Brexit: Preparations and Negotiations

Lord Butler of Brockwell Excerpts

Monday 23rd July 2018 Lords Chamber

[Lord Butler of Brockwell (CB)]

My Lords, not for the first time in this House, I find myself in agreement with the noble Lord, Lord Bridges. I feel that, if we have to be critical of the Government’s White Paper, we have a duty to be constructively critical. It is very tempting for opposition parties and for remainers like me to be entirely destructive—and there is plenty of scope for it—but we have to remember that the Government and the EU are involved in a negotiation that is more important than any other in our recent history. This is not a political game.

I believe that the proposals in the White Paper on trade in goods are more realistic than the Government’s previous total rejection of the single market, because no other basis has been put forward that is credible as a means of achieving frictionless trade and the avoidance of physical checks at the Irish borders, including the Northern Ireland border.

The much-criticised acceptance of the common rulebook on goods has been described as a compromise, and indeed it is. For some people it is a compromise too far, and they fear that in the course of negotiations the Government will make further concessions, as they are described. I do not see it that way; I see the White Paper very much as a wish list, and the Government and the Prime Minister described it as ambitious. I doubt whether we will achieve all the objectives in the White Paper. Indeed, it might fall at the first hurdle of securing EU agreement to our collecting EU tariffs on its behalf—although I hope that it does not. But I do not see failing to achieve all the objectives as the same as making further concessions.

One area where sceptics fear further concessions is on immigration policy. I hope that we will have an immigration policy that is liberal enough to admit people whom our economy and public services need. But the Prime Minister is surely right that the White Paper respects her red lines by making it clear that it will be our decision. EU rules already provide that EU citizens who wish to live in another member state must be able to find work or be self-sufficient. I regard it as a tragic irony that our Government have never sought to apply those requirements, which would have satisfied the concerns of many who voted for Brexit because of their concern about EU migration.

I am determined to observe the advisory time limit, so, as a member of the House’s EU Financial Affairs Sub-Committee, I will add just one thing about financial services. I think that the noble Lord, Lord Davies, and the noble Baroness, Lady Smith, were a little unfair to the White Paper in saying that it had nothing to say about financial services or that it had abandoned them. The White Paper proposes that in this area, which is so important for the UK, we should rely on achieving an agreement for what is described as “enhanced equivalence”.

The EU sub-committee has hitherto taken the view that equivalence is not a satisfactory basis for our relationship because it does not provide long-term reliability for financial service providers. The Government no doubt feel that access to UK financial services is sufficiently important to the EU that it will agree to an enhanced regime. I was therefore disappointed to see in the Financial Times this morning that Monsieur Barnier was quoted as having ruled out the possibility of enhanced equivalence in his remarks on Friday on grounds that I regard as specious—that it would infringe too much on the EU’s ability to make its own regulations. I believe that the EU could be more flexible about that, and I am comforted by the fact that Mr Barney Reynolds of New Direction has published a pamphlet arguing that an agreement for enhanced equivalence along these lines should be easily negotiated. Indeed, he has published a draft EU regulation for it. Can the Minister tell us whether the Government have seen Mr Reynolds’s pamphlet and whether they agree with it?

I feel that, if we are to leave the EU, we have a duty to be constructive about the proposals in the White Paper. As the noble Lord, Lord King, said, quoting the Times and Winston Churchill, the proposals in the White Paper might be the worst basis for negotiations apart from all the alternatives. Having said that, I have never disguised from the House my view that, despite the manifold imperfections of the EU, it would be better for the UK, the EU and the world if we were to withdraw our notice under Article 50 and join in reforming the EU from within.

--- Later in debate ---

[Lord Butler of Brockwell]

Nor did I mention it today.

[Lord Mandelson]

I should have been on that list.