Outcome of the European Union Referendum

Lord Howard of Lympne Excerpts

Wednesday 6th July 2016 Lords Chamber

Adjourned debate on the Motion of the Lord Privy Seal (Baroness Stowell of Beeston) that this House takes note of the outcome of the European Union referendum.

[Lord Howard of Lympne (Con)]

My Lords, the main reason why I want to leave the European Union is because I want to restore as the supreme constitutional authority in our country the Parliament and the Supreme Court of the United Kingdom, both of which are at present subordinate to the institutions of the European Union, including the European Court of Justice. I greatly look forward to the day when we become an independent, self-governing country again, in common with practically every other country in the world except the remaining members of the European Union.

I want to concentrate my remarks on my view of the objectives we should seek to achieve in the negotiations for our exit. I am very confident that our country has a bright future—a much brighter future—outside the European Union than inside it, but to secure that future we first have to sort out our relationship with the European Union. I do not believe that that process need be anything like as complicated nor take anything like as long as is sometimes predicted.

This whole subject has been bedevilled by the confusion which exists over the single market. The term “access to the single market” is often used to mean participation in or membership of the single market, but the two are of course quite different. We do not need nor should try to remain participants in or members of the single market. The advantages of membership have been greatly exaggerated, as was pointed out yesterday by my noble friend Lord Lamont. In any event, it seems as though the European Union would not agree to our continuing membership without requiring the continuation of freedom of movement.

Access to the single market is a very different matter. Everyone has access to the single market. The Foreign Secretary was quite wrong to say in his article in Monday’s Telegraph that there is a range of outcomes between no access and full, unfettered access. No one has no access; the question is on what terms this access is to be agreed. The range available to us extends from access on WTO terms—probably the worst available option, but not a disaster—to access with a no-tariffs free-trade agreement.

A free-trade agreement is eminently achievable. In fact, all non-EU countries in Europe, except Belarus, have free-trade agreements with the European Union. It is manifestly in their interests as well as ours, and not just because they have a large surplus in their trade with us. Consider a company such as BMW. BMW not only exports very large quantities of cars to us; they also export large quantities of Minis from the United Kingdom into the European Union. BMW, which is very important to the German economy, is hardly likely to allow the German Government to agree to a deal which impedes this two-way flow.

Of course, any exports into the European Union would have to comply with the regulations of the single market, just as exports to the United States or Japan or China have to comply with their regulations. The vast swathe of our economy which does not export to the European Union would be freed from the regulations of the single market. That would be a considerable advantage. It would also mean that we could decide for ourselves whether and to what extent we should change or abolish the tariffs we currently charge, under European Union rules, on goods from the rest of the world.

Concern has been expressed about the position of the City of London, but, as Barnabas Reynolds, partner and head of financial institutions and regulation at the prominent law firm Shearman & Sterling, has said:

“The vast majority of banking and investment banking activity should be largely unaffected even in the worst scenario, and the ultimate situation is likely to be considerably better than that.”

One of the reasons is that the UK is currently compliant with the regulations and directives which govern the provision of financial services in the European Union. This makes the basis of a trade deal simple: so long as neither party changes the relevant rules, passporting will continue after exit in the same way as before. This would give both parties the right to change the rules in a relevant area, bearing in mind that a rule change might affect the continuing passporting rights of those businesses which export from the UK to the EU or vice versa. There is every prospect of a negotiation which would reach an outcome which is perfectly satisfactory to both sides.

I will say a word about immigration. During the debates on the referendum, I frequently made the point that the referendum should not have been about the level of immigration into our country. It should have been, and to a large extent was, about who should decide the level of immigration into our country. There are those who think we need our current level of immigration. Others differ. Let us argue it out and decide it here in this country as does every other country in the world except the members of the European Union and Norway and, for the moment, Switzerland.

As so many of your Lordships have said during this debate, let us not begin to entertain any suggestion that immigrants who are here legally, including those from the European Union, should be used as bargaining chips. That is a matter of common, simple decency. I do not believe for a moment that any of our European neighbours will want to round up and deport citizens of the United Kingdom who live and work within their borders. If I am wrong, and they do, let them wear the badge of shame which will for ever be associated with such actions. Let such a badge of shame never be allowed to besmirch the reputation of Her Majesty’s Government.

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[Lord Paddick (LD)]

My Lords, I have been asked to contribute to this debate with regard to the law and order impact of the decision by the British people to leave the European Union. I make it clear from the outset that I want to be positive and helpful in pointing out the areas where I believe the Government need to focus. I do not believe in Project Fear, and my record shows that I never did—but, for the record, I supported and voted for the UK remaining in the European Union.

My understanding with regard to the exchange of highly sensitive intelligence relevant to national security and the combating of terrorism is that it tends to be shared on a bilateral basis with some of our European partners and not others. I see no serious impact on those bilateral arrangements as a result of us leaving the EU. But the same cannot be said with any degree of certainty about the sharing of other intelligence in relation to serious and cross-border crime, the operation of the European arrest warrant and the operation of Europol. For example, until recently, the UK Government decided not to participate in the Prüm Decisions. This EU agreement allows member countries to rapidly match unlimited numbers of fingerprints and DNA profiles found at crime scenes with databases held by other member countries and to check foreign vehicle registration plates. Although we have agreed to participate now, there is at least a two-year lead time. The recent decision to join in this initiative is now in jeopardy unless the Government can make alternative arrangements. There are existing routes to carry out these checks through Interpol, but these take weeks and sometimes months instead of seconds—or, at the most, 24 hours—using Prüm. Will the Minister ask the relevant team how we might secure the advantages of participating in Prüm despite leaving the EU?

No doubt the Government might say, as the noble Lord, Lord Howard, said this afternoon, that it would be in the interests of both the UK and EU member states for such co-operation to continue. Conversely, EU member states may argue that we should not be able to enjoy all the benefits of EU membership without being a member.

[Lord Howard of Lympne]

Does the noble Lord not agree that actually our European neighbours—still partners but about to be erstwhile partners in the European Union—benefit enormously more from those arrangements than we do? They make many more requests to this country for co-operation then we make to them, so they would be the losers if these constructive co-operative arrangements were not to continue.

[Lord Paddick]

Clearly, both the UK and the European Union would be the poorer without having these arrangements, but at the present time we are not members of the Prüm agreement. Therefore, we do not benefit at all from this rapid exchange of data, whereas other members of the European Union do. I cannot personally foresee how we are then going to become a member of the group that shares in those tremendous benefits when we are outside the European Union unless the Government can negotiate a deal.

Europol has been important in tackling cross-border crime. Close European co-operation to deal with such serious crimes as child sexual exploitation is essential. Europol, headed at the moment by a UK citizen, has successfully facilitated joint operations involving police forces from many EU countries. These joint operations may no longer be possible unless alternative arrangements are put in place. The European arrest warrant has been valuable in bringing people swiftly to justice, including terrorists who have fled the UK. Will the Government explain how they will prevent southern Spain from becoming a haven for fleeing fugitives, as it was before the European arrest warrant came into force?

This House has on many recent occasions debated the issues around racism and xenophobia, and the status of EU nationals currently resident in the UK and of British residents currently resident in the EU. Many noble Lords have concluded that the EU referendum has given people the confidence to give effect to feelings harboured for some time. What action will the Government take to tackle the root causes of such feelings and to restore a climate where racists feel unable to act?

Another difficult issue that needs to be addressed is the one mentioned by the noble Lord, Lord Hain: that of the border between Northern Ireland and the Irish Republic. There appear to be conflicting principles. If the principle of free movement of people within the EU, including the Irish Republic, is no longer to apply to the UK, but the free travel area enjoyed by UK citizens and citizens of the Irish Republic, but not other EU citizens, is to remain, I urge the Government to address now the question of how the border is to be controlled in such circumstances.

Parliament passed legislation to delegate to the British people its power to decide whether the UK should be a member of the European Union. The British people, by a majority democratic vote, decided that we should leave the European Union. I believe that we cannot now decide that we want to take that power back just because we do not like the result.

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[The Minister of State, Foreign and Commonwealth Office (Baroness Anelay of St Johns) (Con)]

My Lords, this has been an extraordinary debate, in the best sense of the word, and one that befits one of the most significant democratic exercises in our history. It is the first occasion on which this House has had the opportunity to reflect at length on the implications of the decision by the electorate that the UK should leave the European Union. The tenor of the speeches around the House has displayed a range of emotions, from anger at the result from many, to delight at the result from some. We have heard passionate advocacy for particular future policies, thoughtfulness and some degree of optimism for the future.

This will not be the last opportunity for all of us to contribute our expertise to the consideration of the terms on which the United Kingdom will leave the European Union. I anticipate that we will benefit from the reports of our Select Committees, and that the usual channels will consider the matter of making time available for debates. But it does not stop there. Indeed, my noble friend the Leader of the House is already engaging actively with the noble Lord, Lord Boswell, to consider how best the EU committees of this House can play their part throughout. I welcome the fact that our European Union Select Committee hopes to publish its initial views before the Summer Recess, and has already taken evidence from my right honourable friends Oliver Letwin and David Lidington.

Hearing the opinions of all noble Lords and benefiting from their expertise are of great value to the Government. Over the past two days we have heard from 114 noble Lords. Unusually for me—I hope noble Lords will understand this—I will not do what I usually do. I do like to refer to every noble Lord by name—I am known for it—but I will not do that this time. I apologise, but I tried this out on my husband the other night. I read out the list of names, and I realised that, even without names as long as mine, it would take me nearly nine minutes just to say the names once, even without referring to the issues. So I offer my apologies. I might just break that rule at the very end of my speech, though, because I would like to refer to one particular matter that I heard about yesterday.

As the Leader said in opening the debate, she and I are here primarily to listen. That has been a tremendous privilege throughout these two days; thank you. I will seek to reflect on the key issues raised by noble Lords.

It is clear that the majority of the British people did vote to leave the European Union. Noble Lords from around the House have made the point, however, that we should never forget that just over 48% of people who cast their vote wanted us to remain a member. The priority must indeed be to make the decision work for everybody in the United Kingdom, whichever way they voted. The implementation of this decision will not be straightforward: we have already seen that there will be adjustments within our economy, and they have continued overnight. There are complex constitutional issues to consider, and there will be a challenging negotiation to undertake with Europe. However, our guiding principle throughout will be to ensure the best possible outcome for all British people.

With this in mind, I shall address first the process of implementing the decision. That is, of course, the matter of Article 50 and what it entails. There has been much debate over the last two days about the route by which the UK will leave the European Union. Several noble Lords expressed reservations about whether, indeed, we should leave. The Article 50 procedure is the only lawful route by which the UK can leave the EU. Our own European Union Committee’s report on the process of withdrawing from the EU, published on 4 May, made clear:

“If a Member State decides to withdraw from the EU, the process described in Article 50 is the only way of doing so consistent with EU and international law”.

My right honourable friend David Cameron has made it clear that it is for the next Prime Minister to decide when to trigger Article 50 and start the formal and legal process of leaving the EU. This was clearly understood and respected by the most recent European Council. A considerable part of this debate has understandably focused on the role of Parliament in the Article 50 process, and I was pleased to hear all contributions on this matter.

In law, Article 50 explicitly recognises that a member state may decide to withdraw in accordance with its own constitutional requirements, so it is for the member state concerned to determine what those constitutional requirements are. In the UK there is no legal obligation to consult Parliament. In law—I emphasise that—the Government alone can trigger the Article 50 process under their inherent prerogative power to conduct foreign affairs, which includes the power to withdraw from a treaty or international organisations. But, as the Prime Minister said, we now have to look at all the detailed arrangements and Parliament will clearly have a role in that, making sure that we find the best way forward. I realise that Parliament will have a variety of views, just as we have heard a variety of views over these two days. It is that richness from noble Lords that we need to hear.

Some have argued that there should be an Order in Council or an Act of Parliament before withdrawal from the EU takes place. Noble Lords have indicated that there may be legal challenges on these matters. If that does happen and there are legal challenges, I will not be able to comment on those specific events but we can talk later in other debates about the general range of powers that are around. It is important to note that the Prime Minister has recognised that Parliament will have—does have—a role. The views expressed by Members of both Houses provide important advice to the Government, and the Government listen.

Further debate is focused on the timing of an application to trigger the Article 50 process. Some noble Lords wish to hurry; others have followed the advice of one of my noble friends who said, “Bad certainty now doesn’t trump good certainty later”. This is indeed a time for calm reflection and preparation of a cogent application for an exit which benefits us all. By “us all”, of course, I include all those who live within the United Kingdom, whatever their nationality. I will come to that later, but it always occurs to me that if we do not treat those who live here well, they cannot contribute to our economy, so it is in our interests to consider that they are a benefit, too.

There has been debate about the timing of the repeal of the European Communities Act. I would say that that is the end of the process, not the beginning, but I note an interesting suggestion that the Bill of repeal should be introduced early, with what I would call a sunrise clause to deliver a delayed implementation date, which I believe my noble friend mentioned.

Considerable reference has been made to the issue of a second referendum. I will say that tomorrow we have a Question for Short Debate on this matter, too. In theory there could be a second referendum. However, from the word go the Prime Minister made it absolutely clear that there should not be a second referendum because that would break faith with a decision made by the public on 23 June. He has always made it clear that the referendum would be a once-in-a-generation decision. Noble Lords from all Benches have also made the point that holding a second referendum would prolong the argument and prevent that healing process which this country needs, and which noble Lords have recognised the country needs.

So what happens to European Union business and the UK over the next two years, or however long it takes to negotiate our exit from the EU? Once Article 50 is invoked, we will remain bound by EU law until the withdrawal agreement itself comes into force. The period between the invocation of Article 50 and our eventual exit from the EU is indeed up to two years—unless, of course, other member states agree to extend it.

Questions have been asked about what will happen to the UK’s participation in EU business in that period. I was asked specifically about the matter of regulation-making, and particular reference was made by two noble Lords to the agri-food sector and the need for transitional provisions. Clearly, the EU will continue to function and make progress with its legislative agenda, but it is important to note, too, that EU directives usually have quite a long time delay before they come into effect. So the question in the mind of noble Lords is, I think, whether the UK can block legislation during our negotiating period. The only way that we could do that with certainty is if we are able to exercise a veto. We could ask for specific legislation to exclude the UK, but this would generally be subject to qualified majority voting in the Council and would require other member states to vote with us.

I was asked that the Government do all in their power to ensure that the voice and expertise of the Civil Aviation Authority should not be wasted when we withdraw from the EU. I think that this is a detailed example of just the kind of important issue that will need to be addressed during our renegotiation. I was asked why there was no plan B and why we did not create a Brexit unit before. I say gently to noble Lords that we have been round that particular house many times before in our debates, particularly when we were debating the passage of the referendum Act through this House. It was made clear by the Prime Minister that, in setting out his view as to why it was right to accept the renegotiated deal that he had with the other 27 states, it was right to put a positive case to the public and not to say, “I think I am going to lose and, therefore, we will arrange the alternative”. We always said that it was for those who wanted to leave the European Union to say what the alternative was.

But we have clearly acted very quickly indeed. A new unit is already being set up in Whitehall, as of last week, bringing together officials and policy expertise not only from across the Cabinet Office, Treasury, Foreign Office and BIS, but—I can confirm to noble Lords who asked about this—from other spheres as well. I also absolutely agree that there is invaluable expertise in this House upon which we will need to call. The unit is based in the Cabinet Office and will report to the Cabinet on delivering the outcome of the referendum. It will advise on transitional issues and objectively explore options for our future relationship with Europe—and with the rest of the world, from our new position outside the EU. Questions were asked, quite rightly, about what legislation will be required to guarantee those rights and responsibilities flowing from EU law which the UK wants to retain—and there will be many. I expect the unit to play a crucial part in assisting government departments to rapidly identify such legislation as is required and how it may be put into practice.

It was absolutely right that a House of this nature should ask detailed questions about what happens to the areas outside London—and indeed in London, too—and I understand the concerns about the devolved Administrations and others. As we prepare for a negotiation on our new relationship with the EU, we need to ensure that we look to preserve—and advance—the interests of all parts of the United Kingdom. I can give assurance that the British Government will fully involve the Scottish, Welsh and Northern Ireland Governments, as well as the Government of Gibraltar, in this process. We will also consult the Crown dependencies, the overseas territories and all regional centres of power, including the London Assembly, to ensure that all their interests are taken properly into account. Indeed, the Prime Minister has spoken to the First Ministers of Scotland and Wales, as well as to the First and Deputy First Ministers in Northern Ireland, and to the Taoiseach. Officials will work intensively together during the coming weeks to bring our devolved Administrations into the process for determining the decisions that need to be taken. I have to say again—I know it will irritate noble Lords but I hope not to have to say it too much more—that, while all the key decisions will have to await the arrival of the new Prime Minister, there is a lot of work we can do right now.

Concern has been expressed about the impact on Scotland. I can give the House an assurance that the Prime Minister remains of the view that there should not be a second Scottish referendum. Less than two years ago, the people of Scotland voted clearly to remain part of the UK. That vote was conducted in the context of a clear manifesto commitment by the Prime Minister to hold a UK-wide, in/out referendum on our membership, so it was already known about then. The reasons for Scotland to be in the UK are as strong now as they were 18 months ago.

Proper concern was expressed, of course, about the position of Northern Ireland. All political parties in Northern Ireland and the Irish Government share a vision of peace and prosperity for Northern Ireland. The EU referendum result does not and should not change that. It will not change that. The Taoiseach has been very clear that he wants to minimise any possible disruption to the flow of people, goods and services between Northern Ireland and the Republic. In that context, the British and Irish Governments have already met to discuss the challenges relating to the common border area. Our relationship is special and it will remain so.

I have heard very strong and passionate feelings expressed around the House with regard to the issue of what happens to UK citizens within the EU and to EU citizens here in the UK. I have heard the strong feeling expressed that the Government should give an immediate, absolute assurance that all EU citizens legally in the UK should be allowed to remain indefinitely and work or study here. While I am not quite in the position to be able to create new policy at the Dispatch Box, I can give some helpful indications. The Government value highly the contribution made by EU nationals to our daily lives. As I said earlier this week, I deplore the fact that, during the referendum campaign—and subsequently—there have been reported increases in hate crimes against our EU friends.

I was asked whether the Home Office is going to publish its action plan on tackling hate crime. Although a date has not actually been confirmed yet, it will be published shortly. As my noble friend Lord Ahmad made clear on Monday in a Statement to the House, the position of EU nationals remains unchanged during the process of applying to leave the EU.

Earlier today, there was a debate in another place, to which noble Lords have already referred. During that debate, my right honourable friend James Brokenshire made clear to the House of Commons that the Government,

“want to be able to guarantee the legal status of EU nationals who are living in the UK”.

He said that he was confident—and so, therefore, am I confident—

“that we will be able to do just that. We must also win the same rights for British nationals living in European countries and it will be an early objective for the Government to achieve those things together”.

He then went on to say:

“I am confident that we will be able to work to secure and guarantee the legal status of EU nationals living here in conjunction with the rights of British citizens”.

As has been said, it is important that we consider everybody who believes that they have acquired rights and we need to work from there.

The Minister for Europe and the Foreign Secretary have been holding—

[Lord Howard of Lympne]

I am sure my noble friend understands that, by talking about this guarantee in the future, she has done little to allay the real anxieties which hang over the heads of millions of people from the European Union who are lawfully in this country now. This is a guarantee that could—and should—be given now and it does not take the matter further to suggest that it can be given at some time in the future.

[Baroness Anelay of St Johns]

My Lords, as I said, I do not think that I am in a position to invent new policy at the Dispatch Box. I have listened very carefully to the views of the House, and those views will be taken very strongly into account—as every single view about every part of this debate will be taken into account by the Government. This House has had an opportunity, which another place has not yet had, to spend two days debating these matters in detail. The value of this has been that we have been able to go into details that another place has not. It is important that we consider the position of all. That includes UK citizens who are within the EU. I can give an assurance—I was asked a specific question on this—that it also covers UK citizens who work in the EU institutions. It is true that acquired rights are a difficult matter; what I have given today is an assurance, made in another place by James Brokenshire, which I believe should be able to deliver the right result.

Noble Lords referred to the impact of the referendum result on the economy. The Prime Minister and the Chancellor have been clear that Britain’s economy is fundamentally strong. As a result of the Government’s long-term plan, ours is one of the strongest major advanced economies in the world. We are well placed to face the challenges ahead. We have low, stable inflation; the budget deficit is down from 11% of national income and is forecast to be below 3% this year; the financial system is also substantially more resilient than it was six years ago. It is true that the markets may not have been expecting the referendum result but, as the Chancellor set out on 27 June, the Treasury, the Bank of England and our other financial authorities have spent the last few months putting in place robust contingency plans to maintain financial stability—and they will not hesitate to take further measures if required.

It is important that we make the most of our great ability as a trading nation to be even more entrepreneurial than in the past. The Prime Minister has made it clear that the UK will remain a member of the single market during the period of renegotiation. There will be no immediate change in the way that our goods can move, nor in the way that our services can be sold. Britain is and always will be open for business. We are indeed a special country—a great trading nation. The Government’s ambition remains that Britain should be the best and easiest place in the world to do business, and a global trading partner.

There has been considerable disagreement around the House about the precise relationship which the UK should or should not have with the single market. We have had a great opportunity to hear some of the plans that could be put forward to have almost a single market-light or single market-heavy. There is a lot on which we need to reflect from these debates, which have also reflected the extent of disagreement about what our approach to free movement might be after we have negotiated the exit. What should be part of that agreement? I have listened carefully to all those diverse views, which will all contribute great value to the development of the work on policy from now on.

This House has excelled in the work that it has carried out in the international field. Our withdrawal from the EU will be the biggest institutional change that this country has undergone in a generation—but not everything has changed. The United Kingdom remains a permanent member of the UN Security Council, the second largest contributor to NATO and a member of the G7, the G20 and the Commonwealth. We must not forget the Commonwealth’s role in preventing and helping to resolve conflicts. We remain fully engaged and prominent on the world stage, projecting our values, protecting our security and promoting our prosperity, with the strongest economic links with our European neighbours, as well as with our close friends in North America and the Commonwealth, and important partners such as India and China.

We live in a truly great country. We will continue to thrive and prosper, whatever the nature of our relationship with the EU and whatever challenges lie ahead. In tackling those challenges we must have one guiding principle in mind: to ensure the best outcome for all those who live in these great islands of ours.

I referred earlier to the thoughtfulness that has threaded its way through our debate. Peers have rightly advised that we should all find new ways of living well together. I shall break my rule about not referring to particular noble Lords: I must, I feel, refer at the end to the words of the most reverend Primate the Archbishop of Canterbury yesterday. He said:

“We need a deep renewal of our values in this country. We need a renewal of a commitment to the common good and of solidarity. We need a sense of generosity, hospitality and gratuity, of the overflowing of the riches and flourishing that we possess, not only into our society but across the world”.—[Official Report, 5/7/16; col. 1860.]

I agree. That is the way forward. I beg to move.