Oral Answers to Questions

David Davis Excerpts

Thursday 7th September 2017 Commons Chamber

[Stephen Kinnock (Aberavon) (Lab)]

1. What discussions he has had with Cabinet colleagues on plans for the House to vote on continued UK membership of the EEA.

[The Secretary of State for Exiting the European Union (Mr David Davis)]

The United Kingdom will no longer participate in the EEA agreement once we leave the European Union. The United Kingdom is a party to the EEA agreement in its capacity as an EU member state, so on exit day the EEA agreement will cease to operate in respect of the UK. It will no longer have any practical relevance to the United Kingdom. We are considering what steps, if any, we might need to take to confirm formally our withdrawal from the EEA agreement as a matter of international law.

[Stephen Kinnock]

I thank the Secretary of State for his answer, but I am afraid that article 127 of the EEA agreement, to which the United Kingdom has been a signatory since 1993, clearly states that any country wishing to leave the European economic area must give formal notice of at least one year. Will the Secretary of State therefore please confirm that such notice would have to be given to leave the EEA and that, given the fundamental constitutional, political, legal and economic importance of such a decision, the decision to leave the EEA would be subject to a debate and a vote?

[Mr Davis]

There is actually agreement that when the UK ceases to be a member of the EU, the EEA agreement will no longer operate in respect of the United Kingdom. As such, the Government’s legal position is clear: article 127 does not need to be triggered for the agreement to cease to have effect, but we are looking at it just to make sure, for clarity purposes, that we meet its requirements.

[Mr John Whittingdale (Maldon) (Con)]

Does my right hon. Friend agree that continued membership of the European single market, which some Opposition Members seem now to be advocating, would negate many of the advantages of leaving the European Union, while requiring us still to accept decisions that we could no longer influence? To that extent, it would actually be worse than continued membership as a full member.

[Mr Davis]

Yes, my right hon. Friend is quite right. The simple truth is that membership of the European Free Trade Association, for example, which would be one way to retain EEA membership, would do exactly that: it would keep us within the acquis, and it would keep us within the requirements of free movement, albeit with some limitations, but none of those have worked so far. In many ways, it is the worst of all outcomes. We did consider it—I gave it some considerable thought, maybe as an interim measure—but it seemed to me to be more complicated, more difficult and less beneficial than other options.

[Tom Brake (Carshalton and Wallington) (LD)]

The Secretary of State has given an equivocal answer on whether there might need to be a vote on the EEA. Will he consider whether we should also have a vote on the settlement bill and, indeed, on the cost of the Nissan deal set out in the rather heavily redacted letter I have here?

[Mr Davis]

Well, the heavily redacted letter was not from me, so I am not entirely sure what the right hon. Gentleman is referring to, but the answer, generally, is no.

[Mr Nigel Evans (Ribble Valley) (Con)]

Does the Secretary of State agree that we have already had a vote, and that was on 23 June last year? The British people decided to leave the European Union. Does he agree that one of the things we can now look forward to is being able to do trade deals with a number of countries throughout the world, which we are now constrained from doing as members of the European Union?

[Mr Davis]

My hon. Friend makes exactly the right point: we are able to make trade deals once we leave the European Union, and that will give us enormous benefits, because as the European Commission itself admits, 90% of world trade will be outside the EU, not within it, in the coming decades.

[Keir Starmer (Holborn and St Pancras) (Lab)]

The Secretary of State set out his position on the EEA. On 15 August, he told the “Today” programme that transitional arrangements should be

“as close as possible to the current arrangements”.

Two days before that, the Chancellor and the International Trade Secretary said in a joint article that Britain would leave the customs union and leave the single market. Both positions cannot be right. Will the Secretary of State step up to the Dispatch Box and tell us what form of transitional arrangements the Government are seeking to negotiate?

[Mr Davis]

I did that only a couple of days ago. I will come back to the point, but for the House’s interest, I will read a small part of a LabourList article—I read LabourList all the time, of course—by the hon. Member for Aberavon (Stephen Kinnock), who opened this question. He said:

“On Sunday Keir Starmer used an article in The Observer to call time on the ambiguity that had come to define Labour’s approach to Brexit since the referendum”—

the ambiguity, right? He said, “It was an approach”—this is the best bit—

“that…served us well on 8 June”.

What was that ambiguity? Tell leavers you want to leave; tell remainers you want to remain. That ambiguity, of course, could not last, and, as the hon. Gentleman said, it was never sustainable. That is the ambiguity of the right hon. and learned Gentleman who has just asked his question.

Now, our position is very clear. The transition arrangements will meet three different requirements: to provide time for the British Government, if need be, to create new regulatory agencies and so on; time for companies to make their arrangements to deal with new regulation; and time for other countries to make arrangements on, for example, new customs proposals. That is what will be required. That is why we need to be as close as we are to our current arrangements. It does not mean that, in the long run, we are in either the customs union or the single market.

[Mr Speaker]

There is plenty of material for colleagues to include in their Second Reading debate speeches if they so wish. The material might be better located there.

[Keir Starmer]

I asked the Secretary of State his position and he started with my position. If he wants to swap places—any time.

Given the progress to date, and knowing that we will go back to this answer, what prospects does the Secretary of State genuinely believe there are for bespoke transitional agreements being agreed, negotiated and implemented by March 2019? Knowing how anxiously businesses are looking at this, when does he anticipate being able to tell them what the arrangements will be, because they need to make arrangements?

[Mr Davis]

That is a very legitimate and sensible question. I believe that the benefits of a transitional arrangement go both ways—they are symmetrical. They apply equally to France, Holland, Germany or Denmark as they do to us. That is some of the read-back we have been getting. I know that the right hon. and learned Gentleman has been travelling around Europe himself and he will no doubt have picked up that same read-back. We are finding that the Commission is open to discussion of transition. We have raised it only briefly at each of the last two meetings because it does not fit within the current four groups of negotiation, but I think there is a very good prospect.

[Dr Paul Williams (Stockton South) (Lab)]

2. What assessment the Government have made of the potential effect of the EU (Withdrawal) Bill on (a) workers’ rights and (b) environmental protection.

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[John Stevenson (Carlisle) (Con)]

8. What steps his Department is taking to ensure a flexible approach in the Government’s negotiations on the UK leaving the EU.

[The Secretary of State for Exiting the European Union (Mr David Davis)]

Both sides in the negotiation are clear about the fact that we want to achieve the best possible outcome and the strongest possible partnership. We have said repeatedly that, to achieve that end, both sides must demonstrate a dynamic and flexible approach to negotiations. In papers published by the Government, for instance, we have made it clear that we stand ready to protect the voting rights of EU nationals living in the UK. There will be give and take as the negotiations progress, but the destination is clear: a deep and special partnership that sees both parties emerge strong and prosperous, capable of projecting our shared values, leading in the world and demonstrating our resolve to protect the security of our citizens.

[John Stevenson]

Given that a transitional arrangement is likely to be required, and if the Government are to be flexible, a simple solution to consider is an off-the-shelf arrangement with some modifications. Would the Government be willing to consider rejoining the European Free Trade Association and then the European economic area, with suitable and appropriate amendments and modifications?

[Mr Davis]

As my hon. Friend will understand—he heard me say this earlier—we considered that in some detail before the Lancaster House speech. We concluded that it did not meet the requirements for which the British people voted and that it would not be as easy to negotiate as an alternative bespoke transitional arrangement might be.

[Hilary Benn (Leeds Central) (Lab)]

Now that the Secretary of State has accepted that there will need to be transitional arrangements, is it the Government’s policy that the UK will continue to make payments into the EU budget for that period, however long it lasts?

[Mr Davis]

I think this must be the 20th time I have said to the right hon. Gentleman that I am not going to negotiate from this Dispatch Box, and he should know that. What I will say to him is that the transitional arrangements as we have described are an implementation period—or phase, or any of all the other different words used for it—and are there for one purpose: to ensure, in his words, that we avoid a cliff edge. That is not just true of us: it is not just the UK that has come to this conclusion—some time ago as it turns out—but so have the other members of the European Union, and one of the things we have been doing in the past six to nine months is ensuring that they understand from their point of view precisely how valuable to them a transitional arrangement will be.

[Kevin Hollinrake (Thirsk and Malton) (Con)]

It is right that we meet our financial obligations when we leave the European Union, but past contributions we have made have funded vital infrastructure across Europe, including eastern Europe, which will have a long-term financial benefit for the EU. Has this been discussed in negotiations and used to mitigate our final bill when those negotiations conclude?

[Mr Davis]

We have made that very plain: the words used are that we expect to respect our international obligations but also to have our rights respected. That point has been made very clear. One of the reasons why the last negotiating round was perhaps a little tenser than the previous one is that we were making it very plain what we judged the legal basis to be, and that was not always comfortable.

[Sir Vince Cable (Twickenham) (LD)]

What assurances can the right hon. Gentleman give to financial services companies and other firms that are seriously concerned that they now face the cost and uncertainty of three successive rule books: the single market, the post-single market transition and the post-transition agreement?

[Mr Davis]

As ever, the right hon. Gentleman makes a good point, and that does mean that we will want to ensure there is a single transition, not two different transitions in and out of the transition period. That is why, as the right hon. and learned Member for Holborn and St Pancras (Keir Starmer) quoted me as saying, I said we want the transition arrangement to be as close as possible to the current circumstance. It will be remembered, too, that when I responded to the right hon. and learned Gentleman I said there are three effective sets of criteria: one, time for the Government to accommodate; two, time for other Governments to accommodate; but, importantly too in his context, time after the decisions for financial services and other industries to do their own accommodations.

[Lucy Frazer (South East Cambridgeshire) (Con)]

Last week, Michel Barnier said it was not fair that EU taxpayers should continue to pay for Britain’s obligations, but is it fair that British taxpayers should continue to pay for the EU’s obligations in circumstances where we may not be benefiting from subsidy schemes post-withdrawal?

[Mr Davis]

My hon. Friend raises a point that we have already raised with Michel and the remainder of the team. At the moment, the Union’s negotiating team are taking the approach of stressing what they term legal responsibilities, and we are challenging them. When we get to the end of that, we will make some decisions about political and moral responsibilities, and also negotiating outcomes, and that is where the decision will, I suppose, be made.

[Matthew Pennycook (Greenwich and Woolwich) (Lab)]

The Government took flexibility to new heights over the summer, taking just under three weeks to jettison one of only two proposals set out in their customs arrangement paper on the basis that they represented “blue sky thinking”. Can the Secretary of State tell us how many of the other proposals set out in the various future partnership papers are effectively just creative ideas that are unlikely to survive contact with reality?

[Mr Davis]

I do not think the hon. Gentleman was paying attention the day before yesterday: I said to him then that blue sky thinking, talking to an American audience, is a description of an imaginative approach.

[Anna Soubry (Broxtowe) (Con)]

May I gently say to my right hon. Friend that I would have thought that what everybody is trying to do is to form some kind of consensus? I think we all agree that we have a very, very short period to negotiate all manner of highly complex agreements, including a transitional period agreement. So may I suggest to him that, rather than keep ruling things out, we put everything back on the table and look at what we call “Norway for now”, which we would simply adopt as a transitional period until such time as we come to a final arrangement with the EU?

[Mr Davis]

Well, my right hon. Friend can be as gentle with me as she likes. The simple truth is that, before the Lancaster House speech, we went through a process of considering what the best negotiating strategy would be, in some detail. We looked at who would have to negotiate with, where the compromises would have to be made and what the gains would be. We came to the conclusion that the route we are now taking, involving discussions with the member states initially and now with the Union and a transition based on maintaining the important components of what we currently have, is the best way to do it.

[Sarah Jones (Croydon Central) (Lab)]

9. What discussions he has had with the Chancellor of the Exchequer on changes to VAT rates after the UK leaves the EU.

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[Mr Simon Clarke (Middlesbrough South and East Cleveland) (Con)]

14. What steps the Government are taking to ensure that the timetable for the UK leaving the EU is met.

[The Secretary of State for Exiting the European Union (Mr David Davis)]

We aim to get the right agreement for the United Kingdom and the European Union. Government officials are working at pace, and we have said repeatedly that both parties will need to demonstrate a dynamic and flexible approach in each negotiation round. Flexibility and creativity are needed from both sides, and we have already said that we are willing to meet as frequently as required. We want to reach an agreement about our future partnership by the end of March 2019. From that point, we believe that a time-limited interim period will be in the mutual interest of the United Kingdom and the European Union, allowing people and businesses in the United Kingdom and the European Union to adjust to the new arrangements.

[Bob Blackman]

I thank my right hon. Friend for his answer. Our future trade relations with the European Union are clearly vital, and it is good news that a queue of trade deals is potentially in the offing for when we leave. Given our unique position with the EU, it is surely perfectly possible to conclude a trade agreement by the time we leave in March 2019.

[Mr Davis]

Yes, my hon. Friend is exactly right. The Bill that we will debate later today is designed with exactly that in mind. The unique nature of the free trade agreement that we are seeking to agree with the European Union is that we all start from exactly the same standards. The previous question related to maintaining the same standards for labour law and other matters, but those standards are actually already better. My hon. Friend is right that our unique position is the key to getting a fast, effective and wealth-creating trade agreement.

[Mr Simon Clarke]

People and businesses in Middlesbrough South and East Cleveland are confident about the opportunities that lie ahead after Brexit. Can the Secretary of State reassure my constituents that he will ignore some of the ill-judged rhetoric coming out of the Commission about teaching us a lesson and focus instead on securing a deal that works for our mutual benefit?

[Mr Davis]

I think I should say, in the interest of maintaining amity across the negotiating table, that Mr Barnier clarified that he did not intend to say “educate”. He meant that he wanted to bring everybody up to speed on the benefits, as he sees it, of the single market. Both sides want to achieve the best possible outcome and the strongest possible partnership for the future, and that is what we intend to do. It is in neither side’s interest for there to be a cliff edge for businesses or a threat to stability. The UK and the EU will work together to agree provisions for an interim period that will allow people and businesses in both the UK and the EU to adjust in a smooth and orderly way to new arrangements. That will minimise disruption, give as much certainty as possible and meet the wishes of my hon. Friend’s constituents.

[Jim Shannon (Strangford) (DUP)]

Nowhere is the timetable for leaving the EU more important than in Northern Ireland and the Republic of Ireland. Press reports today indicate that there will be a special relationship in how we work the border between the Republic of Ireland and Northern Ireland. Can the Minister give us some idea of those discussions and of what has happened so far?

[Mr Davis]

At the moment, I can talk only to the discussions within the European Union negotiating group. From the beginning we were very keen to start on this as quickly as possible. We understand, of course, that the conclusion we get will be dependent, to some extent, on all the other decisions on borders. How much special arrangement we have to make will depend on how open the borders are generally. We have made very good progress. At the last round in particular, the Commission was concerned that continuing with the common travel area would impinge on European Union citizens’ rights. We have persuaded the Commission that that is not true, and it has basically accepted our argument.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

Does the Secretary of State not realise that, every time he speaks at the Dispatch Box, the key wealth-creating areas of this country feel more and more uncertain about their future? We are haemorrhaging people. We cannot recruit people to the City of London and financial services, we cannot recruit people to universities and we cannot recruit people to manufacturing. For goodness’ sake, man, get on with the job.

[Mr Davis]

Perhaps I will organise a visit for the hon. Gentleman to see Mr Barnier himself. We have taken action in all those areas. We have taken action to underpin the funding of universities. In industry, we have seen the Nissan arrangements. We have talked to the financial services sector about what we expect to happen, and we have particularly talked about an implementation period with them in mind—not just them, but them in particular. Plenty of action is being taken to improve the certainty and clarity on where we are going.

[Mr Speaker]

Finally, Charlie Elphicke.

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[Martyn Day (Linlithgow and East Falkirk) (SNP)]

T1. If he will make a statement on his departmental responsibilities.

[The Secretary of State for Exiting the European Union (Mr David Davis)]

Since our last Question Time, the Government have made important progress towards delivering the result of the European referendum and grasping the opportunities that Brexit can provide. In the negotiations with our European counterparts, we have found important areas where we agree—on pensions, healthcare and Northern Ireland, for example—and we are now working on those areas where we do not agree. We have provided more clarity by publishing papers on a range of issues. Finally, later today we will debate the repeal Bill, which will give effect to the result of the referendum while providing the legal certainty that will avoid unnecessary disruption. I believe the Bill should command the support of all those who believe in securing a smooth and orderly exit from the European Union.

[Martyn Day]

Leaving the EU single market and customs union would be an unprecedented act of self-harm to our economy, especially if the UK Government fail to negotiate a trade agreement with the EU. Will the Secretary of State confirm that if he fails to reach a deal within the two-year deadline, the UK will remain a member of the EU under the existing terms?

[Mr Davis]

No, I will not. The vote of the British people was very clear: they wanted to leave the European Union and take back control, of both borders and laws. That would not be possible if we simply stayed inside the single market under the current terms.

[Scott Mann (North Cornwall) (Con)]

T2. As my right hon. Friend will be aware, EU legislation giving protections to food from particular geographical areas, such as the Cornish pasty, our clotted cream and the Cornish sardine, came into force in 1993. Has his Department had discussions with the Department for Environment, Food and Rural Affairs about similar arrangements carrying on after we leave the EU?

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[Andy Slaughter (Hammersmith) (Lab)]

T5. Whenever I hear the Secretary of State explaining what will replace our current relationship within the EU, whether he is on the single market, the rights of EU nationals or whatever, it always sounds like a cut-and-paste, second-best, Heath Robinson version of events. I just wonder whether he ever, even for a moment, thinks it is possible he may be mistaken.

[Mr David Davis]

It would probably be a unique foray at this Dispatch Box for a Minister to admit error, but let me say this to the hon. Gentleman: I said at the beginning that this is a negotiation; it will take time and go in directions that we do not necessarily expect, and there will be give and take in it. That is as close as I can get.

[Steve Double (St Austell and Newquay) (Con)]

T3. Later today, this House will get to debate the European Union (Withdrawal) Bill for the first time, which, as we know is a very important piece of legislation that provides certainty and a smooth exit for this country from the EU. Will the Secretary of State set out for the House, and indeed for the country, what the consequences would be of this Bill not being passed? Does he agree that any Member who seeks to block its passing is not acting in the national interest?

[Mr Davis]

I am afraid that my hon. Friend is precisely right. The purpose of the Bill is to establish continuity, for several reasons. The first is to provide certainty for business, an issue raised by the hon. Member for Huddersfield (Mr Sheerman). The second is to ensure our ability to carry out a free trade deal which will be unique in the world. The third is to underpin all the rights and privileges that we have promised to our country down the years, including employment rights, consumer rights and environmental rights. All those things are vital in the national interest, so he is exactly right.

[Nick Thomas-Symonds (Torfaen) (Lab)]

T7. How should employers in my constituency that I have visited in recent months today assess the risk of ending up with tariffs or additional regulatory barriers to exporting to the single market when we leave the EU?

[Mrs Kemi Badenoch (Saffron Walden) (Con)]

T4. The purpose of the European Union (Withdrawal) Bill is to provide continuity and a working statute book on the day we leave. Will my right hon. Friend make it absolutely clear that a vote against this Bill is a vote for chaos and for uncertainty?

[Mr David Davis]

My hon. Friend is exactly right about that, and she allows me to reiterate one other point: all the talk from Opposition Members has been about changing things in this Bill. The Bill is about maintaining continuity; it is about keeping in place the aims and purposes of all the European law that we currently have—and will have the day after we leave.

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

The purpose of any transitional arrangement is, as the Secretary of State said, to avoid a cliff edge, and to give continuity and certainty to the UK economy. But the Chancellor and the Trade Secretary published an article last month saying that during any such period the UK would not be in the single market or the customs union. What is the purpose of a transitional arrangement that undermines the very stability and continuity it is supposed to achieve?

[Mr Davis]

The right hon. Gentleman makes a good point and I suspect it would have been in his question earlier if he had had the chance to ask it. The simple truth is, as I have said, that we are starting from the aim of maintaining as much continuity as is necessary to anything that might change in the final settlement. So we will do that. Because we are not in the European Union at that point—legally, we will not be—we will not be formally members of the single market and the customs union. We may well seek a customs agreement for that period and a similar arrangement on the single market provisions, but we cannot make that decision ourselves; there is a negotiation to be carried out with the EU.

[Mr David Jones (Clwyd West) (Con)]

T6. Does the Minister agree that the system of secondary legislation contemplated by the Bill that we will be debating later today provides the best and most flexible means of ensuring that the United Kingdom is left with a coherent statute book when we leave the European Union? Does he not also agree that there will be general bemusement in this country that the Opposition are seeking to oppose that Bill?

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[Mr David Davis]

I would say two things to the hon. Lady: first, we will do that as soon as is feasible within the constraints of the negotiation; and secondly, if she is concerned about business confidence, I say to her that the best way to guarantee stability is to vote for the Bill this afternoon.

[Chris Davies (Brecon and Radnorshire) (Con)]

Many farms in Wales straddle the border with England. Will my hon. Friend outline how he is ensuring that the voice of cross-border communities is not being ignored in discussions over Brexit and devolution?