UK’s Exit from the European Union

Debate between Stephen Farry and Stella Creasy

Monday 24th April 2023 Westminster Hall

[Stephen Farry]

I agree. We will soon discover that in many respects, by design the UK will have to be a rule taker. It is in the fundamental interest of the UK economy to follow rules that are essentially set at the European level, but we will not have the important say that we had previously.

Like the hon. Member for Oxford West and Abingdon (Layla Moran) and many other colleagues in today’s debate, including the right hon. Member for Leeds Central (Hilary Benn), I sit on the UK Trade and Business Commission. Almost every week we hear evidence from a range of experts and other stakeholders who set out huge concerns about the impact of Brexit on their sectors. It is accurate to say that the UK economy has seen seriously constrained growth as a consequence of Brexit. Of course, there are other issues, but Brexit is by far the major stand-out factor that differentiates the UK from its main competitor nations in the developed world.

The trade deals that are happening around the world will never compensate for the increased trade barriers that we have erected with our closest and biggest external trading partner. It is one thing to say that the European Union is not growing at the same rate in terms of international trade; having a trading partner that represents 30% to 40% of our international market compared with a partner that grows from 0.1% to 0.2%, while maybe a radical change in the level of trade on the surface, does not amount to the same impact on UK business. Also, we have discovered that freedom of movement applies in two directions. Who knew? Constraints on the ability of others to come here applies to UK citizens seeking to move overseas.

I want to focus on the impact on Northern Ireland. In some ways, I feel slightly humbled in this respect because we have had, at the very least, the benefit of the Windsor framework. I put on the record again my appreciation for those who were involved in reaching that agreement, both on the UK side and in the European Commission. At best, the Windsor framework is a soft landing for Northern Ireland, but Northern Ireland will still suffer many of the same problems that the UK as a whole is facing from Brexit, as well as some further particular challenges that are unique to our own geographical situation on the island of Ireland.

Perhaps the most apparent consequence is seen in our governance. I have no doubt that my colleague, the hon. Member for Strangford (Jim Shannon), will express a different view on this when he speaks, but for me our governance worked based on sharing and interdependence. It relied upon the joint membership of the UK and Ireland within the single market and customs union, and that in turn allowed us to have those interlocking relationships, within Northern Ireland, on the island of Ireland and within the UK, allowing a balance of different identities to be expressed without that much encumbrance. Brexit—particularly a hard Brexit—will threaten some people’s sense of identity and create some degree of economic friction. The Windsor framework has gone a long way to mitigate some of that, but it only applies to goods and not to the other fundamental freedoms around services, capital and the freedom of movement.

[Stella Creasy]

The hon. Gentleman is making a powerful point about how important the Windsor agreement is. Does he therefore agree that one of the egregious things about Brexit is pushing things such as the Retained EU Law (Revocation and Reform) Bill, which, in and of itself, fundamentally undermines the Windsor agreement by removing all those alignments of laws around goods and indeed services on which the Windsor agreement is based? It just reflects how Brexit has blinded people to what is in the best interests of people, whether in Northern Ireland or the rest of the United Kingdom.

[Stephen Farry]

I am grateful to the hon. Lady for those comments. I had hoped that wisdom would eventually prevail in relation to that piece of legislation. It is not just pointless but needlessly self-destructive, and it will pose particular problems to Northern Ireland, given that we do currently do not have a functioning Assembly, and if the current sunset clause—at the end of this year—still applies, we do not actually have the space to put in place successor pieces of regulation to cover for all the gaps that may or may not emerge. There is also a very particular challenge to the fundamental freedoms that are set out in the Good Friday agreement, and transposed in terms of article 2 of the protocol, which has now itself become the Windsor framework.

It is important to recognise that we are making these comments today in the context of the 25th anniversary of the Good Friday agreement, which happened earlier this month. Last week, there was a major conference at Queen’s University in Belfast. We had the Prime Minister over there, pledging his ongoing support for the agreement and praising all those who have got us to this particular point, without at the same time recognising that some of the policies that the Government are pursuing in relation to Brexit, including retained EU law, pose a major threat to people’s rights in Northern Ireland.

Beyond the issue around the movement of goods, there are issues in terms of access to labour and skills, which are particularly problematic in our economy. Like everywhere else in the UK, services are by far the largest aspect of our economy. The contrast on the island of Ireland is now becoming incredibly stark. Northern Ireland is going through major difficulties, not least due to our lack of a functioning Assembly and Executive. We are also facing into a budget crisis and we have very sluggish economic indicators. By contrast, our friends on the other part of the island are actually expecting a massive surplus, potentially as much as €20 billion, over the next couple of financial years. They have much higher growth than Northern Ireland; their productivity levels are much higher. And that is creating a major tension for an economy that competes in that all-Ireland context as well as in a pan-UK context.

I want to put another point on the record, Mr McCabe. I have no doubt that other Members will wish to pick up the loss of European Union funding, which was so crucial for some of the more marginalised parts of the UK. I appreciate it is a particular factor in Wales, but also in places such as Merseyside and Cornwall. What has replaced it through the shared prosperity fund simply cannot compensate for what has been lost. It is undoing what the Government are notionally trying to do in terms of levelling up because the money simply is not there.

The same applies to research funding. The UK is internationally renowned for the quality of our research and development, our universities and how we innovate. Again, through not being part of Horizon Europe, we are losing opportunities. It is a matter not simply of funding, as important as funding is, but of the international collaboration and the networks. Speak to any scientist—they will say that all this has to happen at scale, and we have to be part of those networks. The UK is going through a process of needlessly marginalising itself. I very much welcome this petition and would embrace an inquiry. It is only through proper discussion of these issues and having an honest conversation that we can begin to undo the damage that has been done over the past few years. I look forward to a mature reflection on what needs to happen to restore the UK’s place in the world.