Trade Bill

Lady Hermon Excerpts

Tuesday 9th January 2018 Commons Chamber

[Dr Fox]

First, the fact that there is a large EU trade surplus with the UK is one reason why it is in the interests of the EU to want a good and open trading agreement with the UK. Secondly, on my hon. Friend’s point about the direction of travel, it is certainly true that the proportion of UK exports that go to the EU has diminished from some 54% at the beginning of the millennium to about 42% today, so it is already true that the UK is exporting into other growing parts of the global economy.

[Lady Hermon (North Down) (Ind)]

I want to bring the Secretary of State back to legislative consent. He gave some advice to the SNP Members, but he has more difficulty in Northern Ireland, where we have not had a functioning Assembly for a year. That is totally frustrating for the people of Northern Ireland, but how do the Government think they are going to obtain legislative consent from the Northern Ireland Assembly—or are they preparing for direct rule in Northern Ireland? It is one or the other.

[Dr Fox]

The hon. Lady gives me a good opportunity to pay tribute to my right hon. Friend the Member for Old Bexley and Sidcup (James Brokenshire), who stood down from the post of Secretary of State for Northern Ireland yesterday, for his work in trying to achieve a deal in Northern Ireland. We all hope that there will be a functioning Government that the UK Government are able to deal with, because it is in the best interests of all concerned in Northern Ireland that we get a functioning democratic Government in Stormont.

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[Dr Fox]

My right hon. Friend is right. That agreement was the first multilateral trade agreement for decades, which shows how difficult it is to get such multilateral agreements. It does reduce friction for customs arrangements worldwide, but although, as he said, the benefits are great, it is still in the best interests of the UK to come to an open and comprehensive trading agreement with the EU itself.

The Bill provides powers for HMRC to collect and share trade data, as has been mentioned. Those powers include the one in clause 7 that allows primary legislation to be amended to provide for HMRC to collect exporter information. Clause 8 will grant HMRC the authority to share data with those bodies that require those data to carry out a range of public functions relating to trade. Currently, HMRC collects a range of data from import and export declarations that is shared with the European Commission, as well as with other Departments and public bodies, under information gateways governed by EU law. Such gateways will, of course, cease to apply once we leave the European Union, and numerous functions that are currently carried out by the European Commission will be transferred back to the United Kingdom. HMRC will therefore need to be granted the legal authority to request data from exporters and share that data to ensure the continued smooth operation of the UK’s trade frameworks and clear and informed policy making from my Department, as I said to the hon. Member for Livingston (Hannah Bardell). The powers in clauses 7 and 8 will grant that authority, and nothing more.

[Lady Hermon]

rose—

[Dr Fox]

I give way once more to the hon. Lady, whose charms I cannot resist.

[Lady Hermon]

Thank goodness I am blessed with bundles of patience. I am exceedingly grateful to the Secretary of State for giving way. I am really worried about clause 7, which is extremely broad and gives enormous powers to HMRC. The Secretary of State will be well aware that there are hundreds of farms that straddle the border in Northern Ireland. Under clause 7, if those farms trade in machinery and cattle across the border—as they do daily—they will be obliged to give information to HMRC. The clause says that “any person” may be asked for such information. Would Sinn Féin MPs who represent border constituencies be obliged to give HMRC such information, as well as farmers?

[Dr Fox]

When we discussed this proposal with the Treasury and HMRC, we were keen to ensure that it applied to information related only to those elements needed to continue what we currently do and to gain the information that we believe we need for better trade policy making. HMRC was insistent that before it made any changes we restricted the power as much as possible, because HMRC did not want to become a huge bureaucratic organisation, as the hon. Lady suggests. We intend to define the power tightly when we set the regulations. I have had discussions with HMRC on the basis that we will not want to carry out a hugely bureaucratic exercise. Nevertheless, it makes sense for us to know exactly how much we are importing and exporting and which businesses are doing that. That is the basis for good future policy making.

The time will come when we can begin to forge new trading relationships around the world, building a truly global, outward-facing Britain—a country at the very heart of international trade—but this Bill is not about those new relationships. Instead, it is about preserving and ensuring continuity. We want to protect the access to global markets that is so vital to thousands of British businesses. We want to abide by our obligations to those economies that have already negotiated free trade agreements and other trade agreements with the European Union. The Bill grants us the powers necessary to achieve those aims.

We present the Bill for Second Reading with an eye to the future. It is explicitly designed to prepare for our departure from the European Union, while building the foundations that will facilitate successful future trading relations with the wider world. I hope Members from all parties recognise the value of the Bill and the measures it contains, as well as its importance in helping to provide much-needed certainty to businesses and consumers as our departure from the EU next year approaches. Trade is an issue that transcends party politics: it is an intrinsic part of our very way of life and our prosperity. The Bill is just the beginning, but it is a first step towards a stable, secure and prosperous future for the United Kingdom and our friends beyond.

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[Hannah Bardell (Livingston) (SNP)]

It is a pleasure to speak on behalf of the Scottish National party. I will do my best not to take up too much of your or the House’s time, Madam Deputy Speaker.

The UK Government have an opportunity in the Bill to show leadership, to engage widely and to consult with devolved nations, business and other stakeholders about what should be contained within it, but it seems like a paper-thin effort—and not a very great effort at that. Given the magnitude of Brexit and its potentially damaging ramifications, this pretty paper-thin Bill is an affront to democracy and lacking in any real detail—not a great start as we enter this new territory.

A hard Tory Brexit would be disastrous for the economy and completely undermine the Scottish Government’s efforts to boost Scotland’s trading position. We found out just a few moments ago that the UK Government have dropped their promise to amend devolution aspects of the European Union (Withdrawal) Bill and that they plan to do it in the House of Lords. That is shameful, because the Secretary of State for Scotland made a promise on the Floor of the House to the people of Scotland and Scottish MPs.

We have significant concerns about trust in the Government and about whether they can stick to their word. Regarding withdrawal, the Scottish Parliament should not have its powers in any way diminished. As we know, the Government cannot be trusted. The Law Society of Scotland, for instance, says:

“We are concerned by the extensive scope of delegated ministerial powers under the Act, mirroring concerns previously identified in relation to the use of Henry VIII powers in the context of the European Union (Withdrawal) Bill. It is not clear why the Government considers such wide powers to be necessary.”

It would be interesting to hear from the Secretary of State what his take on that is. In its excellent briefing, the Law Society of Scotland refers to “Clarity of drafting”, which it says is

“central to good law-making.”

It says:

“Under clause 2(2) an international trade agreement means a ‘free trade agreement’, however ‘free trade agreement’ is not itself defined.”

That is a very important point. In all these discussions about free trade agreements, the actual definition is not given. The briefing points out that clause 2(2) also

“refers to ‘an international agreement that mainly relates to trade, other than a free trade agreement’. However, ‘mainly’ does not grant sufficient certainty in terms of interpretation.”

I am no legal eagle, but I am sure that my hon. and learned Friend the Member for Edinburgh South West (Joanna Cherry) will give us her take on matters later.

[Lady Hermon]

There is a very significant omission from the definition section in clause 4, which relates to Northern Ireland. When I asked the Secretary of State about that in an intervention, he repeated the Government’s mantra that there is hope of restoring the Northern Ireland Executive. If there were indeed that hope, one would expect to see some reference to the devolved authority meaning the First Minister and Deputy First Minister, hopefully acting jointly, but there is zero mention of those Ministers. The clause defines a devolved authority as “a Northern Ireland department”. The Government, I suggest, are clearly preparing for direct rule, and I am deeply concerned about that.

[Hannah Bardell]

I share the hon. Lady’s concern. It seems very much as though the Government are making policy on a wing and a prayer.

It is just over 20 years since the people of Scotland voted for devolution, for progress, to move forward and have power over some, but not all, of their own affairs. In 1997, voters in Scotland backed the creation of a Scottish Parliament by 74% to 26% and voted by 63% to 37% for it to have tax-raising powers—powers that we are very proud to be using.

The Scottish Parliament’s pillars of establishment include accountability: it is answerable to the people of Scotland. It should be open and encourage participation. It should be accessible, and should involve the people of Scotland in its decisions as much as possible. I remind the House of that not to give a history lesson, but to highlight what the people of Scotland voted for and what was delivered in devolution, on a cross-party basis. This Bill, and more generally Brexit, are not what Scotland, or indeed the rest of the UK, voted for. The Bill threatens devolution in Scotland, and it threatens the vote that took place 20 years ago.