European Affairs

Mark Hendrick Excerpts

Wednesday 14th March 2018 Commons Chamber

[Sir Mark Hendrick (Preston) (Lab/Co-op)]

It is a pleasure to follow the hon. Member for Eddisbury (Antoinette Sandbach), whose thinking in some respects is very similar to mine.

Unfortunately, we are in a situation in which a Conservative Government find themselves in the unenviable position of not having a majority in Parliament while there are big divisions among their Back Benchers. They have an arrogant disregard for the practical realities they face, particularly with regard to their negotiation stance with the EU27 on Brexit. From “Brexit means Brexit” to “deep and special relationship”, and now “managed divergence”, it is clear that the Prime Minister is trying to find forms of words that will hold her party together, rather than producing a firm negotiating stance that is clearly understood by the EU and has a reasonable chance of success.

The marriage of convenience between the Conservative party and the Democratic Unionist party can be sustained only by the additional payment of £1 billion to Northern Ireland and an agreement over not having a hard border between Northern Ireland and the Republic of Ireland. This marriage is predicated, obviously, not only on a payment from the Exchequer to Belfast, but on the understanding that the free movement of goods, services and people across the border between the north and south of Ireland can be negotiated successfully with the EU27 without the UK having access to the single market or being in the customs union. Currently, that seems highly unlikely at best, and impossible at worst.

Without an agreement on access to the single market, as well as some agreement on a customs union, it is difficult to see how the Democratic Unionists can avoid a hard border. Current indications from Brussels give the impression that the EU27 will not be willing to agree on an open border unless there is some agreement in those two areas. All in all, the Government have a huge mountain to climb, are badly equipped to do so, and seem to think that the solution is to placate their own Back Benchers, rather than carrying out serious negotiations with our European neighbours.

It is now 21 months since the referendum and there is still little agreement between the EU and the UK on many key issues. The leave campaign promised that an extra £350 million a week could be spent on the NHS if we left the European Union. We now find a Government with a Foreign Secretary who was one of the leaders of the leave campaign and who said that the EU could “go whistle” when it became clear that the UK had to pay to leave the European Union to meet obligations that had already been agreed with the EU. On the contrary, the Government have now agreed to pay £40 billion to £50 billion to exit the EU. That is in sharp contrast to the £350 million a week that was going to come back into the NHS.

The so-called “sufficient progress” that was claimed to have been made in the first phase of Brexit still overlooks the details of what would be required to deal with a hard border with Ireland and to guarantee citizens’ rights in a manner acceptable to the UK and the EU. Within the phase 2 negotiations that should focus on the framework of a future relationship, we find that the EU is focusing on a “framework” while the UK talks about a “future relationship”. Little seems to be agreed about whether the transitional deal can be extended beyond two years, and a date of October this year to formalise talks on a transition is far too late to give businesses throughout the UK any sort of certainty about how they can continue to conduct business with companies in the EU27 states.

My view is similar to that of the hon. Member for Eddisbury: the UK should have adopted a negotiating stance of realising an outcome similar to the position of Norway, which has access to the single market despite the fact that it is not a member of the EU. On top of that, I would have liked to have seen a discussion about a customs union that would be far better than Turkey’s, which we could have negotiated with the EU27 in good faith. However, we have a Prime Minister who says that we do not want to be in the single market or the customs union. She wants a bespoke trade deal just for the UK, but she seems oblivious to the fact that such a proposal would seriously undermine the European single market and is therefore totally unacceptable to the EU.

The introduction of the concept of “managed divergence” seems to be more about managing the diverse range of views among Conservative Back Benchers than managing emerging differences between EU and UK regulations. The Chequers Brexit awayday, which was held to achieve a truce between the warring factions of the Conservative party, resulted in a negotiating stance of “ambitious managed divergence”. That form of words satisfied both the Brexiteers and the remainers, but it will find no support in the EU27 when these hard-headed negotiations finally get going.

The EU wants the Prime Minister to come forward with her vision of a future relationship between the EU and the UK. The managed divergence she talks about is known as the “three basket” approach, because it has three tiers: a core tier, where the UK would agree to align fully with EU regulations and adopt new rules automatically; a middle tier, where there would be a form of managed mutual recognition of rules, such as for environmental protection; and an outer tier, where the UK would be free to diverge from EU rules with no consequences for market access, whether or not those areas are in the single market’s acquis. The notion that the EU will be willing to accept three baskets of regulations in its trading arrangements with the UK is delusional and makes the British Government themselves look like a basket case.

This whole Brexit catastrophe is like watching a car crash in slow motion, except that the driver, the Prime Minister, is holding her hands over her eyes and trying to convince the passengers—her own party and the public—that everything will turn out fine. It can only result in humiliation for the Prime Minister when it is made clear that managed divergence is not acceptable and that this inflexible attitude towards the single market, the customs union and, for that matter, the European Court of Justice cannot continue. One can envisage the outcome being a hard Brexit. That hard Brexit is the favoured option of some of the Brexiteers in her party, but it could destroy any hope of a soft border between the north and the south of Ireland.

The Prime Minster should stiffen her resolve and tell her recalcitrant Back Benchers that our trading relationship with the EU is still important, even though we are leaving the EU. She should get down to serious negotiations that will preserve jobs and businesses up and down this country, instead of leading us off a cliff edge that will result in a WTO-style agreement.