Exiting the EU: Sectoral Analysis

Edward Leigh Excerpts

Tuesday 7th November 2017 Commons Chamber

[Mr Baker]

The hon. Lady asks an interesting question. It is precisely because we wish to avoid dumping unnecessary information on the Committee that we want to take the time necessary to bring together the information in an appropriate form—[Interruption.] Well, that was what the hon. Lady said. She asked for comparative economic forecasts, but I have already said repeatedly that this material does not include quantitative economic forecasts.

[Sir Edward Leigh (Gainsborough) (Con)]

What the Minister has said is perfectly reasonable, but I urge him to release the documents in full as quickly as possible, as redactions only enflame interest. I have lived through many of these rows, and once such documents are published, they are often found to be very long and boring. When Parliament gets itself into a fine passion about this sort of thing, the travelling is often more fun than arriving.

[Mr Baker]

On my hon. Friend’s final point, having carefully read the initial analysis, I think I can say with some certainty—[Hon. Members: “Oh, we have some analysis!”] I say to SNP Members that, as I have already told the House, I have read the initial round of analysis from the beginning of the life of the Department.

I can say to my hon. Friend that, in this case, the arrival will indeed be far less interesting than the journey.

European Economic Area: UK Membership

Edward Leigh Excerpts

Monday 6th November 2017 Commons Chamber

[Stephen Kinnock (Aberavon) (Lab)]

I beg to move,

That this House believes that for the UK to withdraw from the European Economic Area (EEA) it will have to trigger Article 127 of the EEA Agreement; calls on the Government to provide time for a debate and decision on a substantive motion on the UK’s continued membership of the EEA; and further calls on the Government to undertake to abide by the outcome of that decision.

I thank the Backbench Business Committee for granting today’s debate, and I thank right hon. and hon. Members on both sides of the House for supporting the application for it. In particular, I thank my hon. Friend the Member for Lewisham East (Heidi Alexander) and the right hon. Member for Broxtowe (Anna Soubry) for co-sponsoring the motion.

If the referendum result was indeed a vote to take back control, this House must surely have its say on that critical issue. I rise to commend the motion to the House, because all options both for the transition and for the comprehensive trade and partnership deals must be on the table. I first want to set the debate in context by outlining what the European economic area is and what it is not. I will then explain how EEA membership can square the circle between market access, sovereignty and control. I will also illustrate how EEA membership offers a sensible and workable transition out of the European Union—a bridge, rather than the potentially catastrophic cliff edge of exiting on World Trade Organisation terms.

First, what is the EEA? Simply put, it is an internal market between the EU28 and Norway, Iceland and Liechtenstein. It was set up in 1993 to allow the participation of non-EU states in the single market. However, the EEA internal market excludes single market features such as fisheries and agriculture, and it does not entail membership of the customs union. That means that EEA members are able to negotiate trade deals with third countries, either bilaterally or through the European Free Trade Association. That is how Iceland became the first European country to strike a bilateral trade deal with China in 2011.

It is through EFTA membership, in conjunction with the EEA, that unfettered trade in goods is achieved. EEA-EFTA membership could therefore provide a solid basis on which to sustain frictionless trade between the UK and the Republic of Ireland post-Brexit.

[Sir Edward Leigh (Gainsborough) (Con)]

The hon. Gentleman just talked about a “catastrophic cliff edge”. Clearly, it is in the interests of our country that we have a free trade deal, but will he put that in context? Exports in 2016 accounted for 28% of our GDP and EU exports for 12.6%. Last month, the World Bank published a study showing that in the event of no deal and WTO rules, British trade with the EU might fall by 2%. That is 2% of 12.6%, or a quarter of 1% of our overall GDP. Therefore, when he talks about a catastrophic cliff edge, let him put it in context.

[Stephen Kinnock]

I thank the hon. Gentleman for his intervention. May I suggest that he takes a trip to the port of Dover? The Brexit Select Committee, of which I have the honour of being a member, visited it recently and we were told that an additional two minutes of processing time on the 10,000 heavy goods vehicles that go through the port would result in a 13 mile tailback. A WTO Brexit, we were told, would add a lot more than two minutes. We therefore have to look at this debate in the context of the institutional capacity of our country to cope with a WTO Brexit, which is critical.

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

It is a great pleasure to follow the hon. Member for Aberavon (Stephen Kinnock), who has raised some important and interesting constitutional issues.

The motion before the House today asks us to conclude that

“for the UK to withdraw from the European Economic Area (EEA) it will have to trigger Article 127 of the EEA Agreement”.

It is certainly the case that article 127 provides that every contracting party to the agreement may withdraw from it, provided that it gives at least 12 months’ notice in writing to the other contracting parties. The question is whether that formality actually needs to be adopted. The EEA agreement is an arrangement that has been concluded among the member states of the European Union, the European Union itself and three of the four European Free Trade Association states—namely, Iceland, Norway and Liechtenstein. There is no doubt, as the hon. Gentleman has said, that the United Kingdom is a contracting party to that agreement in its own right. Indeed, it has no option but to be so, because article 128 of the EEA agreement provides that every European state must, on applying to become a member of the EU, apply for EEA membership. In other words, Britain’s membership of the EEA is a consequence of its membership of the European Union.

The UK has given notice of its intention to withdraw from the European Union, and by application of the provisions of article 50 that notice will become effective no later than midnight on 30 March 2019, at which point the EU treaties will cease to apply to the United Kingdom. The UK’s departure from the European Union will indeed have an impact on its membership of the EEA. Article 126 of the EEA agreement provides that it shall apply to the territories to which the treaty establishing the European Economic Community, now the European Union, is applied, as well as to the three signatory EFTA member states. Given that the EU treaties will no longer apply to the UK at the moment of its departure, pursuant to article 50, and that the UK is not one of the three EFTA signatories, it necessarily follows that at that moment, on the stroke of midnight on 30 March 2019, it will also cease to be subject to the provisions of the EEA agreement. In other words, for all practical purposes, British membership of the EEA will fall at that point. It will remain a contracting party to the agreement, but under the terms of the EEA agreement, the agreement will cease to apply to it.

There has been a great deal of academic discussion as to whether that is indeed the case, but a view supporting the proposition that Britain will effectively cease to be a member of the EEA on leaving the EU has been given by no less a figure than Professor Baudenbacher, to whom the hon. Gentleman has referred. The professor has said:

“A state can only be an EEA Contracting Party either qua EU membership or qua EFTA membership. That follows from the two pillar structure of the EEA agreement. You are either in the EU pillar or in the EFTA pillar but you cannot be floating around freely.”

The hon. Gentleman has mentioned the desirability of the United Kingdom becoming a member of EFTA. It may or may not be desirable—I personally would oppose it—but it has to be recognised that if we are not a member of either EFTA or of the EU, we cannot be a member of the EEA.

[Sir Edward Leigh]

My right hon. Friend is giving a most learned disquisition. Will he tell us what the practical effects would be if it were legally possible to become a member of the EEA? For instance, would it be possible to control our own borders? It seems to me that the reason so many people voted to leave was that they wanted to control their own borders.

[Mr Jones]

My hon. Friend makes an excellent point. The fact is that we would be left with EU-lite. We would still be subject to the four freedoms, including the freedom of movement of persons. That would mean we would not be able to control our own borders, despite the Liechtenstein precedent.

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[John Stevenson (Carlisle) (Con)]

First, I congratulate the hon. Member for Aberavon (Stephen Kinnock) on securing this important and much needed debate. It is important because it is very relevant to our relationship with the EU. We see a lot of discussion going on in the media about the remain and leave debate, and the vote we had. In my view, that is over: the referendum decided that we should leave the EU, and that should now be a given—we have just to get on and accept it.

However, the referendum did not decide our future relationship between the UK and the EU. That is for the Government and Parliament to determine. It is our responsibility to achieve the best possible arrangement for the UK in our relationships with the EU. When we are doing that, we must recognise the views of both the 52% and the 48% from the referendum. It is important that we get the arrangement right and that it balances the different views in the best possible way, acknowledging that that will be difficult and we will have to compromise—that is a very important word.

I accept that there are two clear and different views: the “WTO view” and the “hardly any change at all” view. All of us would agree that in a perfect world there would be a perfect free trade agreement, but we need to have a reality check. At the moment there is a huge amount of uncertainty, which affects Parliament, Government activity, individuals and, most importantly, industry and commerce, where it is leading to decisions about investment not being taken or being postponed. To some extent, damage is already happening and it will continue to happen. For example, in my constituency a tyre factory was going to go ahead prior to the vote, but this has now been postponed and may never happen, so we are seeing the loss of £155 million of investment.

Two key decisions have been made. The first is that we are leaving the EU in March 2019. Secondly, there is a general acceptance that there has to be a transitional arrangement until 2021. I have watched the debate so far, and my conclusions are simple. We are leaving, as that was the decision of the people in the referendum. We all accept that there is a need for a transition, and we must also recognise the huge amount of uncertainty and the need to minimise it as soon as possible. We should look for the most practical, sensible and easy option to deal with that uncertainty—one that is easy to understand and well established. We do not need to invent the wheel once more. That solution is simply that we base our future on rejoining EFTA, thereby retaining membership of the EEA.

The advantages of such an approach have already been set out: we would leave the EU, as set out in the referendum; we would be out of the ECJ; agricultural and fisheries policies would be returned to us; we would have our own trade agreement opportunities; and, most importantly, we are talking about something that is established and understood by all concerned, and is a compromise.

[Sir Edward Leigh]

When my hon. Friend’s constituents voted to leave the EU, did they really vote to ensure that our borders remained open for ever more through European immigration? That would be the consequence of his proposal that we stay in the EEA.

[John Stevenson]

I am going on to talk about that very issue. I fully accept that my constituency voted to leave, and I totally respect that. I also understand that many of the reasons revolved around immigration.

By rejoining EFTA, we would eliminate a huge amount of the uncertainty almost immediately and we could very well turbo-charge EFTA in the future; a country of 65 million people would be coming in to support and help improve the prospects of additional agreements with other countries. But we have to acknowledge that there are certain compromises involved in our rejoining EFTA: free movement would continue—although, as the hon. Member for Aberavon has pointed out, there is article 112. We must also remember that we will need some sort of free movement if we are to make sure that we have people coming into this country with the right skills to support our industries.

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[Sir Edward Leigh]

The whole point of this exercise is that we want to have a system by which we let into this country people who will contribute to this country, so of course we are not going to go from full-scale migration from the EU to no migration. That is an absurd reduction of our argument.

[James Cartlidge]

I put that point as a question because the official leave campaign line was that it would end unskilled migration to this country. That is not realistic.

My second question is controversial, but it is incredibly important. It is currently illegal for an unskilled migrant to enter this country from outside the EU. We legally discriminate because we are members of the EU. We allow unskilled migration only from within the EU; we do not allow access through tier 3 visas, which would allow unskilled migration from outside the EU. The latest figures from Migration Watch show that net migration from outside the EU was 50,000 more than from inside it.

If we go for this so-called global Brexit and open up unskilled migration through an equalised immigration system, we will simply have, at best, a reduction in EU migration and a significant rise in non-EU migration. If the country voted on immigration terms, it did not vote for that. That is why I say we should not underestimate the level of control the country would have over migration through being in some form of the EEA or EFTA.

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[Mike Gapes (Ilford South) (Lab/Co-op)]

It is a real pleasure to follow the hon. Member for South Suffolk (James Cartlidge). He has made an excellent speech, and I want to hear more from him in the future.

I begin by taking on the claim that was made by some on the Government Benches that, somehow, a decision was taken in June 2016 to leave the European economic area. If that is the case, I have to ask why, in their submission in December 2016, the Government’s lawyers said:

“No decision has been taken either to serve or not to serve a notice under article 127 of the agreement. Consequently, there is no decision which is amenable to judicial review.”

No decision was taken because that decision has to be taken by the Government; it was not automatic. Therefore, this Parliament must have the final say about that matter.

I am not an advocate in any strong way of the proposal of my hon. Friend the Member for Aberavon (Stephen Kinnock). I am an unreconstructed remainer. I remain so, and I will fight to stay in the European Union. We have not left yet, but if—if—we leave, I will fight to get the best possible deal for our country.

There are problems with EFTA and the EEA: the arrangements do not cover agriculture or fisheries. Potentially, that is a massive problem for Northern Ireland, and it needs to be taken into consideration. As we have heard, the arrangements do not cover the financial sector and they do not deal with many problematic issues that we will have to confront if we leave the customs union. We need to have an EEA-plus arrangement rather than just an EEA one, as that will need other agreements alongside it. It may take time to negotiate those, and in the meantime, let us not go on a Gadarene rush over the cliff.

[Sir Edward Leigh]

I am amused by the hon. Gentleman’s proposal to have an EEA-plus. Presumably, he can now tell us what will be the difference between being a member of the EU and being a member of the EEA-plus?

[Mike Gapes]

EEA-plus would relate to issues such as having an agreement on a common foreign and security policy, and an agreement on those matters that do not affect some of the EFTA or EEA countries because the UK is not Liechtenstein, Norway, or Iceland. We must have the closest possible relationships with our EU neighbours and partners on many issues to do with policing, security and defence. Having said that, the essence, which is the economic relationship, is fundamental, and a transition is better than a disaster. The disastrous crashing out of the single market with no deal, or a very costly bad deal, is not in our interests. As Michel Barnier, the EU’s negotiator, has said:

“We don’t have time to invent a new model.”

Why reinvent something when it is already there and when it can be taken up and built on to establish the security and the certainty that our businesses need in this transition period?

Interestingly, there is support for that view in an article by Wolfgang Münchau in the Financial Times today. He said:

“Once the reality of a limited trade deal sinks in, we are left with only two logical strategies: either join the EEA, or go for a minimalist agreement and focus on making that work.”

That seems to be the choice, and there are some on the Government Benches who, for ideological reasons, want a minimalist agreement. That is because they are not Brexiteers, but wrexiteers and they are prepared to bring down our economy and slash our public sector and our national health service. It will cost our public services billions if our economic growth is reduced and our economy is reduced. We will then suffer the consequences. We will also suffer the consequences of unpicked fruit and difficulties in the agricultural sector. All the major financial services companies, banks and American banks are already planning to move their headquarters from London to Dublin and their personnel from London to Frankfurt and Paris. Those things are happening even now before the decision is finally taken. Let us stop this insanity, act now and, at least, stay in the EEA.

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[Sir Edward Leigh (Gainsborough) (Con)]

Well, I am not sure that it is ever very wise to live in a shed, but we will leave that to one side.

The hon. Member for Aberavon (Stephen Kinnock) gave a characteristically intelligent speech, raising some important questions. Speaking personally, my main motivation for supporting the leave campaign was parliamentary democracy: I wanted to reassert the control of Parliament over our affairs. I have always been influenced by the debate, starting in 1992 with many great speeches from both sides of the House, which questioned our entry into an entirely new treaty set-up, whereby our own laws were no longer sovereign.

The hon. Gentleman is right to raise his question and I would also like to question the Minister. It is my belief and hope that we are committed to having full parliamentary approval of this process. As I understand it, the Government are attempting to make a deal, which will then be put to the House of Commons before we actually leave the EU at the end of March 2019. The House of Commons can then presumably approve or reject that deal. But we are now in the article 50 process, which is irreversible. Therefore, as I understand it, if the deal was rejected, it would not happen and we would exit without a deal. I put that point to the Minister; I am sure that he can resolve these matters easily.

Now, of course, it would be possible for Members of Parliament—particularly the Opposition, if they could garner a majority—to engineer a vote on whether we stay in the EEA. Of course, for that to happen, we would want to have some idea of the policy of Her Majesty’s Opposition, but that is currently somewhat unclear. We do know that they are committed to leaving the EU, but they have been quite careful—I quite understand, as they are in opposition and their job is to cause as much trouble as possible for the Government—and remarkably unclear about their official position with regard to accepting staying in the single market. The reason for this is that the six most leave-voting constituencies were Labour constituencies and the six most remain-voting constituencies were Labour constituencies. To be fair to the Labour party, it has to face both ways and that is what it is doing.

[Mike Gapes]

The hon. Gentleman initially said that he voted the way he did because he wanted parliamentary control. Why, then, is he so reluctant to allow this House to make a decision about whether we should leave the EU or leave the EEA?

[Sir Edward Leigh]

Actually, I said precisely the opposite, if the hon. Gentleman had been listening. I have made it absolutely clear that I am a committed parliamentarian, and I am absolutely committed to a vote.

[Wera Hobhouse (Bath) (LD)]

Is it not true that this House is here to debate, and is it not proper that, as we debate, we come to new conclusions and new ways of looking at things? It is perfectly legitimate for people to start thinking about different outcomes from the ones they were thinking about at the beginning, because more things are coming to light.

[Sir Edward Leigh]

That is a very fair point, and I entirely accept it.

[Heidi Alexander]

rose—

[Sir Edward Leigh]

I have very little time now, so may I just finish my remarks? [Interruption.] I have plenty of time? Well, I have to give way to the hon. Lady.

[Heidi Alexander]

I am grateful to the hon. Gentleman for giving way. Given what he said in response to my hon. Friend the Member for Ilford South (Mike Gapes) about supporting a vote on whether we leave the European economic area, would he be willing to sign my new clause 22 to the European Union (Withdrawal) Bill, which would put that into statute?

[Sir Edward Leigh]

I am grateful to the hon. Lady for making that kind offer, but my problem is that, in these terms, I am a Government loyalist, and I want to help the Government to get this Bill through. That is most important, because if we do not get the Bill through, we will be in a kind of limbo—I apologise for using the expression “a kind of limbo”. All that the Bill does is transfer all the EU laws into our law. I am anxious that we get a generous free trade deal. I am also anxious that we pass all the EU laws into our law, particularly because I do not want us to create a bargain-basement economy—I want us to preserve workers’ rights and to be a gold-class economy. All that the Bill does is transfer all those protections for workers, and many other useful things, into our law, so I will be supporting the Government—

[Sir William Cash]

rose—

[Sir Edward Leigh]

And so, I hope, will my hon. Friend.

[Sir William Cash]

May I refer my hon. Friend to the remark he made about the Labour party looking at this issue both ways? The Labour party did, in fact, vote against the principle of the Bill, which includes the repeal of the European Communities Act 1972, by virtue of which all the legislation and the jurisdiction of the Court of Justice come into effect.

[Sir Edward Leigh]

Of course I note that point, but I must now proceed to the end of my remarks.

I have said what I want to say about parliamentary procedure, and I now want to say a bit—

[Anna Soubry]

rose—

[Sir Edward Leigh]

Well, I have to be polite to my right hon. Friend.

[Anna Soubry]

I am extremely grateful. May I be clear about the wise words from my hon. Friend? Setting aside the withdrawal Bill—he makes a good point about the Bill, and I think we all agree on it—if there were some other mechanism by which it was guaranteed that this place had a say on our membership of the EEA, is he saying we should have a vote? We could take it away from the withdrawal Bill and put it somewhere else, but is he saying that this place should make that decision?

[Sir Edward Leigh]

In fairness, I think it will be virtually impossible to avoid such a vote. If the Opposition—once their position becomes clear, and it is not—want to have a vote, I am not sure it would be possible for the Government to avoid such a vote. However, I go back to my very first remarks: as I understand it, we will be voting on the deal, and if the Government are defeated, we will go back to article 50 and exit without a deal.

In the very last minute I have, may I say a bit about the EEA, because people have to be entirely honest about it, and particularly about the Norwegian experience? The whole point of Norway’s membership of the EEA was that it was supposed to be a waiting room for the EU; it was actually to prepare Norway for EU membership. That is why Norway has adopted the overwhelming majority of EU laws in the intervening years.

I understand why some people here who voted remain in the referendum want to stay in the EEA, but I urge them to be honest about it—let us have an honest debate. Once we stay in the EEA, we basically sign up to the four freedoms, to losing parliamentary control over many of our own laws and to unrestricted immigration from the EU. People may think that that is a good idea, but they have to at least be honest about it. If both sides of this debate are honest with each other, we will perhaps get a fair conclusion.

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[Stephen Gethins (North East Fife) (SNP)]

I thank the hon. Member for Aberavon (Stephen Kinnock) for securing the debate. He knows that I do not agree with absolutely everything that he said in his speech, but he has provided Parliament with a valuable service, and we should be grateful to him and to the other Members who secured the debate. I believe that we should stay in the customs union and the single market, although I know that the hon. Gentleman and I do not entirely agree on that. None of us has all the answers in this debate, least of all the Government. In fact, it would be nice if the Government had the odd answer, but they do not. It is almost inevitable, in a Parliament of minorities, that we will have to compromise, and so today’s debate has been useful.

The hon. Member for Aberavon made particularly good points about the ambiguity and indecision at the heart of Government. The hon. Member for Strangford (Jim Shannon) said, quite rightly, that he voted to leave, and we respect his decision to do so. But a consistent thread throughout the debate has been the fact that we do not know what leaving the European Union will mean. Not only was yesterday Guy Fawkes day—someone else who was perhaps a little bit disappointed in this place—but it marked 500 days since the EU referendum. In those 500 days, we have received very few answers indeed.

The Minister has had longer than 500 days to think about what leaving the European Union means, because he, like many of his colleagues, was a member of Vote Leave and campaigned to leave. Some Conservative Members have spent decades planning to leave the European Union. One would have thought that having spent not just 500 days, but decades planning to leave the European Union, they might have the odd answer about what doing so would mean. Alas, no. As our contribution to the debate, the Scottish National party have put forward a compromise—drawing, on a cross-party basis, on expertise from those who know the European Union best—which is that we should remain part of the single market and the customs union.

In Scotland, we know the importance of the single market. The Fraser of Allander Institute, which was not scared to publish its report about the impact of leaving the European Union, estimates that leaving the single market could cost Scotland alone 80,000 jobs and £30 billion, never mind the impact on our friends and partners elsewhere in the United Kingdom. In view of that known impact, it is little wonder that the Government are terrified about releasing their impact assessments.

[Sir Edward Leigh]

rose—

[Stephen Gethins]

On that point, I will gladly give way to the hon. Gentleman.

[Sir Edward Leigh]

Is the hon. Gentleman such an enthusiast for remaining in the European single market that he is totally committed to remaining in the United Kingdom single market?

[Stephen Gethins]

This is the astonishing thing. All of a sudden, Members have invented this idea of remaining part of the United Kingdom single market. The European Union is a club for independent sovereign states in a way that the UK is not. The thing that the hon. Gentleman has missed, throughout our membership of the EU, is that the UK remains sovereign and independent in a way that Scotland is not. Trying to compare the UK single market with the European single market is pretty desperate stuff, and Members do not have to believe in independence to recognise that.

I want to highlight the importance of freedom of movement, which is another area on which I may disagree with the hon. Member for Aberavon. Freedom of movement is something from which I have personally benefited as a UK citizen, and I want young people to have the same opportunities as I had. Freedom of movement makes our country a richer place to live, and all parts of the United Kingdom benefit from it. It enriches us financially and, critically, as a society, making this country a more diverse and tolerant place to live. Seasonal workers are especially important to our industries, and freedom of movement particularly benefits us at certain times of year. It is also important to our universities and other industries.

I would like to put on record the fact that I am astonished by what I am hearing about the European Court of Justice. The European Union has been a success for many reasons, one of which is that the European Court of Justice sits at its heart and arbitrates on behalf of 28 member states. Something else that has been missed is the fact that we will need an arbiter in whatever comes about after we leave.

We also face the danger of no deal—something that has been openly touted, quite irresponsibly, by Conservative Members. We noted from the press that there was a Halloween presentation to the UK Cabinet on no deal. That is a spooky thing for us all, given its impact. As I did on 1 November, when Parliament voted to see the impact assessments—we are still not going to get them—I wonder what the Government are trying to hide from us. What was the Cabinet told? What do they know? The House deserves to know, and that is why the House voted to know what is in those impact assessments.

A no deal scenario will hit hard the big cities in Scotland and, I am sure, elsewhere in the UK, with Aberdeen being particularly badly hit.

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

It is a pleasure to wind up this debate, and I commend my hon. Friend the Member for Aberavon (Stephen Kinnock) and his co-sponsors, my hon. Friend the Member for Lewisham East (Heidi Alexander) and the right hon. Member for Broxtowe (Anna Soubry), for securing it. Each of them made forceful and thought-provoking contributions, and I thank the many other Members who have made excellent speeches.

The Opposition have consistently called for the maximum parliamentary transparency and accountability compatible with conducting the Brexit negotiations, and for Parliament to have more of a grip on the process. That is why we welcome the fact that this debate is taking place, and support the efforts of hon. Members from both sides of the House who have sought to secure greater clarity and certainty about what steps, if any, would be required for the UK to withdraw from the European economic area as a matter of international law. As always in these Brexit debates, we have covered a wide range of issues, but the motion refers specifically to continued membership of the EEA and to whether article 127 of the EEA agreement needs to be formally triggered. It is on that that I want to focus my remarks.

As several hon. Members have said, the EEA is an arrangement that enables three non-EU countries—Iceland, Liechtenstein and Norway—to participate in the EU internal market and allows the 28 EU member states to benefit, as Britain undoubtedly has, from preferential access to their markets as part of that agreement. Formally, the contracting parties to the EEA agreement are the 31 individual counties, although the EU itself was also added as a contracting party in 2004, because the EEA has a mixed agreement. As such, like other EU member states, the UK is a signatory to the agreement.

Article 127 of that agreement, which is the focus of the motion, sets out a basic rule for withdrawing from it. The article requires a contracting party wishing to leave the EEA to provide 12 months’ notification of withdrawal to the other contracting parties to give them time to modify the agreement. Taken at face value, article 127 suggests that the UK will have to give formal notification of withdrawal from the agreement to the other 30 contracting parties if it intends to leave the EEA. As several Members have suggested, the implication is that unless such formal notification is given, the UK will remain a contracting party to the agreement and a participant in the EEA after it has exited the EU.

It is worth briefly considering the implications of that argument, because there are reasons to believe it would not be the quick fix that many assume it to be. At a minimum, if the UK were able to remain a participant in the EEA after it had exited the EU, simply by means of failing to provide formal notification under article 127, it is likely that formal modification of the EEA agreement would still be required. As I sure the House is aware, it would involve an onerous, time-consuming and uncertain process of treaty change and ratification. That is because some parts of the EEA agreement refer to the contracting parties, which could be any of the EEA states, but other parts refer specifically to EU and/or EFTA states.

The situation could not therefore apply to the UK after Brexit unless it joined EFTA, which, as several hon. Members, including my hon. Friend the Member for Ilford South (Mike Gapes) and my right hon. Friend the Member for East Ham (Stephen Timms) have said, would not resolve crucial issues such as the customs union or the Northern Ireland border, and it would not be a straightforward process. I note the comments of the Norwegian Prime Minister in August that joining EFTA, even for a temporary period, would, in her words, be a “challenging and costly” undertaking.

To illustrate the problem that would be created if we attempted to remain part of the EEA simply by letting this lapse, rather than by providing formal notification, it is worth examining article 36 of the agreement. The article makes it clear that the beneficiaries of the right to the freedom to provide services are EU nationals and EFTA state nationals. Hypothetically, if the UK attempted to remain in the EEA as a third type of contracting party, it would therefore be subject to the rules of the EEA agreement, but its citizens and businesses would not benefit, which I do not think anyone in the House would countenance. The EFTA option is therefore the only viable one in the majority legal opinion, but as several hon. Members have said, that is not as straightforward as some would like to suggest.

However, taking a step back, it is not even clear whether the requirements of article 127 apply to a contracting party that has decided to end its membership of one of the two bodies—the EU and EFTA—that enable a state to be party to the agreement in the first place. It is not clear because it has never been tested. It is true that there is no provision in the EEA agreement requiring a contracting party to leave the EEA if it ceases to be a member of the EU or EFTA, but the wording and spirit of the agreement clearly appears to rest on the assumption that only EU or EFTA states can be party to it.

[Sir Edward Leigh]

This is all very interesting as a legal lecture, but is the Labour party in favour of staying in the EEA?

[Matthew Pennycook]

The Labour party’s position is very clear: we want to seek a deal that retains the benefits of the single market and the customs union. We think we should be a member of the single market for the transitional period. Whether the EEA option is the only viable one for doing so during the transition is a question for another day. The wording of the motion on article 127 and continued membership of the EEA is very specific.

In short, the situation is entirely unclear. In the opinion of the House of Commons Library, the majority legal view is that under the present wording of the EEA agreement, it is impossible to be a party to that agreement without being a member of the EU or EFTA. That view has been put forward by a number of experts, including, most prominently, Professor Baudenbacher, the President of the EFTA court. He has argued that there is no scope within the EEA agreement for a third type of a contracting party that is neither an EU nor an EFTA member. The argument has not yet been tested in court.

EU Exit Negotiations

Edward Leigh Excerpts

Tuesday 5th September 2017 Commons Chamber

[Sir Edward Leigh (Gainsborough) (Con)]

During the last three or four years, there have been very high levels of migration into the EU, particularly from north Africa and the middle east. If there is to be an implementation period, existing EU citizens will no doubt have freedom of movement into our country during that period. For that reason, will my right hon. Friend ensure, first, that the implementation period is over well before the date of the scheduled next election and, secondly, that if existing EU citizens do have a right of entry during the implementation period, that right refers to people who are already citizens of the EU at the end of March 2019?

[Mr Davis]

My hon. Friend is introducing a whole load of hypotheticals. As I said earlier, the transition or implementation period might be an homogenous extension of what we have now, or it might be a piece-by-piece extension. We do not know at the moment; we have not yet even got into that negotiation. But the simple fact is that there are a number of things limiting how long that period can go on for. One of them is, frankly, that the Government have to deliver on departure from the European Union promptly—that is really what the British people expect. But there are also other issues, such as negotiability; if this period ran for too long, some of the Parliaments in Europe might think, “Actually, that’s a new treaty, and therefore we need to have a mixed-agreement procedure.” So there is a variety of things that will limit the extent it will go on for, and I am pretty clear it will be over before the next election.

Oral Answers to Questions

Edward Leigh Excerpts

Thursday 27th April 2017 Commons Chamber

[Mr Speaker]

Order. The right hon. Gentleman is a very fine man, but his name is not Sir Edward Leigh. [Interruption.] Be patient—we will hear from the fellow shortly. I am sure the right hon. Gentleman, who is a person of immense distinction, knows his own name—he just did not hear me.

[Sir Edward Leigh (Gainsborough) (Con)]

We are of one mind anyway—it does not really matter very much.

In the interests of good government, will the Minister instruct the permanent secretary to ensure that there are worthwhile discussions with a possible future Government on how we square the circle of staying in the single market but controlling immigration and of being inside the customs union, or outside it—I do not know what they are going to do—and trying to make new trade agreements? I am sure that the permanent secretary is a very clever man and that he can do all this work.

[Mr Walker]

I congratulate my hon. Friend on his demonstration of the single transferable question and on the point he makes. The speech from the shadow Secretary of State has been widely picked up as setting out a confused position and one that is irresolvable, but I have no doubt that our permanent secretary is brilliant enough to be able to work his way through it.

European Union (Notification of Withdrawal) Bill

Edward Leigh Excerpts

Ping Pong: House of Commons
Monday 13th March 2017 Commons Chamber

[Mr Mark Harper (Forest of Dean) (Con)]

It is a particular pleasure to follow the right hon. Member for Sheffield, Hallam (Mr Clegg), as he and I spent a number of years working together in coalition government. I know that was not enormously fruitful for all those on my side, but I thank him for his remarks.

Let me deal with one opening point and then refer to the amendments, rather than making a general speech. One observation to make, which comes back to the right hon. Gentleman’s point about process, is that we sent to the House of Lords a short, well drafted and tightly focused Bill. Usually, the House of Lords argument and its criticism of this House is that we send it long, badly drafted and ill thought through legislation, which the House of Lords then has to improve. In this case, we sent the other place a short, tightly focused, well drafted Bill that does one very specific thing; it then made the Bill longer and reduced the quality of the drafting. We should help their lordships out this afternoon by getting rid of their poorly drafted amendments and sending the Bill back to them in the same expertly drafted form in which it started.

[Sir Edward Leigh (Gainsborough) (Con)]

The simple truth is this: deal or no deal, vote or no vote, positive vote or negative vote, this process is irreversible; we are leaving the EU and that is what the people want.

[Mr Harper]

I am grateful to my hon. Friend for that.

Let me now deal with the two Lords amendments that my right hon. Friend the Secretary of State is inviting the House to disagree with. The first one relates to EU nationals, and I have listened carefully to the debate we have just had on it. I believe I heard the hon. Member for Ochil and South Perthshire (Ms Ahmed-Sheikh) suggest to the Secretary of State during it, from a sedentary position, that he could put people’s minds at rest by accepting the amendment. I fundamentally disagree with that.

If we read what the amendment actually says, as opposed to what people have asserted it says, we find that all it says is that the Government should bring forward proposals within three months to deal with people who are legally resident in Britain. I think this is faulty for three reasons. First, the inclusion of “three months” puts in place an arbitrary time limit, which will be decided by judges if people challenge it. This may happen in the middle of the negotiation process that the Secretary of State is going to carry out to secure the rights of British citizens and it could well disrupt that process.

The second and more important point is about the fact that the amendment refers to those who are “legally resident” in the country today. Two groups are involved here, and I would like to be more generous to one and less generous to the other. The first group comprises those whom we have discovered perhaps did not understand EU legislation, which says, “You are legally resident here if you are a student or you are self-sufficient only if you have comprehensive health insurance.” Many people fail that test; I think it would be sensible for us to take a generous approach when legislating for people to be able to stay here, but the amendment, as drafted, does not suggest we do that. I think the Government could be more generous to EU nationals who are making their lives here than the amendment proposes—I think that would be welcome.

European Union (Notification of Withdrawal) Bill

Edward Leigh Excerpts

3rd reading: House of Commons & Committee: 3rd sitting: House of Commons & Report stage: House of Commons
Wednesday 8th February 2017 Commons Chamber

[Suella Fernandes]

I will not, because I have taken quite a few interventions and I want to make progress.

Business for Britain has estimated the cost to British consumers of the damage done by the common commercial policy and the customs union at some £500 per household. The amendments do not reflect the absurdity of the current position. British companies such as JCB are no more able to sell their machinery tariff-free from India to the UK than Tata can from the UK to India. Since 1973, Britain’s trade has pivoted from being global to being European, and that has all been negotiated on our behalf by the European Trade Commissioner. Why is there no amendment recognising the influence to be regained by Britain resuming its own seat at the World Trade Organisation? Why is there no reference to the fact that EU trade policy has wrecked the ports of Glasgow and Liverpool, which are on the “wrong” side of the country, and denied us any chance of determining our own trade policy? That is a reflection of the one-sided prejudice in, and misguided nature of, the amendments.

The amendments fail to point out that in 2015, the UK’s deficit in trade in goods and services with the EU was £69 billion, while the surplus with non-EU countries was £30 billion. Why is there no amendment asking for an impact assessment on the gains from trading more widely and more freely with the rest of the world, building on our surplus with countries outside the EU? The amendments do not reflect the fact that Britain is losing out now because of our membership of the customs union, and they miss the fact that we have more to gain by leaving. They omit those salient features because Opposition Members do not want to be honest about the fact that the EU still does not have any agreements with major nations such as Brazil, the USA or China, and that we have more to gain from increasing our exports to the rest of the world than by remaining a member of the customs union.

My second-to-last point is on EU nationals. I consider the Prime Minister’s position appropriate in the circumstances: she will guarantee the position of approximately 3.5 million EU nationals as soon as possible once the negotiations have started. I want to ensure that this issue is put in perspective. Of the 3.5 million EU nationals currently residing in the UK, approximately 64% already have the right to stay here, 8% are children with an EU national parent and therefore have a right to reside here, and 12% will have accrued their five years permanent residency by 2018. This means that 84% already have a secure immigration status in this country. We are talking about a minority of people.

[Sir Edward Leigh (Gainsborough) (Con)]

Let us be practical. We cannot even deport convicted criminals. The truth is that not a single EU national will ever be deported.

[Suella Fernandes]

I agree wholeheartedly. That course of action would go against any idea of natural justice, legitimate expectation and the rule of law.

Exiting the EU: New Partnership

Edward Leigh Excerpts

Thursday 2nd February 2017 Commons Chamber

[Mr Davis]

This is my sixth statement to the House in less than six months—[Interruption.] Let me finish. The House will have the opportunity to vote on any number of pieces of legislation before we get to the end and then will have a vote to decide whether what it gets is acceptable. I cannot see how it can be made more meaningful than that.

[Sir Edward Leigh (Gainsborough) (Con)]

On page 49 of the White Paper, the Government state:

“We have an open mind on how we implement new customs arrangements with the EU”.

It is important to be admirably clear so that everyone knows where we stand, so will the Secretary of State confirm for the avoidance of doubt that we are not only leaving the EU and the single market, but definitely leaving the customs union?

[Mr Davis]

If my hon. Friend reads the rest of that chapter, he will see that we will exclude ourselves from the common commercial policy and common external tariff, which amounts to exactly what he says.

European Union (Notification of Withdrawal) Bill

Edward Leigh Excerpts

Tuesday 31st January 2017 Commons Chamber

[Sir Edward Leigh (Gainsborough) (Con)]

The speech made by the hon. and learned Member for Holborn and St Pancras (Keir Starmer) was one of the best speeches I have ever heard from the Labour Front Bench in its tone, its honest acceptance of the difficult choices being made by all of us in this House and its fundamental acceptance that we, by a majority of six to one, passed a decision to the people that we have to respect. This debate is simply about facilitating that, which is why so many of us will ensure that there is a large majority tomorrow evening to vote in favour of triggering the process for which our people asked.

I will also follow—some may think, rather counterintuitively—the other remarks of the hon. and learned Gentleman who led for the Labour party. I sincerely believe that this process is not a triumph of nationalism, or of us being apart from them. It is quite the opposite: part of a new internationalism and recognition of our common citizenship of the whole world. We stand ready to break free of the protectionist barriers erected by the EU that have so damaged much of the third world, and rejoin the world at large. As a former Prime Minister of Australia said, “Britain is back.”

Of course, we crave the familiar—self, family, friends, village, county, country or even continent—but we know that the human race is one and that human dignity is indivisible. That dignity has not been respected in our continent in the past. By the spring of 1945, Europe had descended into such a spiral of hate, war and destruction that people understandably despaired. Noble spirits such as Schuman, Adenauer and De Gasperi understood that the familiar divisions of home, tribe and nation were so dangerous when exaggerated that they needed to be not abolished, but overcome, in a process that became the European Union. No longer would one nation be able to use iron and steel for its own chauvinistic, fratricidal and destructive ends. Then came the freedoms of travel and work. That is why they set the project in motion.

[Alberto Costa]

My hon. Friend and I are executive officers of the all-party parliamentary group for Italy, and we both went to Rome but a few months ago. Does he agree that, although we will respect the will of the British people, that does not include changing the rights of Italians and other EU nationals who have been lawfully resident in the United Kingdom for years? Will he confirm that that is his view?

[Sir Edward Leigh]

Of course I will confirm that that is my view. It is also the view of everyone to whom we spoke in the Italian Parliament and in the British Parliament. Our Government have made that absolutely clear.

The point that I am trying to make is that, at the time I was describing, the British Parliament, under the leadership of Attlee and Churchill, understood that this was a supranational movement, which is why they did not join. All the discussions in the late 1940s and early 1950s, which we can read about, talked about an ever-closer union. It was not the Council of Europe, in which the right hon. Member for Doncaster Central (Dame Rosie Winterton) serves and in which I had the privilege of serving. The EU is not a body of sovereign nations. It is bound by a single court of justice. That is why our predecessors took the decision not to join in 1957, and they were right to do so.

Our predecessors were desperate to try to conclude a free trade agreement with our European friends and if they had been offered that free trade agreement in Messina, they would have signed up to it. That is precisely what we are trying to achieve. We are trying to be internationalist and to further free trade. This country is not, and never must be, protectionist or small-minded. Indeed, de Gaulle had an understanding of our point of view, when he talked about a “Europe of nations”. He asked how Great Britain, a maritime power with large and prosperous daughters all over the world, could fit into the Europe that was being created. An amusing cartoon from 1962 by the Dutch cartoonist Opland shows European Economic Community leaders faced with the prospective arrival of big mother Britannia with her diverse progeny of Canada, Australia and New Zealand. The caption reads, “If I join, can my offspring too?” Of course, the answer was no. We were already part of a worldwide community of nations, which we called, and still call, the Commonwealth.

What we are now trying to achieve is similar but even more ambitious. We want to lead this worldwide drive towards free trade. In 200 years’ time, people will view Brexit not as the last gasp of an outdated nationalism, but as the advent of a new internationalism. We understand the sincerity with which our remain friends put their arguments, but we are disappointed that they do not seem to want to grasp the immense globalism of Brexit—of escaping the EU barriers and looking beyond the ocean to take the mantle of solidarity with the rest of the world. Yes, we want our European friends to succeed. We are definitely not engaged in 19th-century rivalries and scrambles, nor board games of Risk and Diplomacy. In all sincerity and with sympathy for their views, we believe that this is an opportunity for us and them.

[Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)]

Will the hon. Gentleman give way?

[Sir Edward Leigh]

Of course I will give way to my friend, the Chair of the International Trade Committee.

[Mr MacNeil]

My friend talks about opportunities for globalisation through Brexit, but for globalisation to occur, somebody needs to reciprocate. Who will be the major reciprocators of the change of attitude that has emerged in the UK in the past six to eight months?

[Sir Edward Leigh]

I accept that there will be trials along the way, but what is the harm in trying to lead by example? What is the harm of believing in true internationalism and international free trade, and leading the world in it? That is all we are asking.

A free trade deal can be concluded so quickly. We have harmonised our laws for 40 years. It is only politics that prevents our European friends from concluding a free trade deal with us. I say to the right hon. Member for Doncaster Central, in all sincerity, that we do not want to create a bargain basement economy in which we lessen workers’ rights. On the contrary, such is the strength of our economy, innovation and industries that surely we can enshrine a gold standard protecting our workers as well as our fields, forest, rivers and seas. There is nothing, apart from politics, to stop our European friends rapidly sorting out a free trade deal in goods and services. There has never been so easy a free trade deal.

I appeal to my French cousins—not figurative ones, but literal ones—living in Provence and Paris. We want to strengthen our links, not dissolve them, in an amity of nations. On the way, we have to ensure that we enshrine security, control of borders and all those things but, for the positive and international reasons I have given, many Members of Parliament will be proud to vote for this tomorrow evening.

--- Later in debate ---

[Matt Warman (Boston and Skegness) (Con)]

On 23 June, the British people were presented with a simple choice. In my constituency of Boston and Skegness, 76% voted to leave the European Union—more than in any other seat in the country. While that choice on the referendum ballot might have been simple, it covered a multitude of issues, some of which I would like momentarily to unpack.

We talked in the constituency of Boston and Skegness at great length about what it would mean to control immigration. We talked at great length about that one single issue—not to the exclusion of all others, but certainly more than any other issue. While I agree with many of my right hon. and hon. Friends that much of this debate was about taking back control of our laws and our money, it is disingenuous to pretend that immigration was not—certainly in my constituency and many others—the single key issue on which many made their decision to vote one way or another.

Let me make two key points on immigration. First, if we are to control our borders, we must leave the single market. To those who say that leaving the single market was not on the ballot paper, I say it absolutely was to anyone who was having the conversations in my constituency. From talking to others about the vital new relationship Britain would have going out into the world after we left the European Union, I know that it meant making our own bilateral trade deals with countries. That means leaving the customs union. It absolutely was on the ballot paper.

The sophisticated, in-depth and detailed debates in the run-up to 23 June were on the deal that the Prime Minister now proposes to take us through over the coming two years. When it is said in some quarters that this negotiation is a hard Brexit or a soft Brexit or some kind of Brexit that people do not like, that is patronising the electorate, who knew exactly what they were doing and who chose to make a new relationship with the world.

We might have a simple Bill today, but it stems from a complex debate that led to a very simple question. That question was resoundingly answered in my constituency, and I suspect it will come as no surprise to anyone when I say that I will vote with the Government to trigger article 50 tomorrow.

[Sir Edward Leigh]

My hon. Friend and I, both representing Lincolnshire, were on opposite sides of this argument in the referendum campaign. It was easy enough for me to go with my constituency, but I think the House views my hon. Friend’s stance as a courageous one, and I think he is respected for what he is telling us now.

[Matt Warman]

That is a kind comment from my constituency neighbour—it is either courageous or bonkers, but we will leave that to the voters to decide in 2020. As I say, I hope that whatever we do in this House, we are rewarded for sticking to what we believe, and that brings me to my second fundamental point.

Article 50

Edward Leigh Excerpts

Tuesday 24th January 2017 Commons Chamber

[Mr Davis]

I will say two things. First, I really recommend that the hon. Lady reads the judgment, rather than trying to interpret it or put her own blush on it: read the detail of it. It is a very good judgment and a very sound judgment, as I said in my opening statement. As for giving continual votes and continuous information, I have been saying that all day today.

[Sir Edward Leigh (Gainsborough) (Con)]

The Bill should be brief and the outcome simple; that is a point of principle. Is the Secretary of State aware that if the Opposition parties combine to constrain the Government’s negotiating hand—for instance by insisting on staying in the single market, which would mean effectively remaining in the EU—many of us believe that we should have an immediate general election and put the matter to the people? That might concentrate the minds of those in the Labour party.

[Mr Davis]

My hon. Friend is asking me a question that is way above my pay grade, to say the least, and the person whose pay grade it is has left. The point I would make to my hon. Friend is this. I would hope that every Member of this House saw it as their duty to their constituents to deliver the best outcome. That is precisely what the Government’s strategy is—to deliver the best outcome for Britain in this negotiation.

New Partnership with the EU

Edward Leigh Excerpts

Tuesday 17th January 2017 Commons Chamber

[Mr Davis]

One of the things the Prime Minister has made plain is that we are not the supplicant, either in this negotiation or in what follows. Britain is the intelligence superpower in Europe; we are critical to the defence of Europe from terrorist threat, and we are critical to the military support of Europe and to dealing with migration, with our Navy at work. Those things will continue; they are very often on a bilateral basis anyway, but they will be done on a treaty basis that is equal to both sides.

[Sir Edward Leigh (Gainsborough) (Con)]

I think we should loyally support the Government. [Laughter.] Will the Secretary of State confirm that insisting on controlling our own borders and insisting on doing international trade deals are inconsistent not just with membership of the European Union but with the customs union and the single market? So I agree that, after the welcome tone of today’s speech, it is not hard Brexit—it is full Brexit.

[Mr Davis]

With respect to my hon. Friend’s opening remarks, my health is fragile these days, so will he be careful about making such assertions about supporting the Government? However, it is plain that we have endeavoured to put together the option that gives the best outcome for Britain while obeying the decision of the people. That is what we have done, and it will work.