United Kingdom-European Union Future Economic Partnership

Lord Wallace of Saltaire Excerpts

Monday 5th March 2018 Lords Chamber

[Baroness Evans of Bowes Park]

A customs partnership would mean that at the border the UK would mirror the EU’s requirements for imports from the rest of the world, applying the same tariffs and the same rules of origin as the EU for those goods arriving in the UK and intended for the EU. By following this approach, we would know that all goods entering the EU via the UK paid the right EU duties, removing the need for customs processes at the UK/EU border. In relation to agency membership, there are indeed precedents. Switzerland, for instance, is an associate member of the European Aviation Safety Agency, which means that airworthiness certifications are granted by its own aviation authority and disputes are resolved through its courts.

[Lord Wallace of Saltaire (LD)]

On managed divergence and regulatory alignment, the phrase “managed divergence”, which I gather the Cabinet agreed on 10 days ago, does not appear in the Prime Minister’s speech or this Statement. What we have on regulatory alignment is the very odd statement that Parliament in many cases will pass identical laws to an EU law. That sounds remarkably like a sort of Potemkin sovereignty, in which we do it independently but we simply follow what the others have done. That is not real sovereignty at all. Do the Government now accept that the advantages of regulatory alignment across the whole goods sector are such that, in practice, we will want to maintain the same standards, or do they accept, as the Foreign Secretary and others wish to go on insisting, that there are some rules out there that we will somehow want to diverge on?

[Baroness Evans of Bowes Park]

It will be not just for this Parliament but for future Parliaments to decide what our regulations look like. As the Statement set out, we may choose to commit in some areas of regulation, such as state aid and competition, to remain in step with the EU. The UK drove much of the policy in this area, so we have much to gain from keeping proper discipline on the use of subsidies and anti-competitive practice. The noble Lord is right: the Statement said that Parliament may choose to pass an identical law. Businesses that export to the EU have told us that in some instances it is strongly in their interests to have a single set of regulatory standards. However, if the Parliament of the day decided not to achieve the same outcomes as EU law, it would be doing that in the knowledge that there may be consequences for market access, but it would be its decision to do so.