European Union (Withdrawal) Act

Vince Cable Excerpts

Tuesday 4th December 2018 Commons Chamber

[Sir Vince Cable (Twickenham) (LD)]

I wish to say a few words on behalf of the Liberal Democrats’ position that we should have a people’s vote with the option to remain in the European Union. We shall campaign to remain in the European Union, as we believe unambiguously that that is in the national interest and the right thing to do.

I think that I am one of the relatively few people left in the House who actually campaigned to join the European Union and in support of membership during the Wilson referendum. It was my privilege at the time to campaign alongside some very fine British and Scottish statesman, such as Jo Grimond, John Mackintosh and, perhaps above all, John Smith, who strongly believed that Britain’s future lay in the European Union. John Smith in particular would be pleased with the amendment that my Liberal Democrat colleagues have tabled, which fully endorses the Labour party’s amendment, but would add a small section that the leader of the Labour party either forgot or was embarrassed to refer to. It would add

“including a public vote as endorsed by the Labour Party Conference”.

He did not mention that this evening.

My other relevant experience, which I share with the right hon. Member for Derby South (Margaret Beckett), is of having worked as President of the Board of Trade, for five years in the coalition Government. There were several important lessons from that experience. The first was the importance to Britain—and this was recognised by both parties in the coalition and the Labour party—of its membership of the single market. It stemmed originally from an insight in the 1980s under Mrs Thatcher and was taken up by the Blair Government, that the future of the British economy lay with services, not just financial services but more generally. It was an area in which Britain had a considerable competitive advantage, and was in the national interest to promote. We did so, and we lectured countries such as Germany that were dragging their feet on issues such as mutual recognition of professional qualifications. At the end of the campaign for the single market, in 2015, we reached a provisional understanding on a digital single market, which was very much in the interests of Britain’s emerging digital economy and creative industries. The Prime Minister herself said recently that this was something that Britain should be part of, until it was pointed out that we cannot be part of it if we leave the single market.

The other major lesson of that period comes from having negotiated with General Motors over Ellesmere Port and Luton, with Ford over its plants in the UK, with Toyota, with Jaguar Land Rover over its expansion, with Airbus over its big investments here, and with Siemens over its investment in wind turbines. In each case, the company made it absolutely clear that it was making its investments in the UK manufacturing sector in order to be part of the wider European market. Many of those investors, who invested here in good faith, now feel somewhat betrayed. The Japanese have said that very clearly, having been told by successive Governments that our membership of the European Union single market, on which the future of their investment here depended, would be maintained.

Looking forward, there are overwhelming arguments for remaining a member of the European Union. Some of them have already been expressed, including the arguments about peace, put forward by the right hon. Member for Leeds Central (Hilary Benn), and about high environmental standards. The fundamental point, however, is the impact on our living standards. It has been acknowledged—even by the Government in the past two weeks, as a result of their assessments—that however Brexit is constructed, we will be worse off if we leave the European Union. We can have different scenarios and assumptions, but there is none that shows that we would actually benefit from leaving the EU. We can see the signs of this already in what has happened since 2016. We have seen the biggest devaluation since the second world war, the cut in real incomes, the stifling of business investment and the decline in productivity. These things will continue on a bigger scale.

We are offered the fantasy of a clutch of trade deals, but we need to look at what that actually means. There will be some trade deals that can be negotiated. Small countries in the Caribbean will certainly sign up for trade deals to get better access for their bananas and sugar. Some countries will find it relatively easy to come to an agreement. They include Japan, Korea and Canada, but they already have trade agreements with the European Union, so we would gain nothing from that.

[Norman Lamb (North Norfolk) (LD)]

Does my right hon. Friend share my concern about our participation in the world-leading Horizon 2020 programme and the Horizon Europe programme that will follow it? When I questioned the Prime Minister last week at the Liaison Committee, there was no clarity as to whether we would be part of that successor programme, which will be vital for our science base in this country.

[Sir Vince Cable]

My right hon. Friend is absolutely right, and he speaks with the authority of his Select Committee. Many universities will be among the biggest casualties of Brexit precisely for this reason. The loss of the Horizon and Erasmus programmes, and in some sectors the loss of Galileo, will be a major blow to the UK economy.

On the specific issue of trade deals, the countries that really matter are the United States, India, China and possibly Russia. We know about the United States, which has made it absolutely clear that an “America first” trade agreement will mean fewer British exports to the United States and more imports to Britain from the United States. It is quite unambiguous about how it defines a successful trade deal. When the right hon. and learned Member for Rushcliffe (Mr Clarke) and I negotiated with the United States on the Transatlantic Trade and Investment Partnership agreement, even the milder Obama Administration made it clear that they wanted British food standards to be shredded and that they could offer very little in return because public procurement, which is a key issue in the United States, is a state function.

Agreement with India is also difficult to achieve, as we have already heard. It is a very protectionist economy, and it would offer limited access for whisky and financial services in return for a substantial increase in visas for relatively low-paid Indian professional workers, which the Prime Minister has already specifically ruled out. The Chinese might reach an agreement, but only if we turned a blind eye to Chinese practices on intellectual property and the rest, and we are trying to impose more sanctions on Russia, so what kind of a trade deal could we possibly get there? This really is a fantasy. However, we need to be careful—this is where the amendment of the right hon. Member for Leeds Central (Hilary Benn) is so important—that we do not allow the development of the argument that we must have the possibility of no deal. There was an argument for saying that the no-deal option must be kept on the table when we were negotiating with the European Union, but an agreement has been reached and no better terms are going to be obtained. The Prime Minister is now negotiating with the House, and that is why no deal is there. It is not to threaten Europe, but to threaten us, and we must stand up to that and reject it absolutely.

Finally, a people’s vote is essential because we must give people the choice now that we know what Brexit means. We need informed consent, not just an opinion expressed on promises made at the time. The perfectly reasonable argument has been advanced that we want to bring the country together, and the Prime Minister spoke eloquently about that. We do not want to perpetuate division, but the brutal truth is that the country is bitterly divided, and it will be bitterly divided if we leave under the terms that the Government have negotiated. We will be entering into a set of conditions in which the economy will deteriorate relative to how it would have performed in the European Union. The younger generation coming through will bear the brunt of the costs. Most of them voted to remain in the EU—an estimated 80% of 18 year olds wish to remain—and there will be great bitterness and resentment about what the older generation has imposed upon them. The issue will not go away, and there will be continued demand for a further vote on the question.

[Layla Moran (Oxford West and Abingdon) (LD)]

Does my right hon. Friend share my concern that the Prime Minister’s gambit that this will somehow be the end of the matter is not true? The 26-page political declaration is just the start of further negotiations, and people deserve the right to say whether they want to continue talking about Brexit and to suck the air out of this Parliament’s ability to tackle the big issues in this country.

[Sir Vince Cable]

That is absolutely right, and none of us should be under any illusion that this issue is going to die in March next year. As my hon. Friend points out, we will have five or 10 years of continued negotiation about what type of trade relationship we have, and there will be bitter divisions around that. We will have a great deal of disillusionment with the costs that Brexit will inevitably entail and continued demands to return to the issue. Let us agree to have another vote on Brexit now that we know what it is. That is the least damaging and least hurtful way that we can proceed as a country.