Brexit: Deal or No Deal (European Union Committee Report)

Lord Cavendish of Furness Excerpts

Tuesday 16th January 2018 Lords Chamber

[Lord Cavendish of Furness (Con)]

My Lords, it is a pleasure to follow my noble friend Lord Taylor. I enjoyed hearing his warnings on the fate of empires.

Another day, another report from the European Union Committee. I am delighted to thank its members for the time and industry they have devoted to the subject and I thank most warmly the noble Lord, Lord Whitty, who is nearly in his place, and associate myself with the remarks of the noble Lord, Lord Jay, who always brings a polite and helpful tone to debates. Beyond that, I can think of absolutely nothing to say in support of this report or its findings. I also say with sadness that I find aspects of the report to be really disgraceful and unworthy of this House.

EU committees have been markedly Europhile for as long as I can remember. As a member of two of them, I recall that any and all criticism of EU institutions was virtually taboo during our hearings. I do not press this complaint too far since I acknowledge that the membership of the EU committees come close to reflecting the views of your Lordships as a whole. However, I find the report so blatantly hostile to Brexit and so uncritically in favour of the EU that those parts of it which address such legitimate concerns as say, open skies, customs arrangements and, especially, security are accordingly devalued and trivialised.

In paragraph 9 of its summary of conclusions and recommendations, the report goes so far over the top as to trespass into fiction. As has been much quoted, it says of having no deal that it is difficult, if not impossible,

“to envisage a worse outcome for the United Kingdom”.

As many people have pointed out—and as I do, too—that is simply untrue. I can think of innumerable outcomes worse than no deal. Leaving the EU but staying in the single market and the customs union would, I venture to suggest, be a far worse outcome.

Mention has been made made more than once of what the authors refer to as the overwhelming evidence that led to their conclusions. Not only is the committee’s choice of witnesses scandalously selective; reading the transcripts, I was appalled by how little those witnesses were tested. Take for example the CBI, which said in its evidence that its views are a reflection of its membership. Well, I am a member and I certainly do not share its views—a point I often put to it. The truth is that it is a hostage to its major subscribers. Less and less does it represent the SME sector, which I happen to belong to and as such declare my personal interests as listed in the register. Our sector is the real driver of the British economy and it gets no mention at all that I could find. Nor did I find in the transcripts a declaration of the CBI’s interest in respect of the money it received from the EU. But then again, perhaps special privileges apply to it as they apply to others in respect of European affairs. The CBI now enjoys a reputation for being wrong on almost everything; it comes as a surprise that so much weight is given to its testimony.

While it is true that the committee heard evidence from Ruth Lea and from John Longworth, co-chairman of Leave Means Leave, again it comes as a surprise to me that nothing was heard from such distinguished independent voices as Roger Bootle or Professor Patrick Minford. Did it occur to the committee, I wonder, to invite some of our more successful entrepreneurs such as James Dyson to give evidence? No—the committee heard what it wanted to hear.

I do not pretend to be entirely happy with the way that negotiations have gone—here I echo the noble Lord, Lord Teverson—and am certainly not happy with how much we appear to have given away, with not much to show in return. One must sympathise with the Government in trying to run these talks against the background of a chorus of those who seek to reverse the referendum result and want to undermine the Government at every turn. I have also heard the story on good authority of how, during David Cameron’s negotiations before the referendum, every single Commissioner was briefed to the effect that there was a zero chance of Britain voting to leave the EU. It reminds me of the First World War joke about a man walking up Whitehall, looking in confused fashion left and right, and eventually flagging somebody down and saying, “Excuse me, which side is the Foreign Office on?”. “Ours, I hope”, comes the reply. What has changed?

The report says that the policy of nothing is agreed until everything is agreed should be abandoned. A huge amount has been made of this by supporters of the report but, according to my research, unless I am wrong, those words appear in a document in response to the Prime Minister’s Article 50 letter to President Tusk. Those words appear in President Tusk’s letter. That completely demolishes the arguments of about five noble Lords who argued in support of this report.

Where the report is right is that time is very short. In recent weeks, I have begun to notice that some blue water is beginning to emerge between the EU negotiators and the member states, and here is the rub. I tend to agree with the former Greek Finance Minister, who told Radio 5 Live:

“Brussels does not want a mutually advantageous deal and London has not realised it ... the fallacy lies in the presumption that those who are conducting the negotiations from Brussels and their political masters in Berlin and Paris, are interested in an economic outcome. They’re not. They’re far more interested in making an example of Britain so that others around the European Union get a lesson that anyone who opposes their authority gets crushed”.


Perhaps noble Lords would prefer from nearer home the words of the former Governor of the Bank of England, Mervyn King, the noble Lord King of Lothbury, who warned that the talks are a waste of time:

“The European Union is a political construct and they have political objectives ... I think the idea that we’re going to get soft treatment from the rest of the EU is false”.


The committee discussed the question of whether politics trumps economics or vice versa but reached no conclusion. I found from the transcript that the chairman mused that arguments over the primacy of law or politics will continue. How right he is. It certainly complicates the Government’s task that so many political and economic forces are self-evidently at work here.

If I understand correctly, the distillation of the committee’s recommendations is that we should apply for time-limited extended membership of the EU to hammer out every last bureaucratic detail, paying in as we pay in now, constrained as we are constrained now but with much reduced influence. It leaves no one on either side of the argument in any doubt that the committee ultimately wants us to stay in the EU permanently. As other noble Lords have said, the committee needs reminding that the people and Parliament have spoken and it ill befits this unelected House to try to reverse that decision. It is a course I reject, and I hope it is a course that the Government also reject.

The report underestimates all the benefits and opportunities of leaving the EU, that ossifying, free-trade-hating organisation. It exaggerates all the risks. A conceit among the political and official class is that they somehow have great influence over trade. They have nothing of the kind. I look back on my experience of half a century of trading in some 40 markets of the world. I have never craved certainty or expected it. Markets suddenly collapse and I have to find other markets. Customers are the thing I look for, and that is what I get. Over that long period, I have almost always ignored what Governments said about trade. We have nothing to fear from leaving the EU. I fear that the EU negotiators will put politics ahead of economics, which will bring delays. There must therefore be a case for walking away politely sooner rather than later and starting a new life under WTO rules with the aim and ambition of becoming a new world pioneer in free trade.