Department for Exiting the European Union

Tommy Sheppard Excerpts

Monday 26th February 2018 Commons Chamber

[Tommy Sheppard (Edinburgh East) (SNP)]

It is a pleasure to follow the right hon. Member for Leeds Central (Hilary Benn). I hope to respond in a minute to some of the points that he made about the customs union. However, before I start to talk about DExEU and Brexit, I want to make some general observations about the process in which we are engaged during our two days of debate on the estimates.

When I, and most of my colleagues, came to the House in 2015, we were quite shocked by the lack of financial scrutiny of the Executive in the Chamber. Since we became the third party, we have pressed for change in the way in which the estimates are considered. I therefore welcome the baby steps taken this year, in that we are at least able to focus on a set of figures that relate to a Government Department and what it is doing, rather than discuss random topics that may or may not be related to budgetary matters. However, we still have a long way to go in holding the Executive to account financially and in terms of their policies.

I firmly believe that if we were the board of a large charitable organisation, the charity regulators would find us wanting in terms of our procedures for financial scrutiny and accountability. I also believe that if we were the board of a large corporation, our shareholders would be demanding action to improve our processes. I therefore hope that the steps we have taken this year are the beginning of a process, and we might one day get to a situation where the Government are required to produce a programme plan charting their future policies and their effects, and then each Department has to produce a programme plan, which each Select Committee can scrutinise along with the budget that goes with it. That is the process that the Scottish Government are engaged in, in terms of how they govern the responsibilities under their remit, and it is one that we could learn from and try to develop here in the years ahead.

What happens when we combine a rudimentary process of programme planning and financial planning with the complete absence of a set of policy objectives in the first place? The answer is DExEU, because here we have combined an absolute lack of planning and a financial mess. DExEU was set up in the summer of 2016 by a shell-shocked Government who frankly did not know what to do in implementing a referendum result that they did not expect. In a desperate desire to be seen to be doing something, they set up a brand, spanking new Department, with lots of new letterheads and people to write memos to each other, and lots of people employed to research and analyse something, the only problem being that there was no plan to be implemented.

In the absence of a plan to be implemented, we have gone from one chaos to another, and I share the Minister’s embarrassment. This must be the only Department in history that underspends its budget not by a couple of percentage points, but by 50% in its first year, and it has had to go to the Treasury to scale down its estimates of spending in the next financial year.

That is a phenomenal metaphor for the Government’s Brexit policy, because they do not know quite what they are doing. In the absence of their being able to play a co-ordination role in planning for Brexit, individual Departments have had to be allowed to do their own thing and try to deal with the consequences as best they can. That is why 90% of the amount of money being spent on Brexit preparations, or the lack of them, is not to be found in the Department supposedly responsible for co-ordinating preparations for Brexit. That is a ridiculous situation.

This, of course, is from a Government who have said not only that they will set up a brand new Department, but that money is no object for that Department. This is a Government who cannot find the money for our health service; a Government who are determined to squeeze down wages by pay restraint in the public sector and reduced living standards; a Government who have, for heaven’s sake, taken £30 a week of employment and support allowance from the most vulnerable people in our community—yet they can find £4 billion over the next few years to spend on preparing for Brexit. The problem is that the plans are so incomplete, and they do not know what they are doing, so they are even unable to spend the money.

[Bill Grant]

rose—

[Tommy Sheppard]

I will certainly give way, and hopefully we will hear what the plan is.

[Bill Grant]

I remind you, in case you have forgotten, that this Government created and increased the living wage and took millions of people out of tax, and your Government in Scotland asked that the wages cap be lifted in the public sector simply so you could tax people more.

--- Later in debate ---

[Madam Deputy Speaker (Dame Rosie Winterton)]

Order. It is becoming a bit of a habit that there are exchanges across the House with Members saying “You” and “you” and “you”. We must observe the courtesies of the House; one goes through the Chair.

[Tommy Sheppard]

Thank you, Madam Deputy Speaker. I was going to point out that the hon. Gentleman’s intervention had a tenuous link to the subject of debate and no connection whatever to what I was saying, but he has none the less made his point for the record.

What does this lack of preparation mean for financial planning? I shall give the House two quick examples. The first is the customs union—or the customs arrangements, as the Government will call them. I might be wrong, but it seems overwhelmingly logical for our global trade that if we are leaving the European Union, we should first immediately try to seek an arrangement with those countries that are nearest to us and with which we have the greatest trading links. That ought not to be a matter of controversy. The only reason that it is controversial is the existence of an unreasonable number of people on the Government Benches who are so Europhobic that they will not countenance anything that looks like a cut-down relationship with the European Union. The idea of having a customs union should not be controversial, however, and I very much welcome the fact that Her Majesty’s Opposition now seem to be on a course towards coming round to that point of view.

[Angus Brendan MacNeil]

At one stage, the Labour party was against “the customs union”. Now it is for “a customs union”. The Conservatives are clearly against the customs union, and the Opposition are rallying around it, but we now have a third option from Labour, apparently dividing the Opposition, in favour of a customs union that it cannot fully explain. Does my hon. Friend see a difficulty in what Labour is proposing?

[Tommy Sheppard]

I am going to be uncharacteristically kind to the Labour party and take the right hon. Member for Leeds Central at his word. He seemed to be suggesting that we were moving towards a situation in which the difference between “a customs union” and “the customs union” might not be that great. In fact, I think he said that he viewed “a customs union” as having to replicate the procedures of “the customs union”.

[Jenny Chapman (Darlington) (Lab)]

This is becoming one of the most pointless, tedious and repetitive conversations. May I help the hon. Gentleman out? There is not really any difference; it is all about how it is embedded in the treaty. We cannot be part of “the customs union” because it is part of the treaty that we are leaving, so we will need a new one. Therefore it will be “a customs union”. There is, in essence, no difference.

[Tommy Sheppard]

Well, if there is no difference, welcome to the party! It is good to have the hon. Lady on board, and we look forward to her walking through the Lobby with us next time this comes to a decision.

The debate about customs arrangements is relevant to the budget because the clock is ticking and we are now only just over a year away from Brexit day. We still do not know what customs arrangements we are going to have with the EU27, yet the Department for International Trade is allowed to run round the world meeting everyone and talking about all manner of global trading arrangements, even though everyone knows that if there is a set of legacy arrangements involving the European Union that will probably place conditions on or compromise any arrangements we can make with anyone else. What a waste of money it is to engage in the process of pretending that we are going to have unfettered global trading arrangements with the rest of the world while at the same time discussing the need for preferential trading arrangements with the European Union.

Let me just take one more minute to talk about the second aspect of Brexit and DExEU that illustrates the lack of co-ordination and the financial waste involved in this process—namely, clause 11 of the European Union (Withdrawal) Bill. Unless that clause is corrected, it will drive a coach and horses through the principle of devolution to Scotland, Wales and Northern Ireland, yet at the 11th hour we still do not have the amendments that the Government admitted in debates in this Chamber were necessary to make the Bill work.

The question is this: who is at fault for that? Is it the Secretary of State for Scotland, the Secretary of State for Exiting the European Union, the Minister for the Cabinet Office or the Prime Minister? Someone needs to tell us why they could not achieve the simple thing of preparing legislation that would allow a coherent withdrawal Bill to be presented to the House. That is not something that we can blame on Brussels. Michel Barnier does not really care what clause 11 of our European Union (Withdrawal) Bill is or what the post-Brexit arrangements for devolution are. This problem is self-made and self-inflicted, because the Government are so incoherent and unable to plan. I hope that in the months and years to come we will have rather more coherence in Government policy and therefore rather better financial coherence as a result.