Leaving the EU: Business of the House

Vince Cable Excerpts

Wednesday 12th June 2019 Commons Chamber

[Sir Vince Cable (Twickenham) (LD)]

It is a privilege to speak in this debate as one of the signatories to the motion, but I want to start by paying tribute to the right hon. Member for West Dorset (Sir Oliver Letwin), who has not just signed this motion but anticipated the potential threat to the country, and indeed the sovereignty of the House, from proroguing and has applied his mind to a procedure for stopping it. We should all be very grateful to him. Of course although today is an Opposition day, this motion is supported by seven different parties. I hope and expect that a significant number of Conservatives will support it, not because they share my view that we should be stopping Brexit, but because they are concerned about the sovereignty of Parliament and the consequences of no deal.

Fingers have been pointed at the right hon. Member for Esher and Walton (Dominic Raab), who is not present. He is probably not alone in advocating Prorogation as a solution to this problem, but actually he has done us a favour and we should be grateful to him for highlighting a risk that might not otherwise have been apparent. I believe the real risk here is that one of the mainstream leadership candidates, having made unqualified commitments to remove Britain from the EU by 31 October, encounters the same arithmetic as his predecessor and encounters the constraints of the withdrawal agreement and, to avoid the humiliation of the present Prime Minister, feels obliged to resort to drastic action. That is the risk that we face and I am grateful to the right hon. Member for West Dorset for starting a process of providing a necessary safety valve.

It has already been agreed that we do not want an extensive review of all the arguments for and against no deal. They have been endlessly rehearsed and we will get plenty of time to rehearse them again. But in the few minutes I want to take, it is worth drawing attention to a couple of recent developments that underline just how dangerous that concept is.

We have just had a visit from President Trump, who has reminded us about the instability of the world trading system. Those who advocate leaving without a deal place their faith in something called WTO rules. We now know that these WTO rules are worthless. The President of the United States attaches as much value to the WTO as he does to the European Union. He wants to destroy it. He is undermining it. He is failing to provide judges to dispute panels, which no longer work. So WTO rules are not worth the paper they are written on. That is the world into which the extreme advocates of no deal want to plunge the United Kingdom.

The other point, which is highly topical, relates to the leadership competition within the Conservative party and the various fiscal bounties that are being offered to us. I suppose that, as an ageing pensioner on a high income, I should be deeply indebted to the right hon. Member for Uxbridge and South Ruislip (Boris Johnson) for thinking about me when he formulated his tax policy, but actually he is one of several candidates who threatens to blow a very large hole in the Chancellor’s provisions to deal with a no-deal Brexit.

It could be argued that the Chancellor is excessively conservative. None the less, he is sufficiently prudent to be aware that a no-deal Brexit will do significant harm to the economy and to fiscal receipts and that there has to be some reserve provision. However, we now enter a period of danger in which that reserve could well be blown on promised tax cuts. Among the many adverse consequences of a no-deal Brexit—not just those we are familiar with around the supply of drugs, the shock to trade and the impact on the economy—is a serious fiscal crisis leading in turn to currency devaluation and other economic consequences.

We will no doubt debate many times the consequences of no deal, but the risks are becoming more and more apparent. We should be grateful to those who anticipate those dangers and seek to prevent us from getting anywhere near them.

EU: Withdrawal and Future Relationship (Votes)

Vince Cable Excerpts

Monday 1st April 2019 Commons Chamber

[Mr Speaker]

Of course I shall come to other Members. I call Sir Vince Cable.

[Sir Vince Cable (Twickenham) (LD)]

On a point of order, Mr Speaker. It is even clearer than it was the last time we had indicative votes that one compromise option has substantial support. There is the largest number of votes in the House for a people’s vote—larger than last time. Is it not possible to combine the two and therefore find a way forward through consensus?

[Mr Speaker]

The right hon. Gentleman’s question is of course of a rhetorical character. It invites no response from me, but he has registered his view, upon which I am sure colleagues will reflect.

EU: Withdrawal and Future Relationship (Votes)

Vince Cable Excerpts

Wednesday 27th March 2019 Commons Chamber

[Mr Speaker]

Well, interpretations vary, which I think is clear from the points of order. The hon. Lady has made her point with some force, and I am sure that people will study it in the Official Report together with the observations of other right hon. and hon. Members.

[Sir Vince Cable (Twickenham) (LD)]

On a point of order, Mr Speaker. Further to the point about how to reconcile this evening’s votes with your ruling earlier today, I note that two motions received votes significantly in excess of what the Government have achieved with their meaningful votes. Would it therefore not be appropriate for the Government to bring back their withdrawal agreement, amended to take account of the Leader of the House’s changes and modified to allow for a confirmatory vote? In that way, we may at last reach some consensus.

[Mr Speaker]

A variety of options is there for policy makers, parliamentarians and members of the Executive, and the right hon. Gentleman has helpfully indicated what he thinks should be the priorities in the important days that lie ahead.

European Union (Withdrawal) Act

Vince Cable Excerpts

Wednesday 9th January 2019 Commons Chamber

[Sir Vince Cable (Twickenham) (LD)]

One problem of having extended debate and resumption of debate is that we are getting a lot of repetition and recycling of arguments that we have heard many times before. For that reason, I want to focus on one specific issue, which is the idea of World Trade Organisation rules and exactly what they mean. The term “WTO rules” is used casually in every pub, and in every radio interview I encounter, but I suspect that many of the people who use it are not at all clear what it means.

Before getting into the detail of that, I will make one general point about no deal, which was brought out rather brilliantly by the right hon. and learned Member for Holborn and St Pancras (Keir Starmer), who got to the heart of this very well. He exposed the fact that no deal is actually a choice. It is not just something that happens; it is the conscious choice of a Government who could choose to revoke article 50, as the Father of the House keeps reminding us. That may be a difficult decision and a very unpopular one, but article 50 could be revoked, and by choosing not to revoke it, the Government will be choosing to have no deal, with all its catastrophic—or so they tell us—consequences.

Let me narrow down to the specific issue of what the WTO rules would be if we found ourselves in a no-deal world. The basis on which I speak is that many years ago, long before I came into the House, I was part of a small community of international trade specialists and got involved in negotiating the so-called Uruguay round and then the Doha round as part of the World Trade Organisation—or, as it was then called, the general agreement on tariffs and trade. I saw at first hand the way in which the WTO system operates. I realise that there is no longer just a small community of anoraks, which is what we were. A large number of people now consider themselves experts on trade policy, but the glibness with which the term “WTO rules” is applied leads me to believe that there are probably not too many anoraks, because there are some very real difficulties in applying WTO rules.

The World Trade Organisation is to trade what the United Nations is to peace. It has some admirable principles, but I think most Members, and certainly those on the Government Benches, would consider it seriously negligent of us to make our national defence dependent solely on the rules of the United Nations. Rules have to be enforced, and they have to be effective.

We need to look back on what the World Trade Organisation is and what it is trying to achieve. In the post-war world, it has established one central principle, and actually it is not free trade; it is something called the most favoured nation—MFN—rule. It is about non-discrimination. It has one big waiver, which is to allow common markets and customs unions such as the European Union to function on the basis of total free trade within themselves, but its whole objective is to stop the proliferation of bilateral agreements.

Such agreements were common in the inter-war period, and they are becoming fashionable again. Many people who are in favour of Brexit say that they are the whole purpose of trade policy. Those people want deals with numerous countries, but the whole purpose of the WTO was to stop this happening. It was supposed to be a multilateral organisation. In that capacity, the WTO achieved a great deal. It cut tariffs to single digits on most manufactures except agriculture, and it got rid of quantitative restrictions, except for the quotas that still exist for agriculture and textiles. It also began to establish a set of rules around intellectual property and various other intangible non-tariff barriers regarding, for example, government procurement.

The problem is that the WTO reached the zenith of its authority about 10 years ago, when the Doha negotiations collapsed and multilateral trade negotiations ceased to make any progress. This was largely due to the obstruction of India, Brazil and, to some extent, the United States. The European Union was actually the main liberalising force, but anyway, the negotiations collapsed and the WTO’s authority is now much less strong. Where does that leave us in terms of what the WTO rules now mean? If they mean anything, it is the application of the rule of law. In the WTO, the rule of law operates through dispute panels, which in theory have the same force as the European Court of Justice in settling disputes. It baffles me that Conservative Members are so affronted by the intrusiveness of the European Court of Justice, because it was designed to achieve precisely what the dispute panels of the WTO were designed to do.

However, like the United Nations, the WTO is not a desperately effective body, and many of its rulings are not carried through. Because it is a weak organisation, it is possible for big countries to bully weak ones. A celebrated case some years ago involved a trade dispute between the United States and Costa Rica—over men’s underpants, as it happens—and Costa Rica won the dispute. The United States felt deeply humiliated and refused to comply. A face-saving compromise was eventually reached, but that dispute sowed the ill feeling that in due course led to President Trump, who has made it absolutely clear that he does not believe in the World Trade Organisation. He does not want it to work, and he is doing everything he possibly can to stop it working, including not sending judges to sit on the dispute panels. It is now a very weak organisation. If we were to crash out of the EU under WTO rules and found ourselves in a dispute with the United States—or, indeed, with the European Union, which we had left—we would not be able to rely on the WTO dispute panels to settle the dispute in an orderly manner.

That is one of the WTO’s central weaknesses. Another is that, throughout its history, it has been overwhelmingly concerned with getting rid of tariffs. The main problem in international trade these days is the divergence of standards, which is of course why we originally entered the single market under Lord Cockfield and Mrs Thatcher. That was perfectly logical. If we are trying to liberalise trade, we attack the non-tariff practices that obstruct trade, hence the harmonisation of rules on mutual recognition. However, the WTO does not do that. It has very weak rules covering government procurement and all the barriers that are dealt with in the European Union through the rules on state aid, competition and the like. That, in turn, means that there is very little in the WTO that covers the services sector, which, as we have been reminded, accounts for 80% of our economy. We have a fair degree of liberalisation in the services trade in the European Union, which benefits our high-tech industries, financial services and so on. No such arrangement exists in the WTO. Those sectors are completely unprotected.

Finally, and not least, the fact is that some tariffs remain, and they are on agriculture. We have the problem that if we leave the European Union with no deal, on WTO terms, the European Union’s tariffs on dairy products, lamb and various other items, which are quite high, immediately kick in. The problem with that, as we discovered when we had the foot and mouth epidemic, is that if we cannot export, prices crash. The only logical response from the farming industry, in order to maintain the value of the stock, is to slaughter large herds. This will happen. We know there is a paper at the moment in the agriculture Department—the Department for Environment, Food and Rural Affairs—setting out a plan for slaughtering a third of all British sheep in order to maintain the integrity of the market. That is an inevitable consequence of a high tariff obstructing British exports.

That is not all; I had only 30 seconds in the House yesterday, but I mentioned the particular problem associated with exports through the port of Portsmouth. It is actually the lifeline to the Channel Islands; that is the main route. The Channel Islands are not otherwise affected by Brexit of course, but they will be in this case. If trade is obstructed at the port because of the need to comply with veterinary requirements, phytosanitary requirements and things of that kind, lorries will be obstructed and fresh produce will not be able to get through. Quite apart from the disruption to traffic, the whole system of agricultural trade and the supply of food to the Channel Islands will simply dry up. We have an enormous practical problem resulting from this.

[Mr Leslie]

The right hon. Gentleman is giving an excellent speech, which is very helpful indeed. Did he see that the Financial Times reported yesterday that the Department for Transport commissioned research that says that just a 70-second delay in authorising a vehicle at the border could mean a six-day queue to get on a ferry?

[Sir Vince Cable]

Yes. Indeed, if I have made a contribution to this argument, it is in pointing out that this is not just a problem in Dover; this problem exists in all the ports around the country. There is going to be serious disruption of supply chains—of the supply of fresh food and many other items. Those people who trivialise the issue by simply saying, “WTO rules—nothing to worry about”, are completely disregarding these consequences.

The conclusion I come to—I think many Conservative Members share it, publicly or privately—is that no deal is just not a viable, acceptable option under any circumstances. We will therefore, within the next few weeks, be brought to the point at which the Government will have to revoke article 50. That would be a major step; it would be overturning the result of the referendum. I feel uncomfortable about Parliament, through Government, doing that. That is why I and other people who are not enthusiasts for referendums believe that the only way of dealing with this properly and of reasserting democratic legitimacy is to go back to the public and seek their approval for doing just that.

EU Withdrawal Agreement: Legal Changes

Vince Cable Excerpts

Monday 7th January 2019 Commons Chamber

[Stephen Barclay]

May I join you, Mr Speaker, in congratulating my right hon. Friend on his well-deserved knighthood? As regards the interplay between the financial settlement and how a no-deal scenario would be managed, there is a contradiction in saying on the one hand that we can leave the EU with no financial contribution, and on the other that there would be sufficient good will on the EU side for them to move beyond anything more than contingency planning and offer some sort of managed deal, when, at the same time, we are not honouring the legal obligations we have.

[Sir Vince Cable (Twickenham) (LD)]

The Leader of the Opposition clarified, over the recess, that in the event that the Labour party obtains and wins a general election it will proceed with Brexit, so what are the Minister’s civil service advisers telling it that is in any way different from what the Government are doing?

[Stephen Barclay]

It is not for me to speculate on what civil servants tell the Leader of the Opposition. I am not sure they would be having those discussions. The reality is that the Leader of the Opposition’s party was the first to offer an in/out referendum. His party should therefore respect the decision, as its then leader said it would. It was the biggest vote in our country’s history and that is why it is right that we avoid further divisiveness and ensure we leave as we said we would.

Oral Answers to Questions

Vince Cable Excerpts

Thursday 6th December 2018 Commons Chamber

[Kwasi Kwarteng]

My right hon. Friend has well-known views about these issues. Many manufacturers and businesspeople in Britain seek an assurance that they will be able to trade freely with the EU, and I think the acquis communautaire is something that they value.

[Sir Vince Cable (Twickenham) (LD)]

The Minister will be aware that engineering employers and the CBI have given cautious support to the Government’s proposal on the basis that the transition and the common customs area will protect their supply chains. What further reassurance can he give them that these arrangements might be long term, or even permanent?

[Kwasi Kwarteng]

The right hon. Gentleman is absolutely right, and I commend him for his honesty in suggesting that many businesspeople think the deal is a very good one. Certainly, businesspeople in my constituency want the deal to go ahead. I think that we will secure a frictionless or very good free trade arrangement with the EU, and I think that our businesses will grow and be encouraged by the free trade agreement that we get.

European Union (Withdrawal) Bill

Vince Cable Excerpts

Tuesday 12th June 2018 Commons Chamber

[Sir Edward Leigh]

I am afraid that my right hon. and learned Friend was not listening to his own speech. Was I not listening—was I not two or three feet away from him—when he said that the amendment that we passed earlier was not going to make much difference to the whole process? It was like giving a statement, was it not? What we are talking about is completely different. This really is the ultimate wrecking amendment, and it is not the wrecking of parliamentary sovereignty; it is the wrecking of the will of the people and democracy. There are so many compromises that we all have to make. There are so many things that I do not understand about this negotiating process, and about how we have got stuck on the hook of Ireland, the backstop, “max fac” and all these other things, but the essential thing is this: the people want us to leave the EU. They want to regain control of their borders and they want us to be out of the European Court of Justice. All this Bill does—it is not the EU negotiating Bill—is simply to implement the will of the people. Parliament, do not stand against the people! Implement their will.

[Sir Vince Cable (Twickenham) (LD)]

Many Members will today be speaking under pressure or while considering different interests. Some will be observing what the hon. Member for Streatham (Chuka Umunna) called the pure Churchillian principle of accountability and thinking clearly about our consciences and judgments, while others will be concerned about the will of the people as expressed by their own or other people’s constituents, or by parts of the UK such as Scotland that are distinct. Others will be thinking about their party and—dare I say it?—some may even consider the views of their party Whips. People will come to different conclusions and weigh these things differently, and the most vocal people will be those who are not necessarily balancing them with the greatest difficulty. We should respect those on both sides who are struggling to reconcile these different pressures.

We are weighing up a difficult constitutional matter, and two constitutional questions are wrapped up in Lords amendment 19. One is about how we reconcile the rights of a plebiscite with those of Parliament—we have debated that many times, and the hon. Member for Gainsborough (Sir Edward Leigh) was very unambiguous about where he stands—and the other is about how we balance the rights of the Executive with those of the legislature. We have debated that in different contexts. A few weeks ago, we were talking about exactly how to weigh war powers and accountability.

Lords amendment 19 takes us forward in one crucial respect with regard to the so-called meaningful vote. It gives additional clarity. It might be better had we taken the wording proposed by the right hon. and learned Member for Beaconsfield (Mr Grieve), but the amendment does give clarity, and it would not have the exaggerated consequences that some have predicted, as was set out very sensibly by the right hon. and learned Member for Rushcliffe (Mr Clarke).

[Andrew Bridgen]

Does not the right hon. Gentleman concede that when Lord Bilimoria introduced Lords amendment 19, he said that it had the ability to stop Brexit? Will the right hon. Gentleman not concede that this is a wrecking amendment?

[Sir Vince Cable]

The House would have to vote in that way, fully conscious of what it was doing. We just have to wait and see how the House chooses to proceed. The overall effect of the Lords amendment is clearly to—

[Andrew Bridgen]

Stop Brexit.

[Sir Vince Cable]

No, but stopping Brexit is one option we need to consider.

Although Lords amendment 19 takes us forward, it would not, as the right hon. and learned Member for Rushcliffe just explained, have the damaging consequences anticipated by many exaggerated predictions. It would not necessarily undermine our negotiating position. The EU countries have their own legislation to consider and have already made it clear that their objective is a smooth, quick, clear Brexit. Anything that might cause major disruption—if they were unfair to the UK, for example—and therefore lead to Parliament’s rejecting the deal would not necessarily be in their interests, and they would, I am sure, reject that.

The crucial point, which is made in the article by Professor Bogdanor that the Brexit Secretary has quoted at length, is that whereas the amendment is a necessary step, it is not sufficient, and that is because Parliament cannot overthrow the judgment of the people in a referendum. The article is quite clear about that, and so are the Liberal Democrats, although we approach this from the opposite direction to some of the Brexit supporters on the Government Benches. We believe that when Parliament has considered the final deal or the absence of a deal, the public should have the final say on the matter. This is not an extraordinary observation. Countries that rule by plebiscite, such as Switzerland, regard confirmatory referendums as a matter of course. The people vote and then the legislature and Executive review the matter. At the end, there is a confirmatory referendum to determine whether the people accept the proposal. There is no reason why that should present a problem. It is a matter of fundamental—

[Several hon. Members rose—]

[Sir Vince Cable]

I will complete my remarks and then let others contribute.

Our amendment (a) to Lords amendment 19 expresses that thought very clearly. I notice that the hon. Member for Bracknell (Dr Lee), who probably more than anyone else is reconciling these different forces today, has accepted that the logic of the position is not simply for the House to have a meaningful vote, but to go back to the people and then accept the result of that vote. Were there to be a vote on the final deal, I would accept it fully, and I would then then work with people who support Brexit to make that work. If we continue on the present path, however, with a definition of Brexit that is narrow and specific, as in the Lancaster House speech—it was supposedly drafted by the Prime Minister’s then adviser—and that many of us would not accept as a proper definition of Brexit, which the Prime Minister has pursued in a stumbling and incoherent way, we will not accept that, and we will not accept the result of the Brexit negotiations even after Brexit has taken place. The public need to have a vote on the final deal at the end of the process.

[Sir Henry Bellingham (North West Norfolk) (Con)]

rose—

Oral Answers to Questions

Vince Cable Excerpts

Thursday 2nd November 2017 Commons Chamber

[Mr Walker]

My hon. Friend raises an important point. I assure him that we have been meeting regularly with the Scotland Office and with DEFRA colleagues to discuss these issues, which have also been discussed in the Joint Ministerial Committee (EU Negotiations) in relation to important principles that were agreed about where shared frameworks might be required and where they will not.

[Sir Vince Cable (Twickenham) (LD)]

Scotland is a significant beneficiary of the European Investment Bank. If Britain leaves the EIB after Brexit, will the Government replace it with a British investment bank, with equivalent resources?

[Mr Walker]

As the right hon. Gentleman will know, the UK is a significant shareholder in the European Investment Bank, as well as a significant beneficiary of its lending. As the Chancellor set out in his Mansion House speech, we will look at the opportunities for co-operation in this area when we come to the talks on the future relationship, but the UK will of course take whatever steps are necessary in the event that there is no deal. That is not our central scenario; we are working towards a constructive deal for both sides.

Oral Answers to Questions

Vince Cable Excerpts

Thursday 7th September 2017 Commons Chamber

[Mr Davis]

We have made that very plain: the words used are that we expect to respect our international obligations but also to have our rights respected. That point has been made very clear. One of the reasons why the last negotiating round was perhaps a little tenser than the previous one is that we were making it very plain what we judged the legal basis to be, and that was not always comfortable.

[Sir Vince Cable (Twickenham) (LD)]

What assurances can the right hon. Gentleman give to financial services companies and other firms that are seriously concerned that they now face the cost and uncertainty of three successive rule books: the single market, the post-single market transition and the post-transition agreement?

[Mr Davis]

As ever, the right hon. Gentleman makes a good point, and that does mean that we will want to ensure there is a single transition, not two different transitions in and out of the transition period. That is why, as the right hon. and learned Member for Holborn and St Pancras (Keir Starmer) quoted me as saying, I said we want the transition arrangement to be as close as possible to the current circumstance. It will be remembered, too, that when I responded to the right hon. and learned Gentleman I said there are three effective sets of criteria: one, time for the Government to accommodate; two, time for other Governments to accommodate; but, importantly too in his context, time after the decisions for financial services and other industries to do their own accommodations.