Exiting the European Union and Global Trade

Lord Vaizey of Didcot Excerpts

Thursday 6th July 2017 Commons Chamber

[Sir William Cash]

I know where the hon. Gentleman is coming from, but I simply say that even the leader of his party has more or less had to abandon the pursuit of the independence of Scotland, which is what underpins that question. [Interruption.] That is the bottom line. Comparisons between our great country and Somalia and Sudan are simply absurd, because this is a great country that has been making its own laws for centuries.

We went into the European Community with hope, and I voted yes in the 1975 referendum because I wanted to see whether it could work. My 30 years in the European Scrutiny Committee have proven absolutely that it does not. It is undemocratic and operates behind closed doors, and I doubt whether even that applies in some of the countries to which the hon. Gentleman has referred.

I now want to conclude—

[Mr Edward Vaizey (Wantage) (Con)]

Hear, hear!

[Sir William Cash]

I always know that I am making an impact when the hon. Member for Wantage starts wanting to get to his feet.

[Mr Vaizey]

Right hon. Friend.

[Sir William Cash]

He is my right hon. Friend—my very good friend. [Laughter.] I have great respect for him, although we do not always agree about everything. The same is true of my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke), who is, I suspect, on much the same track as him.

We enjoy a trade surplus of £34.4 billion with the rest of the world. As I said, yes, 44% of our trade is with the EU—

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[Mr Edward Vaizey (Wantage) (Con)]

I draw hon. Members’ attention to my entry in the Register of Members’ Financial Interests. This is the first time I have had the chance to speak in this new Parliament and the first time I have spoken with you in the Chair, Madam Deputy Speaker. It is a great honour.

Let me begin by praising the incredible work being undertaken by the Department for International Trade. I read the Secretary of State’s brilliant article on ConservativeHome this morning, and I know that everyone in the Chamber will have availed themselves of it. Ministers have travelled to 50 countries—the number of air miles accumulated boggles the mind—and 10 trade groups have been set up. We have an international trade adviser, and we took the shrewd decision to make the brilliant Antonia Romeo the permanent secretary. And we now have a Minister on the Front Bench who is fluent in German—

[Mr Jenkin]

And Russian.

[Mr Vaizey]

And Russian. So everything is now in place for progress to be made.

I have to say that I am sceptical about the future. May I quickly add that I do not work for the BBC? However, I want to use this opportunity to say that I am a huge supporter of the BBC and of BBC news, which is respected all around the world. Those people who question the BBC’s patriotism or declare that it is somehow biased in this debate are absurd. You can see me on YouTube, when I defended George Osborne’s Brexit emergency Budget debate, being torn apart by Andrew Neil. He cut me no slack as a remainer coming on his programme. The BBC is not biased or partial, and people who claim that it is have simply lost the argument.

Let me get back to the main point of the debate, which is trade. I confess that I find this country in a confusing position. We are leaving the European Union free trade area that gives us access to 500 million consumers in order to trade with them on the basis of the World Trade Organisation rules. That seems to be the only position that we are taking. At the same time, we will negotiate a free trade deal with the United States because we do not like trading with that country on a WTO basis, so I am completely unclear as to what our position is on free trade and why we are walking away from 500 million consumers. I also find it odd that we want to have no deal rather than a bad deal.

It is quite clear from Michel Barnier’s speech this morning that we cannot pick and choose which sectors might benefit from access to the single market. It is also clear that having access to the single market and being a member of the European Union enables us to have free trade. The European Union has negotiated 60 free trade deals. The House approved a free trade deal with Canada this week, and another has seen exports to Korea rise by 54%. The EU has just started negotiations with Japan, and it is through no fault of the EU that we do not have a trade deal with the United States.

Trade deals are not necessarily nirvana. Ministers and others say that we will be able to have free trade deals from the day we leave the European Union, but I caution them as to the nature of those free trade deals. My hon. Friend the Member for Stone (Sir William Cash) talked about the virtues of free trade, with which I agree, and the opportunity to reduce import tariffs, but he has to be aware of the reaction of the British public and different sectors of the British economy if we simply reduce tariffs against their competitors. Not every free trade deal will be plain sailing, which is why it has taken seven years to negotiate the free trade deal with Canada.

[Hannah Bardell]

Is the right hon. Gentleman aware of the research by the University of California, Berkeley showing that the average time taken to negotiate a free trade agreement is 28 months? That means it would take the UK 91 years of cumulative negotiation to get to where we are. Does he think that will be a problem?

[Mr Vaizey]

That is the point. The idea that we can take free trade deals off the shelf and not face lobbying from different sectors of our economy on the possible threats to their position from a free trade deal—the idea that all sectors of our economy are crying out for free trade deals—is a misconception. These are extremely complicated arrangements. [Interruption.] My hon. Friend the Member for Harwich and North Essex (Mr Jenkin) says that we do not have a free trade deal with the EU, but at least we have access to the market without quotas, tariffs or non-tariff barriers.

Remember that free trade deals are constructed by human beings. This week I met a former US trade negotiator who is well plugged into the entire scene and who told me that the US trade representative organisation is already at full stretch and is demoralised by President Trump canning the Trans-Pacific Partnership. It has to renegotiate the North American Free Trade Agreement, and the Transatlantic Trade and Investment Partnership has been put back on the agenda. When President Obama said that we were at the back of the queue, the language may have been unfortunate but we should be realistic about where we are in the line with the US and realistic about the capacity of the US Administration to negotiate with us.

I have a few asks of the Minister, who is free to reply in German or Russian, as he sees fit, to show his capacity, for which I have nothing but admiration. Which countries are we targeting, and why have we chosen them? I know that we have 10 trade groups. I would like to hear his thoughts on a timetable for free trade deals with those countries. Is there any economic analysis of what the growth of GDP will be once those free trade deals have been negotiated?

I am a great supporter of the work of the Secretary of State for International Trade, who mentioned the welcome inward investment we have seen in the past year or so. As a former Minister with responsibility for the digital industries, I particularly welcome the investment by companies such as Facebook and Google. There are many, many issues, but we welcome their inward investment. Does the Minister agree that that inward investment is predicated on their ability to recruit people with specialist abilities?

[James Duddridge]

From around the world.

[Mr Vaizey]

Will the Minister assure us that companies that want to invest in the UK will, as my hon. Friend the Member for Rochford and Southend East (James Duddridge) says, be able to continue recruiting people with the right skills both from the European Union and from across the world? One of the benefits of the single market is that for a person recruited from the European Union, having their partner and family members able to come here to work is a huge incentive.

[Vicky Ford (Chelmsford) (Con)]

I fully respect that we will be leaving the single market and will need a new deal. At the moment, a company selling, say, a cancer scanner to a Spanish hospital needs to have a maintenance service contract. It can send an engineer to service the scanner under a posting of workers arrangement, and there is mutual recognition of the engineer’s professional qualifications. Does my right hon. Friend agree that, in our new trade agreement, it is important to be able to easily trade not only goods but services, with the ability to send workers flexibly from one jurisdiction to another?

[Mr Vaizey]

My hon. Friend makes a fantastic point. She was an incredibly effective MEP and she certainly would have turned up to Juncker’s speech in the European Parliament; she worked tirelessly and I very much hope the Government will listen to her as we negotiate Brexit, because she has experience that is unparalleled in this House. The point she makes is pertinent to my constituency, where MRI scanners are made at Oxford Instruments.

I was going to talk about Euratom, but I have run out of time—luckily we have a Westminster Hall debate on Wednesday. I do not know whether my hon. Friend the Member for Stone (Sir William Cash) will be speaking in that debate, but we all want to make our points on Euratom then.

[Mr Jenkin]

Will my right hon. Friend find a moment or two to talk about Euratom?

[Mr Vaizey]

I will on Wednesday morning, because I have run out of time now—I have only 30 seconds left. I wish to conclude with a plea. I know that we have this two-year timetable under article 50, but, as the Secretary of State said, this is a political process. He is hoping that the European Union will do a deal because their politicians will want to do what is right for their people. Why are we wedded to a two-year cliff-edge process, given that even in a brief, six-minute speech I have been able to highlight some of the extraordinary complexities we are facing? If only I had had longer, perhaps 12 or 18 minutes, I could have expanded on this.

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[Tom Brake (Carshalton and Wallington) (LD)]

I also congratulate the hon. Member for Midlothian (Danielle Rowley) on her excellent speech and the priorities she has set for herself and her constituents. I also congratulate my hon. Friend the Member for Caithness, Sutherland and Easter Ross (Jamie Stone) on making a confident and polished maiden speech; clearly that particular Stone will be playing a significant role in the cairn of democracy.

I am disappointed that the Secretary of State is not here, because I would have liked to point out to him that the business of attacking national broadcasters is something that Putin and Trump do, and that it is not something that our Secretary of State should be doing.

[Mr Vaizey]

Will the right hon. Gentleman therefore join me in welcoming Robbie Gibb from the BBC, who has just become the director of communications at No. 10?