Exiting the EU and Transport

Ian Paisley Excerpts

Wednesday 23rd November 2016 Commons Chamber

[Chris Grayling]

The world has moved on somewhat. The International Civil Aviation Organisation agreement that was reached in Montreal six weeks ago provides a global framework to tackle emissions in the aviation industry. All of us, both inside and outside the European Union, will be part of that as we ensure that the economies of the developed and the developing world can continue to benefit from improved aviation links while, at the same time, we meet our obligations to control carbon emissions.

The second area on which I am focusing is road haulage. We depend on road hauliers—without them, our shops would be empty and industry would grind to a halt. Our logistics industry does a first-class job in getting our goods to the right places, but the vast majority of lorries on the roads never leave the country. As we look to the future and to trade that does leave the country and crosses borders, there is one simple fact that we need to bear in mind. About 85% of the lorries operating between the United Kingdom and the continent belong to EU-owned businesses—international hauliers that are not based in this country.

The member states of the EU and the United Kingdom have a common interest in reaching an agreement. We need sensible arrangements for the future to allow goods to flow freely from and to the United Kingdom. We need to give UK hauliers a fair chance to win business and to be successful. We shall focus on that during the negotiations, ensuring that we achieve the right outcome for the international hauliers that serve this country and for UK hauliers as well. I am talking to all those who are involved in running our roads and the freight services that use them.

[Ian Paisley (North Antrim) (DUP)]

Will that include an aggressive look at freight charges for the movement of goods outside the United Kingdom to faraway markets? I understand that New Zealand, Australia and Canada have freight subsidies that allow them to cut the prices of freighted goods.

[Chris Grayling]

I am not necessarily a great fan of inappropriate subsidies, but I hope and believe that as we negotiate free trade agreements with countries around the world we shall create an environment in which trade and freight haulage are conducted on a level playing field, and that there are no artificial barriers that push up our costs and help others to reduce theirs. Above all, however, we benefit from a world in which trade flows freely. That is clearly in the commercial interests of European hauliers, especially hauliers from the Irish Republic. I am very aware that as we enter the negotiations, we have a particular duty of care to our friends in the Republic. We have a duty to seek to reach an agreement that will ensure that their trade, which frequently involves travel by road through the United Kingdom to other parts of Europe, can flow smoothly. It is in all our interests to ensure that we have sensible cross-border arrangements.

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[Drew Hendry]

I thank my hon. Friend for his intervention; he has made his point and I will not follow it up any further.

One can imagine, under the future provisions, being a tourist from Europe, especially in the short break market, with the choice of going to the UK or somewhere else where there is a lot less hassle—somewhere more welcoming. Additional space will need to be allocated to immigration control operations in airports and other ports of entry. It is thought that the costs could spiral into tens of millions of pounds. This cost must be borne by airports and port operators, who then cannot invest that money in increased connectivity and improving the passenger experience. According to the Tourism Industry Council, if the 23 million EU nationals who visited in 2015 were to be subject to full border checks, Border Force would be required to increase resources allocated to this by 200%—on top of the problems that already exist. Manchester Airports Group says:

“Border Force provision at a number of airports is already inadequate, with a lack of long term planning meaning queue times for passengers can already be unacceptably long.”

So what is the plan?

[Ian Paisley]

Before the hon. Gentleman gets into the detail of the hypotheticals of border controls, does he accept that the single largest threat to ordinary travellers in the United Kingdom, and across the entirety of Europe, is none of the things he has mentioned but the package travel directive about to be introduced by the EU, which will put additional costs on every single traveller because they perhaps use sites like Expedia?

[Drew Hendry]

The hon. Gentleman makes a good point. So many issues are facing us that it is very difficult to pick out the single most important item. There are a lot of unanswered questions.

Is the plan to reach an agreement with the EU that the EEA channel will continue to operate in the UK, and that EU member states will allow UK citizens to use the EEA channel in the EU?

Regional airports are vital for connectivity within Scotland, but the reckless gamble with our EU membership has caused great uncertainty for these airports that could have a seriously detrimental impact on our economy. Scotland has a large number of regional airports, many of which are reliant on low-cost airlines and outbound tourism to survive and to be an economic success. The International Air Transport Association predicts that a 12% reduction in sterling would result in a 5% decline in outbound travel, while Ryanair has said that it is scaling back its expansion in the UK.

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[Ian Paisley (North Antrim) (DUP)]

My constituency voted overwhelmingly—62.2%—to leave the EU, despite the fact that with its large agricultural hinterland it receives huge European farm subsidies, and with its manufacturing base it benefits from the opportunity to manufacture and export to the EU. It also has a huge travel base. It is a tourism mecca, and tourists need travel infrastructure. So it is engaged in manufacturing, travel, tourism and transport goods, but despite all that, it voted to leave the EU, and we must ask ourselves why.

Why would so many people in that set of circumstances vote to leave? It is because the EU is seen to be failing them. When we look specifically at transport issues, we can see why. Before we even discuss the EU, there are many things that we could do domestically to assist companies in the transport sector in our country. For example, in my constituency we manufacture buses. The Wrights Group manufactures a considerable number of the buses for this great city and for Scotland—indeed, it recently enjoyed a very beneficial order from Scotland, for which we say thank you to our Scottish cousins. It also manufactures for Singapore and a number of other Asian countries, and employs hundreds of people in Singapore in the assembly of those buses and, importantly, in the maintenance of those buses. It is a significant local employer and a world employer.

The company can benefit more from domestic decisions taken here than it can from EU decisions taken in Brussels. For example, the Government’s Bus Services Bill currently going through Parliament will have a dramatic impact on transport orders for my constituency if it goes the right way. We also have—I say this very gently to those on the Labour Front Bench—a new Mayor of London. I appeal to him through his Front Bench colleagues to come to Northern Ireland as soon as possible to visit that bus company, which transports his citizens around his city, and see the great work that it could do to expand the bus offer in London. I understand that between now and 2021 London will require another 1,000 buses. I hope that that transport infrastructure will benefit from buses manufactured in my constituency. I wanted to put that on the record before I turn to the substance of the debate.

When the Secretary of State opened the debate, he was full of confidence and optimism. I share that optimism. We should approach the issue of transport and Brexit with some optimism because there are opportunities that can be beneficial to us.

There is one issue that could have been addressed in the Chancellor’s statement today. I hope that the Transport Secretary will continue to whisper “airport passenger duty” in his ear between now and the Budget in April. I hope he will keep pushing that little issue. We should not be paying a pernicious, dirty little tax to the Chancellor of the Exchequer just to transport ourselves from one part of the UK to another. It is wrong. It is not the sort of tax that our Government should be levying, and it should be removed soon. I hope that the Chancellor will hear that not just from me but from the Transport Secretary between now and the Budget.

Many people, including our neighbours in the EU, complain about Brexit. We hear it every day and read about it in the newspapers, but those of us who voted to leave the EU did so with a good intention—to bring about good for our country, not bad. I have noticed that those on the remain campaign and those opposed to the action that the United Kingdom is about to take are talking up crisis after crisis—whether a transport crisis or a crisis to do with transport problems with our border in Northern Ireland.

I commend the singular actions of the Secretary of State over the recess. When a crisis emerged in Northern Ireland relating to our one transatlantic fleet operator, United Airlines, it was largely because the Secretary of State got on the telephone to the United States and spoke to the head of the airline and others, pressing them to keep the flights operating in Northern Ireland, that the service was saved.

As a result of the right hon. Gentleman’s conversation with United Airlines and an emergency aid package put in place by the Northern Ireland Executive, involving multiples of millions of pounds, the service was indeed saved—until two weeks ago. Someone in the EU then complained that the actions of the Secretary of State and the Northern Ireland Executive amounted to state aid and were therefore wrong. They objected so much that Europe has now told United that it must reject the multi-million pound aid package. As a result, the airline is now closing its service; the last flights from Belfast to Newark in the United States of America will take place in January next year. That shameful action needs to go on the record.

[Sir William Cash]

In the ports sector, as in many others, there are hidden subsidies. Ports over the whole of Europe are publicly owned. Given the money pumped into them, they also represent the lack of a level playing field. What is sauce for the goose is sauce for the gander. I commend the hon. Gentleman for what he said and what the Secretary of State tried to achieve.

[Ian Paisley]

I agree; the hon. Gentleman has put his finger on the fact that the issue extends not only to airports but to seaports as well.

Last week in the House, I pressed the Secretary of State about the United Airlines issue. He kindly said that the decision was “deeply unwelcome” and that a fair amount of effort had been done by his Department, working alongside the Northern Ireland Office and Northern Ireland Executive, in trying to make sure that this air route was sustained. He went on to say:

“The loss of the route because of EU action is deeply unwelcome and precisely the kind of unnecessary decision from Brussels that led this country to vote to leave the European Union.”—[Official Report, 17 November 2016; Vol. 617, c. 377.]

I say a hearty “Hear, hear” to those words. That action was pernicious and should not have taken place. The company should have been allowed to continue to operate in Northern Ireland. Many people in County Antrim who have seen the benefits of Europe have turned against it because of such decisions. I am glad that we as a nation have woken up to that.

We have also had the allegation that the Irish Republic—our well-known neighbour—wants to be supportive of Northern Ireland as it leaves the EU. Indeed, it has written to many of the hauliers in Northern Ireland to invite them to a tea party hosted by the Taoiseach in Dublin. He has called it the all-island civic dialogue, and he wishes to have a conversation about the implications of Brexit for the Republic of Ireland. Now, I am quite happy for the Taoiseach to do that, and for him to understand the conversation that is going on, but if he targets businesses in Northern Ireland with a view to getting them to go to the south of Ireland and to crank up opposition to the UK’s decision, that is where I draw the line. I therefore commend the words of our First Minister in Northern Ireland, who said that the Dublin Government are poaching some of our businesses, and that includes our haulage businesses. It is right that this House understands that, while we welcome the opportunity to work with our southern neighbours, we can also see when someone speaks out of both sides of their mouth—on the one hand saying they are concerned about our relationship, but on the other hand doing everything they can to undermine that relationship and poach businesses from us. I think we should put that on the record.

It is also important that we identify those EU transport regulations that hurt British businesses. In an intervention on the Scottish National party spokesman, the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry), I mentioned the package travel directive. Expedia is an American company that employs over 2,000 people in call centres and outreach centres in the United Kingdom. It is based in England and Scotland, and it will hopefully soon be based in Northern Ireland. That company employs thousands of people, but it is now faced with the package travel directive. Ordinary business and tourism travellers who use sites such as Expedia or trivago as a one-stop shop for their airline ticket, their hotel, their car rental, the shows they wish to attend or other things they wish to book, such as restaurants, will find that this package travel directive, which comes from the EU to protect huge monopolies, will try to pass on a major charge to the companies—Expedia, trivago or others—or, more than likely, to the customer, because they are using a one-stop shop, when they should apparently be encouraged to use several different operators to place their orders. That package travel directive is wrong, and it should be opposed. That is another reason why many people in the United Kingdom see that, in terms of travel arrangements, we would be better off out of the EU.

[Drew Hendry]

On the point about additional costs to the travelling public, does the hon. Gentleman agree that the absence of the European health passport would mean an increase in insurance costs for UK customers travelling in Europe?

[Ian Paisley]

I do not know whether that is the case, so I cannot say whether it would or not. I would certainly be happy to look at that, but we need to encourage our own insurance industry—perhaps we will have a debate about the insurance industry and Brexit—to pick up those issues to determine whether there is a way in which we can address them.

Companies such as Expedia are faced with this package travel directive. We need to be alive to the fact that Europe is not a great benefactor of the travel sector and that it is actually doing an awful lot to hinder it.

[Sir William Cash]

On the general principle that the hon. Gentleman is addressing—the extent to which directives have an adverse effect on certain industries and the national interests of particular countries—is he conscious, as I certainly am, of what is called regulatory collusion? This has been written about by Professor Roland Vaubel of Mannheim University, who makes it clear that a system is employed in the Council of Ministers and through COREPER whereby decisions are made that benefit certain congregations of countries in a way that is detrimental to others, and that this is not a benign system, but actually the pursuit of national interests in another name.

[Ian Paisley]

I agree with the hon. Gentleman and thank him for making that point. This is about not only helping congregations of countries, but assisting cabals within certain sectors of the industry. For example, the package travel directive helps people who do not use computers to buy their tickets and encourages people to use only shops. I have nothing against travel shops, but they should not be assisted over the heads of people who wish to use the internet to make their bookings. There is a very deliberate attempt to try to destroy that business on the internet.

On road haulage, the Government need to address exporter freight charges. Many of our competitors outside the EU, such as Australia, Canada, New Zealand and countries in Asia, including India, have opportunities to assist the trade in their manufactured goods by reducing the cost of exporting them around the world. In essence, this is about freight charges, not just internally within their own countries, but externally. Our Government need to decide what assistance that system gives and how, when we eventually leave the EU, our companies can have a similar type of assistance or, more importantly, can be encouraged to get round the advantage that those other countries are given.

Let me give the House a few examples. In Australia, the freight equalisation scheme allows for goods shipped around the world to be subsidised when going to their final destinations. That means that a similar good manufactured in New Zealand, for example, suddenly becomes more expensive because its freight charges are included in its shipping, whereas the Australian good has its freight charge subsidised or, in many instances, wiped out. New Zealand opposed Australia when it introduced that scheme, but it is still in place. India has a freight assistance scheme, as well as an enterprise promotion policy, which is about assisting with freight charges.

If these issues of transport costs are not addressed, when we finally leave the EU and have wider export opportunities, we will find that if we try to get our goods—manufactured goods, foods or drinks—to certain markets, they will be disadvantaged because we do not give them a freight subsidy. I know that the Government do not like the word “subsidy” and that they will have to look at this further, but something should be done to assist with those transport costs. It is important that the Government have that in their mind.

I welcome the debate and the comments by the Secretary of State. It is useful that we continue to prod and examine these issues.

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[Stephen Gethins]

Here we go! We were so well prepared that that is not just in the White Paper—I know the hon. Gentleman has read it—but we even had a fiscal commission working group. We had 670 pages of the White Paper and a fiscal commission working group setting out three options, including sharing the currency, which one Minister said that we would, of course, be able to do—[Interruption.] As my hon. Friend the Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry) said, that compares to tumbleweed—absolutely nothing—from the Government.

The Secretary of State might want to take notes, because there were 15 pages on transport alone in our White Paper. As the hon. Member for Stoke-on-Trent South (Robert Flello) will be pleased to hear, it set out the areas for high-speed rail. It makes much more sense if high-speed rail goes through to Edinburgh and Glasgow, rather than just to Birmingham. The benefits of specialist transport organisations were mentioned, too.

[Ian Paisley]

How many of the 600 and more pages started with the words “could”, “maybe” or “might”?

[Stephen Gethins]

To be fair, a lot more than in the Government’s plans about the EU referendum. The hon. Gentleman makes a fair point on that, as usual. There were a lot more “coulds”, “woulds” or “maybes” than in the Government’s preparatory documents.

The hon. Member for North Antrim (Ian Paisley) will be pleased to hear that the Government must have been reading our White Paper, because there was talk about the benefits of transitional agreements. Clearly, on the basis of recent press reports of the Government’s plans, they are taking to heart ideas about transitional agreements, which have come straight from the White Paper on Scottish independence. There is also talk about working with our European partners and the EU, where it has responsibility. Of course, Government Members told us that if people voted for Scottish independence, we would not be in the European Union and that the only way to guarantee membership was to vote no. What happened there? The point is that co-operating with Europe is vital.

I am glad to see that the hon. Member for Eastleigh (Mims Davies) has returned to the Chamber. She raised the critical issues of climate change and greenhouse gas emissions. In the context of reducing greenhouse gas emissions, we have many reasons to be grateful for co-operation with our European partners. Everyone who has survived this debate so far continues to benefit from the European Union air quality directives every moment of every day. As for climate change, Scotland’s world-leading Climate Change (Scotland) Act 2009, which smashed its targets when Conservative Members said we could not achieve them, is much closer to Brussels policy than legislation in this place. We have allies and friends who take a similar view.

There is also an important point to be made about the single market. As the Member of Parliament representing, for instance, Pittenweem, Oban and Peterhead, I notice that articulated lorries from European Union countries take fine Scottish seafood to markets across the EU. Driver licensing for EU nationals is especially important in rural areas, be they in the borders, in North East Fife, in Northern Ireland or in the highlands. We want to make those people feel at home, because they contribute so much. Will that licensing continue? Will we continue to have the harmonisation that we have enjoyed?

Our geography in Scotland makes airports and air links very important to us, and I am delighted that the Scottish Government have managed to secure 23 new routes since 2014. We benefit from that, and so do other people. Who would not want to spend their holidays in North East Fife? I am sure that you would, Madam Deputy Speaker, and have done so as well. My hon. Friend the Member for Kilmarnock and Loudoun (Alan Brown) pointed out that Prestwick was nearby. Just the other day, Michael O’Leary said that the UK Government did not have a clue, and it is hard to disagree with him.

European funding for research and development has been and continues to be critical. We need to develop clean, green technologies, and Scotland is well placed for that. Currently, Horizon 2020 has a smart, green and integrated transport fund which is worth €6.5 billion. We need to start planning now for what will happen after 2020. Perhaps Ministers will provide certainty by telling us what their plans are.

It is becoming clearer and clearer that Scotland is closer to Brussels in so many policy areas. Transport is just one of them.

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[Mr Jones]

What I can say is that the Department encourages the trade unions, as it does every other part of the community, to contribute to the consultation that we are currently holding. I suggest that the right hon. Lady encourages them to contact us.

The hon. Member for Glasgow South (Stewart Malcolm McDonald), who pronounced himself to be a passionate supporter of the remain campaign, made a remarkably Eurosceptic speech, in which he raised the issue of Volkswagen and what he described as a “scandal”—many in this House would agree with that. As I have said previously, when the great repeal Bill comes through, the EU legislation will be absorbed into our own body of legislation and we can then amend it. It will be up to this Parliament to decide whether it wishes to improve on the current arrangements, and I discern from his remarks that that is something he would welcome.

The hon. Member for North Antrim (Ian Paisley) made an upbeat speech, in which he identified a number of opportunities arising from Brexit. He raised the issue of the package travel directive, and all I would say in response is that we are aiming at a new state of affairs, under which this Parliament can make decisions such as that and not simply accept the directives that come from the EU.

[Ian Paisley]

Is the Minister at a point yet to make a commitment that that directive will never come into force?

[Mr Jones]

Forgive me, I did not hear the question.

[Ian Paisley]

As a person called Paisley, I have never once been told that no one can hear me—I apologise profusely. Can the Minister make a commitment at this point, or at some time in the future, that that directive will never come into force?

[Mr Jones]

I think the answer to that is that it depends on how quickly we complete our withdrawal from the EU and on what this Parliament decides to do. I have no doubt that the hon. Gentleman will be a strong advocate for its non-acceptance of that directive.

The hon. Member for Kilmarnock and Loudoun (Alan Brown) made a contribution relating, inter alia, to the spaceport that he hopes will be located at Prestwick. I had ambitions for north Wales, but I am sure we will both be happy wherever it is located. He also raised the issues of road freight and customs checks, both of which are certainly being taken into account by my Department and by the Department for Transport in the context of our EU exit negotiations.

The hon. Member for Stoke-on-Trent South (Robert Flello) raised the issue of the importance of logistics. I understand that he is the chairman of the all-party group on freight transport, and he has raised a number of these issues in round-table meetings that have been arranged by the Minister of State, Department for Transport, my right hon. Friend the Member for South Holland and The Deepings (Mr Hayes), who has undertaken to maintain that dialogue.

Finally, we heard a contribution from the hon. Member for North East Fife (Stephen Gethins), who spoke about the Scottish referendum.

This has been an important and valuable debate. As I say, it has helped to inform the consideration of my Department and the DFT, and we will continue to hold similar engagements both within this Parliament and with stakeholders from outside the EU. [Interruption.] I make no apologies—I hear the catcalls from Labour Front Benchers—for the fact that this Government are giving proper consideration to the process of withdrawal from the EU. I believe that this Government—