European Union (Notification of Withdrawal) Bill

Lord Shipley Excerpts

Committee: 1st sitting (Hansard): House of Lords
Monday 27th February 2017 Lords Chamber

[Lord Blencathra]

My Lords—

[Lord Shipley (LD)]

My Lords, I support Amendment 6, moved by the noble Baroness, Lady Quin. I will speak to Amendment 9, which is in my name and refers to all parts of the United Kingdom and not just the north-east of England. This whole group relates to the impacts of Brexit and the need for there to be assessment before the Government go much further.

It is estimated that around 160,000 jobs in the north-east of England are directly linked to our being part of the single market. That is because 58% of north-east exports go to the European Union, against a national figure of 42%. After 2019, with a hard Brexit there will be no automatic access to the single market, which is the largest free trade area in the world. Therefore, what are the economic advantages to the north-east of England or indeed to any part of the United Kingdom of losing that automatic access? I would like the Minister to explain how the Government plan to protect it.

I understand that the Minister met the North East Chamber of Commerce last Friday following an initiative by my noble friend Lord Beith. Will this be the first of many such meetings? I ask that because there are structures in London, Scotland, Wales and Northern Ireland for the Government to relate to, but what about the rest of the United Kingdom—the English regions? Regular meetings must be held with those regions to put them on an equal footing with Scotland, Wales, Northern Ireland and London. For that reason, I think that we need regional impact assessments of leaving the European Union. As an example of the problem, and as the noble Baroness, Lady Quin, emphasised, the north-east of England has a net balance of trade, with total exports amounting to £12.14 billion in 2015. No other region does so well in having such a positive balance of trade. The trade surplus in 2015 was £3.4 billion in the north-east—that is, the north-east local enterprise area and the Tees Valley local enterprise area added together.

It would be a disaster for jobs for this surplus to be lost. Chemicals had a trade surplus of £2 billion and the machinery and transport sector had a trade surplus of £2.3 billion. Some sectors had a trade deficit, which accounts for the overall surplus being £3.4 billion. Such a trade surplus is a very impressive figure for a small region in population terms such as the north-east of England. That is why I have concluded that the Government should establish resilience task forces in each part of the United Kingdom to work with the Government on the problems that will arise if we leave the single market and the customs union.

The abolition of government offices in England has not helped this situation and it has resulted in England being treated as a single entity run out of London. England is not a single entity and its differences should be reflected in the Government’s work on Brexit. In terms of EU funding support, we could look at our universities. The north-east universities are receiving £155 million in EU funding in the current funding period, 2014-20. They stand to lose access to much of that funding once we have left the European Union. Will the Government pick up the bill? Will they guarantee equivalent funding after 2020? In terms of structural funding, the north-east of England, including Tees Valley and the North East LEP, is receiving £590 million in structural funding from the EU in the 2014-20 period. Cornwall will receive £476 million, and Greater Manchester and Leeds City Region will receive more than £300 million each. England will receive £5.6 billion and the UK as a whole more than £8 billion. Will the Minister tell us what the Government’s plan is to make this money available after Brexit?

The question matters because it is the poorer parts of the country that voted more strongly for Brexit, but those are the very parts of the country that are in receipt of much higher levels of EU support. This is the challenge for the Government: have they any plans in place, eight months after the Brexit vote, to make those poorer parts of the United Kingdom resilient in the face of Brexit? The danger is that it is these very areas that will fall yet further behind once we leave the EU in 2019. What are the Government’s plans, in the face of Brexit, to generate growth in the poorer parts of the United Kingdom?

[Lord Blencathra]

I apologise to the noble Lord, Lord Shipley, for attempting to get in before him: I had forgotten that other noble Lords had amendments they might wish to speak on. I must warn my noble friend the Minister that I am very tempted to support these amendments, provided he can give me two firm assurances—first, that these assessments will be carried out by the Bank of England, the IMF and the same geniuses at the Treasury who forecast that by 2030 we would all be £4,322.15 worse off; and secondly, that he will send these assessments to Mr Juncker and Mr Barnier. I can think of nothing more likely to completely mislead those with whom we will be negotiating. Better still, he might get PricewaterhouseCoopers to do it, after its spectacular success at the Oscars last night where it could not count up a few hundred votes correctly.

In all seriousness, when have we ever seen an impact assessment attached to a government Bill which was remotely worth the paper it was written on? They are meaningless rubbish and no one takes them seriously. I did take one seriously when I was asked to chair the joint Select Committee on the original draft so-called snoopers’ charter Bill, which some noble Lords and Members of the Commons served on. We went through that impact assessment in detail and tore it to shreds. It estimated about £900 million as expenditure and our committee calculated that the real figure would be about £2 billion to £3 billion. We all know that impact assessments are not very accurate.

On the other hand, let us suppose that the Government did manage to write a proper impact assessment. We could do that on a sector-by-sector basis for each industry. I suppose that we could get the leaders of all those industries and all the other experts to draw up a proper SWOT analysis where Ministers have a pretty accurate assessment of the strengths, weaknesses, opportunities and threats to that industry from staying in or leaving the EU. Let us say that those SWOTs were spot-on accurate. Does anyone seriously suggest that we should then publish them and hand them straight over to the EU negotiators so that they can spot all the weaknesses in our position and the strengths that we want to exploit? It would be the height of folly to do such a thing. Indeed, it would be barking mad. If we were to do that, why stop there? Let us send Mr Putin a list of all our defence weaknesses and get MI6 to tell ISIL about any gaps in our security. Will Mr Barnier and the EU give us a paper on their strengths and weaknesses? Will they tell us their impact assessment of Britain? Of course not.

I am not being totally facetious. We will embark on negotiations that will determine the future of this country. The EU is reported to be demanding a £50 billion divorce settlement from us. I hope that we will strongly resist that. But if we are so daft as to publish any weaknesses in our arguments against it, we could end up robbing the taxpayer of billions of pounds. Billions of pounds are at stake.

I am not against impact assessments per se, although I prefer the SWOT analysis. Indeed, I hope that our Ministers and the Prime Minister have them. But I also hope and pray that they are keeping them under a top secret cover and keeping them very close to their chest. The last thing we want is to have them published or shared or laid before Parliament, which is probably even worse than publishing them in the press.

--- Later in debate ---

[Lord Forsyth of Drumlean]

I am most grateful to the noble Baroness. I suppose then that she will be withdrawing Amendment 6 and I do not need to argue against it any further. As she has always been a doughty champion for the north-east, I completely understand why that should concern her. I simply point out that this is not the Bill in which to make that argument. I have no doubt that there will be an opportunity to discuss these matters when we get the great repeal Bill, as well as in the intervening period. There is nothing to stop people putting down Motions in either of the Houses of Parliament and pressing the Government on any of these matters.

Amendment 9, in the name of the noble Lord, Lord Shipley, lists every region of the United Kingdom and asks what the impact of withdrawing from the European Union will be. Every penny of regional aid for any of these regions is our money. It is money that we have given to the European Union that comes back. That money is not going to disappear. I remember as Secretary of State being forced into supporting projects that were not priorities for us because we had to get agreement that they were additional and that they represented the prevailing policy at the time of the European Union. The difference will be that we are actually able in this Parliament to decide how our money is spent on our priorities in each of the regions. That is a great step forward. I do not, for the life of me, understand how the noble Lord could expect the Government to come up with an impact assessment of that. It will depend on the negotiations, on how much of our money we get back, and on a whole range of issues.

[Lord Shipley]

The noble Lord said two things that I do not accept. First, he said that the money that comes from the European Union is not going to disappear. There is a real danger that it will disappear because the country is going to be poorer and the Government’s tax income is going to be less. There is no evidence at all that all the money that is currently used in structural funds is going to carry on in the same volume. I do not accept that the money will simply be there and will be redirected again by the UK Government.

The noble Lord also asked who would do the impact assessments. Impact assessments are being done for London, Scotland, Wales and Northern Ireland because there are governance structures in place that can do so. The Government have regular meetings with all those bodies. My point has been that the rest of England is being left out from that process. That is the problem and I hope that the Minister can alleviate my concerns later.

[Lord Forsyth of Drumlean]

I am sure that the Minister in his excellent way will respond to these particular details. I am looking at this amendment, which says that we cannot start the process of leaving the European Union until we have,

“Her Majesty’s Government’s negotiating strategy for withdrawal on the economy, investment and regional funding of”,

all these regions. That is ridiculous—absurd. Perhaps the noble Lord put down the amendment just to have a debate and is not proposing to press the matter, but to say to the Government, “You cannot implement what the people voted for until you have done a set of calculations that are impossible to do until you start the negotiations”, looks to me like a circular argument and yet another device from those Benches to prevent us from getting on with what people voted for.

[Lord Shipley]

Amendment 9 is a probing amendment and I think that the other amendments in this group are similar. There is an issue about whether the Government are prepared to guarantee the levels of funding post-2019 and again post-2020. I very much hope that the Minister will assure this House that the levels of funding will not disappear.

[Lord Forsyth of Drumlean]

That is not what the noble Lord’s amendment says. It is an interesting argument. When he says that the money is going to disappear because we will be poorer, that brings me to the extraordinary Amendment 22, which appears to be supported by a former Cabinet Secretary. It asks for,

“any existing impact assessments or economic forecasts relating to the United Kingdom’s future trading relationship with the European Union conducted by HM Treasury, the Department for Exiting the European Union, the Department for International Trade or the Office for Budget Responsibility”.

As my noble friend Lord Blencathra pointed out, the Treasury and the Office for Budget Responsibility told us that we would have a recession and limited growth and that unemployment, interest rates and mortgages would go up, all of which has not happened. We have turned out to be the most successful economy in the G7. This continuing running down of our economy and telling people that we will be worse off is not good for confidence or for the Government and it flies in the face of what people voted for. They listened to all these impact assessments and decided not to believe them, which is why they voted to leave the European Union.