King’s Speech

Lord Moynihan of Chelsea Excerpts

Thursday 14th May 2026 Lords Chamber

[Lord Moynihan of Chelsea (Con)]

My Lords, this week the Prime Minister—if indeed he still is the Prime Minister; I am not sure—abandoned his red lines to stealthily reintegrate with the EU, to change our laws to its laws, with the UK having very little say in what those laws will in future be. The direction of travel of the Government’s reset is not just a betrayal of Brexit; it is a blundering destruction of our future economic opportunities. The long bond today trades 10% lower than it did at any time during the Truss Administration.

Brexit has not, as claimed by the noble Lord, Lord Liddle, who is not in his place—

[Noble Lords]

Yes he is!

[Lord Moynihan of Chelsea (Con)]

Oh, I apologise—the noble Lord has moved further back. Brexit has not cost our economy, an idea that was ably demolished by my noble friends Lord Redwood and Lord Frost. Indeed, the OBR, in its claim that there has been a diminution, published my 10-page letter to it rebutting its claim—but, interestingly, made no attempt to respond to it.

Here are the facts. The City of London, our key strength, has flourished, as even the Economist, with some embarrassment, admitted. That is because we have diverged from the EU. Our key tech sector has flourished, thanks to avoiding the EU’s disastrous AI Act. The UK’s precision breeding Act has given us a genuine first-mover advantage in gene-editing, with high-lipid barley, low-asparagine wheat, climate-resilient camelina, cancer-beating tomatoes, and many more in the pipeline. We have escaped over 13,000 new regulations and 12,000 new EU directives which have been created since we left.

Contrary to the noble Lord, Lord Strasburger, who is in his place, this country does not want to rejoin the EU. When voters are asked whether they want to retain control of our laws and retain the pound, and, above all, retain control of our borders, you get the same solid rejection as we got 10 years ago. This Government are wrong to sense electoral advantage in crawling back to the EU.

Let us look at what is already planned and agreed for this reset. British fisheries have been handed away to the EU for 12 years, the enormous cost of which was not even assessed. The efficient Turing degree programme is abandoned for the far less useful Erasmus short-term travel scheme—and we pay £815 million a year for that change. There will be dynamic alignment with EU rules across food, agriculture, the electricity market and carbon pricing, with its court, the European Court of Justice, adjudicating on any dispute—we can guess how those rulings are going to go.

The EU, eager as ever to exploit our needy gullibility and rook us for astonishing sums of money, is apparently demanding a further £1 billion a year for just this first set of dynamic alignment agreements, yet those agreements, mostly consisting of concessions and payments by us, will be a negative for our economy. The Government say, unconvincingly, that dynamic alignment will benefit the economy by £5 billion, while the Growth Commission says that it will cost us £15 billion.

The chief alleged positive is the SPS agreement, removing the need for export certificates that cost £120 to £250 each, at a total of some £70 million a year. However, those fees are charged by us; we could remove them at any time, but we do not. It is almost as if someone wants us not to, so as to push us in the direction of rejoining. The entire value of all UK agricultural exports is £12.8 billion, which is less than half of 1% of the economy. We will pay £1 billion a year to save £70 million and claim a mysterious £5 billion benefit from that—we should ask the Government to pull the other one.

Norway and Switzerland pay nothing to be in the electricity market, nor should we pay anything. However, that is not what it is about. Joining means assenting to the EU’s requirement that 42.5% of all our energy must come from renewables by 2030. Our current target is for renewables to be 100% of electricity, which is only 20% of our total energy usage, by 2030, so our current target is less than half of what we will have to sign up to. It is an impossible new target, and, as Kathryn Porter has shown and as we have seen in Spain, the more renewables in the mix then the more brownouts and blackouts.

As for the carbon tax deal, it is mainly for six commodities: steel and iron, aluminium, fertiliser, cement, electricity and hydrogen. Dynamic alignment will mean that we no longer pay carbon tax on exports of those products to the EU. However, our exports of those commodities to the EU are nugatory, and we will be required to charge a carbon tax on our much larger imports from the rest of the world. Our competitive position will decline and the EU’s will improve—well done.

Worse, if we enslave ourselves to existing and all future EU rules in these areas, the entire UK economy in these sectors will be required to adhere to these rules. All we produce in these sectors, whether for UK sales or for export to the rest of the world, must follow these rules. What are these rules? For example, there are totally different, although no better, packaging rules—so changing packaging will be a huge expense for British producers across the economy. There are also pesticide residue rules, based not on scientific evidence but on the kindergarten-level idea of the precautionary principle, so UK farmers will have to change what pesticides they all use.

Above all, unless the Government secure a carve-out—of which the chances are extremely low, particularly for this Government—our world-leading position in gene editing will disappear. Bang goes the finest and most productive gene-editing cluster in Europe, of 100 or more companies, supported by eight world-class research institutes. Any products developed there will not be allowed in the UK—the cluster will collapse.

In yet another huge hit to the economy, changes will also apply to all the goods we import from the rest of the world. The UK’s Fresh Produce Consortium forecasts

“thousands of additional and unnecessary border delays, considerably more inspections, more paperwork and port congestion”.

Restrictions on Moroccan cucumbers, Indian mangoes, South African citrus, US sweet potatoes, Californian almonds, and on and on, all add £400 million to supply chain costs. The UK consumer, who will pay for all that in inflated prices, may make their views on that known at the next election, do you not think? Dynamic alignment will clash with our new trade deals such as CPTPP. Not being able to comply with both, we will necessarily end up being taken either to the WTO court or to the European Court of Justice—more cost, more woe and more confusion.

The problems with our economy do not come from Brexit—they come from net zero, as my noble friends Lord Lilley and Lord Redwood so clearly explained, and from the Government’s willingness to make not working more attractive in this country than working. Remove just those two problems, and develop further the regulatory freedoms that Brexit allows, and we can flourish.

Finally, how can we be happy to hear this week that this inept Government now plan to double down on their already disastrous surrender plan to the EU, in the vain and economically illiterate hope that doing so will prove either popular or beneficial?