UK Exit from the European Union

Stephen Doughty Excerpts

Monday 17th October 2016 Westminster Hall

[Paul Scully]

By invoking article 50 we will effectively be working out how to separate the UK from the rest of the EU—that is, dividing up the assets and liabilities and deciding how we move forward with the institutions. Although that is intertwined, it is also slightly separated from our future relationship with the EU. Article 50 says that we have to take our future relationship into account, but there is plenty of time and we need to use the full two years to work out our future relationship.

I would not want to see our future relationship being hamstrung by waiting to invoke article 50 because we are trying to limit our negotiations on our future relationship with the EU. Frankly, that is what hamstrung David Cameron in the first place. If he had asked for more and had not limited himself in his renegotiations with the EU last year, we might have been in a very different place in the lead up to the referendum. We might have voted to remain. We should not limit ourselves in our negotiations on how we move forward once we have left the EU just so we can get to the point of invoking article 50 and starting the process next March.

[Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)]

The hon. Gentleman mentioned devolved Assemblies, Parliaments and Governments a moment ago. Will he be clearer about the role he feels they should have? A crucial factor is that when we went into the European Communities, as they were then, we did not have devolution. A significant amount of the responsibilities have now been devolved to Northern Ireland, Wales and Scotland. The people of those devolved Administrations and Governments must have a clear say on this process. What role does he think they should play?

[Paul Scully]

That is why my right hon. Friend made a big effort to visit Edinburgh very soon after she was elected Prime Minister: to show her intention to engage with the devolved Parliament in Scotland and with the Assemblies. Speaking to the devolved parts of the UK, and also with councils and metropolitan bodies, going right down to smaller units of government, will be integral to the discussions over the next few months. That is crucial.

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[Paul Scully]

If I may, I shall use what might seem like a slightly odd analogy. I have been in business for 20 years. Two years ago, I negotiated a lease for an office. It cost me £2,000 or £3,000 in solicitor’s fees, and about three months to organise. When I got my constituency office, I already had a nice lease to use as a template. It cost me exactly zero pounds and took me a week to organise. When we come to leave the EU, we can start either with a blank sheet of paper or with things that already work. I do not envisage—

[Stephen Doughty]

The hon. Gentleman is grossly over-simplifying the complexity of negotiating trade arrangements; I say that as somebody who has worked on them in Government. However, he mentioned his business experience; the volatility in the value of the pound is causing a great deal of uncertainty for businesses. For example, the value of the scrap used by the steel industry in my constituency is fluctuating due to the value of the dollar, but its exports are also being falsely boosted by the current value of the pound. Does he agree that we need to consider carefully whether the uncertainty created by the Government is giving a false impression of how the economy or different businesses are performing before we get into the detail of any fixed trade arrangements, particularly in certain sectors and with certain countries?

[Paul Scully]

My analogy of the lease was an extreme one. I am not expecting these things to take five minutes; nobody has ever expected organising trade deals to take five minutes. We cannot just transpose the words on one sheet of paper on to another, but my point is that we do not necessarily need to start with a blank sheet. We ought to look at a bespoke model for the UK, but that does not mean starting again from a blank sheet; we can take a little from here and a little from there, depending on what we want and on our mix of businesses, which is different from that of Switzerland, Canada, Turkey or any other of the countries often cited.

In his speech last week, the Secretary of State for Exiting the European Union said:

“We have Norway, which is inside the single market and outside the customs union; we have Turkey, which is inside the customs union and outside the single market; and we have Switzerland, which is not in the single market but has equivalent access to all of its productive and manufacturing services. There is not a single entity, but a spectrum of outcomes, and we will be seeking to get the best of that spectrum of outcomes.”—[Official Report, 12 October 2016; Vol. 615, c. 332.]

That still leaves us building blocks that we can use to do that.

The hon. Member for Cardiff South and Penarth (Stephen Doughty) spoke about uncertainty. We need to come at the issue with a sense of mutual respect, co-ordination and co-operation in order to build a national consensus, without political point scoring or people burying their head in the sand about the referendum—I am not referring to today’s debate, but I am concerned that that is happening in the court case that is going on. As the hon. Gentleman says, business does not like uncertainty; I know that from my own business experience. I do not mind risk, because business is based on it, but it is about being able to control as much of the risk as possible. We will never be able to control 100% of the risk, but the more of it we can control and the more certainty we can bring into the equation, the better the outcome will be.

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[Geraint Davies]

Sadly for myself and indeed the country, I am not part of the Government. [Interruption.] There we are.

Do not misunderstand me—it was an extremely serious vote and the will of the electorate needs to be respected. However, one has to remember that the referendum vote was quite a narrowly defined vote and the suggestion is that now, if more information was available, people would act differently.

If it is increasingly obvious that the economic impact, in particular, and the other impacts will be so disastrous that they will be outside of what people expected, and if what is being offered—namely the hard Brexit—is not what people anticipated, it is reasonable that we should have another look at what will be a long-term change.

Regarding the spectrum of people voting, the hon. Member for Sutton and Cheam and others will know that only 15% of people over the age of 65 did not vote—85% of them did vote—whereas only a third of people aged between 18 and 24 voted. Now, people might say, “Well, that’s their fault”—I understand that point—but people of that age have more to lose, in terms of the length of time and all the rest of it.

The whole thing was sort of hurtled through and the reason we had this referendum—let us face it—was because David Cameron, the then Prime Minister, thought before the general election, “Well, I’ll offer a referendum to stop UKIP, so the Labour party won’t win”, and we have ended up in a situation with this referendum that he thought he was going to win but cackhandedly messed up. Obviously, we had this deception at the same time, and we have ended up in this position. In the light of what is happening, should we as responsible representatives just sit back and say, “Oh, what can you do?”

[Stephen Doughty]

I wonder if, like me, my hon. Friend has had conversations with his constituents and found that, regardless of which way they voted, they feel very much in the dark at the moment about the actual practicalities of where we are and where we will be in the future. I know that he too has a significant proportion of constituents who working in the higher education sector and who are wondering whether their research projects will be able to continue, and many who work in the aerospace industry—Airbus operates in the defence space and aerospace sectors across Europe, with multiple sites, so what is the future for that industry?—or in the steel industry. People want to know the practicalities—the pragmatic results—regardless of whether they respect the vote or otherwise. Does he feel, four months on, that he has any clearer answers about where we are to give to the constituents asking these questions?

[Geraint Davies]

Well, no. As I have said, I would like to think we would look again, because, as my hon. Friend has just pointed out, there is enormous uncertainty in all those industries and all those delivery systems, so the inward investors and co-operators cannot come in.

My hon. Friend mentioned higher education. In Swansea West we have seen the building of a second university campus, with hundreds of millions of pounds of European money. This institution is internationally acclaimed and networked, in particular, into research and development across Europe. Now, all of that networking and those partnerships will say, “Sorry, you can’t do that now, because you’re not going to be here”. So, after all those partnerships, we will have to do our own research on our own, rather than having this global space or platform in Europe to do it.

My hon. Friend also mentioned hospitals. Sadly, my mother has been very unwell and she is in a hospital in Portsmouth. As I left the hospital, I saw that there was a board showing six of the top surgeons in that hospital and none of them had “British names”. What that means is that some of the best people in the world have trained and are giving their services here, and the suggestion that after five years we will just ship people off because they have got the wrong name is ridiculous. We have always been an international place that attracts people who get Nobel prizes. We have seen a number of Nobel prize-winners recently saying, “It is appalling that we’re now going to pull up the drawbridge and become Fortress Britain.” As for the point about uncertainty, business and other service sectors simply do not know what will happen.

Of course, in the community of people who are EU citizens, the referendum result is a disaster, and not only because xenophobia is being sped up and people are in the streets, saying, “Go home”, and all the rest of it, but because the economic fact is that the average EU citizen contributes 34% more in tax than he or she consumes in public services. If we swap those people for retired Brits in Spain, France or wherever it is—I know there are about 2.2 million of those people living abroad and we have got about 2.6 million or so people from the EU living here—we would be swapping hard-working, tax-contributing, working Polish people and all the rest of it for people who have retired to the sun, and who would be more of a cost on the health service and make less of a contribution. How does that make economic sense, and was it debated?

The whole thing is a nightmare and what the Government are saying to those people is, “Well, we won’t allow you to have permanent residence here until we know everybody else isn’t going to send our people back”, and when will we get that assurance? So, the point about uncertainty is at the heart of the problem. Who will invest? Who will have these academic partnerships?

A dreadful situation is emerging. I realise that some of the opponents of this view want “Independent Trump Day”, or whatever they want here, and some people still think this is going to be a great idea, and are sure “Only Fools and Horses” and all that sort of stuff is fantastic. However, the reality is that this is an issue of such immense strategic importance that Parliament should look at it again and not simply say, “Well, that’s what they said. It’ll be unfortunate if it doesn’t turn out as we hoped.”

We realise we cannot negotiate; we realise now that, if we go along to a country, we will not represent the EU; and we realise that we already trade with the rest of the world. In total, 56% of our trade is already with the rest of the world; it is not like we were not trading with the rest of the world before.

Finally, on being desperate for any deal, I am particularly concerned about and engaged with issues around the Transatlantic Trade and Investment Partnership, and the Comprehensive Economic and Trade Agreement, in terms of new trade arrangements that would give companies particular powers to sue Governments. As the Minister will know, tomorrow the Council of Ministers is due to agree the provisional agreement of CETA in Slovakia. What that will do is immediately invoke powers for companies to sue Governments who pass laws that will affect their profitability in the future. By way of example, there is a sugar tax coming in now, assuming that the ideas on that have not changed, and fizzy drinks manufacturers are currently suing Mexico over a similar situation. So we could be in line for all sorts of things. I know that the Minister has said to us, “We haven’t been sued before”, but that is because at the moment we are the investor in small economies. Now the gun will be given to Canada, and the American subsidiaries will work through that. The point I am really trying to make is that we will be desperate to have trading agreements and we will want to sign up to virtually anything, at any cost, in the future, once we are out of the warm home of the EU.

I hope that there is still space politically to think again, and with those words I will give other people time to speak.

[Andrea Jenkyns (Morley and Outwood) (Con)]

I apologise for being late, Mr Wilson; I had other parliamentary business, unfortunately.

Before I became an MP, I worked on the “Let Britain Decide” campaign. I really believed that the British public should have a vote in a referendum, so I was delighted when the Prime Minister at the time, David Cameron, agreed to it. During the referendum campaign, I was the Vote Leave co-ordinator for Yorkshire, so this issue is something that I am incredibly passionate about. At the same time, I am also very balanced and I understand that this issue rouses passions whichever side of the argument people are on. What I find frustrating, though, is that it is coming up to four months since we had the referendum and I cannot understand why we are still talking about the result of the referendum, harking back to the campaign and throwing stones—“He did this during the referendum campaign”; “Brexit did this”; “Remain did this”. We were elected to Parliament to do what is right for Britain. Is it not time that we actually did that? Over 17 million people voted to leave, and in my opinion their decision must be respected. We should pull together, whether remainer or Brexiter, and listen to the will of the British people, do what is right now and get the best deal for Britain.

[Stephen Doughty]

Does the hon. Lady understand that many people who voted, whichever way they voted, and who respect the result feel very confused about the Government’s strategy on the actual practicalities? That is where a lot of the concern is coming from and why we as representatives are taking part in these debates and asking these questions, because we do not know where we are headed. Whether we are pragmatists and whether we like the result or not, we simply do not have the answers yet or even a clear sense of direction. Does she not accept that that is a problem?

[Andrea Jenkyns]

I can understand the hon. Gentleman’s point exactly. I have worked in business for many years and I was disappointed that in the re-negotiation process we, as a country, revealed our hand before negotiations took place. That does not make good business sense to me, or to anyone else who has been in any negotiations, even at a micro-business level. It is wrong to have a blow-by-blow account of every step of the process.

We want what is right for Britain. The public voted for this. I know that lots of work has been going on in the background, with people pulling together and looking at everything, including trade deals. It is such a big area—I am involved in the all-party group on music and we have to look at things such as copyright laws. It is massive, as we all know. A blow-by-blow account will not be useful for Britain—in my personal opinion it could harm us in the long run—although I respect why the hon. Gentleman would ask such a question.

We should pull together and start to focus on four key things, one of which is trade. I recently got back from Taiwan and even met with Health and Trade Ministers there. Their door is open already and they are keen to set up some trade deals, and other countries are falling in line. We are not just about Europe; we should be looking at trading globally and also at supporting some of the rising BRIC nations, ensuring that their economic wealth helps to lift them into being economic powerhouses too.

Trade is one thing we need to look at; the others are control over our borders, control over our laws and control over the contributions to the EU budget. Trade barriers have been becoming increasingly obsolete. The EU has become increasingly protectionist in its outlook and slow to negotiate free trade deals. We need only look at the situation with Canada and how long that took, and it is not yet fully rectified. We cannot get over the fact that immigration is a primary concern for voters, and we must listen to them. Issues of mass migration have been ignored for too long. Having lived in Lincolnshire for a while, I can see how migration can be very good for our economy, but it should be about doing what is right for Britain, based on the skills we need and on any skill deficit we may have. Any Brexit deal will have to address a tailored immigration model that truly takes back control for Britain and is truly right for the country. Never mind looking at other models out there; it should be a model that is right for Britain.

The EU eroded the sovereignty of our Parliament and EU Commissioners face no accountability, so Brexit must bring back people’s rights to choose who is elected.

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[Andrea Jenkyns]

I am sorry but I have nearly finished, so I would like to carry on.

[Stephen Doughty]

The hon. Lady’s party has put VAT up to 20%.

[Andrea Jenkyns]

Is the hon. Gentleman trying to intervene, or can I finish talking? [Interruption.] No, I am not offering, thank you very much. [Interruption.]

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[Ms Ahmed-Sheikh]

It is very important that we get the chronology and the history right on when the referendums were held. In 2014, there was a referendum on Scottish independence, and 55% voted to remain in the UK, but that UK is no longer the same entity.

[Stephen Doughty]

The hon. Lady mentioned the 2014 result. I spent a lot of time in Scotland arguing for Scotland to remain in the UK alongside Wales. I think we are better off together. Does she not agree that the polling today shows that if there were another referendum in Scotland, there would be the same result? We were both on the same side in the EU referendum debate, and the people who voted remain did not do that to give a mandate for Scotland to become independent. It is grossly misleading to take the argument forward in that way.

[Ms Ahmed-Sheikh]

I do not believe that I have suggested at any point in any of my remarks that anyone is taking the referendum as a mandate for Scottish independence. Indeed, the only people who talk about Scottish independence in the Commons Chamber—I have witnessed this for myself—are the Government and the hon. Gentleman’s party. The First Minister has set up a standing council to come forward with a number of solutions to this unfortunate situation whereby the UK has accidentally found itself being required to leave the EU. If we are talking about current polling and straw polls, that does not now seem to be the wish of the majority of people in the United Kingdom.

The suggestion is that we look at the options available to us. First, let us find the best option for the UK as a whole. If that is not possible, the First Minister will of course look at the other options available to her—options that she has a mandate for in the manifesto on which she was elected. That brings me back to my point: the Government were elected on a manifesto that said that we would remain part of the single market. That is what business is saying it wants. At the Dispatch Box a few weeks ago, the Secretary of State for Business, Energy and Industrial Strategy waxed lyrical about mass-engagement and the number of businesses he had visited up and down the country. I asked whether he could name a single business that was in favour of leaving the single market. Surprisingly enough, no answer was forthcoming, but that seems to be a common state of affairs with the Government.

That leads me on to where we find ourselves. Just today, the Prime Minister was required to state that she had confidence in the Chancellor of the Exchequer, as there are again differing positions in the Government on the single market. The Prime Minister was required to change statements and rebut the Secretary of State for Exiting the European Union, the Secretary of State for International Development and the Foreign Secretary, because they are not singing from the same hymn sheet. It is no wonder that the country is in absolute chaos and the pound is in this position; no one knows what is happening. In such times, we should look at who has a plan. Who is the woman with a plan? I have clearly laid out Scotland’s position, and I expect Members in all parts of the Chamber to accept and respect that position.

In addition, because of the manner in which that referendum campaign was fought, we have had an exponential rise in hate crime. People who have come from other places and made this country their home are feeling vulnerable. It seems perfectly feasible for Members in this debate to talk about how we should encourage people with expertise from other countries to make this country their home, while in the same breath saying that we are unable to guarantee to EU nationals who have chosen to make this country their home that they, their families and their children, who are in our schools, can continue their life here. That is a shocking state of affairs. We cannot have one set of rules for one group of people, and one set for another. We should respect the people who have chosen to make this country their home.

Our position is clear: the democratic interests of the people of Scotland must be taken into consideration. The First Minister is happy to work with the Prime Minister of the United Kingdom. The Prime Minister said that Scotland would be involved. Involvement in the negotiations is key; consulting is not enough. If the Prime Minister wants to keep Scotland on board, that is very much in her hands.

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[Melanie Onn (Great Grimsby) (Lab)]

This has been an unexpectedly exciting debate that has raised some of the long-standing issues on both sides, and the wounds of those issues will not easily be healed without some answers.

I will focus my comments on the petition that calls for an immediate repeal of the European Communities Act 1972. Colleagues might be aware that I have a private Member’s Bill before the House that would protect in UK law all of the workers’ rights that are derived from the European Union. I fear that some of the most fundamental of those rights would simply fall away were the Act repealed today, including equal rights for part-time and agency workers, the right to annual leave and parental leave and the protection of employment upon the transfer of a business or the outsourcing of services. That is not to mention all the other areas of law that have been implemented through the Act. The Prime Minister has said that the Government will not address that. Instead they will look to pass a great repeal Bill to come into force once we have left the EU; only then will the European Communities Act be repealed. But where will that leave workers’ rights?

According to the Library, the great repeal Bill will likely seek to secure all legislation passed through the European Communities Act in the same form as it currently exists—namely, in secondary legislation. This comes to the point about which I clumsily sought to intervene earlier in the speech by the hon. Member for Sutton and Cheam (Paul Scully). As Members are aware, using secondary legislation means that each law or directive can be changed through a statutory instrument. The Bill would therefore give this and any future Government the ability to amend or repeal fundamental rights without necessarily holding a debate or even a vote in the House.

The Prime Minister said at her party conference last month:

“Existing workers’...rights will continue to be guaranteed in law”.

However, there appears to be disagreement in her Cabinet. The Transport Secretary told the press on the same day as the Prime Minister’s speech that the Government want to keep only some workers’ rights measures. He, along with several other Cabinet members, are on record calling for the scrapping—or in one case halving— of employment protections. Arguments within the Conservative party aside, and whatever the intentions of this particular Government, the fact is that by maintaining employment protections in secondary legislation while removing Britain from the common floor of minimum rights that the EU ensures, the great repeal Bill will leave workers’ rights hanging by a thread.

[Stephen Doughty]

My hon. Friend is making a strong speech and I wholly support her efforts because I share her concerns. The matter goes beyond employment rights and into areas such as environmental protection. Whatever the Government say, the fact that secondary legislation will be used for employment protection opens the measures up to more malevolent forces to attempt to amend or weaken them. Does she agree that we should not rely on the assurances that the Government have given in public so far?

[Melanie Onn]

I could not agree more with my hon. Friend. He has mentioned precisely the concerns that led me to introduce my Bill.

The other way in which the European Union has helped to secure and protect the rights of British workers is through the courts. A huge number of rulings from the Court of Justice of the European Union protect employees in our country. For example, the requirement for overtime and commission payments to count towards holiday pay is because of a European court ruling, as is the requirement to pay care workers a full wage for sleep-in shifts.