts. Frankly, if people are faint-hearted, they should leave the stage. I will show good faith, but there will be an enormous price to pay if we are being duped. Let us win 4-3 and deliver Brexit. I will support the Government next Tuesday—not out of blind faith, but for the good of this country, the United Kingdom.