European Union (Withdrawal) Bill

Matthew Pennycook Excerpts

3rd reading: House of Commons & Report stage: Second Day: House of Commons
Wednesday 17th January 2018 Commons Chamber

[Matthew Pennycook (Greenwich and Woolwich) (Lab)]

I beg to move, That the clause be read a Second time.

[Mr Speaker]

With this it will be convenient to discuss the following:

New clause 2—Meaning of Withdrawal Agreement—

“It shall be the objective of Her Majesty’s Government to ensure that the arrangements for the UK’s withdrawal from the EU which comprise the “withdrawal agreement” specified in subsection (1) of section 14 shall include full, comprehensive and sufficient detail as if it were a legal instrument capable of acceptance and deposit as an international trade agreement at the World Trade Organisation, with detailed agreements on the following aspects of the future relationship between the United Kingdom and European Union including—

(a) geographical scope of application,

(b) regulatory cooperation,

(c) national security,

(d) cross-border trade in services,

(e) market access,

(f) tariff arrangements,

(g) tariff rate quotas on all products,

(h) customs duties on imports,

(i) duties, taxes and charges on exports,

(j) fees and charges,

(k) import and export restrictions,

(l) provisions concerning anti-dumping and countervailing measures,

(m) transparency,

(n) sanitary and phytosanitary measures,

(o) trade conditions,

(p) customs valuation,

(q) subsidies,

(r) dispute settlement and mediation,

(s) establishment of investments,

(t) non-discriminatory treatment,

(u) expropriation,

(v) enforcement of awards,

(w) mutual recognition of professional qualifications,

(x) cross-border financial services,

(y) prudential regulatory alignment,

(z) maritime transport services,

(aa) telecommunications,

(bb) electronic commerce,

(cc) competition policy,

(dd) state enterprises and monopolies,

(ee) government procurement,

(ff) intellectual property,

(gg) trade and sustainable development and the environment,

(hh) trade and labour standards and employment conditions and

(ii) taxation.”

This new clause would make it the objective of HM Government that the withdrawal agreement sought prior to exit day should include proposals setting out the full details expected of a comprehensive international trade agreement.

New clause 3—Republic of Ireland and Northern Ireland—

“(1) Nothing in the provisions made under section 8 or section 9 of this Act shall authorise any regulations which—

(a) breach any of the obligations of Her Majesty’s Government made under the Belfast Agreement implemented in the Northern Ireland Act 1998 (which made new provision for the government of Northern Ireland for the purpose of implementing the agreement reached at multi-party talks on Northern Ireland), or

(b) create hard border arrangements between Northern Ireland and the Republic of Ireland, or

(c) undermine the full alignment of the United Kingdom with the rules of the European Union Internal Market and the Customs Union which support North-South cooperation, the all-island economy and the protection of the Belfast Agreement.

(2) Subsection (1)(c) shall apply unless Her Majesty’s Government, the Government of the Republic of Ireland and the European Union agree alternative specific solutions which can continue to address the unique circumstances of the island of Ireland, the obligations of the Belfast Agreement and the avoidance of a hard border arrangement between Northern Ireland and the Republic of Ireland.”

This new clause would ensure that the aspects of the Phase 1 agreement between the UK and the EU regarding the Republic of Ireland and Northern Ireland are brought into UK law.

New clause 4—Financial Settlement—

“The Chancellor of the Exchequer shall publish, within one month of Royal Assent of this Act, the full details of the methodology agreed between Her Majesty’s Government and the European Union as set out in the “Joint Report from the Negotiators on Progress During Phase 1” which was published on 8 December 2017.”

This new clause would ensure that the agreed methodology for calculating the financial settlement between the UK and the EU set out in the Joint Report from the Negotiators of 8 December 2017 are published and brought into the public domain.

New clause 5—Trade in Services—

“It shall be the objective of Her Majesty’s Government, in negotiating a withdrawal agreement, to secure the same rights, freedoms and access available to UK businesses trading in services as exists through the United Kingdom’s membership of the European Union, as if section 1 of this Act were not brought into effect.”

This new clause would ensure that the negotiating objectives of Ministers would be to secure the same benefits for service sector trading businesses after exit day as are available under the existing Single Market and Customs Union arrangements by virtue of membership of the European Union.

New clause 6—Alteration to the notification under Article 50(2) of the Treaty on the European Union—

“Her Majesty’s Government shall publish a summary of the legal advice it has received in respect of the ability of the United Kingdom to extend, alter or revoke the notification, under Article 50(2) of the Treaty on the European Union, of the United Kingdom’s intention to withdraw from the EU.”

This new clause would require Ministers to place in the public domain a summary of the legal advice they have received concerning the options available for the United Kingdom in respect of the notification made under Article 50 of the Treaty on the European Union.

New clause 10—Governance and institutional arrangements—

“(1) Before exit day a Minister of the Crown must make provision that all powers and functions relating to any right, freedom, or protection, that any person might reasonably expect to exercise, that were exercisable by EU entities or other public authorities anywhere in the United Kingdom before exit day, and which do not cease to have effect as a result of the withdrawal agreement (“relevant powers and functions”) will—

(a) continue to be carried out by an EU entity or public authority;

(b) be carried out by an appropriate existing or newly established entity or public authority in the United Kingdom; or

(c) be carried out by an appropriate international entity or public authority.

(2) For the purposes of this section, relevant powers and functions relating to the UK exercisable by an EU entity or public authority include, but are not limited to—

(a) monitoring and measuring compliance with legal requirements;

(b) reviewing and reporting on compliance with legal requirements;

(c) enforcement of legal requirements;

(d) setting standards or targets;

(e) co-ordinating action;

(f) publicising information.

(3) Responsibility for any functions or obligations arising from retained EU law for which no specific provision has been made immediately after commencement of this Act will belong to the relevant Minister until such a time as specific provision for those functions or obligations has been made.”

This new clause would ensure that substantive rights and protections cannot be removed by the “back door”, and that the institutions and agencies that protect EU derived rights and protections are replaced to a sufficient standard so those rights and protections will still be enjoyed in practice.

New clause 11—Meaningful vote on deal or no deal—

“(1) The Prime Minister must publish and lay before both Houses of Parliament an assessment of the impact on the economy of the United Kingdom, and on each nation, province or region of the United Kingdom, of any unratified agreement between the United Kingdom and the EU under Article 50(2) of the Treaty on European Union which sets out the arrangements for the United Kingdom’s withdrawal from the EU.

(2) Any agreement between the United Kingdom and the EU under Article 50(2) of the Treaty on European Union which sets out the arrangements for the United Kingdom’s withdrawal from the EU may not be ratified unless—

(a) subsection (1) has been complied with,

(b) the House of Lords has considered a motion relating to the unratified agreement,

(c) the House of Commons has approved the unratified agreement by resolution,

(d) the statute mentioned in section 9 (approving the final terms of withdrawal of the United Kingdom from the European Union) has been passed, and

(e) any other legislative provision to enable ratification has been passed or made.

(3) If no agreement has been reached by 31 December 2018 between the United Kingdom and the EU under Article 50(2) of the Treaty on European Union setting out the arrangements for the United Kingdom’s withdrawal from the EU, the Prime Minister must publish and lay before both Houses of Parliament within one month an assessment of the impact on the economy of the United Kingdom, and on each nation, province or region of the United Kingdom, of leaving the EU under Article 50(3) of the Treaty on European Union without an agreement.

(4) If no agreement has been reached by 31 January 2019 between the United Kingdom and the EU under Article 50(2) of the Treaty on European Union setting out the arrangements for the United Kingdom’s withdrawal from the EU,

(a) a Minister of the Crown must propose a motion in the House of Lords relating to the lack of an agreement, and

(b) a Minister of the Crown must propose a motion in the House of Commons approving the intention of the United Kingdom to leave the EU under Article 50(3) of the Treaty on European Union without a withdrawal agreement.

(5) Unless the House of Commons approves by resolution after 31 January 2019 the intention of the United Kingdom to leave the EU under Article 50(3) of the Treaty on European Union without a withdrawal agreement, the Prime Minister must either—

(a) reach an agreement before exit day between the United Kingdom and the EU under Article 50(2) of the Treaty on European Union which sets out the arrangements for the United Kingdom’s withdrawal from the EU, or

(b) request the European Council for an extension of negotiation under Article 50(3) of the Treaty on European Union, or

(c) rescind the notice of intention under Article 50(2) of the Treaty on European Union to withdraw from the EU given in accordance with the European Union (Notice of Withdrawal) Act 2017 and request the European Council to accept that rescission.’

This New Clause would ensure that the Government assesses the impact of either an agreement or no deal on the UK economy and regions before a meaningful vote, and that if Parliament does not agree to the agreement or to no deal, then the Government must request a revocation or extension of Article 50.

New clause 12—Environmental protection after EU exit—

“(1) Before any exit day, the Secretary of State must publish a report detailing all EU environmental protections, powers and functions.

(2) The report pursuant to subsection (1) shall specify—

(a) all environmental legal protections which derive from EU law;

(b) the powers and functions relating to environmental protection or improvement exercised by EU institutions;

(c) the empowering provisions in EU law relating to those functions; and

(d) any loss of environmental protection, or the monitoring and enforcement of environmental protections, which may arise as a result of the UK’s exit from the EU.

(3) Before any exit day the Secretary of State must publish proposals for primary legislation (the “Draft Environmental Protection Bill”).

(4) The Draft Environmental Protection Bill must include provisions which would—

(a) ensure that the level of environmental protection provided by EU law on the day this Act receives Royal Assent is maintained or enhanced;

(b) make provision to remedy any loss of environmental protection, or the monitoring and enforcement of environmental protections, established in the report pursuant to subsection (1);

(c) create a statutory corporation (to be called “the Environmental Protection Agency”) with operational independence from Ministers of the Crown to monitor environmental targets previously set by EU law relating to environmental protection and other such environmental targets that may be set by Ministers of the Crown and international treaties to which the United Kingdom is party;

(d) require the statutory corporation in (4)(c) to report to Parliament every year on progress in meeting those targets and to make recommendations for remedial action where appropriate;

(e) allow the statutory corporation in (4)(c) to publish additional reports identifying action or omissions on the part of Ministers of the Crown that is likely to result in targets not being met; and

(f) extend to the whole of the United Kingdom.

(5) The Secretary of State must publish annual reports to Parliament on how environmental protections and the monitoring and enforcement of environmental protections have been affected by the United Kingdom’s exit from the EU.

(6) Before publishing a report pursuant to subsection (5) the Secretary of State must hold a public consultation on the effect of leaving the EU on environmental protection.

(7) The Secretary of State must publish and lay before each House of Parliament the first report pursuant to subsection (5) no later 29 March 2020 and each subsequent report must be published no later than the period of one year after the publication of the previous report.”

This new clause would require the Secretary of State to produce a report on the loss of environmental protection as a result of the UK’s exit from the EU, and to prepare an Environmental Protection Bill to make up for any loss of environmental protections, and the monitoring and enforcement of environmental protections. It would also require the Secretary of State to produce annual reports which make an assessment of the impact of the UK’s withdrawal from the EU on UK environmental protection.

New clause 14—Maintaining individual rights and protections—

“(1) When making any agreement under subsection (2), the Secretary of State shall take steps to ensure that UK citizens enjoy standards of rights and protections equivalent to those enjoyed by citizens of the EU under EU law.

(2) This section applies to—

(a) any agreement between the United Kingdom and the EU which prepares for, or implements, the UK’s withdrawal from the EU;

(b) any international trade agreement—

(i) between the UK and the EU, or

(ii) between the UK and another signatory which seeks to replicate in full or in part the provisions of an international trade agreement between the EU and the other signatory.

(3) In relation to any agreement under subsection (2), the Secretary of State will maintain the highest standards of transparency.”

This new clause creates a duty for the Government to ensure that individual rights and protections are maintained to a level equivalent to (although not necessarily the same as) those in the EU when making agreements with the EU or international trade agreements.

New clause 15—Non-regression of equality law—

“(1) Any EU withdrawal related legislation must be accompanied by a statement made by a Minister of the Crown certifying that in the Minister‘s opinion the legislation does not remove or reduce protection under or by virtue of the Equality Acts 2006 and 2010.

(2) In subsection (1) “EU withdrawal related legislation” means—

(a) any statutory instrument under this Act;

(b) any statutory instrument made by a Minister of the Crown wholly or partly in connection with the United Kingdom’s withdrawal from the EU; and

(c) any Bill presented to Parliament by a Minister of the Crown which is wholly or partly connected to the United Kingdom’s withdrawal from the EU.”

This new clause would ensure that legislation in connection with withdrawal from the EU does not reduce protections provided by equality law.

New clause 17—Effect of losing access to EU single market and customs union—

“(1) The Prime Minister must publish and lay before both Houses of Parliament an assessment of the impact on the economy of the United Kingdom, and on each nation, province or region of the United Kingdom, of any unratified agreement (“the Agreement”) between the United Kingdom and the EU under Article 50(2) of the Treaty on European Union which sets out the arrangements for the United Kingdom’s withdrawal from the EU.

(2) The assessment in subsection (1) must so far as practicable analyse the expected difference in outcomes between the Agreement and continued participation in the EU single market and customs union.

(3) The assessment in subsection (1) must be prepared by the Treasury and must include separate analyses from the National Audit Office, the Office of Budget Responsibility, the Government Actuary’s Department, and the finance directorates of each of the devolved Administrations of the methodology and conclusions of the Treasury assessment.

(4) A statute of the kind mentioned in section 9 (approving the final terms of withdrawal of the United Kingdom from the European Union) may not come into effect until the Prime Minister’s assessment under subsection (1) has been—

(a) debated by each House of Parliament, and

(b) approved by resolution of the House of Commons.”

This purpose of this New Clause is to ensure that the alternative of remaining in the EU single market and customs union is formally considered by Parliament on the basis of an independently validated economic assessment before any statute approving the final terms of withdrawal takes effect.

New clause 18—Consultation on environmental governance and principles—

“(1) Within one month of Royal Assent, the Secretary of State must consult on and bring forward proposals to—

(a) provide that all powers and functions relating to the environment or environmental protection that were exercisable by EU entities or other public authorities anywhere in the United Kingdom before exit day which do not cease to have effect as a result of the withdrawal agreement are fully carried out.

(b) introduce primary legislation to establish a new independent environmental regulator with the purpose of, responsibility for, and appropriate powers to oversee the implementation of, compliance with and enforcement of environmental law and principles by relevant public authorities.

(c) incorporate EU environmental principles in primary legislation as a basis for relevant decision-making by UK public bodies and public authorities.

(d) establish a process for the publication of a national environmental policy statement or statements describing how the environmental principles will be interpreted and applied.

(2) EU Environmental principles include but are not limited to—

(a) the precautionary principle;

(b) the principle that preventive action should be taken to avert environmental damage;

(c) the principle that environmental damage should as a priority be rectified at source;

(d) the polluter pays principle;

(e) the principle that environmental protection requirements must be integrated into the definition and implementation of policies and activities, in particular with a view to promoting sustainable development;

(3) In carrying out a consultation under this section, the Government must—

(a) consult with the devolved authorities;

(b) be open to responses for at least two months; and

(c) consider the resources and legal powers that the proposed regulator under (1)(b) will need in order to properly carry out its functions.”

This new clause enshrines the Government’s stated intentions in respect of the environmental principles and the establishment of a new independent environmental regulator. It sets out the minimum standards for consultation on these matters.

New clause 20—Citizens’ Jury on Brexit Negotiations—

“(1) A citizens’ jury shall be established to enable UK citizens to be consulted on the progress of negotiations between the UK and the EU on the withdrawal of the UK from the EU, and the approach outlined in UK Government White Papers.

(2) The citizens’ jury shall in total be composed of exactly 1501 persons.

(3) Members of the citizens’ jury shall be randomly selected by means of eligibility from UK citizens on the current electoral register as registered on the date of this Act receiving royal assent, with allocation across the 9 UK Government Regions, Scotland, Wales and Northern Ireland weighted by population, and a stratification plan, with the aim of securing a group of people who are broadly representative demographically of the UK electorate across characteristics including whether they voted Leave or Remain.

(4) The jury will be broken down into individual sittings for each of the 9 UK Government Regions in England, as well as Scotland, Wales and Northern Ireland.

(5) The sittings will be for no more than 72 hours at a time, facilitated by independent facilitators, and if required, by electing fore-people from within their number.

(6) Membership of the jury will be subject to the same regulations and exceptions as a regular jury, but membership can be declined without penalty.

(7) The citizens’ jury will be able to require Ministerial and official representatives of the UK Government and the Devolved Administrations to give testimony to them to inform their work, and to have the power to invite other witnesses to give evidence as required.

(8) The citizens’ jury shall publish reports setting out their conclusions on the negotiations and UK Government White Papers.

(9) The first report from the citizens’ jury shall be published within two months of this Act receiving Royal Assent, and subsequent reports shall be published at intervals of no more than two months.

(10) Costs incurred by the citizens’ jury shall be met by the Exchequer.”

New clause 21—Environmental protection and improvement: continuation of powers and functions—

“(1) The Secretary of State must establish and maintain a publicly accessible register of EU environmental powers and functions.

(2) The register produced pursuant to subsection (1) shall specify—

(a) the specific powers and functions relating to environmental protection or improvement exercised by EU institutions;

(b) the EU institution previously responsible for exercising those powers and functions; and

(c) the empowering provision in EU law relating to those powers and functions.

(3) The register produced pursuant to subsection (1) shall include the following functions—

(a) monitoring and measuring compliance with legal requirements;

(b) reviewing and reporting on compliance with legal requirements;

(c) enforcement of legal requirements;

(d) setting standards or targets;

(e) co-ordinating action; and

(f) publicising information including regarding compliance with environmental standards.

(4) Within one month of Royal Assent, the Secretary of State must—

(a) publish and lay before Parliament a statement identifying those powers and functions identified in the public register established under subsection (1) that will continue to be exercised by EU institutions or, alternatively, the existing or proposed new public authorities to which these powers and functions will be transferred; and

(b) make Regulations containing provisions to ensure that all relevant powers and functions relating to environmental protection or improvement exercisable by EU institutions anywhere in the United Kingdom before exit day continue on and after exit day.”

This new clause would ensure oversight of the transfer of functions from EU institutions to domestic institutions, by requiring the Government to establish a publicly accessible register of environmental governance functions and powers exercised by EU institutions, and to make regulations that ensure that all relevant environmental powers and functions are continued.

New clause 22—Dealing with deficiencies arising from withdrawal – further provisions—

“(1) This section applies where there is a deficiency in retained EU law on and after exit day in respect of which regulations have not been made under section 7.

(2) A deficiency includes, but is not limited to, retained EU law which—

(a) contains anything which has no practical application in relation to the United Kingdom or any part of it or is otherwise redundant or substantially redundant;

(b) confers functions on, or in relation to, EU entities which no longer have functions in that respect under EU law in relation to the United Kingdom or any part of it;

(c) makes provision for, or in connection with, reciprocal arrangements between—

(i) the United Kingdom or any part of it or a public authority in the United Kingdom, and

(ii) the EU, an EU entity, a member State or a public authority in a member State,

which no longer exist or are no longer appropriate.

(d) makes provision for, or in connection with, other arrangements which—

(i) involve the EU, an EU entity, a member State or a public authority in a member State, or

(ii) are otherwise dependent upon the United Kingdom’s membership of the EU,

and which no longer exist or are no longer appropriate

(e) makes provision for, or in connection with, any reciprocal or other arrangements not falling within paragraph (c) or (d) which no longer exist, or are no longer appropriate, as a result of the United Kingdom ceasing to be a party to any of the EU Treaties,

(f) does not contain any functions or restrictions which—

(i) were in an EU directive and in force immediately before exit day (including any power to make EU tertiary legislation), and

(ii) it is appropriate to retain, or

(g) contains EU references which are no longer appropriate.

(3) A deficiency within the meaning of subsection (1) includes any failure or other deficiency arising from the United Kingdom’s withdrawal from the EU together with the operation of any provision, or the interaction between any provisions, made by or under this Act, but does not include any modification of EU law which is adopted or notified, comes into force or applies only on or after exit day.

(4) Where this section applies, the retained EU law in respect of which the deficiency arises is to be interpreted in accordance with subsections (5) to (9).

(5) The retained EU law does not allow, prevent, require or otherwise apply to acts or omissions outside the United Kingdom.

(6) An EU reference is not to be treated, by reason of the UK having ceased to be a member State, as preventing or restricting the application of retained EU law within the United Kingdom or to persons or things associated with the United Kingdom.

(7) Functions conferred on the EU or an EU entity are to be treated as functions of the Secretary of State.

(8) Any provision which requires or would, apart from subsection (7), require a UK body to—

(a) consult, notify, co-operate with, or perform any other act in relation to an EU body, or

(b) take account of an EU interest,

is to be treated as empowering the UK body to do so in such manner and to such extent as it considers appropriate.

(9) In subsection (8)—

“a UK body” means the United Kingdom or a public authority in the United Kingdom;

“an EU body” means the EU, an EU entity (other than the European Court), a member State or a public authority in a member State;

“an EU interest” means an interest of an EU body or any other interest principally arising in or connected with the EU (including that of consistency between the United Kingdom and the EU);

“requires” includes reference to a pre-condition to the exercise of any power, right or function;

(10) This section ceases to have effect after the end of the period of two years beginning with exit day.”

This new clause provides a scheme for interpretation as a backstop where the transposition necessary to avoid deficiencies has not been effected by regulations made under Clause 7.

Amendment 2, in clause 7, page 5, line 6, leave out subsections (1) to (6) and insert—

“(1) A Minister of the Crown may by regulations make such provision as the Minister considers necessary to prevent, remedy or mitigate—

(a) any failure of retained EU law to operate effectively, or

(b) any other deficiency in retained EU law,

arising from the withdrawal of the United Kingdom from the EU.

(2) Deficiencies in retained EU law are where the Minister considers that retained EU law—

(a) contains anything which has no practical application in relation to the United Kingdom or any part of it or is otherwise redundant or substantially redundant,

(b) confers functions on, or in relation to, EU entities which no longer have functions in that respect under EU law in relation to the United Kingdom or any part of it,

(c) makes provision for, or in connection with, reciprocal arrangements between—

(i) the United Kingdom or any part of it or a public authority in the United Kingdom, and

(ii) the EU, an EU entity, a member State or a public authority in a member State, which no longer exist or are no longer appropriate,

(d) makes provision for, or in connection with, other arrangements which—

(i) involve the EU, an EU entity, a member State or a public authority in a member State, or

(ii) are otherwise dependent upon the United Kingdom’s membership of the EU, and which no longer exist or are no longer appropriate,

(e) makes provision for, or in connection with, any reciprocal or other arrangements not falling within paragraph (c) or (d) which no longer exist, or are no longer appropriate, as a result of the United Kingdom ceasing to be a party to any of the EU Treaties,

(f) does not contain any functions or restrictions which—

(i) were in an EU directive and in force immediately before exit day (including any power to make EU tertiary legislation), and

(ii) it is appropriate to retain, or

(g) contains EU references which are no longer appropriate.

(3) But retained EU law is not deficient merely because it does not contain any modification of EU law which is adopted or notified, comes into force or only applies on or after exit day.

(4) Regulations under this section may make any provision that could be made by an Act of Parliament.

(5) Regulations under this section may provide for—

(a) functions of EU entities or public authorities in member States (including making an instrument of a legislative character or providing funding) to be exercisable instead by a public authority (whether or not newly established or established for the purpose) in the United Kingdom,

(b) the establishment of public authorities in the United Kingdom to carry out functions provided for by regulations under this section.

(6) Regulations to which subsection (5) apply must ensure that the functions of such EU entities or public authorities are exercised with equivalent scope, purpose and effect by public authorities in the United Kingdom.

(7) But regulations under this section may not—

(a) impose or increase taxation,

(b) make retrospective provision,

(c) create a relevant criminal offence,

(d) be made to implement the withdrawal agreement,

(e) amend, repeal or revoke the Human Rights Act 1998 or any subordinate legislation made under it,

(f) amend or repeal the Northern Ireland Act 1998 (unless the regulations are made by virtue of paragraph 13(b) of Schedule 7 to this Act or are amending or repealing paragraph 38 of Schedule 3 to the Northern Ireland Act 1998 or any provision of that Act which modifies another enactment),

(g) contain any provision the effect of which is that, in comparison with the position immediately before the exit date—

(i) any right conferred on a person by retained EU law is either removed or made less favourable,

(ii) any standard laid by retained EU law is lowered, or

(iii) any remedy, procedure or method of enforcement, in relation to any rights or standards conferred by retained EU law, is made less effective, or

(h) amend, repeal or revoke the Equality Act 2010 or any subordinate legislation made under that Act.”

This amendment restricts the Clause 7 powers so as to ensure they are only used as far is as necessary for the purposes of the Bill, that they do not abolish enforcement functions and that they do not reduce rights or protections.

Amendment 9, page 6, line 16, at end insert—

“(da) amend, repeal or revoke any retained EU law which implements a provision listed in Schedule [Exceptions for Directives etc.].”

This amendment, which is linked to NS1, would except EU Directives relating to workers’ rights from the power to make regulations to remedy deficiencies in retained EU law.

Amendment 56, page 6, line 23, at end insert—

“(6A) Within three months of this Act receiving Royal Assent, and every three months thereafter, a report must be laid before each House of Parliament listing—

(a) all deficiencies which Ministers of the Crown have identified would arise in retained EU law after exit day but which they do not intend to prevent, remedy or mitigate in advance using the powers under subsection (1);

(b) the reasons for each decision not to prevent, remedy or mitigate such deficiencies, and

(c) an assessment of the consequences of that decision.”

This amendment (linked with Amendment 55 provides for Parliamentary scrutiny of any decision not to use clause 7 powers to save retained EU law from being unable to operate effectively.

Amendment 59, in clause 9, page 7, line 16, at end insert—

“(5) No regulations may be made under this section until the Secretary of State has signed an agreement with the European Union guaranteeing that the United Kingdom will remain a permanent member of the EU single market and customs union.”

This amendment would mean the UK would confirm its continued membership of the single market and customs union before Ministers of the Crown carry out any actions under Clause 9 of the Bill.

Amendment 10, in clause 14, page 10, line 40, leave out from “means” to the end of line 41 and insert

“the time specified by an Act of Parliament approving the final terms of withdrawal of the United Kingdom from the EU;”.

This amendment would require exit day to be specified in a separate bill on the terms of withdrawal.

Amendment 39, page 11, line 37, at end insert

“and the arrangements for a status quo transitional period which encompasses—

(a) a “bridging period” to allow new agreements to be reached satisfactorily between the United Kingdom and the European Union lasting as long as necessary for a full trade agreement to be ratified, and

(b) an “adaptation period” to allow the phasing in of new requirements over time to provide for the implementation of changes to new agreements in an orderly and efficient manner.”

This amendment ensures that the meaning of “withdrawal agreement” is also taken to include a detailed transitional period with two distinct aspects, firstly allowing for a “bridging period” during which new agreements are concluded and secondly allowing for an “adaptation period” to give business and other organisations a period to adjust to those new arrangements.

Amendment 1, page 11, line 40, at end insert—

“(2A) Subsection (2B) applies if any “exit day” appointed in this Act is not in accordance with any transitional arrangements agreed under Article 50 of the Treaty of the European Union.

(2B) A Minister of the Crown may by regulations—

(a) amend the definition of “exit day” in the relevant sections to ensure that the day and time specified are in accordance with any transitional arrangements agreed under Article 50 of the Treaty of the European Union, and

(b) amend subsection (2) in consequence of any such amendment.

(2C) Regulations under subsection (2B) are subject to the affirmative procedure.”

This amendment ensures that the Bill can facilitate transitional arrangements within the single market and customs union.

New schedule 1—Exceptions for directives etc.—

[Matthew Pennycook]

I rise to speak to new clause 1 and amendments 2 and 1, which stand in my name and those of my right hon. and hon. Friends. As you are aware, Mr Speaker, this remaining group contains a significant number of important issues, and while I want to spend time talking to each of our three amendments, I am conscious that time is limited, so I will endeavour to keep my remarks as brief as possible.

As my hon. Friend the Member for Sheffield Central (Paul Blomfield) reminded the House yesterday, as far back as last March the Opposition set out six ways in which the Bill required improvement. The first was that it be drafted in such a way as to enable transitional arrangements after 29 March 2019 on the same basic terms as now—including being in a customs union with the EU and within the single market. The second was that the sweeping delegated powers in the Bill be circumscribed. The third was that it needed to contain clear and robust protection and enforcement mechanisms for all EU-derived rights, entitlements, protections and standards. Sadly, despite some small steps in the right direction, the Government have largely failed to respond in any meaningful way to the concerns we raised in relation to these three areas. The purpose of new clause 1 and amendments 2 and 1 is to press the Government once again to do something about each of them.

I turn first to new clause 1, the purpose of which is to ensure that retained EU law enjoys a form of enhanced protection from subordinate legislation contained in other Acts of Parliament. This is a highly technical matter but a crucial one for the rights and protections our constituents enjoy. Mr Speaker, you were not in the Chamber at the time, but hon. Members who were present will recall that the House debated clauses 2, 3 and 4 in great detail on day two of Committee, and I certainly do not intend to cover the same ground again today. As we heard again yesterday, however, there are very real problems that flow from the ambiguous and uncertain status of retained EU law—a problem to which we believe new clause 13, tabled by the right hon. and learned Member for Beaconsfield (Mr Grieve), provides a pragmatic solution, or at the very least a sensible starting point for a conversation about how the status of this new category of law could be more clearly defined.

Leaving to one side the issues relating to the status of retained EU law—issues that I have no doubt the other place will return to at some length—there is another, related concern, and that is the vulnerability of this new category of law to subordinate legislation and what that means in practical terms for the rights, entitlements, protections and standards our constituents currently enjoy. I want to be very clear as to the argument I am making at this point, because when I first did so on day two of Committee, the debate was prone to veer off on to other related but distinct issues.

The concern I am highlighting does not relate to the issue of how Parliament is to scrutinise and, where necessary, approve the hundreds of statutory instruments that will flow from clause 7, as well as clauses 8, 9 and 17. We welcomed the Government’s acceptance of the amendments tabled by the hon. Member for Broxbourne (Mr Walker) and other members of the Procedure Committee, although we still believe that they do not go far enough, particularly in relation to the new sifting committee’s inability to request that Ministers revoke and remake specific statutory instruments.

Nor does the argument that I am advancing concern how the powers contained in this Bill might be used to amend, modify or repeal retained EU law. The specific issue that I am highlighting, and what new clause 1 seeks to address, is our serious concern that the Bill as drafted leaves retained EU law vulnerable to amendment, modification or repeal by subordinate legislation contained in numerous other Acts of Parliament.

[Melanie Onn (Great Grimsby) (Lab)]

Is it not the case that workers’ rights have no privileged status under the Bill? Once the Bill becomes an Act, those rights can be picked off by secondary legislation. If the Government wish to prevent workers from receiving proper holiday pay or to cap awards for discrimination, they will be easily able to do so.

[Matthew Pennycook]

That is absolutely true. The Government would be able to do that by using subordinate legislation in other Acts of Parliament. That applies not just to workers’ rights, but to other areas of law such as the environment and consumer rights. That category of law will lose its underpinnings following our departure from the EU.

Wrenched away from the enhanced protection enjoyed as a result of our EU membership, retained EU law—and we should bear in mind that that category of law might be with us for decades—will in many cases enjoy the lowest possible legislative status, and consequently the wide range of rights and protections that flow from it will be more vulnerable than they were before. The Opposition have repeatedly emphasised that Brexit must not lead to any watering down or weakening of EU-derived rights, particularly rights and standards in areas such as employment, equality, health and safety, consumers and the environment. That is why we tabled new clause 58 in Committee. Setting out the reasons why the Government were opposed to new clause 58, the Solicitor General argued that it would

“fetter powers across the statute book that Parliament has already delegated.”

Furthermore:

“Relying only on powers set out in this Bill to amend retained EU law would be insufficient”.—[Official Report, 15 November 2017; Vol. 631, c. 418.]

In keeping with the constructive approach that we have taken towards the Bill throughout this process, we have engaged seriously with the Solicitor General’s argument, and new clause 1 is the result. Like new clause 58, it seeks to give retained EU law a level of enhanced protection, thus avoiding a situation in which laws falling within the new category might enjoy the lowest possible legislative status. It also accepts the defence put forward by the Solicitor General, and provides a mechanism whereby a Minister may use regulations provided for in other Acts of Parliament to amend, repeal or modify retained EU law, but only in cases in which it is necessary to maintain or enhance rights and protections, and only after consultation. In short, it concedes that there are many instances in which the use of subordinate legislation contained in other Acts of Parliament might be necessary, but seeks to reconcile its use with a presumption of enhanced protection.

Since the referendum, Ministers have repeatedly stated that the Government do not wish to see any rights and protections diminished as a result of our departure from the EU. That is also what the public expect, but it requires a level of protection that the Bill as it stands does not provide. We hope that the Government will engage seriously with the new clause and accept it, but we intend to press it to a vote if they do not.

[Chris Stephens (Glasgow South West) (SNP)]

Is it not important for the public to be reassured about workers’ rights, given reports in the media of Cabinet discussions about scrapping the working time directive?

[Matthew Pennycook]

I think most of our constituents assume that the guarantees that they currently enjoy will continue. They will not know that many of these rights flow from and are underpinned by EU law, but they would expect them to be transposed in a way that would provide the same level of protection rather than the lowest possible legislative status. This is an issue to which we shall have to return, and one that the other place will no doubt tackle.

Amendment 2 seeks to further circumscribe the correcting powers contained in clause 7. Throughout this process, we have been at pains to argue that, to the extent that relatively wide delegated powers in the Bill are necessary, they should not be granted casually, and that when they are granted they should be limited whenever that is possible and practical. It is clear from their tabling of amendments 14 and 15, and consequential amendments, that the Government accept that there are shortcomings in the drafting of clause 7. We welcome the fact that the deficiencies identified in clause 7(2) will now form an exhaustive rather than an illustrative list—with the caveat, I should add, that the further deficiencies can be added at a later date. In effect, the list as drafted will be exhaustive unless Ministers subsequently decide that it is not. That is not perfect, but it does represent some progress.

Nevertheless, even with the incorporation of Government amendments 14 and 15, the correcting powers provided for which clause 7 provides are still too potent and too widely drawn. Suggestions on day six of the Committee stage that the clause ought to stipulate that the correcting power should be used only when necessary have been ignored, as have concerns that the Bill as drafted does not guarantee that the powers and functions of entities such as the European Commission and other EU agencies will continue to operate with equivalent scope, purpose and effect after exit day. Concerns that the Bill as drafted could be used for a purpose other than that which was intended— specifically, that it has the potential to diminish rights and protections—have likewise been ignored.

On day six, the Government had the chance to justify the drafting of the clause in detail and to address each of those concerns, but they did not do so adequately. They were also given an enormous menu of options, in amendments tabled by Back Benchers in all parties, whereby the powers in the clause—and, indeed, similar powers elsewhere in the Bill—might be constrained. Amendments 14 and 15 represent the totality of their response. As I have said, they are a step in the right direction. but on their own they are not enough. That is why we tabled amendment 2, which addresses comprehensively the range of flaws contained in clause 7 so that the correcting power is reasonably and proportionately circumscribed. If the Government do not indicate that they have taken those concerns on board and are prepared to act on them, we will press the amendment to a vote.

Amendment 1 seeks to ensure that the Bill can facilitate transitional arrangements after 29 March 2019 on the same basic terms as now. The Opposition have argued for some time that we need a time-limited transitional period between our exit from the EU and the future relationship that we build with our European partners. We believe that, to provide maximum certainty and stability, that transitional period should be based on the same basic terms as now. That includes our being in a customs union with the EU and in the single market, both of which will entail the continued jurisdiction of the European Court of Justice for the period that is agreed. Our view is shared widely by businesses and trade unions, but for a long time it was considered to be anathema to the Prime Minister and senior members of her Cabinet.

[Melanie Onn]

I thank my hon. Friend for being so generous with his time. There are many cases, such as Marshalls Clay Products Ltd v. Caulfield and Gibson v. East Riding of Yorkshire Council, in which domestic courts have reached incorrect decisions on workers’ rights. If the European Court of Justice will no longer be the adjudicator after the transitional period, what will?

[Matthew Pennycook]

After the transitional period, the ECJ would not be the adjudicator. That would be dealt with as a matter of retained law. My hon. Friend has reinforced a point that I made earlier. We need a level of enhanced protection and the courts need clarity on how to interpret this new category of law, because if they do not have that clarity and certainty, they will be more vulnerable.

[Sir William Cash (Stone) (Con)]

I hope shortly to be able to make a brief speech on that very subject, dealing with the question of whether or not there should be a power for the courts to disapply Acts of Parliament in relation to the matters to which the hon. Gentleman has referred.

[Matthew Pennycook]

I am not sure that that warranted an intervention, but I await the hon. Gentleman’s contribution with bated breath.

[Geraint Davies (Swansea West) (Lab/Co-op)]

Further to the point made by my hon. Friend the Member for Great Grimsby (Melanie Onn), does my hon. Friend agree that either the institutions and agencies that currently enforce EU rights, privileges and protections should be maintained as EU agencies, or a transitional arrangement should involve agencies and institutions that will protect people’s rights in respect of, for instance, work, the environment and consumer issues?

[Matthew Pennycook]

I certainly believe that, when it is appropriate and when the country will derive benefit, we should continue to participate in EU agencies. The important point, however, is that when the functions and powers of EU agencies are transferred to either an existing or a new body, the purpose, scope and effect of the rights and protections that flow from those agencies should continue. That is one of the issues that clause 7 fails to address.

Returning to my earlier train of thought, all of this was why the Prime Minister’s Florence speech of last year was so welcome. It made it clear that Government policy was to seek, semantics about implementation versus transition aside, a time-limited period in which the UK and the EU would continue to have access to one another’s markets on current terms, and with Britain continuing to take part in existing security measures.

Crucially, the Prime Minister made it clear that this bridging arrangement would take place on the basis of

“the existing structure of EU rules and regulations.”

That quite clearly implied the acceptance of the jurisdiction of the ECJ, as confirmed by the Prime Minister in an answer to the hon. Member for North East Somerset (Mr Rees-Mogg) in the weeks following the speech, when she stated:

“that may mean that we start off with the ECJ still governing the rules we are part of”. —[Official Report, 9 October 2017; Vol. 629, c. 53.]

It is also set out in black and white in the phase 1 agreement.

[Chuka Umunna (Streatham) (Lab)]

With regard to the issue of transition or implementation, as the Government call it, does my hon. Friend agree that while it is of course necessary in particular to give time for our businesses to prepare, transition or implementation is no safe harbour if this Government are determined to pursue the extreme break from our relationship with the EU which have set out with their red lines? That is no safe harbour to jumping off a cliff; it just delays it, in fact.

[Matthew Pennycook]

I absolutely agree; and the unpicking of, or wheeling back from, some of the progress we felt had been made in the Florence speech is one of our concerns.

The Bill before us was drafted before the Florence speech, but rather than amend the Bill to reflect the evolution of Government policy outlined by the Prime Minister in that speech, the Government chose instead to fashion a legislative straitjacket for themselves in the form of enshrining “exit day” for all purposes in the Bill as 11 pm on 29 March 2019. Let us be clear: bringing forward amendments to stipulate that exit day for all purposes of the Bill had nothing to do with leaving the EU. The article 50 notification made our departure from the EU on 29 March 2019 a legal certainty, so, for the purposes of the Bill, exit day could be left in the hands of Parliament.

[Peter Grant (Glenrothes) (SNP)]

The hon. Gentleman just used the phrase “legal certainty” in referring to our departure from the EU on 29 March 2019. Does that mean that he has seen legal advice that article 50 cannot be revoked? Is the Labour Front-Bench position that it is impossible, as opposed to politically inexpedient, to consider revoking article 50?

[Matthew Pennycook]

The hon. Gentleman tempts me down an avenue that has nothing to do with the point I am making, which is that it remains unclear why the Government tabled three exit day amendments to their own Bill which have sown further confusion. We do not know why they did that—whether it was driven by Tory party management considerations or some other reason. The effect of those Government amendments would have been to end the jurisdiction of the ECJ on 29 March 2019, thereby preventing agreement on a transitional period on current terms.

The Government clearly soon realised their mistake and to save face enlisted the right hon. Member for West Dorset (Sir Oliver Letwin), who is not in his place, to table amendments to loosen the legislative straitjacket they themselves had created. But his amendments, which the Government have accepted, only provide a limited form of flexibility. Ministers may now amend the definition of exit day in clause 14 for the purposes of the Bill if the date when the treaties cease to apply to the UK is different from 29 March 2019. However, there is good reason to argue that that power might not be sufficient to facilitate transitional arrangements after 29 March 2019 on the same basic terms as now. If it is not—this might end up being the most bizarre aspect of the Bill’s curious parliamentary process—the Government will find themselves in the ludicrous position of having to amend this Bill when they bring forward the withdrawal agreement and implementation Bill later this year.

[Mr Dominic Grieve (Beaconsfield) (Con)]

I think that is a virtual certainty in any event. On the basis of the Bill that the Government have promised the House for the end of this year, it seems to me that it will be a substitute for the arrangements under the existing European Communities Act, so I think that must be what is going to happen.

[Matthew Pennycook]

I agree, but what I would say—and why I would urge Members to support this amendment—is that it need not require the amendment of this Bill to allow the facilitation of transitional arrangements on the same terms in addition to the provisions that the right hon. and learned Gentleman is right to say will be needed in that further Act of Parliament.

We still believe that it should be Parliament, not Ministers, that decides exit day for the various purposes in the Bill. Our amendment 1 helpfully bolsters the position set out by the Prime Minister in the Florence speech by ensuring that this Bill can facilitate transitional arrangements on the same terms as now.

Given that this is, of course, Government policy, it is a wonder that the Government did not bring forward such an amendment themselves. They did not do so because they cannot agree on what the transition means. There can be no clearer evidence for that than the recent appointment of the hon. Member for Fareham (Suella Fernandes) to the Department for Exiting the European Union team, given her past form in seeking to actively undermine the policy position set out in the Florence speech by encouraging her colleagues to sign a European Research Group letter to the Prime Minister objecting to crucial aspects of it. It is ironic that those Tory MPs who voted for amendment 7 back in December are viewed by many as having betrayed the Government, while those who actively undermine stated Government policy appear to get promoted in quick succession.

Amendment 1 is simply an attempt to restore some common sense to the question of exit day for the purposes of this Bill. It would ensure that this Bill can facilitate any transitional arrangements agreed as part of the article 50 negotiations and that we avoid the ludicrous situation of potentially having to come back to amend this Bill in order to do so. It is in line with stated Government policy, and we therefore look forward to the Government not only accepting it, but welcoming it.

The Opposition have made it clear from the outset that a Bill of this kind is necessary to disentangle ourselves from the European Union’s legal structures and to ensure that we have a functioning statute book on the day we leave. But as we argued on Second Reading in September last year, this Bill is a fundamentally flawed piece of legislation. Sadly, despite the small number of welcome concessions, and the implications for the legislation of the defeat the Government suffered at the hands of amendment 7 and the right hon. and learned Member for Beaconsfield (Mr Grieve) on 12 December, it remains a fundamentally flawed Bill. Those flaws still need to be addressed either by this House today or in the other place, and on that basis I urge all hon. Members to support new clause 1 and amendments 2 and 1.

[Mr Kenneth Clarke (Rushcliffe) (Con)]

I am glad to see my right hon. Friend the Member for New Forest West (Sir Desmond Swayne) in his place behind me, where I always welcome him. When I arrived, I inquired whether he had had a cup of coffee before today’s long proceedings, and I undertake to try to have no soporific effects on those Members who have survived to the eighth day of this Committee and Report stage.

I do not intend to follow entirely the hon. Member for Greenwich and Woolwich (Matthew Pennycook), although I listened to many of the points he made with considerable sympathy; I am quite sure that clause 7 will require more work when it gets to another place, and I also have considerable sympathy with what he said about the confusion now surrounding exit day and the ability to proceed to what I am sure is the obvious transition arrangement we are going to have to have for quite a long time, which will be on precisely the same terms that we have at the moment, so far as access to the market is concerned.

I will turn my attention, however, to the Bill’s impact on the economy, following from new clause 17, which is in this selection and strikes me as excellent, and several more of the same kind. In our eight days, the House has not had anything like adequate opportunities to consider this absolutely vital policy implication of what we are embarked upon as we seek to leave the EU. I do not share the view that the Bill needs to be treated in this House or the other place as a mere technical or necessary Bill of legal transition; we have the opportunity to put into the Bill some of the essential aspects of our future economic relationship and to allow the House to express a view and put into statute things that we wish, and instruct in line with our constitution, the Government of the day to follow.

There is undoubtedly going to be some economic cost to this country, regardless of the means by which we eventually leave the European Union. If we have a complete break with no deal, the implications could be very serious indeed. I am one of those who think it rather foolish to try to put precise figures on this. The Scottish National party earlier tried to make precise estimates of what would happen because a think-tank had put out a range of consequences, depending on which options were followed. It was rather reminiscent of the arguments put forward by the then Chancellor of the Exchequer when he tried to help the remain side during the referendum campaign. They were really rather fanciful figures.