EU Retained Law

Lord True Excerpts

Thursday 23rd June 2022 Lords Chamber

[Lord Wallace of Saltaire (LD)]

My Lords, I was not sure whether to laugh or cry when I read the Statement. It takes us into a surreal world of fantastical Government, in which, as the Minister for Brexit Opportunities declares,

“our country will achieve great things.”—[Official Report, Commons, 22/6/22; col. 866.]

That is like Donald Trump promising he will make America great again—just as windy and as empty of content.

There is no evidence behind this Statement. I challenge the Minister to find any. A great deal of evidence was gathered and analysed on exactly this issue between 2012 and 2015 in what was labelled the balance of competences exercise. Eurosceptic Conservatives in the coalition Government believed that an extensive survey of business, sector by sector, would produce a long list of unnecessary Euro regulations that the UK Government could then demand to be renegotiated.

Three Ministers oversaw this exercise: David Lidington, Greg Clark and myself—two Conservatives and a Liberal Democrat. Sector by sector the responses came in, saying that companies were happy with the current balance between domestic and European regulation. Several transport companies argued for greater emphasis on common European regulation rather than less of it. The Scotch Whisky Association, whose then chief executive was David Frost, now the noble Lord, Lord Frost, was particularly enthusiastic about the advantages of common regulation with the European single market. Of course, that was before the noble Lord’s damascene conversion from evidence-based argument to embittered opposition to everything European.

Can the Minister tell us what consultations the Government have conducted in the past year with large and small companies before committing themselves to diverge from EU regulations in the way Mr Rees-Mogg plans? My understanding is that UK exporters, both large and small companies, would much prefer the Government to maintain close alignment between UK regulations and those in our largest overseas market. Does the Minister have any recent evidence to the contrary? Does he understand that the Government have any recent evidence to the contrary?

The chimera of making a bonfire of regulations has appealed to the ideological right ever since Friedrich von Hayek and Milton Friedman. Belief in the superiority of unregulated markets has survived through stark evidence to the contrary, as in the loose regulations that led to the Grenfell fire. Margaret Thatcher understood that a well-regulated market is fundamental to a thriving economy, which is why she pushed for the common regulatory structures of the European single market. British Ministers and officials played a major role in creating that common single market. Many of the regulations that Mr Rees-Mogg is now denouncing were shaped by UK efforts, not imposed by foreign Governments on a powerless UK, as he is now suggesting—but Mr Rees-Mogg’s career has been entirely in finance rather than the real economy of production, marketing and exporting, and much of it offshore in Hong Kong, Singapore and other low-tax financial jurisdictions.

Mr Rees-Mogg is also the Minister for Government Efficiency. He notes in his Statement the extra work that Whitehall officials have undertaken to grasp these “Brexit freedoms”, as he puts it. He does not note that leaving the EU and setting up a range of national regulatory agencies to replace those we shared with our European partners has required a substantial increase in both the number of officials and the costs involved. Part of our contribution to the EU budget went towards funding those common agencies; some of them, such as Europol, were led by British officials. Yet at the same time as being Minister for Efficiency—that wonderfully odd phrase—Mr Rees-Mogg is pushing for a sharp reduction in Civil Service numbers, without regard to the additional tasks that it is taking on. Can the Minister explain how the Government propose to manage this additional effort while slashing the number of staff?

There are more windy comments in the Statement about restoring the sovereignty of Parliament, followed by the declaration that most of this will be pushed through under secondary, even tertiary, legislation, without effective parliamentary scrutiny. The illusion that we now stand imperially sovereign in the world, freed of the European yoke, is punctured by the letter that the noble Lord, Lord Grimstone, circulated yesterday, announcing that we are opening trade negotiations with the Gulf Cooperation Council—in which we will not mention civil or political rights so as to avoid offence. This Government are willing to negotiate and compromise with the GCC but not with our democratic neighbours. Can the Minister explain how giving concessions to the Gulf autocracies avoids limiting UK sovereignty while Mr Rees-Mogg insists that any compromise with the EU infringes on UK sovereignty?

Last night, I wondered whether the Minister might revolt as he attempted to justify this irrational ideological waffle and follow the example of the noble Lord, Lord Agnew, by walking out of the Chamber and the Government mid-Statement. However, I fear that he has not yet reached that point, despite the nonsensical Statement that he is forced to defend.

[The Minister of State, Cabinet Office (Lord True) (Con)]

My Lords, there has been a rather obsessive theme from the noble Lord, Lord Wallace, today, who seems excited at the prospect that I might walk out of the Government. I can absolutely disabuse him of his expectation of that prospect. Unless the Prime Minister decides otherwise, I shall be extremely content to remain here and take the Brexit freedoms Bill through your Lordships’ House.

Having listened to the noble Lord, on the sixth anniversary of the Brexit referendum, I am inclined to say that the Liberal Democrat Party does not know whether to laugh or cry. His sneering response tells me that the Liberal Democrats, like the Bourbons of Naples, have learned nothing and forgotten nothing in their desperation to keep the United Kingdom in line with the European Union’s orders.

[Lord Wallace of Saltaire (LD)]

My Lords, I talked about what companies are saying to the Government, and that is about evidence. We are six years down the line from the Brexit referendum; by now we ought to be talking about what sort of relationship we have with the European Union.

[Lord True (Con)]

My Lords, the noble Lord has had one go, and I think I characterised his party’s position perfectly accurately. The party opposite gave a much more measured response and asked me some specific questions. He asked me one which I shall answer. Again, I am disappointed that, on this sixth anniversary, the Labour Party is still saying that it is not important, in effect, to examine these 2,400 elements of retained EU law, which have a status equal to United Kingdom Acts of Parliament. It is perfectly reasonable that those matters should be examined. My right honourable friend Mr Rees-Mogg made it very clear that it is not necessarily the expectation that all these will be swept away, as the noble Lord said. These matters will be looked at on their merits. Frankly, one of the examples that my right honourable friend gave in the other place was the power of vacuum cleaners. Perhaps if we had more powerful vacuum cleaners in this place, we would not have mice running around the place, gorging themselves on all the bits and pieces of crumbs that are left.

There is a serious issue here, despite what was said opposite. It is perfectly reasonable that departments examine the case for the continuation of this mass of regulations. This is the expectation of departments, in concert with interested parties. The noble Lord asked whether we had done consultation. We have engaged with a range of organisations with interest in retained EU law. We have worked closely with all departments, and their stakeholder groups through them across Whitehall. That engagement has included lawyers, academics, universities and other non-governmental organisations. More recently, it is well known that the Minister for Brexit Opportunities also issued a call to the British public, not I think through an organ widely read on the Benches opposite, on the regulations that they might wish to abolish—particularly focusing, as I think we should, on those that make life harder for small businesses, which shut out competition or simply increase the cost of operating. Through a large number of small changes, we can enact real economic change.

The noble Baroness asked about sunsetting, as she called it, and reports on that matter. The issue to which she referred is still subject to consideration of how the reforms will be carried forward in that respect. So far as the cost is concerned, I assure her that the dashboard was built by Cabinet Office officials using the Tableau software, and was created with no additional cost to Her Majesty’s Government.

As for the benefits, I give an undertaking to the noble Baroness on her perfectly reasonable and proper question that there will be an impact assessment published with the Brexit freedoms Bill when we bring it forward, and that will obviously be laid before your Lordships’ House.

[Baroness McIntosh of Pickering (Con)]

My Lords, I thank my noble friend for taking questions on the Statement. Of the 2,400 items of retained EU legislation, 570 come from the Department for the Environment, Food and Rural Affairs. I imagine that most of those of relate to phytosanitary, plant health, animal health, hygiene and welfare. If that is the case, does he not agree that most of those will in fact be retained as UK law after this exercise is completed?

[Lord True (Con)]

My Lords, I am not anticipating either way but as I said in my opening response, in reviewing retained EU law, Defra will obviously, as my noble friend asks, ensure that environmental law is fit for purpose and able to drive improved environmental outcomes while ensuring that regulators can deliver efficiently. It is an important piece of work that will make sure that the UK regulatory framework is appropriate and tailored to the United Kingdom. We have been very clear about our environmental goals and we do not resile from them. They are set out in the 25-year environment plan, the Environment Act 2021 and the net-zero commitment in the recently published Nature Recovery Green Paper. Any changes to environmental regulation in this context or any other will need to support those goals.

[Lord Bellingham (Con)]

My Lords, is it the intention of HMG to reform the EU Solvency II rules, which restrict investment by insurance companies to fixed-interest instruments, such as bonds? If we really do want to unlock further wealth and job creation, surely we need to allow insurance companies to invest in, for example, projects such as social housing and wind farms.

[Lord True (Con)]

My Lords, my colleagues in another department will have to answer on the specifics, but my noble friend is absolutely right to highlight that the area of financial services broadly is something of fundamental importance to the national economy, and indeed the Scottish economy. I assure him that my colleagues will continue to examine the areas of regulation to which he has referred, with a view to keeping our financial services sector dynamic and effective and a place where people from all over the world would wish to come and work.

[Viscount Stansgate (Lab)]

My Lords, I thank the Minister for the Statement. In the light of the remarks he has just made about consultation, and in advance of the Bill, can he tell the House what proportion of the measures that the Government hope to introduce will be promulgated by secondary, or indeed tertiary, legislation?

--- Later in debate ---

[Lord True (Con)]

My Lords, we are at the stage now where the dashboard has been published; submissions and comments will be made on it, and it will be refreshed quarterly. We will then have to consider the mechanisms. If it is decided that the regulation needs to be either repealed or substantially altered, we will have to consider the legislative mechanism, which would have to be case by case. When we publish the Brexit freedoms Bill, it will include elements that allow for the Government to implement their policies. At that stage, noble Lords will obviously be able to debate the appropriateness of the proposals that we put before them.

[Baroness Neville-Rolfe (Con)]

It is agreed by everyone that we have a productivity problem in the UK. As we have seen from history, one way of dealing with that is to sweep away anti-competitive legislation, including some that has been referred to in the debate. Does my noble friend the Minister agree that some operators benefit preferentially from their very existence and that it is essential to have the toughness needed to face them down? That can help small businesses, as my noble friend has said, and growth, and can, I hope, reduce bureaucracy. I am in danger of speaking for too long, but I mention that I have worked for most of my career in business and particularly welcome the promise to the noble Baroness, Lady Chapman, of an impact assessment on the Bill.

[Lord True (Con)]

My Lords, I am very grateful to my noble friend. It seems quite a long time ago that we were working in Downing Street on the aspiration of reducing regulation. She makes interesting points which one does have to bear in mind in consulting on and considering the way forward.

It is important that we make it easier for small businesses, and it is also true—I am not criticising anybody or any organisation in particular—that familiar regulatory environments, particularly complex ones, are not necessarily as perturbing to very large organisations which have large departments to deal with them as they are to small businesses and would-be innovators and entrants. That is a balance one has to consider across the regulatory environment, including in this exercise before us today.

[Lord Lilley (Con)]

My Lords, I recall that when I went to Brussels as a Treasury Minister or as Secretary of State for Trade and Industry, my brief to discuss forthcoming legislation and regulations invariably said, “Minister, we don’t really want this, but we can’t stop it. Could you try to seek at least one or two of the following half dozen amendments to it?” If we did achieve one or two, that was counted as a great triumph. Will my noble friend insist that departments go back to the briefs that were given to Ministers at the time the regulations went through and look for the changes that we wanted to secure but did not at the time? Will he also reflect on the irony of the Liberal Democrats complaining that secondary legislation will be used to change some of the regulations we inherited, given that they were all introduced under secondary legislation, which gave no option for Parliament to reject them at all?

Finally, since there is time for me to go on, will my noble friend reflect on the fact that the one thing we could do in the past was to gold-plate regulations, which we did? I pay tribute to my noble friend Lord Hailsham, on the privy counsellors’ Bench, who introduced a system to try to limit gold-plating of regulations when we implemented those of the EU. Will my noble friend the Minister make sure that when we modify these regulations, we do not succumb again to the temptation to gold-plate them and that we go back to the Hailsham dashboard—it was called something like that—to make sure that we do not make them more regulatory, rather than less?

[Lord True (Con)]

My Lords, a lot was wrapped up in there. I agree with what my noble friend said at the end and with his tribute to my noble friend Lord Hailsham. There is an eternal tendency, partly because of some of the factors I referred to in my previous answer, to gold-plate and overregulate, and it constantly has to be held in check. Perhaps one of the many benefits of this exercise is that it is departments that will have to make the responses, take the work forward under the supervision of the Brexit Opportunities Unit and consider the kind of points that my noble friend makes.

Finding the papers from the past is an interesting challenge. I am sure that most of those have now been publicly released. I read today that the papers of the Blair Government were being released by the National Archives, so I am sure that the briefs to my noble friend are available to all and sundry. Perhaps we should all go and have a look at them.

House adjourned at 5.33 pm.