European Union (Notification of Withdrawal) Bill

Lord McKenzie of Luton Excerpts

2nd reading (Hansard): House of Lords
Tuesday 21st February 2017 Lords Chamber

[Lord McKenzie of Luton (Lab)]

My Lords, much has been said already in what was an extensive and intensive debate yesterday, and like many of those who spoke in that debate I was and remain profoundly saddened by the outcome of the referendum. We are unpicking some 40 years of history, which by and large has fostered prosperity, developed co-operation on vital matters such as climate change, and inculcated the concepts of a social charter and structural funds to help poorer countries and regions to grow more prosperous. It has kept us safer through co-operation on law enforcement and counterterrorism and has fostered peace in Europe throughout my lifetime.

We are now being asked to withdraw from all this and to step away from the single market and the customs union with no certainty about what arrangements will replace them. It is not an inviting prospect for us in Luton at a time when General Motors’ proposed disposal of its European operations could leave the Vauxhall operation outside arrangements that allow goods to move freely within its main market without tariffs, quotas or routine customs control. The uncertainty about whether the UK will have continued membership of the European common aviation area is also not helpful to an airport-based economy, and it is certainly not helped by a slowdown in growth.

Of course, responsibility for this mess, which is what I believe it is, rests squarely with David Cameron. He gambled that a referendum would heal the split in his party but has ended up splitting the country. History will rightly judge him harshly.

As the House of Lords Select Committee on the Constitution set out,

“neither the question put to the electorate, nor the provisions of the Act under which the referendum took place, set out how or when withdrawal should take place in the event of a vote to leave”.

What Parliament enacted may have been a clear proposition—yes or no, in or out—but it was deficient in setting down how any mandate arising from the referendum would be taken forward; what, if any, feedback, decision-making or further endorsement should follow.

There are myriad consequences and issues arising from leaving the EU, including the need to incorporate some 5,000 pieces of directly applicable legislation into UK law. Many of the options are mutually exclusive. If Parliament did not originally spell out a process for dealing with the mandate, it is right for Parliament and the Government to take up the reins now. But I would argue that we need to be cautious about suggesting that this is all down to the choice of the people rather than down to the consequences of the clear choice that they made to leave the EU. We are dealing here with choices of government, and these should not be sacrosanct.

One of the most profound choices that the Government are seeking to make is to eschew membership of the single market and the customs union. They are prepared to sacrifice these at the altar of reducing immigration, notwithstanding research, most recently from the Centre for Economic Performance at the LSE, again showing the benefits to national income, taxes and the budget deficit from immigration, and notwithstanding a report from the think tank Global Future that suggests that the Government’s approach could mean a fall in current net levels of immigration of no more than 15%, and that might be reduced further by the terms of new free trade agreements, which typically come with a demand for liberalisation on free movement.

I join others—and will vote with them—on insisting that the Government settle immediately the legal rights of EU nationals living in the UK, although I note the press reports that highlight potential practical difficulties with systems in administering a cut-off point. Is this right? The Government’s prevarication over this is cruel, given the substantial contribution that these communities have made to the UK. From local experience, I know the value of that contribution.

The alternative on offer to the single market is some vague prospect of,

“the freest and most frictionless trade possible”.

The OBR’s judgment, we heard yesterday, is consistent, it says, with most external studies that say that any likely Brexit outcome will lead to lower trade flows, lower investment, lower net inward migration and lower potential output. All this has adverse implications for the public finances and our social security system and will add some £60 billion of additional borrowing over the next five years. We know who bears the brunt of worsening economic outcomes under this Government.

As others have said, the White Paper sets out a framework for a deal that hardly amounts to a blueprint. Even if it did, these matters have to be agreed with our European partners. Article 50, once triggered, does not put us in the driving seat; for all practical purposes, it means that we leave the EU whether or not we have agreement. Transitional arrangements may well be in point, but these will presumably be subject to the ongoing jurisdiction of the European Court of Justice.

Complying with this Bill means an uncertain destination but no way back. That is the magnitude of the decision that we are making over the next few weeks. For me this is therefore a difficult choice between supporting what I believe is right for our country and the collision with the limits of our constitutional duty. I have to accept that the combination of the referendum result and the decision of the other place should prevail. However, we should push our authority to the limit in challenging the Government on their proposed deal. Seeking to ensure protection of workers’ rights, justice for EU nationals living in the UK, maximising free access to the market, sustaining our historic ties with Ireland and much more is one way in which we can salvage something from this process.