Discrimination in Football

Stephen Doughty Excerpts

Thursday 11th April 2019 Commons Chamber

[Mims Davies]

I would love to—I love Bristol. The Rainbow Laces campaign is vital, too. There is room for everybody in football. There is a team for everybody out there, and I am delighted there is such a warm welcome in Bristol.

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

As one of the ambassadors of the Cardiff City FC Community Foundation, may I commend the work of the foundation and the club itself in working with Kick It Out and other organisations to tackle racism and discrimination? Will the Minister join me in welcoming LGBT-inclusive teams such as Cardiff Dragons and London Titans, who do amazing work in bringing people into the game?

[Mims Davies]

I saw in my own local mela the range of sporting clubs that are there for people to join. I would say to people, “Have a look.” It certainly sounds as if there is a great opportunity in Cardiff to get involved at sport at every level. That is what this Government want to see.

Leaving the EU: Economic Impact of Proposed Deal

Stephen Doughty Excerpts

Wednesday 20th February 2019 Commons Chamber

[Mel Stride]

I sincerely thank my right hon. Friend for his extremely kind words. As ever, he is too modest. It was not my effort alone that secured the result that we achieved for those very important veterans in Cyprus—he raised the issue, brought it to my attention in Committee, and worked hard with me to make sure that we achieved the right, just and desired outcome.

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

Of course, the economic effects are already being felt. I have spoken to businesses in my constituency that have gone from profit to loss and others that have cut investment. This week I spoke to Cardiff University, which cited Brexit as a factor in the job losses that it has proposed. This is very serious, so does the Minister accept that we need to get serious? Ministers know that no deal would be a catastrophe. They know that every single Brexit would lead to a worse economic outcome for this country, so do they accept that the issue needs to go back to the people so that they can decide, based on the facts?

[Mel Stride]

If I may summarise, the hon. Gentleman makes the point that uncertainty is not good for business. He is entirely right, and that is all the more reason why we should get behind the deal, and get it sorted. We would then have an implementation period in which nothing would change until the end of 2020. The businesses in the hon. Gentleman’s constituency to which he referred could then begin to increase employment and invest with confidence.

Leaving the EU: Economic Analysis

Stephen Doughty Excerpts

Wednesday 28th November 2018 Commons Chamber

[Mel Stride]

These papers put forward an honest appraisal of the estimated impacts of the different scenarios that we have been discussing this afternoon. The right hon. Gentleman makes a more general point about the inexactitude of economic forecasting, and he is right. We have a whole slew of variables, and we are looking at casting 15 years beyond the end of the implementation period—in other words, to 2034-35—which is quite a challenge. However, that is not the same as saying that we have not taken an honest and robust approach to this task. We have done that, and we have gone further. At the behest of the Treasury Committee, we have said that we will have an expert to go through all the details of the analysis, with access to all the officials across all the Departments involved, and that that information will in turn be made available.

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

The Government’s conduct in this matter has been appalling. There is only one clear message that the public should hear from this: Brexit makes you poorer. Every scenario, including the European Economic Area scenario that many of us put forward as the least worst option, will make people poorer. Even though the Treasury—or the Government, or whoever the Minister is trying to claim it is—has not modelled this scenario, the National Institute of Economic and Social Research has modelled the Government’s deal, and that modelling also shows that we will be poorer. So why will the Government not simply agree to take this back to the people and let them make the choice in a people’s vote?

Leaving the EU: Central Counterparty Clearing

Stephen Doughty Excerpts

Thursday 1st November 2018 Commons Chamber

[Mr Chris Leslie (Nottingham East) (Lab/Co-op)]

The title of this debate may encourage hon. Members to flee the Chamber, but I encourage them to leave via the House of Commons Library, which can explain why central counterparty clearing services are so incredibly central to the infrastructure that underpins business, corporate finance and the nature of our economy, and why Brexit could potentially have a significant effect on such services.

To give a sense of scale, the British economy is worth about $4 trillion. LCH, one of the biggest central counterparty clearing services, is owned by the London stock exchange, and this year alone it has cleared $812 trillion-worth of derivative contracts—largely interest rate swaps. That is a mind-boggling sum of money, and I am raising this issue today because it is an internationally important liquidity pool. The UK specialises in this facility, but with the UK leaving the European Union, the jurisdiction in which these CCP operations take place could well be fragmented, which could have a destabilising effect on the operation of central counterparty clearing services.

The question is: if we crash out of the European Union, or if we do not get the right sort of regulatory framework, what will happen to those trillions of dollars’ worth of derivative contracts? This is one of the most significant cliff-edge issues in Brexit, and it has not had anywhere near enough attention or coverage.

By way of background, I will provide an example of what a CCP operation does and what it clears. Imagine a construction company that is getting a big loan from a bank to build a housing estate, or whatever. That loan is quite a big liability for the business, and often the loan will come with a variable interest rate. In order to manage the liability, the construction company might want to swap that variable interest rate for something a little more predictable, a little more stable—perhaps a fixed-rate interest arrangement. Such interest rate swaps are now a common or garden part of corporate business finance. If we are talking about stability in the economy, such products, though complicated, are often the wiring behind the scenes. They really are important to how we stabilise our economy.

In recent times, central counterparty clearing facilities have developed to make sure that companies do not necessarily have to make these arrangements bilaterally with one another, because they can clear them through a central fund that has an insurance buffer arrangement in case of default on such contracts. Companies such as LCH can go through a number of layers in order to cope with the default. We saw a recent default scenario in Norway, where an energy trader was overexposed and a CCP arrangement absorbed much of that default shock and prevented contagion that could have had wider ramifications around the world. This certainly operated in respect of Lehman Brothers and others in the financial crisis. Since then, policymakers worldwide have recognised that CCP is a really important pillar of our financial stability mechanisms. So these are important insurance policies and this is an international pool of liquidity, and London and the UK are right at the heart of those operations.

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

My hon. Friend is drawing attention to an important set of issues of which I was not fully aware. He would probably agree that we cannot have an “It’ll be alright on the night” approach from the Government to such complex arrangements—we need surety on them. Was he interested, as I was, to see Commissioner Barnier talking earlier about how there had been misleading press reports about a deal on financial services and about many of these matters being close to being agreed, and saying that that was not the case?

[Mr Leslie]

My hon. Friend rightly takes us to the more contemporary story about what is happening with these, because Brexit has put everything in limbo. Will these CCP operations be able to continue to service the vast majority of euro-denominated interest rate swaps or derivative products? The European Union had been developing new supervisory arrangements that would have included the UK. Brexit came along and of course those have all now been put into abeyance because the UK may be taken out of those jurisdictions. Time has ticked on and we are now five months, perhaps less, away from the moment of change, yet we still do not have any certainty about what will happen. However, we have heard various rumours.

Last week, the Governor of the Bank of England, Mark Carney, highlighted £41 trillion-worth of outstanding contracts that could be forcibly voided—that could fall out of legal certainty—if we do not get some sort of arrangement put in place. Earlier in the week, EU Commissioner and Vice-President Valdis Dombrovskis indicated that the EU might allow the UK CCPs after Brexit to operate on a temporary basis, with some strict conditionality. Of course we saw the report in The Times today that perhaps in the negotiations there was some sort of sense in which UK financial services companies, including these CCPs, would be able to operate on an equivalence basis, which is not as good as the arrangements we have, where we are around the table and able to make the rules on regulations. We would be a rule taker, but of course we may be allowed access to European markets—and, potentially, vice versa. The danger with that is that it is precarious and it could be switched off at a moment’s notice if policymakers fell out, for whatever reason.

As my hon. Friend has pointed out, today Commissioner Barnier poured a big old dose of cold water all over that, saying, “You should not believe everything you read in the paper.” He reiterated that it was really in the hands of the EU to decide whether equivalence continued. This would not be an ideal situation at all, and the risk is that we would need to see CCP clearing services develop rapidly in other jurisdictions in Europe. Of course the Americans will have their arrangements, but that could start to undermine the centrality of the UK. That would be a great pity, because the UK has expertise and a relatively good regulatory approach, working with our European colleagues.

So the main question I want to put to the Minister is: what is the Government’s attitude to the future, long-term, stable, permanent regulation environment? Are we going to align ourselves closely or in harmony with the EU regulatory framework for central counterparty clearing arrangements? If that is the case, it would be useful to know that that is British Government policy at this stage, because that might then enable something to be built on equivalence. We could possibly move to a position in which the UK still has a say in the regulatory arrangements.

In my view, the public should be given a chance to think again about this whole thing and, if they want, there should be a people’s vote so that the option to remain is still viable. Nothing has been decided that should prevent that from happening. If we are to leave the European Union, it would not be a good thing to do so and put all these things up in the air. We should not fragment the financial safety regulatory arrangements and potentially put businesses, jobs and livelihoods at risk.

EU Customs Union and Draft Withdrawal Agreement: Cost

Stephen Doughty Excerpts

Monday 22nd October 2018 Commons Chamber

[John Glen]

The Chancellor has made money available across-Government to help us through this process. I would acknowledge the massive contribution made by our civil service to help across many Departments of Government. The Prime Minister is committed to securing the best deal for the nation.

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

Leaving the customs union will cost us billions, but it is also costing dear now. Does the Minister not agree with me that, with violent crime rising, the Home Office could have done with the extra money to pay for an extra 4,500 police officers, instead of £500 million for extra customs and border officials to prepare to leave the customs union?

[John Glen]

There is a Budget next Monday, and it will be for the Chancellor to set out the spending settlement for Government Departments.

Taxation (Cross-border Trade) Bill

Stephen Doughty Excerpts

3rd reading: House of Commons & Report stage: House of Commons
Monday 16th July 2018 Commons Chamber

[Anna Soubry]

That was a very long but very good intervention.

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

I have heard exactly the same points from businesses in my community. I have heard the same points about the Northern Ireland-Ireland border, too. That is why I favour staying in a customs union. The White Paper is full of magical thinking, but the amendments tabled by some in the right hon. Lady’s party directly contradict what is in the White Paper, because what they really want is a reckless no deal Brexit in which we crash out, with all the damage that will cause.

[Anna Soubry]

I completely agree. I say to my Government that they are in grave danger of not just losing the plot but losing a considerable amount of support from the people of this country unless we get Brexit right. The people who put their names to those amendments—notably new clause 36 and amendment 73—did so not to be helpful to the Government and to support the White Paper. We know that from their public proclamations, in which they have tried to trash the White Paper.

I made it clear to the Whips and to—well, actually, to the Financial Secretary to the Treasury, for whom I have a lot of time because he is a very good Minister, a very good man and a very good constituency MP. I say that because I have been to his constituency—

--- Later in debate ---

[Anna Soubry]

I completely agree with my right hon. and learned Friend. Members on the Government Front Bench, and indeed across the House, should be hanging their heads in shame. This is the stuff of complete madness. The only reason the Government have accepted the amendments is that they are frightened of around 40 Members of Parliament—the hard, no deal Brexiteers —who should have been seen off a long time ago. These people do not want a responsible Brexit; they want their version of Brexit. They do not even represent the people who actually voted to leave. The consequences are grave, and not just for this party, but for our country. One has to wonder who is in charge. Who is running Britain? Is it the Prime Minister, or is it my hon. Friend the Member for North East Somerset (Mr Rees-Mogg)? I know where my money is at the moment.

[Stephen Doughty]

What has really been going on here is that some of these extreme individuals have been threatening the Government, trying to hold them hostage, and saying that they will vote against Third Reading and bring the Government down, to get these bizarre, contradictory amendments through.

[Anna Soubry]

The hon. Gentleman is absolutely right. It is disgraceful, because this White Paper is a genuine attempt by our Prime Minister to heal the divisions in our party, and indeed the divisions in our country, and take us to a smooth and sensible Brexit that delivers for everybody.

--- Later in debate ---

[Mr Leslie]

Well, I will certainly want to vote against amendment 73, but my hon. Friends will make their own remarks in their own time. I do not know what their intentions are, as I have not had a chance to hear from them. Intuitively, I doubt very much that my hon. Friends, knowing what the hon. Member for North East Somerset (Mr Rees-Mogg) is up to, knowing where the members of the ERG come from on the political spectrum—the hard right Brexit perspective—and knowing how important the economy is to the future of this country, will abstain on amendment 73.

[Stephen Doughty]

It is very clear, as my hon. Friend says, who those Members are working with and what their agenda is. They are working with the likes of Nigel Farage and others who would like to see us crash out, so that they can deregulate the economy and change it into a Singapore-style tax haven on the edge of Europe where they can pursue their right-wing fantasies.

[Mr Leslie]

Yes, indeed.

It is helpful if we view the two Bills we are considering today and tomorrow as a piece, as they interrelate with one another. Many of the amendments tabled for the Trade Bill tomorrow on a customs union are also on today’s amendment paper. I say gently to the Government, “Nice try with your facilitated customs arrangement, but it is not going to fly for a number of different reasons.” I urge the Chancellor and the Minister to stop putting down red lines. They will only find that they come back and embarrass them when they have to accept a customs union.

Let me quickly go into detail on why a customs union really will have to apply in this situation. There may be Conservative Members who agree with me on this point. The facilitated customs arrangement may well apply if we have a free trade agreement with the EU, but only a customs union gets rid of what is known as the rules of origin requirements—the local content thresholds needed to prove whether an FTA is in place to qualify for preferential tariff arrangements. Under a customs union, we do not have to have rules of origin checks. That is a massive advantage of the customs union.

Customs and Borders

Stephen Doughty Excerpts

Thursday 26th April 2018 Commons Chamber

[Yvette Cooper (Normanton, Pontefract and Castleford) (Lab)]

I beg to move,

That this House notes that the EU is the UK’s largest export market for goods, accounting for a total of £145bn of exports and £241bn of imports in 2016; further notes the Government’s expressed aim to secure the freest and most frictionless possible trade in goods between the UK and the EU after 29 March 2019; notes the importance of frictionless trade without tariffs, customs or border checks for manufacturers and businesses across the country who trade with the EU; further notes that the free circulation of goods on the island of Ireland is a consequence of the UK’s and Republic of Ireland’s membership of the EU Customs Union; in addition notes the Government’s commitment to (i), in the UK-EU joint report on progress during phase 1 of the Article 50 negotiations, the maintenance of North-South cooperation and the all-island economy on the island of Ireland, (ii) the Belfast Agreement implemented in the Northern Ireland Act 1998 remaining a fundamental principle of public policy and (iii) the continuation of unfettered access for Northern Ireland's businesses to the whole of the UK internal market; and therefore calls on the Government to include as an objective in negotiations on the future relationship between the UK and the EU the establishment of an effective customs union between the two territories.

This is the first of the debates chosen by the Liaison Committee, and it is on one of the most important issues on which Parliament must decide in the next six months. We did not choose this topic because we all agree—the Liaison Committee includes the hon. Member for Stone (Sir William Cash), and hon. Members can imagine the extent of the disagreement that he and I have on many of these issues. We chose this topic because we think it is an incredibly important issue and we are running out of time. The motion is tabled on behalf of 12 Committee Chairs, and it proposes an effective customs union in the interests of our manufacturing industry and of continuing to support peace in Northern Ireland.

We are running out of time. We are running out of time for Parliament to help shape negotiations, based on evidence heard by our Select Committees and discussions between Back Benchers. We are running out of time to hear from the Government about what they are going to do. The Government rightly say that they want frictionless borders and no extra burdens on business; they want to improve trade and to have no hard border in Northern Ireland, including no infrastructure at the border. However, there is still no clarity about what that means for our borders. Many of our Committees have looked in detail at some of the practical challenges, and the Home Affairs Committee has warned about the problems and challenges of bringing in huge border changes at speed, and with a lack of staff in place.

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

I sit on the Committee chaired by my right hon. Friend, and I wholeheartedly endorse the conclusions we came to regarding our serious worries about Government preparedness. Does she agree that not only is the border between Northern Ireland and the Republic of Ireland a serious issue that is yet to be resolved, but there is also a question whether there will be a maritime border between Wales and Scotland and the Republic of Ireland? The Home Secretary seemed to suggest that there would be customs officials at Welsh ports, but that is a completely unacceptable situation.

[Yvette Cooper]

My hon. Friend is right: there are so many unanswered questions and the clock really is ticking. We secured this debate to try to tease out those questions and get some answers, and to put forward some proposals for this debate. I also put on record apologies from the Chair of the Exiting the European Union Committee, my right hon. Friend the Member for Leeds Central (Hilary Benn), but that Committee is taking evidence in Berlin today.

Why put forward an effective customs union as part of the proposals? It means no tariffs on the goods we buy and sell with the European Union. It means no customs checks at the border. It is a crucial part of delivering the frictionless border for trade that the Government have rightly promised. It clearly does not solve all the problems and meet all the challenges that we face, but it is an important part—

--- Later in debate ---

[Yvette Cooper]

That goes to the heart of the situation. It is partly about certainty and partly about knowing that businesses can smoothly trade in the way that they have been doing, and that we can build on that trade and not end up with new barriers in place. It is manufacturing where this matters most—manufacturing is still the spine of our economy and so much else depends on it. For so many of our towns, such as those in my constituency and across the north and midlands, manufacturing is still at the heart of the local economy, and it could be hugely jeopardised if we end up with a damaging change to the terms of trade.

[Stephen Doughty]

My hon. Friend is being very generous in giving way. Unite––the union shop stewards who came to visit me from Rolls-Royce––made exactly that point. They explained the real damage that could be done by this to the aerospace industry in particular and the long and detailed supply chains that stretch across not just the whole of the UK, but the whole of the European Union.

[Yvette Cooper]

That is right. Many of these manufacturing towns and areas may well have voted to leave the European Union, but they will also argue strongly for support for manufacturing jobs within their communities. We should be listening to their voices.

--- Later in debate ---

[Mr Clarke]

I really should not, because the Speaker will get extremely annoyed. I must come to a quick conclusion and I wanted to touch on Ireland. I apologise to the right hon. Gentleman, but other people must get in.

It is an utterly ludicrous idea that it would somehow be better if we do things on our own. The countries always cited are the United States, Australia and New Zealand, and they will do deals with us because they all want to sell us foodstuffs. There is not a great deal of trade that we can add between us and New Zealand and Australia, and the Americans are desperately keen to sell us their beef and their chicken. As someone has already said, all trade deals are not done by a sovereign country saying, “Of course we are not binding ourselves to do anything.” They involve the agreeing of market regulations and of the trading rules that will apply. We would not say, “It’s all going to be decided by the British courts.” There would be an international arbitration agreement to which businesses and countries could look if one side started breaking its treaty obligations. The Americans will say, “Give up these European food safety and environmental regulations, and we will trade with you on ours.” If we let in chlorinated chicken, hormone-treated beef and genetically modified crops— personally I am not convinced that they are the health hazards that most people in the country seem to believe they are—that means new barriers with Europe, which will not let those products go straight through, and we will probably lose a large part of our biggest market, for food and agricultural products, which is in Europe.

I have one final point to make on international trade and about where the debate is unrealistic. WTO rules have suddenly been elevated to some mystic world order that means that our new trade agreements will somehow be much better. I wish that were true. This country does abide by WTO rules, but they are nothing like as comprehensive as they ought to be because the Doha round failed. The Americans take no notice of the WTO. The Americans and the Chinese are about to start a trade war, and everything that they are doing is in total breach of WTO rules. We will not get a deal with Donald Trump subject to WTO rules. He will not even appoint judges to the WTO court, because otherwise it might do what is usually its major duty, which is settling disputes between states.

Going back to what the right hon. Member for Normanton, Pontefract and Castleford said, we want trade with Europe that has no barriers between ourselves and Europe. It will require some ingenuity to find some basis on which we might still be able to do trade deals with other people, but the idea that some marvellous new global future with fantastic new trade deals is about to open up is hopeless. If someone can get the Americans to open up their public procurement to international competition and give up the “Buy America” policy or to open the regulatory barriers that they have put in the way of professional and financial services, they will be a miraculous negotiator, because we could get nowhere when Obama was in power. I do not think that the present Administration are offering us anything; they just want their beef to come here.

Finally, on Ireland—I will be much shorter on this because it is a big question that has been touched on already—it is absolutely critical that we do not break the Good Friday agreement. It is quite obvious that most people on this side of the Irish sea had never thought about Ireland when we were debating during the referendum and when they were propounding their policies. The problem of the Good Friday agreement has been addressed by most Brexiteers by them saying, “Surely that’s all over now? Isn’t it a nuisance? What an irrelevance. Let us break it now, because it no longer matters. It is far more important that we get the kind of hard Brexit that we want.” That is very dangerous.

The Good Friday agreement is one of the major achievements of the British Governments of my time. It was negotiated with the Americans, with the Government of the Republic of Ireland and with every section of opinion in Northern Ireland. It brought an end—almost; it is the end, I hope—to 200 years of the troubles in Ireland after they erupted into violence. When the troubles were under way in the ’70s and ’80s we lost more policemen and soldiers in Ulster than we did in Iraq and Afghanistan put together. The agreement was a splendid achievement for John Major and Tony Blair, so to say, “What an inconvenience. It is getting in the way of our leaving the customs union,” is very dangerous.

I thought that the Government had accepted that. Indeed, I think they have done so formally on two occasions. First, we had the Prime Minister’s Florence speech, which addressed the matter. Talking about the discussions she had had with Europe about Northern Ireland, she said that

“we have both stated explicitly that we will not accept any physical infrastructure at the border.”

That was solemnly agreed. It was the agreed Cabinet policy. The Foreign Secretary made a strange speech before the Florence speech and a statement shortly afterwards that gave the impression that he was trying to undermine the speech, but I am sure he was not. That statement is already agreed Government policy.

Secondly, we finally managed to make progress by finishing the withdrawal agreement, and we published the texts of what had been agreed. As people have said, there are all these other possible solutions involving using congestion charge cameras and things to avoid issues at the border, but I do not think that they will get very far. We have already committed ourselves to the following:

“In the absence of agreed solutions, the United Kingdom will maintain full alignment with those rules of the Internal Market and the Customs Union which, now or in the future, support North-South cooperation”,

which I think means pretty well full regulatory convergence. As someone has already said, the chief constable of Ulster has said that we cannot have infrastructure at a new hard border. It would outrage nationalist and republican opinion across the whole island and take us right back to all the problems we had. Symbolism is huge in the politics of Ireland and always has been, and it would be grossly irresponsible to put a hard border in the middle of the island of Ireland again. We have never been on such good terms with the Government of the Republic of Ireland since the Republic was founded.

If we have those arrangements at the Irish border, the same arrangements will of course apply to Holyhead and to Dover. That is what I want to see. We want no new barriers and no customs processes. We want the necessary level of regulatory convergence. Obviously, the easy way to do that is to stay in the customs union and stay in the single market. If not, we will need what I think the Prime Minister described as a “customs procedure”, which will be something that looks remarkably like the single market and the customs union.

The customs union is what today’s business is about, and it would do terrible damage to this country if, for strange ideological reasons in the confused aftermath of a misguided referendum, we were to take such a foolish step as not to replicate the customs union in any future arrangements.

[Stephen Doughty]

On a point of order, Mr Speaker. I apologise for interrupting this important debate on a topic on which I have strong views, but something has come to my attention in the last few moments. As you will be aware, the Home Secretary endured some strong questioning both this morning and at yesterday’s sittings of the Home Affairs Committee about removal targets. The BBC’s political editor is now reporting that the Home Office in fact intends to scrap the internal removal targets, so I wondered whether you had received notice that the Home Secretary plans to come back to clarify the statement that she made earlier, which was of course a clarification of statements made by her and her officials yesterday and, indeed, by the Prime Minister, who is responsible for this mess starting in the first place.

Leaving the EU: UK Ports (Customs)

Stephen Doughty Excerpts

Monday 19th March 2018 Commons Chamber

[Mel Stride]

Everybody’s fishfingers will be safe in the hands of this Government.

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

I was a big fan of Peter Pan when I was growing up. I thought that the idea of a magical Neverland was wonderful, but of course as we grow older we realise that it does not exist—[Hon. Members: “What?”] I am sorry to disappoint hon. Members. The Minister, however, seems to think that he can wish a happy thought and fly out of the window. I am going to ask him a very practical question. Have he and the Home Office undertaken plans to train and recruit additional customs officers for the Welsh ports that have been mentioned? I have asked a number of questions and have not been able to get a straight answer from the Home Office. Are additional staff being recruited? If so, how many?

[Mel Stride]

We have made it very clear that sufficient staff will be made available. The head of Her Majesty’s Revenue and Customs has made it clear that there will be a requirement of between 3,000 and 5,000 additional staff. The Chancellor made it clear at the Budget that £260 million would be made available for HMRC in the coming year, and those resources are for people as well as technology. The right and appropriate number of people will be available.

Taxation (Cross-border Trade) Bill

Stephen Doughty Excerpts

2nd reading: House of Commons
Monday 8th January 2018 Commons Chamber

[Mel Stride]

My hon. Friend is entirely right. That is why we have consulted ports so extensively, most importantly that of Dover, which I visited myself. I met the port authorities down there, and members of Her Majesty’s Revenue and Customs have been closely involved in consultations with the ports. Of course, the Bill allows the facilitations that we will require—both unilateral and bilateral—to ensure that the smooth flow of trade occurs at those vital ports. It is particularly essential that we do not have any delay to the processing of imports and exports that go through roll-on/roll-off ports.

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

On the specific need to keep trade frictionless, HMRC, which is part of the Minister’s Department, said that we would need an additional 5,000 customs officials. The Home Office said that it was already recruiting 300 additional staff, although I understand that they will backfill places rather than taking on additional roles. How many new customs officers are currently in training to prepare for the new customs regime in March 2019?

[Mel Stride]

The important point is that we are in discussions with HMRC about its funding—[Interruption.] If I may, I will answer the hon. Gentleman’s question. We are discussing with HMRC the funding arrangements it will need in the 2018-19 financial year. As he suggested, Jon Thompson has said that between 3,000 and 5,000 staff will perhaps be required. Incidentally, they need not be new recruits; they may be people who are reallocated from other parts of HMRC as we change priorities, depending on how the negotiations pan out. I am very confident that an organisation of in excess of 50,000 people will be capable of recruiting sufficient individuals of the right calibre and with the right skills to ensure that the job is done.

--- Later in debate ---

[Mel Stride]

I will make two points. First, as the hon. Gentleman will know, such matters are for the usual channels, and his party is an important part of the usual channels. Secondly, the Bill will of course receive the normal high level of scrutiny as it passes through the House—line by line, clause by clause. Amendments can be tabled, debated and divided on if necessary. The Bill will then come back to the House on Report and for Third Reading. If he has any particular representations to make about the number of sittings in Committee, he should perhaps speak to his Whips, who can then speak to our Whips, and I am sure that we will all end up in a happy place on the issue he has raised.

[Stephen Doughty]

The Minister is being generous, as he always is. Having been opposing Whips at various points on various financial matters, I know that he always does these things in good faith, but I share the concern of my hon. Friend the Member for Nottingham East (Mr Leslie). Both Front-Bench teams are currently tied up with the Finance Bill that is going through—an important piece of legislation that we quite rightly oppose many parts of. Given that, we will not be able to start the scrutiny of this Bill in Committee for quite some time, and the Bill is due to be out of Committee by 1 February. The Bill will not receive full scrutiny in the House of Lords because this is a money Bill, so will the Minister tell us how many Committee sittings there will be to scrutinise a large, substantial and important Bill?

[Mel Stride]

The hon. Gentleman is being typically tenacious, but he asks the same question as the hon. Member for Nottingham East and he will have the same answer. I will spare the House my eloquence by not going through, once again, the same answer that I just gave.

--- Later in debate ---

[Peter Dowd]

There is no one in training and the staff on the ground take a completely different view from the hon. Lady.

The Bill outlines the trade remedies the Government will enforce against the dumping of unfairly priced goods. At the moment, these remedies are provided by the EU, but on leaving, the UK will have to enact and manage its own trade remedies. These measures are spread across this Bill and the Trade Bill and are of great importance to UK manufacturers. As I have said at this Dispatch Box on previous occasions, the Opposition will oppose any attempt by this Government to undermine UK manufacturing and jobs by the weakening of trade remedies, as well as any attempt to dismantle unilaterally the external tariff and open up UK markets to unfairly priced goods. This is a question not of protectionism, but of fairness and the rule of law, as countries that allow or encourage state dumping are not playing by international rules.

The manufacturing industry remains an indispensable part of the UK economy. According to the Office for National Statistics, manufacturing accounted for 2.3 million jobs in 2016 and 10% of the UK’s total economic output. These jobs are shared out across the minerals and ceramics, paper, steel, glass, chemical and fertiliser sectors. They are also spread across communities across the country, where manufacturing remains one of the largest employers. In my constituency alone, more than 2,500 people are employed in manufacturing, and the same will be true of the constituencies of many Members here today.

The trade remedies proposed in this Bill are pitiful to say the least. They are far weaker than the remedies currently in place in the EU and are weaker than those in most developed trading nations, and if they remain unchanged, they will put manufacturing jobs at risk.

[Stephen Doughty]

I agree very much with the point my hon. Friend is making about the pitiful nature of the trade remedies in the Bill. Indeed, I think that it poses much greater risks for industries such as the steel industry in my constituency. Does he agree that it is necessary to put paid to the myth that existed that we could not take trade remedies when we were part of the EU? Indeed, the former Steel Minister who is sitting opposite, the right hon. Member for Broxtowe (Anna Soubry), took a good decision, for which I praised her at the time, to introduce remedies on certain steel products that affected steel in my constituency. Whether these decisions are taken or not is a political choice; it is not about whether we can do this or not under the EU.

[Peter Dowd]

My hon. Friend is absolutely right on that point.

What is concerning is the fact that UK manufacturers and key industries have not been consulted on the trade remedies in the Bill. Perhaps the Minister can explain why, if the Prime Minister is happy to meet representatives from Toyota to agree a deal and the Environment Secretary is in regular contact with the National Farmers Union on future agricultural subsidies, he has failed to consult an industry that represents nearly 10% of the economy and employs millions on the trade remedies it needs to protect UK jobs.

--- Later in debate ---

[Mr Leslie]

If only that were the case. In fact, that same point is raised in paragraph 9 on page 6 of the explanatory notes, which states:

“The Taxation…Bill does not presuppose any particular outcome from the UK’s negotiations with the EU.”

That is not true. The Government have absolutely presupposed that the customs union is off the table. It is the ultimate presupposition, if ever anyone wanted a definition. This Bill apparently does not allow us to stay in the customs union, but it should allow us to do so, because I happen to believe that there is a majority in this House of Commons for membership of the customs union. I have a little job of work to do to continue to persuade my own party’s Front Benchers of that particular point, but I will try my best to do so because I think they will eventually recognise that being part of the customs union is incredibly important for our economy not just in the transition period, but for the longer term. I believe that the numbers are here in the House of Commons to support that and that it will eventually be proven.

I am disappointed that the Government have tried to twist parliamentary procedure by deeming this measure to be a money Bill. It is Mr Speaker who will decide whether or not it is a money Bill, and I think he will do so at the end of this particular Commons procedure. The Government, though, in a slightly tricksy way, are putting through the Bill following a Ways and Means resolution. Why have they done that? They have gutted the Trade Bill and stuck everything they possibly can into what was the customs Bill so that it cannot be amended by the House of Lords. It is the most obvious trick in the book—rule 101 for a Minister. I have been around the block a number of times, and I have to tell the Minister that there are whole clauses in the Bill, such as clause 31, that are about the formation of a customs union. How is that a matter purely for a money Bill? It is absolutely an issue of public policy to do with our trading alliances that the other place should have every right to pass comment on. If it has advice and suggestions for this place, it should be allowed to amend the Bill.

[Stephen Doughty]

I completely agree with my hon. Friend’s point. Is it not underlined by the fact that the Government’s programme motion neglects to state how many days’ scrutiny the Bill will receive in the Public Bill Committee, let alone on the Floor of the House, but does state that the Committee will be done by 1 February? If the Committee does not start for a week or a couple of weeks because the Finance Bill and other measures are going through, there will be an extraordinarily small amount of time for detailed scrutiny of a 56-clause Bill with numerous schedules that will potentially have serious impacts on our economy.

[Mr Leslie]

That is why I suspect that the other place will look at the truncated scrutiny. I tried to get this out of the Minister earlier—not the Minister before us, but the Financial Secretary to the Treasury. It was not a Cabinet Minister who came to the Chamber to introduce the Bill, by the way, but I am told that a reshuffle might be going on, so perhaps the Chief Secretary or even the Chancellor are in negotiations. The junior Minister acquitted himself reasonably well at the outset—as well as he possibly could, given the line that was scripted for him to take—but I think that a Cabinet Minister should have presented a Bill of such scale and importance. It deserves proper scrutiny in this place, with the right number of Committee sittings, because otherwise the other place will have to do that job for us.

--- Later in debate ---

[Mr Leslie]

Of course, that is an unamendable procedure. I think that, at the very least, the Government will be pushed by the other place into a super-affirmative procedure whereby the Commons has a Committee that looks at the details and suggests amendments and changes. Ministers may then plough ahead if they want, but a super-affirmative procedure would mirror more the powers of MEPs in these matters. A simple aye or nay would be a dilution of the scrutiny powers that we currently have democratically via elected Members of the European Parliament.

I want to focus on part 3 of the Bill. In the past couple of days, a lot of attention has been given to the number of firms that do business across the European Union. They think of their trade not as imports and exports, but as arrivals and dispatches. Whether they are buying components from Birmingham or Bristol or from Brussels or Berlin, they treat them all the same for customs and excise and VAT purposes. That will potentially not be the case under the Bill.

Even if we stayed in the single market and the customs union, we would not necessarily be in the EU VAT area, which is outwith the customs union. That is another decision that Ministers will have to face up to and take. I would like the Bill to be amended so that we stay in the EU VAT area or, at the very least, have a proper impact assessment of the implications of leaving it. That is the position of the British Retail Consortium, which argues that leaving it would mean a potential bureaucratic burden for businesses that currently, if they are importing goods from EU member states, can treat the acquisition VAT through the normal quarterly lodgings of their VAT returns. Henceforth, those firms will potentially have to pay VAT up front—it is known as import VAT—at the point of entry, so at the border, at the port, at Dover, at the channel tunnel or wherever it comes in, each time there is that level of transaction. To look at it in the round, the customer would pay the same amount of VAT at the end point, but it would be incredibly disruptive to the cash flow of those firms.

I looked online and at the explanatory notes, thinking that there must be a regulatory impact assessment of that situation, because the Bill abolishes acquisition VAT and introduces import VAT on goods, including those from the European Union. There does not seem to be a particularly rigorous impact assessment. I do not know whether I have missed it. There was one for the Trade Remedies Authority, but there does not seem to be one for the import VAT proposals. There ought to be an impact assessment, because that is Cabinet Office best practice, but I cannot seem to find it.

Again, I do not think voters were necessarily tuned into the implications on the EU VAT area when they cast their votes on the ballot paper. I may be criticised again for saying this, but I did not see the EU VAT area on the ballot paper. Perhaps I was not looking closely enough. Perhaps Government Members will help me out and point to where it was.

Currently, 140,000 British companies have to go through the rigmarole of registration and compliance when importing from outside the EU. A further 132,000 firms that do not trade beyond the EU but source their imports and components from within the EU will potentially be added to that. Knocking on for 300,000 businesses will be hit by this. According to HMRC’s own statistics, the number of transactions that are hit by customs duties and, therefore, potentially by import VAT will go from 55 million trades to 255 million trades a year, with all the paperwork and rigmarole associated with that level of bureaucracy.

[Stephen Doughty]

My hon. Friend is making incredibly important points about the practical implications of the Bill and the proposed changes. Was he not concerned, therefore, that the Financial Secretary refused to confirm whether any additional customs officers were being proposed or were in training? In fact, he seemed to suggest that they would be reallocated from other roles within HMRC or the Home Office. Given the scale of the additional bureaucracy that is being proposed, is that not deeply worrying?

[Mr Leslie]

We will have to hear from Ministers how they propose to deal with the extra 200 million trades going through the new system. I hope to read more in the impact assessment. If the Government can cope with, or have proposals to ameliorate, some of that administrative burden, we would like to see it in the impact assessment.

On top of that, my hon. Friend should know that, as I think was mentioned earlier, HMRC currently has a computer system or IT software called CHIEF. What does it stand for? I will not try to deal with the acronym—oh no, I can; you will be glad to know, Madam Deputy Speaker, that it stands for “customs handling of import and export freight”. CHIEF will be retired in January 2019—keep that date in mind, as it is crucial in the transition. We are moving to a new system called the customs declaration service. It is costing £157 million to implement and is potentially great news, but all these 130,000 new traders will suddenly be brought into this new system, and they will need to be given time, leeway and flexibility to get used to a system that they currently do not have to operate. I want to hear from the Minister what approach the Government will take to gradually phase in the new system while bringing so many extra businesses into that procedure.

[Mr Leslie]

That is not quite the impression I am getting from the business community. Trade bodies, such the British Retail Consortium and others I have mentioned already, are voicing their concerns, but many businesses are also waiting to see if there is any clarity on the details of how this will pan out. The warm words about phase 1 agreements—“We can sort these things out”, “Don’t worry, it will all be fine”—will only butter so many parsnips. Ultimately, businesses want to know how it will affect their bottom line, how they will cope, what sort of new systems they will need to put in place, what sort of employees they will have to bring in, and so on.

[Stephen Doughty]

I am afraid I disagree with the hon. Member for Strangford (Jim Shannon). He and I get on very well, but I am not hearing the same thing. The Freight Transport Association has made very clear the consequences of even marginal delays to customs procedures, such as those caused by the introduction of a new IT system and the additional time spent processing declarations. It has said that the addition of an average of two minutes to customs processing would result in a 17-mile queue from Dover back to Ashford; four minutes takes the queue back to Maidstone; six minutes back to the M25; eight minutes, and we are at the Dartford crossing and Essex. We could not have a clearer illustration of the types of problems that could be caused. These are substantial changes and, even with the best will in the world, they will have substantial impacts on trade.

[Mr Leslie]

That is why we should not just rush the Bill through as though it were a minor, technical copy-and-paste exercise. These are fundamental decisions we are having to grapple with, both in this House of Commons and in the other place, and it is not appropriate that it be deemed a money Bill. Yes, aspects are to do with taxation, but others are not and broaden out into trade and other areas. The Government might think they can deal with this tactically in that way but I do not think it appropriate.

I encourage my Front-Bench team, and all hon. Members, to support remaining in the customs union. I give notice to my Front-Bench team in particular. I asked the shadow Chief Secretary to the Treasury about the Labour party’s policy on the EU VAT area, a specific area of policy we need to get to grips with. The Bill should be amended so that we retain our involvement and participation in the EU VAT area, as that is the clearest, simplest way of retaining the current benefits. I am sure that amendments will come along on this issue, and when they do, I hope that all hon. Members will think carefully about what to do.

As for this evening, I worry that this VAT issue is yet another potential horror story in the Brexit saga. We pull at one thread and yet more issues start to tumble down on top of our constituents and the business community. It is not right to facilitate duties being put on trade with our nearest neighbours and closest economic allies across the EU, and that is why I hope that we will oppose the Bill this evening.

Exiting the EU: Costs

Stephen Doughty Excerpts

Wednesday 29th November 2017 Commons Chamber

[Elizabeth Truss]

As my hon. Friend points out, the people of Norfolk are fair minded. They want the referendum result to be respected and they want to honour our commitments to the European Union, but they want that to happen in a way that is fair for Britain and British taxpayers and that ensures that we get the best possible deal.

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

The figures are astronomical. Is it not the case that the British public are already paying the costs of this Government’s approach to Brexit in the form of the £3 billion that the Chancellor announced in the Budget would be spent on Brexit contingencies and the more than £700 million that he has already shelled out? Should people not have been told about that before the referendum?

[Elizabeth Truss]

It is completely irresponsible of the Opposition to suggest that we should not prepare for all eventualities. It would be disgraceful for the Government not to do that. That would not be the proper action of a responsible Government.