European Union (Withdrawal) Bill

Lord Razzall Excerpts

2nd reading (Hansard - continued): House of Lords
Wednesday 31st January 2018 Lords Chamber

[Lord Razzall (LD)]

My Lords, I suspect that I am not alone in your Lordships’ House in having spent the last year being asked what I was going to do about Brexit. People who would be described as leavers have been asking why we are not getting on with it; remainers like me have been asking what I am going to do to stop it. With more than 180 speakers—as the noble Lord, Lord Porter of Spalding, has indicated—it is probably the case that everything has already been said. Unfortunately for noble Lords, however, unlike the noble Lord, Lord Porter, I still want to say it.

Of course, this is not an Act of Parliament to determine whether we leave the EU. Article 50 notice has already been given. However, this is probably the first opportunity that this House has had to try to influence negotiations: in my case, I hope, away from a disastrous hard Brexit. From the remain side, we clearly know what business wants. Banks and financial services companies want their ability to sell their services across Europe to remain unchanged.

I speak for the Liberal Democrats on manufacturing. It is also clear what the overwhelming majority of manufacturing companies want. First, they want a continuation of tariff-free access to Europe. It has been suggested that this is less necessary in the light of the drop in sterling against the euro. While it is true that the drop in the exchange rate, together with the uplift in world trade, has given a boost to our export sales in Europe, it is not the whole story. As noble Lords will be aware, many manufacturing companies import their components from the European Union, so the drop in currency has increased their costs. As yesterday’s figures from the car manufacturers demonstrate, there has been a significant drop in investment in the motor car industry since the referendum. What is clear to those of us on this side of the argument is that the so-called hard Brexit, with us moving to WTO rules, would be a disaster for our manufacturing industry.

Secondly, manufacturers want frictionless borders. Clearly, this is an essential requirement in Ireland, but it is also critical for the many manufacturing companies that employ just-in-time systems for the use of imported components, where pieces of equipment often pass several times across the border with Europe. Any system that involves hold-ups at the border would be disastrous, and industry has no real confidence that any proposed electronic border provisions would work. As we know, the introduction of IT systems by all Governments is not good.

Thirdly, manufacturers want continued immigration from Europe. Other speakers have mentioned the need for nurses, carers and workers in the leisure industry, but industry requires a continuous input of skilled workers. As my noble friend Lord Stunell would say, the construction industry will collapse without skilled workers continuing to come from Europe and there will be no chance of the Government meeting their housing targets. The so-called tech cities springing up throughout Britain require the continued import of skilled workers from Europe. The Government will say that we will soon develop our own skills base, but there is no chance that it will happen on any reasonable timescale. In any event, some skills are no longer taught in the United Kingdom. For example, many engineering SMEs need analogue engineers, but we now teach only digital engineering in our universities.

Fourthly, there must be certainty about how regulatory agencies will continue or be replaced. There are myriad European agencies whose regulations exporters will still have to comply with. Will we be setting up our own agencies at huge cost or will we retain general compliance with European regulations? The standard answer from the Government is of course that we anticipate agreeing continued arrangements, but will Europe agree?

Clearly amendments will be tabled in Committee from across the House to reflect the wishes of business that I have just expressed. Manufacturing industry would certainly support an amendment that said we should stay in the single market and the customs union. I will support an amendment to provide for a further referendum on the terms of any deal, for which a number of noble Lords have indicated their support. As noble Lords have indicated, the ICM poll for the Guardian last week showed that well over 60% of the public now want a further referendum on the terms of leaving. It was noticeable that the only age group against the idea of this referendum is the retired—that is, people who no longer play a role in the business life of the country and have the smallest stake in our future. I hope the Government will now agree to give the electorate what they clearly want.