European Affairs

Justin Madders Excerpts

Thursday 15th March 2018 Commons Chamber

[Justin Madders (Ellesmere Port and Neston) (Lab)]

There is an old saying that nature abhors a vacuum. Similarly, business abhors uncertainty, and in no industry is that more true than in the automotive sector. As the Government’s sector report makes clear, investment decisions and sourcing choices in the industry are often made by European or global headquarters, and the continued uncertainty about training arrangements are making it ask serious questions about whether it will invest in this country in the future.

Uncertainty across a sector can have a real impact, particularly in communities such as mine where the sector represents a big chunk of the jobs market. The Vauxhall Motors factory in my constituency is currently facing huge uncertainty. Until recently, it employed 1,800 people directly, with many more jobs in the supply chain, so there is no doubt that it is of pivotal importance to the area I represent. How such companies fare in the post-Brexit world will decide how I and my constituents judge the Government’s handling of the negotiations, because when it comes to the crunch, what happens on people’s doorsteps is what really matters to them.

The key choices about Vauxhall’s future rest in the hands of its owners, PSA, which is based in France. We know from decisions already made that it shows no sentiment. We have already lost about 700 jobs since it took over, and these job losses are extremely serious. We are told that they are a reaction to market conditions, with a decline in sales of the Astra. Market conditions are not of course within the gift of the Government, but what is within their gift are the conditions within which business can trade, and this is where the Government really need to start listening to the industry—and acting. Traditionally, the automotive sector makes investment decisions about three to five years in advance, so decisions about investment in a post-Brexit world will be made shortly. The current model in production in Ellesmere Port is due to be discontinued at about the same time in 2021. The chief executive of PSA recently told the BBC:

“We cannot invest in a world of uncertainty”,

so now is the time for the Government to provide them with that certainty.

The automotive sector, as we know, is one of the most productive and successful we have, directly or indirectly employing over 800,000 people and generating almost 10% of the country’s manufacturing output. We know that about half of all UK car production is exported to the EU, and that figure rises to 70% to 80% for vehicles produced at the Vauxhall plant in my constituency. The Business, Energy and Industrial Strategy Committee recently found that

“leaving the EU without a deal would undoubtedly be hugely damaging to the UK automotive sector, more so than to other European countries.”

It concluded:

“Overall, no-one has argued there are advantages to be gained from Brexit for the automotive industry for the foreseeable future.”

Now that we are leaving the EU, it is important to recognise that this is one of our most vulnerable sectors, and there is no upside for it. We therefore need to do everything possible to safeguard jobs and investment. History shows us that once manufacturing jobs are lost, they very rarely come back. So far the response from the Government has been inadequate and complacent, and the sense of denial is palpable.

Of course, it was never meant to be this way. Both during and after the referendum, too many people have exaggerated the simplicity of all this. The Brexit Secretary assured us that we would soon be able to access

“a very, very large trade area, much bigger than the European Union, probably ten times the size”,

despite the fact that if it was that big, it would cover an area twice the size of the planet. The Foreign Secretary promised us that without

“the job-destroying coils of EU bureaucracy we can survive and thrive as never before.”

The International Trade Secretary said that securing a UK-EU trade deal would be

“one of the easiest in human history”.

Yet even with such esteemed and self-confident people negotiating on our behalf, we still do not know— 629 days after the referendum—what the deal will be.

When Cabinet Ministers are pressed on these issues, I have seen them bluffing complacently with dangerous fantasies about the promised green and pleasant land that will apparently emerge before our eyes without any effort being invested. The Prime Minister in her Mansion House speech said that new trading arrangements would need good will to succeed, but that sounds more like crossing one’s fingers and hoping for the best. My constituents’ jobs need more than that and the people who employ them need more than that to invest, so the Government need to understand that the once proud automotive heritage will be lost to the past unless we can secure its future. This is an industry that will survive and flourish only if we are prepared to fight for it. Even if it turns out to be the simple negotiation that the International Trade Secretary promised us, he needs to realise that for there to be an automotive sector in this country that will continue to trade with the rest of the world, it needs to be protected now, so the Government must act.

For me, a commitment to a customs union is the only sensible way to restore certainty and confidence, not some vague and ill-defined customs partnership that may or may not be the same as it is now. We know the argument about how a customs union will have an impact on future trade deals elsewhere, but I do not think that getting a couple of quid off trainers from China is actually a price worth paying for the destruction of the UK car industry. In response to a written question from me about which non-EU countries had been identified as the best ones for future trade deals in the automotive sector, the Minister for Trade Policy said:

“We are working with a number of other countries to explore the best ways to develop our current trade and investment relationships”.

That did not tell me anything, including about whether there are any such opportunities outside the EU.

If it is a choice between preserving trade with up to 80% of our existing customers, as against perhaps getting some new business with some unspecified countries at some unspecified time in the future, I know what every person with an ounce of common sense will choose. The choice for the Government is clear, and if they make the wrong one, we will never forgive them and we will never forget.