Leaving the EU: Impact on the UK

Julia Lopez Excerpts

Wednesday 17th March 2021 Commons Chamber

[The Parliamentary Secretary, Cabinet Office (Julia Lopez)]

I thank all hon. and right hon. Members who have taken part in this afternoon’s debate. The contributions from most have been passionate, insightful and optimistic about our nation’s new path outside the European Union, while recognising that our ambitious and wide-reaching trade and co-operation agreement with the EU will take time to embed. Most also set out a belief in the UK.

The British people’s choice to leave the European Union has often been mis-characterised as a nostalgic, inward-looking reflex, and today we have heard from the SNP that it is “post-imperial stress” syndrome. The hon. Member for Glasgow Central (Alison Thewliss) derided the UK as “insular little Britain”, while Labour MPs suggested it is toxic nationalism and a disaster. The future is bleak, said the hon. Member for Lewisham East (Janet Daby). Sometimes it feels as though we are still in the last Parliament. If only they did talk of sunshine, lollipops and rainbows.

Instead, I believe the vote to leave was a recognition, first, that the world of tomorrow demands agility, speed and nimbleness in resolving the challenges we shall face, with greater democratic accountability, not federalism, in decision making. The vaccine roll-out is a case in point. International co-operation and partnership will always be vital for the UK, but that need not be channelled via a costly bureaucracy.

Secondly, the vote was as much about ourselves and how we govern ourselves as it was about the EU, and my hon. Friend the Member for Redcar (Jacob Young) had that spot-on. It was a request by the British people for us to be more accountable—not to seek scapegoats, but to deliver to communities solutions that fit them. Those in the SNP, in their relentless, sneering negativity, have made it quite clear that they see themselves as unwilling passengers on that journey, but we recognise that Scotland is not the SNP and that the Scottish people are integral to our collective success as active and much valued builders of the UK’s future.

This is why we are not just focused on the opportunities for Scotland that stem from our leaving the EU, but intent on making the levelling-up agenda mean something for each of the four nations in the UK. Ironically, given their appetite for such polls, SNP Members like to frame the choice of voters at referendums as mistakes, and today is no different as they seek to tell the British people once again why they were wrong to leave the EU.

SNP Members talk about the Erasmus scheme without highlighting the tremendous new opportunities for Scottish students from the Turing scheme, which will open up study placements across the world, not just the EU, from September, with grants provided and tuition fees waived. My hon. Friend the Member for Birmingham, Northfield (Gary Sambrook) highlighted the opportunities open to working-class constituents in his city.

SNP Members talk about the challenges to the fishing industry without setting out the investment that we are making to grow the Scottish fishing fleet, the collaboration with industry and European partners to tackle border frictions head-on, or the fact that under the agreement we have reached, Scottish fishermen will benefit from being outside the strictures of the common fisheries policy. They talk about the loss of EU regional funding without explaining that we will be at least matching it.

[Alan Brown]

Will the Minister address the point made by my hon. Friend the Member for Central Ayrshire (Dr Whitford) about the fact that Scottish fishermen cannot swap quotas, and therefore cannot actually access more of the cod and haddock that they rely on as their key income?

[Julia Lopez]

The Under-Secretary of State for Scotland, my hon. Friend the Member for Banff and Buchan (David Duguid), is running the Scottish fisheries taskforce, which is going through some of the issues that the hon. Gentleman highlighted.

SNP Members talk about the loss of EU regional funding, as I mentioned, without explaining that, through the new UK shared prosperity fund, we will at least be matching the funds that have already been distributed to the benefit of communities across our four nations. They talk about the positive role of immigration to the UK without understanding that the desire for greater control of our borders does not undermine the warmth of our welcome to talented, hard-working people from around the world, as our new points-based system attests. They talk of their concern for small business without explaining how our moving away from the EU’s complex procurement regime, rather than clinging closely to it, as they so desire, could open up many more opportunities for SMEs to bid for Government contracts. My right hon. Friend the Member for Wokingham (John Redwood) rightly challenged us to be even more ambitious in this area.

I have heard concerns today about Scottish exports without recognition that geographical indications for valued Scottish products remain in the trade and co-operation agreement, and that those products can now also find new markets as we secure ambitious new trade deals with nations such as America and Australia, and we can benefit from those already agreed with Singapore, Japan and Canada. SNP Members portray the UK as a spent force without celebrating the fact that Glasgow will be hosting the COP26 conference, showing global leadership on the issue of climate change, as well as British ingenuity in green tech.

We do not define the relationships between our nations by our 40-odd years of membership of the EU. No—we are bound by the cultural, familial and economic ties of centuries, which SNP Members want to dismantle as they seek so desperately to bind Scotland back into EU bureaucracy. We also have the humility to recognise that our Whitehall-centric model of Government can be improved. It does not do a good enough job of utilising the talents and hearing the voices of everyone in the UK. That is why, this week, the Cabinet Office announced our second headquarters in Glasgow, where at least 500 civil servants will be based as we relocate at least 1,000 roles to Scotland, including from the Foreign, Commonwealth and Development Office. Brexit was not just about the EU; it is a creative catalyst for us to govern better, which is not a challenge that the SNP seems up for—not when shortcomings can be obscured by finger-pointing. This move brings key decision makers closer to the communities they serve so that we understand the perspective of people in East Kilbride as much as south-west London.

The integrated review published this week on national security, defence and foreign policy sets out the Prime Minister’s vision for the UK in 2030: a stronger, more secure, prosperous and resilient Union that will draw on tremendous Scottish capabilities in space, cyber and maritime industries.

I am grateful for the valuable points that have been raised by right hon. and hon. Members throughout this debate, and I regret that time does not allow me to cover all of them. I have great affection for the Chair of the International Trade Committee, the hon. Member for Na h-Eileanan an Iar (Angus Brendan MacNeil), from our time together on that body. He will know that the demand for Scottish goods comes from nations beyond the EU and that with tariff-free trade secured in the TCA, we now have scope quickly to dismantle tariffs to new markets. Scotland already exports £7,600 worth of goods to the US every minute, but a new FTA could unlock even more opportunity with the US.

Right hon. and hon. Members highlighted genuine constituency concerns this afternoon that I do not seek to brush over. We recognise that there has been friction for seafood exporters and we have set up the seafood distribution support scheme and the Scottish seafood exports taskforce to work through these issues constructively. I received an email just yesterday from a French counterpart in the Hauts-de-France region who is actively engaged with the taskforce and wished to offer assurances that our continental friends are every bit as eager as we are to deal with issues of paperwork, given the exceptional quality of Scottish seafood and its importance to their regional market, which contains Europe’s largest processing seafood processing centre.

On the issue of touring musicians, we are alive to the concerns that have been raised. We have sought a more ambitious deal with the EU. Unfortunately, that request was rebuffed and we are now actively working with the industry to see how Government can facilitate their ambitions.

The Government remain committed to ensuring that every success is made of our status as an independent, outward-looking nation. We believe that this is an exciting new chapter in our national story, to which the contributions of the Scottish people will be fundamental. Indeed, we have ambitious plans for every part of the UK. Unfortunately, today the SNP has rather limply and sourly exposed that it would rather keep up its habit of blaming others than lay out its own ideas for improving the lives of Scottish people.

Question put (Standing Order No. 31(2)), That the original words stand part of the Question.

Oral Answers to Questions

Julia Lopez Excerpts

Tuesday 21st May 2019 Commons Chamber

[Mel Stride]

I entirely stand by my earlier remarks about the measures not being in the least retrospective. Of course, I cannot comment on the tax affairs of the individual that my right hon. Friend has just referred to; it would not be right or proper of me to do so.

[Julia Lopez (Hornchurch and Upminster) (Con)]

I have received increasingly distressed representations from constituents affected by the loan charge. One of their concerns is that in making any settlement with HMRC, they risk giving up their right to review in the event of any subsequent change in Government policy. Will the Minister advise my constituents on what they might do? They currently feel trapped between that prospect and the risk of further financial penalty from HMRC if they do not come to an agreement quickly.

[Mel Stride]

I have made it very clear, as have the Government, over a long period of time—at least since 2016 when these measures were first brought into effect, which is before I arrived in my current position—that our policy is our policy and that we will not change that policy. For those who have been involved in this form of aggressive and contrived tax avoidance, the recommendation is very clear: the best thing to do is to speak to Her Majesty’s Revenue and Customs and come to a sensible and reasonable arrangement for repayment.

Discrimination in Football

Julia Lopez Excerpts

Thursday 11th April 2019 Commons Chamber

[Mims Davies]

I thank the hon. Gentleman for raising that event on the terrace here in the House of Commons, which showed how much good work is done in clubs across the land. It is absolutely right that we do not lose sight of the positive things happening in our communities and, above all, that we are not afraid of standing up to intolerance, because frankly that does no one any good.

[Julia Lopez (Hornchurch and Upminster) (Con)]

I recently attended my first West Ham game at the London stadium. It has an amazing family atmosphere, and I spoke to the foundation about what it is doing to support the Kick It Out campaign. Does my hon. Friend agree that football matches have a special ability to bring together people of all ages and backgrounds, and that racist language and abuse must never be allowed to undermine that by normalising division in the eyes of young people or making aspiring players feel excluded from sharing the joy of the game?

[Mims Davies]

I thank my hon. Friend for raising that. I think that football has come an incredibly long way from where we were in the ’80s, but frankly that is not good enough. Football is a family game and is incredibly welcoming, but small pockets of people continue to use it as a cloak—although it is no disguise, frankly—for intolerance. They should know better. They should look around and see that it is they who have got it wrong.

Railway Stations: Accessibility

Julia Lopez Excerpts

Wednesday 27th March 2019 Westminster Hall

[Dr Offord]

Having lived in Carlisle for several years, I am also aware of the hon. Gentleman’s constituency and his station. Like my station in Mill Hill, his was constructed at a time when disabled and step-free access was not a top priority. Similarly, Govia Thameslink and Network Rail were not aware of my constituents’ need and desire to have step-free access at Mill Hill Broadway station, so I sympathise with his point of view.

[Julia Lopez (Hornchurch and Upminster) (Con)]

Like my hon. Friend, I have a London constituency. As he knows, I am bidding to make Upminster station step-free. I can make the Access for All bid only because the station is operated by c2c rather than Transport for London, and the Mayor has said there is no priority for other stations in my constituency. Will my hon. Friend join me in encouraging the Mayor to invest more of his sizable budget in this area and to look carefully at my request to open up his new £6 million TfL drivers’ toilets to disabled travellers with RADAR keys? It would make a big difference to the quality of their journey if they were able to access facilities.

[Dr Offord]

As a London MP, I certainly agree with that and I urge the Mayor to allow it to happen. Indeed, I urge the Minister to make representations to the Mayor to allow it to happen. It seems not only a sensible solution to a particular problem, but something that could be rectified easily, so I certainly agree.

Not only disabled people suffer from a lack of step-free access in stations. A Department for Transport study showed that two thirds of disabled people are over the age of 65, and demographic trends predict an increase in the proportion of older people in society. According to the NHS, in the UK falls are the most common cause of injury-related deaths in people over the age of 75. The need for reliable, ever-present step-free access is imperative to ensure such injuries or fatalities do not occur in train stations. The Government’s generous funding commitment to improve station facilities is welcomed by Members present today, but I am sure we all agree that the previously mentioned statistics are of significant concern.

European Union (Withdrawal) Act

Julia Lopez Excerpts

Thursday 6th December 2018 Commons Chamber

[Julia Lopez (Hornchurch and Upminster) (Con)]

I recall, not long after the Chequers plan was announced, looking across the Chamber during Prime Minister’s questions and feeling a terrible sense of dread as I realised that the moment of reckoning was coming that could see this House completely out of step with the wishes of the British people. That moment is now upon us, with each and every parliamentarian facing a choice that could profoundly influence trust and faith in our democracy.

The EU referendum took place before 2017 MPs like me were elected. I approached that poll as a private citizen, with a genuinely open mind about the choice before us. The subject of Europe was never one that had consumed me. Along with countless British citizens, I thoroughly researched the issue and largely ignored the hyperbolic official campaigns. As I did so, I assumed that the facts would eventually stack neatly in favour of one choice or the other as I totted up the benefits and drawbacks of each. However, that never happened. I came to realise that the referendum was not a black and white issue with a correct answer, but fundamentally a judgment call about the future, a future that neither side could claim to predict.

I judged that the EU was going to have to politically integrate more deeply if the euro was to survive, creating an inevitable and potentially unbridgeable fissure with non-eurozone members. I saw an organisation that was unwilling or unable to change in the face of major crises at its borders and across its economies, a body that seemed ever more distant from the people it purported to represent and whose structure was neither nimble nor flexible enough to deal with the fast-changing global landscape. When attempts to renegotiate our relationship resulted in so little and when referendums in other nations had gone largely ignored, the notion that we might influence fundamental reform from within seemed more the triumph of hope over experience.

I was equally fed up with the habit of our own politicians of blaming the UK’s shortcomings on Brussels all the time. After the financial crisis and expenses scandal, faith in politicians seemed never to have been lower. I wanted greater accountability of the governing and to bring power closer to, and restore the consent of, the governed. I did not tell anyone else what option to choose, but I decided on balance to vote leave, in the faith and acceptance that whatever the result it would be implemented by those in power. Now I am an MP, I believe ever more, as I look across at a continent where people’s genuine frustrations are translating into political extremism, that Brexit gives British politicians the chance to shape today what could prove an uncontrollable democratic crisis tomorrow.

After my election, I supported the Prime Minister’s original Brexit strategy as set out in her numerous speeches: not to cherry-pick from the EU’s four freedoms, but, while leaving, to seek as wide-ranging and comprehensive a trading and security relationship as possible. I accepted that compromise would be necessary to get there and that aspects of the process would be complex. The Chequers plan, however, marked a turning point for us all. Far from pleasing either side, it united both remain and leave camps in its misguided attempt to achieve a half-in, half-out relationship with the EU. Once that plan had been roundly rejected by European negotiators and requests for a new direction were resisted, we were set on the path of the deeply flawed withdrawal agreement that we debate here today. With the clock wound down and no-deal warnings ramped up, this agreement is now being fought not on its merits but on the grounds that the Government have contrived to offer no better options. Under its terms, on 29 March, we technically leave the EU but enter straight into a transition period that will give us another two years of political discord, unable to move to the relationship we desire because we have given up all our negotiating leverage. The pretence that we should be able to strike free trade agreements of any value, win back control of our laws and fulfil the manifesto commitments upon which all Conservative MPs were elected, is, I fear, a collective delusion, with this agreement a clever ruse disguised as a sensible compromise.

It has been convenient to portray this battle as one that takes place exclusively within the Conservative party and to suggest that a small band of right-wing Brexiteers is holding the moderate majority to ransom. However, this is not about what Brexiteers want. The reason why this fight matters so deeply is that this withdrawal agreement is not consistent with what the British people voted for and it places us in a position unworthy of our nation.

2019 Loan Charge

Julia Lopez Excerpts

Tuesday 20th November 2018 Westminster Hall

[Julia Lopez (Hornchurch and Upminster) (Con)]

It is a pleasure to serve under your chairmanship, Mr Walker. I must begin with a little grovelling and apologise in advance for having to leave this debate for a Statutory Instrument Committee. I am grateful to you for allowing me to speak, and to my hon. Friend the Member for Wycombe (Mr Baker), who secured this debate. It is of great importance not only to my constituents, but to those of many other hon. Members.

My constituents are concerned about the 2019 loan charge. They have tended to work as contractors or freelancers in the IT and professional services sphere, and they are now deeply concerned that HMRC’s actions over the loan charge will place them in serious financial hardship, if not outright bankruptcy. They suggest to me that they were encouraged by professional advisers or the contracting companies themselves to enter special payment schemes, which were deemed legal and allowed for scheme users to be paid in the form of a loan rather than ordinary remuneration. Resulting from poorly drafted IR35 legislation, such schemes are now deemed by HMRC to be disguised remuneration that amounts to aggressive tax avoidance. HMRC is pursuing affected constituents at a time when many cannot easily recover their earnings.

My constituents fear that this action represents retrospective taxation, thereby undermining legal certainty and confidence in the tax system. They are also angry that the charge is being levied on contracting employees, despite a legal case involving Rangers, which judged the employer liable for any unpaid tax and national insurance. Given that for nearly two decades HMRC appeared to permit tax advisers and accountants to recommend the schemes without penalty, my constituents believe they have been let down by a system that should have alerted them to problems in a timely manner.

I have had a one-to-one meeting with the Financial Secretary on this issue in which he set out the Government’s position with clarity. I understand that scheme users will now be able to spread any payments to HMRC over five years should their taxable income this year be under £50,000. However, my constituents want to know why HMRC is not apparently being more robust in pursuing the tax advisers, accountants and contracting companies who took freelancers and contractors down this route in the first place.

One constituent told me:

“I decided to contract having been made redundant 3 times from what I considered safe and stable jobs. I have never in my life taken any state benefit. The only and main reason I signed up to a...scheme was because I felt that after a year as a self-employed person...the rewards did not justify the risks and with IR35...insisted upon by my employers”,

it seemed

“the only route open for me to improve my take home pay”.

He goes on:

“I am not justifying any shortfall in the tax...that I maybe should or could have paid, but Government and HMRC”

allowed

“schemes to flourish for years without redress...HMRC have chosen to inflict regular PAYE/NI rates, apply penalties and interest for open years and take no account of holidays, sickness benefits, pensions, training and out of contract time that freelancers have to finance themselves. Surely, even a concession on the rate being charged under the Loan Charge would be a fair and reasonable compromise?”

I must confess that without having access to the precise details of individual tax paid and the specifics of the schemes entered into, I have found myself caught between the concerns of constituents and the assurances of Ministers, who believe very strongly that the loan schemes clearly represented an illegitimate attempt to avoid tax. I fear, therefore, that the fairness and legality of HMRC’s actions will end up being determined in the courts by those with the tax expertise to look dispassionately at these matters. None the less, I wanted to raise these concerns in this afternoon’s debate in my role as a constituency MP, and I would be grateful if the Minister addressed the specific concerns that my residents have raised with me: namely, the apparent lack of action against culpable financial and legal advisers and employers, the calculation of tax owed, and retrospection in the tax system, which risks undermining wider confidence in the system.

[Mr Charles Walker (in the Chair)]

I call Janet Daby. You have four minutes, I am afraid.

Freeports

Julia Lopez Excerpts

Thursday 11th October 2018 Westminster Hall

[Julia Lopez (Hornchurch and Upminster) (Con)]

It is a pleasure to serve under your chairmanship, Mr Hanson. I appreciate the fact that my hon. Friend the Member for Middlesbrough South and East Cleveland (Mr Clarke) has injected some much needed energy into post-Brexit planning.

Brexit should be a moment of creative opportunity, when we begin to tailor our nation better to fit our citizens’ needs and ambitions. Leaving the EU was never going to be easy—I am not naive—but we in this House have spent two years engaged in a series of infertile, factional war dances, unable to unify around a vision that would allow us to plan properly for the future. Let us have more debates like this in which we set out fresh ideas that can deliver results for the people we represent.

Freeports, as other hon. Members have said, are special trading zones that are considered to be outside a country for customs purposes. Goods can enter and exit a freeport without incurring tariffs and the need for import procedures. That makes way for the import of semi-finished products, such as car parts, from other countries into the UK on special terms. Such parts can be modified or stored, to be re-exported as UK products. By themselves, initiatives such as freeports will not spark a manufacturing renaissance, but when integrated with local enterprise zones, they can help to create the conditions for manufacturing to thrive—particularly in northern towns, which for too long have lived in the shadow of our industrial heritage. The idea deserves consideration as part of a dynamic new trade strategy.

However, let us be truthful: we cannot have a meaningful, independent trade strategy if we remain in a de facto customs union with the EU. The notion that we can sign trade agreements worth having while contained within an indefinite backstop arrangement is, I fear, misguided. Time and again in the International Trade Committee, of which I am a member, and in meetings, international partners have expressed a genuine eagerness to engage in new trading arrangements and initiatives with the UK. They are excited about the re-entry of a major G7 player as an independent trading nation that can push an agenda on global standards and free trade. However, they advise us that it is impossible to start much of that work without a clear sense of the UK’s future trading arrangements with the EU.

Meanwhile, businesses tell us clearly that they simply want clarity, and then they will deal with whatever new arrangements come to pass. The outcome of our withdrawal negotiations must not leave us in a state of perpetual uncertainty. That would be hugely damaging to our nation’s economic interests, and I dare not contemplate how the public would feel if we advised that we had delivered on the referendum result while subcontracting regulatory policy making to our EU competitors. Contempt for the political class would surely deepen, with consequences for our democracy.

The EU has been criticised for vigorously protecting its own interests in this negotiation. Of course, it does not want a more dynamic competitor on its doorstep—I understand that—but we should be equally vigorous in defending our own interests. Freeports, free trade agreements, regulation and trade facilitation measures should all be part of a modern global trade strategy, but infrastructure investment and the manner in which we connect it coherently is also critical.

It may not be fashionable to champion investment in London in a Chamber full of non-London MPs, but the capital should be understood not as one rich haven but as a collection of very different regions, not all of which are thriving and not all of which have seen sustained investment over the years. Before containerisation and offshoring, London’s docks and manufacturers provided east Londoners with a range of opportunities for blue-collar work. By the ’60s, however, the docks began to close, leaving in their wake high levels of unemployment and the depopulation of docking boroughs. The redevelopment of the Isle of Dogs into London’s second financial hub, Canary Wharf, has been a staggering success, but many communities to Canary Wharf’s east still see the glittering office blocks as something very distant from their lives.

Today in Barking and Dagenham, one third of people are paid less than the London living wage. Meanwhile, parts of my own borough of Havering have a very low skills base. More than half of the adults in the borough do not have A-level-equivalent qualifications. Ford in Dagenham, which was once London’s biggest employer, stopped car production in 2002, and a workforce that was 40,000 at its height has diminished to 1,830.

Exciting things are happening in east London and the Thames Gateway, including the newish London Gateway port, Chinese investment in the Royal Albert dock, planned film studios in Dagenham and the arrival of the Barking continental freight railway. All these developments require a catalyst to bring them together and help the region and its people fulfil their huge potential. Perversely, although it is west London’s airport, that catalyst could be Heathrow, which is the UK’s biggest port by value, handling over £106 billion-worth of goods each year. Now that its expansion has been given the green light in Parliament, the airport’s executives want to build large chunks of the new expanded airport offsite at so-called logistics hubs, and then transport those components of the third runway to the site as and when they are required. With infrastructure projects like HS2 and Sizewell contemplating sharing those hubs, the bid that makes the final cut can expect an influx of cutting-edge engineering, research and manufacturing jobs to the area.

Havering has put together an exciting plan for a logistics hub at an 86-acre brownfield site next to the Ford Dagenham plant, which is a stone’s throw from Canary Wharf. As one of the borough’s three MPs, I am extremely excited by the opportunity that the plan presents for reigniting manufacturing in the capital. Superbly connected by river, rail, road and air, the site is next to an industrial estate with 70 logistics companies already there. It is near the ports of Tilbury and London Gateway, as well as the Barking terminus of the intercontinental railway, which, as I have said before, is part of China’s belt and road initiative. A housing zone is planned nearby and the adjacent Centre for Engineering and Manufacturing Excellence, as well as Havering College’s expanding construction campus, could train up local jobseekers.

The Havering-Heathrow hub could therefore have a profound impact in tackling deprivation, crime and unemployment in an area that has struggled to replace the kinds of blue-collar jobs that were formerly provided by the docks and the motor industry. Once the runway is built, the logistics hub could become a cargo processing centre.

We need to do imaginative things which will rapidly and effectively signal what kind of nation we seek to be as we leave the European Union. For instance, could a Havering hub be turned into an east London check-in point for Heathrow itself, taking thousands of car journeys away from the M25 and removing luggage from tube trains as passengers catch organised shuttles or dedicated rail services to the main terminals? A rail line already connects Ford’s Dagenham plant to Stratford, and the Abbey Wood branch of Crossrail could be extended by one stop to provide a direct route to the airport. The Thames could reclaim its glory days of transporting cargo—taking countless lorries off the roads—and acting as a link between air and sea freight terminals. All this would help reduce pressure on the communities around Heathrow airport. We could even explore the creation of a free trade zone from the cargo processing hub at Beam Reach—the logistics hub site—to the ports at Tilbury and Thurrock, which would finally unlock the regeneration aspirations of the Thames Gateway and supercharge the eastern region as a global trading portal that links London and the UK to the rest of the world.

The capital may have been thriving for those working in the service industries, but that has not been the case for many in blue-collar professions. As we leave the European Union, why not use the opportunity of the expansion of our biggest port, Heathrow, to restore east London’s illustrious heritage as a cutting-edge manufacturing centre?

No one aspect of our trading policy can be a panacea in diversifying our economy and making it deliver for people who feel left behind. Realigning our country to global ambitions will take time and cannot be done through free trade agreements alone—it is about infrastructure investment, trade facilitation measures, tax policy, regulation, freeports and other ideas coming together in one coherent strategy. But to maximise that strategy, we need control of our own regulatory and customs tax policy. Please, let us not pretend otherwise.

Finance (No. 2) Bill

Julia Lopez Excerpts

3rd reading: House of Commons & Report stage: House of Commons
Wednesday 21st February 2018 Commons Chamber

[Mel Stride]

Given the limited time remaining, I intend to focus most of my remarks on the amendments and new clauses that have been spoken to in this debate.

I shall begin with new clauses 7 and 8, which seek reviews of the operation of the SDLT exemption for first-time buyers. As we know, housing is one of the great challenges of our age. We all recognise—we certainly have done in this debate—the importance of the supply side, which is why my right hon. Friend the Chancellor, whom I am delighted to see on the Treasury Bench, made such important announcements about funding for more housing. We can now look at hitting 300,000 new build homes in the next decade. The point was made that the OBR suggested that prices may increase by 0.3% as a result of our SDLT measure, but that observation is based on that measure alone and does not take into account the supply-side measures we are introducing.

Amendments 10, 11 and 12 relate to taxis and the vehicle excise duty supplement.

[Julia Lopez (Hornchurch and Upminster) (Con)]

I wonder whether I might make a suggestion on the amendments to which my right hon. Friend just referred. Cabbies in my constituency have raised legitimate concerns about vehicle excise duty. If I have read them correctly, it seems that the amendments that have been tabled to clause 44 would make all taxis exempt from certain vehicle excise duty rates this year, rather than just the new, electric-capable vehicles. As my right hon. Friend knows from our discussions about taxis, I and other London Conservative MPs have serious concerns about air quality in the capital, so I would appreciate his view on whether it would instead be better if we brought forward by a year—

[Mr Deputy Speaker (Sir Lindsay Hoyle)]

Order. Sit, please. In fairness to the Minister, he has a very short time in which to speak. By all means make an intervention to get on the record, but please do not try to make a speech on an intervention.

Taxation (Cross-border Trade) Bill

Julia Lopez Excerpts

2nd reading: House of Commons
Monday 8th January 2018 Commons Chamber

[Julia Lopez (Hornchurch and Upminster) (Con)]

If we are to deliver Brexit, the UK needs to leave the customs union and establish its own customs regime. Without doing so, the UK will be precluded from striking its own free trade deals and left open to certain judgments from the European Court of Justice. I fear that those who believe we can honour the referendum result while staying in the single market or customs union are simply wishing to deliver Brexit in name only.

The Bill is widely drafted in order not to prejudice the eventual outcome of any deal we strike with the EU. It instead ensures that the UK can respond to its new status, whatever the circumstances in March 2019. That could include a no deal scenario—something that would represent a wasted opportunity of historic proportions on the EU’s part. Our Government have already made it clear that the UK wants to maintain free, frictionless trade with the EU and that they wish to maintain continuity with EU law at this stage on customs, excise and VAT to give businesses certainty.

There would be no need for chaos at customs or increased tariffs if our standalone regime could be linked closely to the EU’s, potentially in a new customs partnership. The question is whether the EU has the capacity to recognise its own interests and, more crucially, the interests of the people it governs. Until 2008’s financial crisis, global trade had been growing at up to twice the rate of global output for decades. Ever since, trade has slowed to be in line with, or sometimes below, growth in the global economy and political upheaval has followed.

As a founding World Trade Organisation member, the UK has long been a passionate advocate for liberalised trade. It is time to regain that leadership role and push back against the superficial allure of protectionism. The Bill sets the scene for that. While it introduces the potential for levying tariffs, giving us the tools to protect against dumping, it also allows us to adopt a unilateral trade preference scheme for developing countries to ensure trade further replaces aid as the primary poverty alleviation tool.

The Bill also aims to manage the flow of goods at our ports. Over the summer, I visited London Gateway, a state-of-the-art port in Essex with modern HMRC and Department for Environment, Food and Rural Affairs facilities and spare capacity. A logistical hub is being developed to deliver goods directly to London and the south-east rather than via midlands distribution centres. German grocer Lidl has already taken space there. The competition from nearby ports such as Tilbury, with its vast Amazon fulfilment centre, keeps freight costs low and ties into the Government’s ambitions to unlock the entire Thames Gateway with a new river crossing and more homes. This plan and these efficiencies strip out cost to retailers, helping to offset any potential increase in tariffs. Our customs systems are already highly efficient, but the Bill sets up an authorised economic operator scheme to indicate the fulfilment by exporters and importers of recognised compliance standards and makes provision for HMRC-approved warehouse operators. These measures should fast-track shipments. We now need to identify the sectors most exposed to any new cost and resource HMRC appropriately, which is what the Government are doing.

In my capacity as a member of the International Trade Select Committee, I would like to say something about tariff-free quotas. As an EU member, the UK is party to over 60 free trade agreements that permit our trading partners to export a certain volume of goods to the EU tariff-free. Along with the Trade Bill, this Bill provides the foundation for the continuation of these deals after Brexit. We hope that this grandfathering process will be straightforward, but our trading partners may use the opportunity to renegotiate terms, and rules of origin might add complexity to existing trade. Rules of origin define where a product was made and help to determine the application of quotas, preferential tariffs and trade remedies.

At present, the UK can export to the EU with no restrictions on the value of imported intermediates from third countries, and this will likely change once we are out of the customs union. Origin is generally conferred based on where a good was obtained or manufactured or where the last substantial transformation took place. Cumulation of origin allows for greater flexibility when using raw or semi-manufactured materials from certain third countries. Currently, as an EU member state, the UK benefits from the pan- Euro-Mediterranean cumulation zone.

Cumulative rules of origin may prove hard to negotiate, requiring trilateral discussion between the UK, the EU and the third country concerned. None the less, the UK’s departure from existing free trade agreements is not challenge-free for the EU either. Those FTAs were negotiated on the basis of access to an EU economy that included a UK market, which, in 2015, amounted to 17.5 % of the EU’s GDP, and which contains some of its most voracious consumers. If we withdraw that market from the FTA, there will inevitably be an impact on its functioning, if not on its legal character. The EU plans to remove the equivalent of the UK’s market share from the duty-free quotas that it offers its trading partners. Otherwise, EU domestic producers will have to compete with a greater inflow of tariff-free foreign goods. FTA partners, however, are understandably very unhappy at the prospect of a substantial reduction in their tariff-free quotas.

If the EU can think imaginatively and flexibly about a customs link to the UK economy, with potential agreement on rules of origin at least for a transition period, the potential problems of both sides can be addressed. The EU’s default arrangements relating to rules of origin are relatively liberal, and processes already exist for exporters to self-certify origins. Agreeing on those processes, and ensuring that businesses sign up to them now, should be a priority.

[Kirsty Blackman]

May I pursue the issue of tariff-rate quotas? Is it not the case that, even if countries receive the same amount in total—if they were previously able to distribute 100 tonnes of goods, and in future they could distribute 70 to the EU and 30 to the UK—they might challenge that on the basis that if the UK market collapses, they will not be able to transfer that amount to another country, as they currently can?

[Julia Lopez]

My point is that any issues relating to tariff-rate quotas will affect not just the UK but the EU, and it is therefore in the EU’s interests to try to reach an accommodation with the UK.

I welcome the Bill, which is about preparedness and which, given its wide drafting, allows for any negotiated outcome. I hope that it sets us up for a new chapter in our long history as a proud, global trading nation.