Freedom of Establishment and Free Movement of Services (EU Exit) Regulations 2019

Lord Purvis of Tweed Excerpts

Wednesday 23rd October 2019 Lords Chamber

[The Earl of Clancarty (CB)]

My Lords, at the beginning of this debate, the noble Lord, Lord Stevenson, said that parliamentarians are talking about this issue. The noble Lord, Lord Oates, and others, said that EU citizens are talking about this issue, and indeed, the British living and working in Europe are doing so too. They are all very worried. There is something about this issue to which the noble Lord, Lord Greaves, referred. It is a confidence issue, a trust issue and a perception issue. That is very important. There is a sense that a safety net is being removed in preparation for worse to come, despite the Minister’s assurances.

I would be appalled by any legislation that attempted to reduce the rights of EU citizens to run businesses or be self-employed in this country under a no-deal scenario. Such legislation should surely be in an immigration Bill, not presented to the House in this form as a fait accompli. As the noble Lord, Lord Stevenson, noted, we are talking about a wide variety of industries being affected. The so-called gig economy, the NHS, IT and the creative industries would be hit hard if EU citizens felt forced out, and we would be culturally impoverished as a result. However, as the noble Lord pointed out, it is not only the livelihoods of EU citizens that will be at risk, but the livelihoods of British citizens living in Europe.

It is a widely held view, but a misconception, that most British abroad are retirees. Of the 1.24 million UK citizens in Europe, Britain in Europe estimates that only 20% do not work. Many of those in work are self-employed, in as wide a variety of service industries as in the UK. It feels, however, as though the Government do not care enough about the British living in Europe, or about their livelihoods, which will without a doubt be threatened through any reciprocal effect. A number of us in this House have repeatedly asked the Government to protect the rights of the British working in Europe. This is not the right way to go about it, and that is apart from the message being sent through this legislation to EU citizens who run businesses or are self-employed in this country.

[Lord Purvis of Tweed (LD)]

In the absence of an impact assessment, I have four questions for the Minister. In many respects, they support the points raised by my noble friend Lord Oates.

The first is linked to the questions asked by the noble Lords, Lord Anderson and Lord Pannick. Can the Minister be clear with the House about what the Government consider the current preferential trading environment to be? If we offer a preferential trading environment to those providing services to a national of a country with which we do not have a trade agreement, we fall foul of the WTO. The Minister said that there would be no difference to those providing business services in the UK if they were EU, Swiss or EEA nationals. If that is the case, there should be no difficulty with the WTO, because we would not be offering any preferential arrangement. At the same time, if the WTO considered it a preferential trading agreement, and therefore discriminating against third countries other than EU countries, what would that preferential trading environment be for those that the WTO considered the UK to be falling foul of?

Given our consideration of the Trade Bill, we also looked at the draft services schedule presented by the UK to the WTO. There was no reference to that in the Minister’s remarks. Given that the services schedule has been lodged at the WTO for nearly a year now, what is the interaction with that services schedule? The Minister will know that there is a specific reference in it to those providing financial services, yet there was no reference to that in his remarks today. Will there be a difference for those EU nationals currently providing financial services products to UK citizens? I see the Minister nodding his head from his sedentary position, but that is contrary to the understanding of others. If the operation of the European financial single market ended on a no-deal Brexit, such people would not have the same level of protections. I would be most grateful if the Minister could clarify that.

My second point is linked to that. We also considered a continuity treaty with the Swiss Confederation. That treaty has specific clauses providing for elements of those who would be offering services. There was no mention of that in the Minister’s remarks so I am interested to know whether he can clarify something on the interaction with the treaty that Parliament has agreed, which offers, on a no-deal basis, a preferential level of support for those Swiss nationals. With this instrument, it seems as though things would contradict that because mentions of Swiss nationals run throughout it. If the Minister can clarify the point on how this will interact with the treaty that we agreed with the Swiss Confederation, I would be grateful.

--- Later in debate ---

[Lord Greaves]

My Lords—

[Lord Purvis of Tweed]

Would the Minister give way?

[Lord Duncan of Springbank]

No, I will make some progress if I may. This is complicated enough, and I fear I have to answer noble Lords’ questions before they ask new ones.

The noble Lord, Lord Oates, was very clear in some of the points he raised. That is why I am trying to be as unambiguous as I possibly can. He sought explicitness, and I am trying to give that. The self-employed will be unaffected if they are EU nationals. Those providing services will be unaffected, and their continued ability to provide those services will go undiminished. Those operating businesses will be able to do so going forward undiminished. The laws that underpin them remain as they are, both in our domestic law and in the retained EU law. There are no new restrictions whatever placed upon these individuals in this. That is why I am trying to point out that the limited impact is just that—a limited impact.

This will have no impact on the settled status of anybody coming in; for those noble Lords who are concerned about migration, this suite of statutory instruments explicitly carves out any issues of migration to ensure that they are considered carefully during the passage of the immigration Bill, which is primary legislation and will afford this House and the other place the full rights and abilities to inquire into that. So again, there is no attempt to pull the wool over anyone’s eyes—quite the reverse. In seeking to move this into primary legislation where it touches upon immigration, we are ensuring that this House has the full panoply of opportunity to explore this, as it will need to do going forward. That is why I refute the point of the noble Lord, Lord Oates, that this is a clear breach. I do not believe that it is.

The noble Lord, Lord Pannick, is quite right when he says that this places upon us no new obligations. There are no new obligations which rest upon EU citizens; they can enjoy the rights that they have been able to do so to date. The question is whether the disapplication materially impacts on, for example, the ability of the gentleman mentioned by the noble Lord, Lord Campbell-Savours, to do his business. It does not. The noble Baroness, Lady Bull, raised the question of the restaurateur who operates a Turkish restaurant and whether it places material changes upon them. No, it does not. It is important to stress that we are not seeking in any way to erode the rights currently enjoyed by these EU citizens. However, I should say that this would be far better addressed through an implementation agreement, and ultimately by that future relationship, whereby we can put to rest any suggestion that this Government are seeking to undermine the rights of EU individuals to undertake their legitimate exercises.

The question of what happens for UK citizens who work abroad is more challenging. Again, we cannot insist upon such reciprocity, since it rests with each individual member state, and we cannot offer guarantees on their behalf.