Future Relationship with the EU

Rachel Reeves Excerpts

Tuesday 9th June 2020 Commons Chamber

[Rachel Reeves (Leeds West) (Lab)]

(Urgent question): To ask the Minister for the Cabinet Office if he will make a statement on the fourth round of the negotiations on the UK’s future relationship with the European Union.

[The Paymaster General (Penny Mordaunt)]

Negotiators from the UK and the EU held full and constructive discussions last week via video conference led by David Frost, the UK’s chief negotiator. The talks covered trade in goods and services, fisheries, law enforcement, criminal justice and other issues, in which both sides engaged constructively. There was, however, no movement on the most difficult areas where differences of principle are at their most acute, notably fisheries, governance arrangements and the so-called level playing field.

We have now reached an important moment for these talks. To make progress, we need to accelerate and intensify our work, and the Government are working closely with the EU to achieve that. It is our priority to conclude this negotiation in good time to enable our citizens and businesses to have certainty about the trading terms that will follow at the end of this year and, if necessary, to allow any ratification of agreements reached. We have always been clear that such a deal must of course accommodate the reality of the UK’s well-established position on the so-called level playing field, on fisheries and on the other difficult issues, and fully recognise the UK as a sovereign equal.

The House should also be aware that this Friday, the Chancellor of the Duchy of Lancaster and I will be at the second meeting of the withdrawal agreement joint committee. We will be able to update the committee about the positive progress the UK is making on implementing our obligations, not least on citizens’ rights and the Northern Ireland protocol, but we will also emphasise that we will not be extending the transition period, and will push the EU on implementing its obligations under the terms of the agreement.

The Government remain committed to our negotiations with the EU and the implementation of the withdrawal agreement and will continue to keep the House updated on developments.

[Rachel Reeves]

The UK left the European Union in January, and our task now is to build the best possible new relationship with our European neighbours. Our chief negotiator, David Frost, said last week:

“We need to conclude this negotiation in good time to enable people and businesses to have certainty about the trading terms that will follow the end of the transition period at the end of this year”.

We agree, but currently we are in the dark about what this new relationship looks like.

Both the CBI and the TUC are warning about the impact of chaos and uncertainty on jobs and livelihoods. The Association of the British Pharmaceutical Industry warned this week that, as a consequence of covid-19, the stockpile of medicines has been run down and cannot be rebuilt, in terms of volume or range, by the end of this year. The Road Haulage Association says:

“We are still missing the essential practical information on all new processes and procedures”

as the Government look to introduce millions of extra declarations at the border each year. Does the Minister believe that having 50,000 new customs officers to process those declarations will add to or reduce the red tape for UK businesses?

From freight to farming, fisheries to pharmaceuticals, we need clarity. During the general election, the Prime Minister claimed time and again that the Government had an oven-ready deal. Its fundamental ingredients matter, so will the Minister confirm that the Government still, as they did in December, guarantee that there will be no tariffs, fees, charges or quantitative restrictions across all sectors? Leaving on WTO standards, or even a Canada-style deal, does not guarantee that. Will she also confirm that the Government will safeguard workers’ rights and consumer and environmental protections? There is much concern that that is no longer Government policy. Are the Government still committed to a broad, comprehensive and balanced security partnership, which is essential to bring criminals to justice? Will the Government respect the Good Friday agreement in its entirety?

To conclude, this is not just a deal between the UK Government and the European Union. Through the course of the election, it was the basis of a deal with the British people. We urge both sides to redouble their efforts over the next few days and weeks to ensure that progress is made by the end of this month, so that the Government can honour their commitment to ensuring a good deal for Britain by the end of this year.

[Penny Mordaunt]

I thank the hon. Lady for those questions. At the start of her response, she made a powerful argument for not extending the transition period. If we have learned anything over the last few years, it is that that would only extend the negotiations. I agree that business, our citizens across the EU, and the rest of the world, with which we are also focused on trade negotiations, want to have certainty about the future, so we must press on with that. That is one of the many reasons why we will not extend the transition period.

The hon. Lady is also right to draw attention to the fact that the covid crisis is going on. I know that she is aware of the huge amount of work that was done last year on no-deal preparations, and the tremendous work that civil contingencies and all Government Departments have been doing to ensure that supply chains remain strong, that we can quickly adapt, and that we have stocks of all sorts of goods, including the medicines that we need. These are challenging at times, in the light of what the world is facing, but they are our focus. I assure her of the incredible work that those civil servants are doing to ensure that our citizens have what they need when they need it.

I take a keen interest in those areas as a former employee of the Freight Transport Association. We will shortly be saying more about our border operations. A tremendous amount of work has gone on to improve on our communication with businesses from every part of the UK last year to ensure that is good, and that we are not just giving people the right information, but picking up solutions from the sector, because that will be key to getting it right.

On the hon. Lady’s remarks about rights, animal welfare, security, zero tariffs and zero quotas, our policy has not changed. We will of course respect the Good Friday/Belfast agreement and we expect the EU to do the same.

Covid-19

Rachel Reeves Excerpts

Monday 11th May 2020 Commons Chamber

[Rachel Reeves (Leeds West) (Lab)]

I thank the Minister for that thoughtful opening speech. We all need the Government to get this right. Labour has been clear: we will always put the national interest first. We will support the Government when they get it right but challenge them to do more when that is needed.

We all know how hard lockdown has been, especially for those who fear for their jobs and their businesses; the elderly; the lonely; and those living with an abusive partner or carer. At the moment, most grandparents want nothing more than to be able to hug their grandchildren. Thousands of people are missing out on the chance to say goodbye or even to hold the hand of the person they love in a care home. The same applies to the ambiguous situation relating to funerals and cremations, which is causing enormous pain and distress to so many families. It is in depriving us of these poignant moments—opportunities to hug, to hold and to say goodbye—that the impact of the virus causes the most distress.

There are so many profound social costs, and it all has to be balanced with the huge challenges and risks faced by people working in health and social care. We all want the Government to get this right, but, frankly, the Government’s response in the past 24 hours has been a shambles. Last Thursday, the Government’s briefings to newspapers led to headlines proclaiming that we could look forward to “Happy Monday” and “Lockdown Freedom”, the day before a sunny bank holiday weekend. When I saw those headlines, I recalled the world war two poster in my history class at secondary school that said, “Careless talk costs lives”. I wonder sometimes whether the Government pause to contemplate the health impacts of some of their briefings and statements.

Last night’s statement by the Prime Minister was a chance to provide some clarity about the situation, but it obscured as much as it revealed. This morning, the Foreign Secretary told “Today” programme listeners that they were free to see both their parents at the same time. Almost immediately afterwards, it was clarified that people may see only one parent at a time. The Foreign Secretary then told Sky News that people should return to work from Wednesday, but the press release issued by Downing Street alongside the Prime Minister’s statement clearly stated that people should be encouraged to return to work from Monday. If senior members of the Cabinet struggle to follow the advice, what are the rest of us meant to do?

A four-nation strategy is essential to ensure a coherent and consistent message. It has served us well so far, so why is England now pursuing a different strategy from Northern Ireland, Scotland and Wales? If someone lives in Bristol but works in Cardiff, should they be going to work? What about if someone lives in Berwick but works in Edinburgh?

When it comes to Northern Ireland, the Government must also consider cross-border co-operation. Northern Ireland is unique in that it shares a land border with the Republic, so close co-operation with the Irish Government and the Northern Ireland Assembly is vital to ensure a joined-up approach to effectively combating the virus, particularly with regard to contact tracing. The UK has the highest death toll in Europe. That calls for greater care, not greater risks.

The most substantive change in Government advice today is that workers who cannot work from home should return to work. We want workers to earn an income and businesses to thrive, but for that to happen, workers need to know that they and their families will be safe. Businesses want that knowledge and security as well.

Let us be clear that the biggest risk to our economic security and recovery would be decisions that led to a second peak of the virus, so it is deeply worrying that workers were asked last night to return to work today with no guidelines published with regard to safety in the workplace. If someone has been told to return to work, but lives with a partner with a pre-existing condition or an elderly parent, what are they meant to do?

What if someone has a school-age child but is now expected by the Government and their employer to return to work without the childcare to be able to do that? Can people still be furloughed? Is that at their employer’s discretion? If people cannot work through no fault of their own, will they be required to go on to statutory sick pay?

Who will assess whether a workplace is sufficiently safe? Is it up to the individual employee? I refer the Minister to section 44 of the Employment Rights Act 1996, which permits an individual employee not to return to work without risk of detriment if they reasonably believe that adequate safety measures are not in place. I hope that employers and Ministers will protect those rights.

Meanwhile, workers are told to avoid public transport if possible, but for millions of people in the UK, it is not possible to get to work any other way but by public transport. We have already seen bus drivers in London lose their lives to covid-19. People need to know that they can go to work without endangering themselves, or indeed others. If we are to balance concern for the economy with concern for public health, the Government should bring unions, business leaders and scientists together to develop a national safety standard. The safety of workers and their families is not, and can never be, an optional extra.

It is vital that the furlough scheme continues to support workers, including enabling people to work part time, particularly if businesses are unable to operate at full capacity. We need to hear more from Ministers about ongoing support until the time is right to operate at full capacity for some of the hardest-hit sectors, such as hospitality and travel. We need to support areas such as our coastal communities, which are so dependent on tourism.

The impact of the virus exposes deep inequalities in our society. The poorest areas of the country have been hardest hit. Lower earners are most exposed while the better-off are insulated from the biggest threats. Of the bottom 50% of earners, just one in 10 can work from home. At the top, it is five times that.

This crisis has shown who the real key workers are, from NHS staff to care workers, supermarket workers, cleaners, delivery drivers and bus drivers. They are often underpaid, under-appreciated and undervalued, and they have been asked to put their lives at risk while keeping others safe. Now, more working people who do manual jobs in manufacturing, food processing and construction are being asked to risk their health, and that of their family, while those doing office jobs, which are often better paid, can work from home and face fewer risks.

Black and minority ethnic Britons are disproportionately at risk. We know that black Britons are four times more likely to die from this virus compared with white people. We need a public inquiry into that, which Baroness Lawrence called for today, and we need urgent action to protect the most vulnerable from this virus. Coronavirus did not cause those inequalities, but it has thrown a sharp light on them. We must not let them deepen even further.

In our care homes the spread of the virus continues and the death toll is still too high. Half of workers in care homes earn less than a real living wage, and a quarter are on zero-hours contracts. Many have died. Last Wednesday, the Prime Minister reported that 29 care workers have died since the start of this crisis, but data from the Office for National Statistics show that there were 131 coronavirus-related deaths among social care workers up to 20 April. According to the National Care Forum, just one in five care workers with symptoms have been tested, and they still lack priority testing for coronavirus. Those who dedicate their lives to caring for others, and who care for the sick and the dying whose relatives cannot be with them, are being left without adequate protection, and we are only beginning to know the real cost.

One reason why the lockdown rules are causing so much worry is that new infections and deaths are still at higher levels than when we went into lockdown. The test and trace strategy is still a mess. MPs from across the House will have constituents who have been waiting for well over 48 hours to get their results, and some who have been waiting for more than a week. We see reports of tests having to be flown to the United States because we lack the capacity here. How did we get into that position? Without a test, trace, and isolate strategy it is almost impossible to identify a new spike in infections, or to do anything about it. The Government need to sort that out. Relaxing lockdown will work only if it is sorted out.

At some point we will come through to the other side of this virus, and we will go about rebuilding our lives, our communities, and our economy. The recovery will not be easy, and it will require boldness and imagination to build something better. The contribution of the British public and all our key workers has been immense, but the crisis has revealed huge injustices and inequalities. We deserve a fairer country—that will be Labour’s mission, and I hope it will be the Government’s mission too.

[Madam Deputy Speaker (Dame Eleanor Laing)]

Thank you. There will now be a four-minute time limit on Back-Bench speeches. As ever, I advise Members who are speaking from home and do not have the benefit of the clock in the Chamber to have some other method of ensuring that they do not exceed four minutes. It is amazing how many people cannot add on four, but I know that does not apply to Mr Mel Stride.

Economic Update

Rachel Reeves Excerpts

Tuesday 17th March 2020 Commons Chamber

[Rishi Sunak]

My right hon. Friend has made a good point. I believe that providing liquidity now ensures sustainability for the future, but he is right to identify the further steps that are needed to provide support on fixed costs such as employment, and preserving and incentivising that employment. This is work that we are undertaking as a matter of urgency.

[Rachel Reeves (Leeds West) (Lab)]

For those who are currently off work on statutory sick pay or are self-isolating for public health reasons, who are laid off because there is no work or who are self-employed or low-paid, there is nothing at all in the Chancellor’s package of measures. The Chancellor says that these matters are under review. As a matter of urgency, will he at least increase statutory sick pay to the level of the national living wage, and come back to the House with a package of support that ensures that workers will not be financially penalised for doing the right thing, and will not be unable to pay their bills and rent and put food on the table?

[Rishi Sunak]

We have put £1 billion into the welfare system to provide extra financial security for those people, to speed up both access and the generosity of all those benefits.

Economy and Jobs

Rachel Reeves Excerpts

Monday 20th January 2020 Commons Chamber

[Rachel Reeves (Leeds West) (Lab)]

I welcome the investment that the Chancellor speaks of and the commitment to get to net zero by 2050. Climate change also means more extreme weather events. In Leeds West, we had serious floods in 2015, and yet still the Government refuse to put in the funding to build the flood defences to protect against the one in 200-year flood event that we experienced. When will the Government put the money into that infrastructure?

[Sajid Javid]

That is an important point. I am aware of some of the serious flooding to which the hon. Lady has referred. That is why our national infrastructure plan includes much more funding—significant new funding—for flood defences, and I hope that she will welcome that and support those plans when they come before this House.

Let me also briefly address the amendment in the name of the Leader of the Opposition. Every Labour MP stood on a manifesto that would have cost the average taxpayer an extra £2,400 each year—each and every one of them did that. Labour committed to spending an extra £1.2 trillion over five years, which is equivalent to funding the NHS budget for nine years. It is no wonder that the hon. Member for Salford and Eccles (Rebecca Long Bailey) said, just a few days ago, that the policies that she helped to write lacked “economic credibility”. It is a bit late for that.

Whatever they may say now, every single one of the would-be Labour leaders tried to make the Leader of the Opposition Prime Minister. They endorsed his vision, his world view and his ideas for Britain, and that is why they will never be able to bring the change that the British people voted for. Instead, they are confirming that Labour is the party of the past and that it is out of touch with working people. Labour will just keep on refighting the same old internal battles while this Conservative Government get on with renewing the country.

--- Later in debate ---

[Rachel Reeves (Leeds West) (Lab)]

It is a pleasure to follow the hon. Member for West Worcestershire (Harriett Baldwin), and I echo her concerns about the financial services sector in any future relationship with the European Union. I also put in a plea for the manufacturing sector and its supply chains, which rely on regulatory convergence with our closest trading partners.

I will concentrate my remarks on the employment Bill, but first I will speak about my worries for the economic outlook, especially ahead of the Budget in a few weeks. Business investment, which is essential for our long-term prosperity and productivity, has been falling for six quarters—the sharpest decline for a decade. The economic growth we have seen is anaemic at best, and the economy is likely to have grown by just 1.3% last year, with even lower rates of growth expected this year. That is half the average growth experienced over the past 50 years.

Far too much of the growth we have seen is premised on unsecured household debt, which now stands at more than £15,000 per household—a record 30.4%. We cannot go on like that if we want to build a strong and sustainable economy. Yet we have heard very little, if anything, on that from the Chancellor this afternoon. Many of our cities are growing and have become richer, but inequalities are increasing, too. In other areas, particularly our towns that were once powered by industry, industries have largely disappeared thanks in large part to previous Conservative Governments, leaving an acute legacy of deprivation and disadvantage that I hope the Government will now make their focus.

Turning to the employment Bill, behind the overall positive employment statistics a few facts should be ringing alarm bells to all of us who care about the living standards and the job security of those we represent, particularly the poorest. We welcome increases in the national minimum wage, even if it is not at a rate that we on the Labour Benches would like it to be, but underpayment has been steadily rising over the past two years. Some one in four workers aged over 25 earning about the legal minimum report that they were underpaid two years ago, yet only seven firms have been prosecuted in the past 10 years for underpayment of the national minimum wage, despite violations being in their thousands. Why is that? Even when fines are levied, the full penalties are not applied. Only half the penalties that could be imposed are being imposed.

If we want our workers to be paid a minimum wage, we must ensure that laws are enforced. I support the Government’s commitment to a single enforcement agency to help workers enforce their rights, but I hope that it will be properly resourced and that the barriers the Government have sought to put in the way of workers looking to enforce their rights through the courts will not be repeated in this Parliament.

I urge the Government to look seriously at the recommendations of the Business, Energy and Industrial Strategy Committee from the previous Parliament, which called for workers to be granted worker status as a default, rather than having to take their case to the courts.

Two other changes not in the Queen’s Speech would also be useful: an actual right to a contract reflecting hours worked, not just a right to request one, and, as the TUC has argued, two weeks’ notice of shifts, rather than an early morning text message to let people know whether they have work that day; and payment when shifts are cancelled without reasonable notice.

Too many firms, particularly in the gig economy, try to get out of paying full taxes, national insurance, the national minimum wage, and holiday and sick pay. That is a disgrace and we need much stronger action, yet the Government have let the issue drift while a growing number of workers miss out on the rights that we have fought so hard to secure both in this Parliament and, indeed, through the European Parliament. It is hardly surprising that work is now no longer always a route out of poverty. Some 14 million people live in poverty, including nearly 5 million children, and 60% of them are in households where at least one person works. This is a problem that is set to get worse under this Government, with the number of people in zero-hour contracts and in bogus self-employment on the rise yet again.

I also want to say something this afternoon about business excess and the lack of regulatory oversight. We are now more than two years on from the collapse of Carillion. When Carillion failed, thousands lost their jobs, suppliers went unpaid and large-scale infrastructure projects, including hospitals in Liverpool and the west midlands, went unfinished. The collapse was caused by the recklessness, hubris and greed of its directors, yet they have not paid the price—others have. Carillion was a notorious late payer. Suppliers had to wait 120 days to be paid, or pay Carillion if they wanted to be paid on time. When it collapsed, 30,000 suppliers were owed £2 billion.

Meanwhile, its pension scheme had a £2.6 billion deficit. Ordinary workers—but not, of course, the directors—will not get the full pension that they were entitled to. Yet its auditors, KPMG, signed off Carillion’s accounts for 19 straight years in a row without qualifying them or raising concerns.

Here we are, two years on, and nothing has changed. The Government’s obsession with outsourcing and privatisation continues. The hands-off regulation and light-touch auditing continues. The employment Bill says it will give more powers to the Small Business Commissioner. That is welcome, but it does not really suggest the degree of urgency or priority that is needed.

The corporate failure and the audit failure happened then and it could just as easily happen today. Our audit firms are too powerful. The assumption that the private sector is always best has to end. Small businesses should not be at the mercy of dominant big businesses that determine whether their suppliers are paid, and regulators should clamp down on abuse and not just turn the other way.

This is not some abstract ideal. It is the basis of an economy that: values workers by paying them a decent wage and offering them some dignity and security in the workplace; supports businesses that play by the rules and invest in our economy while ensuring that big businesses do not exploit the system; and invests in every region and nation of our country—in green energy and transport, infrastructure and skills to help our economy to thrive for everyone.

The Queen’s Speech touches on some of those themes but I fear that it lacks the conviction to do what is needed. There is a common theme in all this: the failure to put in place rules to stop workers being exploited; the chipping away of regulations that protect the most vulnerable; the remorseless faith in the private sector, with more outsourcing and privatisation; and the creation of city Mayors but a reluctance to devolve the power and money to let them do their jobs as effectively as they can.

The real problem with the Government and the Conservative ideology is that they do not allow for a challenge to the neo-liberal economic model and do not account for the social value of the public sphere—the glue that binds our society together. While the Government speak on some of these themes, I do not believe that they have the willingness to see them through to deliver the economy that we need.

Oral Answers to Questions

Rachel Reeves Excerpts

Tuesday 7th January 2020 Commons Chamber

[Mr Speaker]

I call Rachel Reeves.

[Rachel Reeves (Leeds West) (Lab)]

indicated dissent.

[Mr Speaker]

Let us take somebody else then.

Spending Round 2019

Rachel Reeves Excerpts

Wednesday 4th September 2019 Commons Chamber

[Sajid Javid]

Let me take this opportunity to thank my hon. Friend for all the work that he has done in relation to self-build homes and more generally, in promoting easier access to homes for everyone. We are discussing that issue with the Ministry of Housing, Communities and Local Government, but I will pursue it further and get back to him.

[Rachel Reeves (Leeds West) (Lab)]

I am surprised that the Chancellor has the cheek to call this a spending review because it is nothing of the sort. It is no surprise that the Office for Budget Responsibility did not dignify it with its own economic and fiscal analysis, as normally happens with spending reviews.

When the Chancellor made his three-year commitment to school spending, he said that he recognised the importance of schools’ being able to plan. May I ask him whether local authorities should also be able to plan for the future when investing in social care and youth services and tackling homelessness? If he thinks that they should be able to do that, why did they not get a three-year settlement as well?

[Sajid Javid]

Let me first say gently to the hon. Lady that this is a spending round. I have not referred to it as a spending review. As she may know, a spending review normally covers a number of years, whereas a spending round covers a single year. She said that I had not “dignified” it with an OBR forecast. No spending review or spending round comes with an OBR forecast; that is normally the case with a Budget, and there are two forecasts a year. I thought that she might already know that, but I am happy to let her know now. She also talked about the funding of sectors such as social care and youth services. I did refer to those: I set out plans for next year, but also plans for the future involving, for example, the new youth investment fund.

Oral Answers to Questions

Rachel Reeves Excerpts

Tuesday 2nd July 2019 Commons Chamber

[Robert Jenrick]

Clearly, it is not possible to progress this matter until we have greater certainty about our exit from the European Union. Those Members of this House who want to see this matter progressed should be voting to leave at every opportunity, as we on the Government side have done. The important thing to point out on regional disparities is that this Government are investing far more than the previous Labour Government. In fact, £430 million a week more in real terms is being invested by this Government than under the previous Labour Government on infrastructure in all parts of the UK.

[Rachel Reeves (Leeds West) (Lab)]

4. What fiscal steps the Government are taking to support the northern powerhouse.

[The Exchequer Secretary to the Treasury (Robert Jenrick)]

The Government are supporting the northern powerhouse through devolution deals for, among others, Manchester, Liverpool, the West Midlands and, most recently, North of Tyne, as well as through over £13 billion of investment in better transport across the north. In addition, we have invested over £3 billion from the local growth fund in the region since 2015, and we committed at the Budget to announce a renewed northern powerhouse strategy later this year.

[Rachel Reeves]

It is quite an achievement for the Minister to get up and say that without any sense of irony whatsoever. The truth is that we have had the incredibly disappointing news this week that Pacer trains in the north of England will not be removed by the end of this year, as previously promised. Despite the warm words about the northern powerhouse, the truth is that since 2014 spending on transport in the south of England has risen twice as fast as in the north of England. Will the Minister use the spending review as an opportunity to rectify these imbalances and finally give meaning to those words, “the northern powerhouse”?

Oral Answers to Questions

Rachel Reeves Excerpts

Tuesday 21st May 2019 Commons Chamber

[Elizabeth Truss]

We are currently assessing the report of the Climate Change Committee on this subject. No doubt the right hon. Gentleman is a regular reader of the Treasury Green Book on the way we assess investments. Last year, in the new Green Book, we specifically included looking at natural capital as a way of making that assessment. That is one of the lenses through which we shall be looking at the spending review.

[Rachel Reeves (Leeds West) (Lab)]

19. Climate change is increasing the risk of flooding, and despite devastating floods in my constituency in 2015, the Government have not yet committed funding for the one-in-200-year scheme that the Chief Secretary knows is needed to protect businesses in Kirkstall in my constituency. The gap now is just £23 million, so will the Government make it a priority in the comprehensive spending review, even if that spending review is just for one year?

[Elizabeth Truss]

I agree with the hon. Lady that Leeds does need flood protection. I remember visiting with her a few years ago to see the scheme. We have already achieved phase 1 with the £32 million for that, and the Government are putting forward £65 million for phase 2. My understanding is that Leeds City Council is keen to work with us on that, and we are keen to make progress.

Spring Statement

Rachel Reeves Excerpts

Wednesday 13th March 2019 Commons Chamber

[Mr Speaker]

The hon. Member for Manchester Central (Lucy Powell), who is ordinarily known for her buoyant and enthusiastic smile, was gesticulating at the Chancellor to speed up. I think she was auditioning for the role of Speaker, and presumably seeking to give the right hon. Gentleman a masterclass in brevity, notwithstanding her desire often to make her own point with enormous eloquence but at not inconsiderable length—but we will see.

[Rachel Reeves (Leeds West) (Lab)]

In today’s forecast from the OBR, GDP growth this year is being revised down by 0.4%. The largest downward revision is to business investment—a downward revision of 3.2%. Business investment is now expected to shrink by 1% this year after shrinking by 1% last year. The Federation of Small Businesses says today that confidence is at “rock bottom”. The CBI says on tariffs that there has been

“no consultation with business and no time to prepare”,

and that this is

“a sledgehammer for our economy.”

Does the Chancellor recognise that businesses are losing patience with this Government and that unless businesses invest and help to grow our economy, productivity and wages are going to stay at rock bottom? What is he going to do to reverse this incredibly worrying and dangerous reduction in business investment?

Finance (No. 3) Bill

Rachel Reeves Excerpts

3rd reading: House of Commons & Report stage: House of Commons
Tuesday 8th January 2019 Commons Chamber

[Yvette Cooper]

The amendment provides a parliamentary safeguard. It does not, in itself, solve any of the many Brexit issues that we have, but it does provide an additional parliamentary safeguard that says that the Government cannot use the powers in clause 89 to implement no deal without first coming back to Parliament to ask for permission and support for a no deal. The hon. Gentleman is right that there may be other powers that the Government may choose to use. There may be other issues that they may choose to pursue, but this is our opportunity within this Bill to address these powers. That is why it is an important one to come around.

I have heard four sets of objections to the amendment. Some say that it is irresponsible; that it is somehow holding the Government to ransom on powers that they need. Some say that it is undesirable and perhaps even unpatriotic because they think that no deal is a good outcome and should not be ruled out. Some say that it is unnecessary because the Prime Minister’s deal is the best way forward. Some suggest that it is unstrategic because we need the threat of no deal to force a decision one way or another. I want to take each of those objections in turn because each of them is wrong.

First, on the charge that this is an irresponsible amendment, the amendment does not affect the normal Treasury and Government operations; those carry on as normal. It simply requires the Government to get Parliament’s permission if they want to use these powers to pursue no deal. Even if there is deadlock, the amendment provides a way forward. Let us suppose that Parliament votes against any deal that is put and also votes against no deal, and the Government still desperately want to use the clause 89 powers. In that event, they could follow paragraph (b) of the amendment if they still want to use the powers they need to apply to extend article 50. So in fact, this is an extremely responsible amendment. The irresponsible thing to do would be just to stand back and hope for the best, or to stand back and allow the Government to drift towards no deal without any attempt to put the safeguards in place to prevent that from happening.

The second objection is from those who think that no deal is a good option, or at least a good enough option not to rule it out. That is reckless. The damage to manufacturing industry, on which many of our constituencies rely, would be too serious. One local factory has said to me that the cost of its imports will double in price if we go to WTO tariffs. Another has told me that its European parent company would be under pressure to switch production to continental factories to avoid delays. Burberry has hundreds of jobs in my constituency, making clothing that is sold all over the world. It has written to me about the risks and concerns about delays to its supply chain. Its letter says:

“My hope in writing to you is that you will work with your colleagues across Parliament to ensure that there is no scenario possible where a No-Deal Brexit is a possibility.”

That is what I am doing.

[Rachel Reeves (Leeds West) (Lab)]

I thank my right hon. Friend for for tabling this amendment, which is so important. The Business, Energy and Industrial Strategy Committee has taken evidence from a number of businesses in the past few weeks, including Nestlé, Toyota and Airbus. Each one of them, and many others too, have said that the most dangerous thing would be to leave the European Union without a deal, which would have catastrophic impacts on their businesses and on the people who work for them. For that reason alone, anything that we can do to avoid a hard Brexit and going on to WTO rules, as some Members suggest, is the most important thing. This amendment at least helps to provide some safeguards to stop that from happening.