EU: Withdrawal and Future Relationship (Motions)

James Cartlidge Excerpts

Wednesday 27th March 2019 Commons Chamber

[Nick Boles]

I am happy to confirm some of what my hon. Friend says but not the first point about not having a say over the rules. Members of the European economic area follow an absolutely crucial process under the EEA Joint Committee, to which all new rules passed under single market legislation are referred, and they have a right of reservation, which means that the postal directive, for instance, has never been implemented by Norway, because it does not like it and just says no. That right would extend to us if we were to join.

[James Cartlidge (South Suffolk) (Con)]

My hon. Friend is making an excellent speech. Does he agree that, even under World Trade Organisation rules, every single UK exporter to the EU will still have to comply with all EU rules and regulations? Once a country leaves the EU, there is no way it can somehow remain a rule maker within it.

[Nick Boles]

Of course that is right; my hon. Friend is absolutely correct. It is also the case that almost every single producer in this country is hardly going to have to follow one set of rules just for their UK sales and another set of rules for their European sales. They will have one standard set of rules and they will probably follow the European ones.

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[Stephen Barclay]

As a former respected Minister, my hon. Friend will know that I am stating the clear position of the Government Law Officers. The same point also relates to the meat of motion (H), because line 5 states that we need to give notice to leave the EEA, which is not the case.

The second issue with motion (D) is that paragraph (1)(e) states that freedom of movement can be restricted to those “genuinely seeking work” or those with “sufficient resources”. Again, that is just incorrect. The existing position as a member of the EU28 is that controls can be put in place, but that has not happened because of how the UK operates. We do not have a registration or ID system or an insurance-based health system, so there are reasons why such controls are not used. With respect, the proposal is a fig leaf to disguise the fact that his solution requires the continuation of freedom of movement.

[James Cartlidge]

Will my right hon. Friend give way?

[Stephen Barclay]

I am conscious that 47 Members want to speak, so I will press on. I am sure that we will have a further debate before too many days have passed.

Turning quickly to motion (J) in the name of the Father of the House, my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke), my concern is that it would open up a role for the courts given that it would be for them to adjudicate on whether the suggestion of a comprehensive UK-wide customs union has been met in our negotiating mandate.

Motion (O) is referred to by some hon. Friends as the Malthouse compromise—Malthouse plan B in this case—and it would involve paying for an implementation period. However, the EU’s clear position is that that proposal would be regarded as the UK reneging on an agreed fair settlement, which it has repeatedly said it is unwilling to accept.

As for the flaws of motion (K) from the Leader of the Opposition, we have been around these houses so many times that we do not dwell on them. Paragraph (a)(iii) refers to “dynamic alignment” but we have already committed to temporary alignment when it comes to implementing EU workers’ rights. Again, the motion also does not address the fact that the Opposition appear to accept the withdrawal agreement but seem reluctant to say so.

In conclusion, the motions before the House represent a range of suboptimal solutions that either do not deliver on the referendum result or do so in a way that would not deliver the benefits of the Prime Minister’s deal. That is why the deal remains the best method to deliver on the biggest vote in our history in a way that protects business and citizens’ rights.

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[James Cartlidge (South Suffolk) (Con)]

Thank you for calling me, Mr Speaker. I am very much used to the time limit changing just as I rise to speak.

I campaigned to remain, but I promised my constituents that I would accept the result of the referendum that my colleagues and I voted into law. In my view, the best deal to do that is undoubtedly the one negotiated by the Prime Minister, with all the difficult squaring of circles that it has had to go through. I sincerely hope that we do agree to that deal. If we do not, we have to accept that, given no deal has been defeated twice in this place, we must have a deal that flexes one of the red lines—the single market and the customs union. I explained on Monday that the issue of free movement should not be as big a concern, because our immigration numbers will be the same; people will just come from further afield. The key issue is trade. If we go down the EFTA/EEA route, we would be outside the customs union, but we would keep the EU free trade deal, which is the single market.

If we were outside the EU but in the customs union, there would be a profound problem. What would happen when we wanted to do a trade deal with a country that the EU did not wish to conclude one with or was unable to do that? This is fundamental. Imagine if it were a key economic bloc such as China. If we wanted to negotiate a trade deal with the Chinese, we would have to wait for the EU to conclude its trade deal, which would take much longer and be far more complicated. The Swiss, whose fine EFTA country is in the single market but outside the customs union, negotiated, as long ago as 2013, an excellent trade deal with the Chinese that has given them billions of pounds’-worth of trade in industrial goods and very strong access in services. This is the key point. There are many good reasons why we as a country could negotiate a trade deal with China that the EU could not, one of which is that we have a profound offer in services that is very different from the overall EU mix.

I think personally that we have to say to our people what are the benefits and opportunities of leaving. One of them must be to live up to our great history and heritage as the home of capitalism and free trade, and go back to trading around the world but with a close relationship with the European single market to fall back on. That works brilliantly for Switzerland and for Norway. In essence, it means leaving the political union and staying in the economic one. It is a very good deal. It is not as good as the Prime Minister’s deal, for all the reasons I have explained in previous speeches. However, at this moment in time, we have to decide whether we really want to deliver Brexit or not. If we are going to do so, and if it is not through the Prime Minister’s deal, which I hope we will vote on on Friday, there must a compromise, and the best one is that which plays to our strengths as a great free-trade nation.

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[Chris Philp]

That was not the case that the right hon. Lady made. She made the case that people should be able to change their mind repeatedly, which implies that she would support any number of referendums.

I rise to speak against motion (D), in the name of my hon. Friend the Member for Grantham and Stamford (Nick Boles), on common market 2.0, and a similar motion, (H), in the name of my hon. Friend the Member for Camborne and Redruth (George Eustice), on membership of the European economic area. I strongly oppose those motions for two reasons. First, they both entail signing up to full single market rules. The House of Commons Library published a paper only yesterday that says on page 19:

“EEA membership… involves a range of obligations, including implementation of EU rules relating to the Single Market”,

with no decision-making role, other than being “consulted”. For a great British institution such as the City of London or our entire industrial economy, our merely being consulted on the rules that govern them simply is not good enough.

Secondly, there is the question of financial contributions, which was a controversial part of the referendum campaign. Another House of Commons paper published on 21 December found that Norway pays per capita contributions that are around half our current level—so, one would assume, about £5 billion per year. The promise made to the British people about saving money would not be delivered in either common market 2.0 or as a member of the European economic area.

We then come to the question of free movement, which was another contentious issue during the referendum campaign. Membership of the single market entails full free movement. Some Members have referred to various brakes or safeguards in the European economic area agreement. Specifically, article 112 says that any such safeguards must be “restricted” in their “scope and duration”. Article 114 says that if a state, like the UK, were to use those safeguards, other member states could take “rebalancing measures” against them, meaning that some of the benefits of single market membership could be withdrawn. No country other than Liechtenstein, in very limited circumstances, has ever taken advantage of those provisions.

[James Cartlidge]

Switzerland.

[Chris Philp]

Well, Switzerland is currently engaged in a running battle with the European Union and has been unable to implement the result of its own 2014 referendum on free movement.

In the 54 seconds remaining, let me briefly turn to the question of trade deals, which relates only to motion (D) and not motion (H). Under the proposal of my hon. Friend the Member for Grantham and Stamford, during our customs union membership—this would probably apply to the Labour party’s official proposal as well—we would be bound by all trade agreements done by the European Union. We would be compelled to follow them, without the right of veto that we currently enjoy, and we would be prevented from doing any free trade deals of our own. That would be greatly to our disadvantage and would exclude countries such as India, China and the USA. For those reasons, I will be opposing motions (D) and (H).