European Union (Withdrawal) Bill

Wera Hobhouse Excerpts

Committee: 2nd sitting: House of Commons
Wednesday 15th November 2017 Commons Chamber

[Robert Neill]

It would be for the Government to choose whether to bring such things forward. At the moment, it would be quite onerous to have primary legislation. Not all these issues will, of course, affect the Holyrood situation. Holyrood may well wish to adopt a procedure for devolved matters, and we could look at that constructively. If there is to be a package of further discussions, we could also consider that further. Scotland is important as a centre of financial services, as is the City of London, and we could try to develop these things as we go forward.

[Wera Hobhouse (Bath) (LD)]

Will the hon. Gentleman give way?

[Robert Neill]

I need to make some progress, so I hope the hon. Lady will forgive me. I have not much more to say.

Let me explain how this procedure will work. The proposed use of the affirmative procedure takes account of the fact that this amendment addresses only EU legislation that is in train, but not wholly in effect. These pieces of legislation have been subject to policy input and scrutiny processes, so they are very limited in number.

Support for this approach comes from two practitioner-based groups in the City: the International Regulatory Strategy Group, which I referred to in debate yesterday, and the Financial Markets Law Committee. The strategy group includes most of the key players in the London financial world. The law committee is an independent body drawn from leading practitioners in City firms and institutions and from members of the judiciary—in fact, it is chaired by Lord Thomas of Cwmgiedd, who recently retired as Lord Chief Justice. Their imprimatur is likely to indicate that this modest proposal has a pretty strong parentage in terms of its expertise and application.

The two bodies identify potential sources of legal uncertainty affecting the wholesale financial markets. Let me give two examples. First, there is the situation regarding the second payment services directive. The directive will apply from next year and will be domesticated, but important regulatory technical standards that will underpin the operation of the directive are not expected to be finalised by the European Banking Authority until after Brexit. At the moment, the Bill will not allow us to adopt those standards into UK law. The amendment would give us a streamlined means to deal with that.

Some of the provisions of the prospectus regulation came into force over the summer, and some important elements are due to take effect in the months after Brexit. Do we have to go through full primary legislation to incorporate that, or do we deal with it through a streamlined procedure? The City institutions and practitioners think it would be much more sensible to have the procedure I propose, so that they have certainty that they will not have delays in the primary legislative process. They can then have the regulation in place, and they are already prepared for it.

That is the nub of the amendment. I am grateful, again, to the Remembrancer’s Office of the City of London for its assistance with the drafting. I am sure the Minister will want to find the means to achieve what is set out in the amendment. I hope that he will be able to respond and find a means of taking this forward.

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[Priti Patel (Witham) (Con)]

I am pleased to have the opportunity to speak in this debate, and particularly to clauses 2 and 3. Of course, my speech follows an intensive course over the past week on how to stage an exit, which was the focus of a degree of international attention. For anyone who is still tracking my movements, I can confirm that as I walked into the Chamber this afternoon, I passed statues and portraits commemorating some of our greatest statesmen, including Margaret Thatcher and Winston Churchill. Those statesmen stood up and defended democracy, freedom and the sovereignty of our great nation.

The Bill paves the way for a smooth withdrawal from the European Union. It complements many of our debates and discussions about article 50 and delivers on the will of the British people, as expressed in the referendum. I welcome the clarity provided by clauses 2 and 3. I pay tribute to my colleague the Solicitor General, who spoke with great clarity for almost an hour about providing guarantees and ensuring that a snapshot of EU law, as it currently applies, is maintained in this country.

The clauses are comprehensive and sensible. They outline pragmatically the steps that need to be taken to prevent a legislative vacuum. They provide important certainty to businesses and the public. They should help to ensure that the great Brexit trade deal that we hope to secure—and we will secure—for our country can be agreed with the EU on exit with regulatory equivalence in place in the right quarters. Of course, because we are taking back control, this Parliament, the Government and the devolved Administrations will be in a position to amend, adapt and change measures, as appropriate, in the years ahead.

[Wera Hobhouse]

Does the right hon. Lady agree that we risk sacrificing parliamentary scrutiny because we are in a big rush to get everything done? Exit day is looming and it is now widely agreed that we face a massive task, so we are rushing everything and sacrificing parliamentary scrutiny.

[Priti Patel]

I respectfully suggest that scrutiny is the purpose of these debates in Committee. We should have a great deal of pride in our role in that scrutiny. We must work with the Government and Ministers. Yes, part of that work is the tabling of amendments, because that is the nature of debate, but our job is to look pragmatically at the right way to deliver the referendum outcome. As we have heard from many Members, including in good contributions today, we will keep measures that are in our interest and that work for our country, and we will of course amend and revise those that do not.

Clauses 2 and 3 are about not only taking back control of those laws and putting power back into the hands of our lawmakers, but introducing accountability through scrutiny. During our consideration of our withdrawal from the EU, Members have tabled amendments—and rightly so—but we should not listen to those who do not have confidence in this House, our democracy and our country, and we should reject the suggestion that we are incapable of governing ourselves. That clearly applies to comments that we have heard not just today, but in previous debates, and predominantly from Opposition Members. They may want to be governed by the EU because they feel unable to govern themselves, but we fundamentally believe that our democratic institutions, and this House in particular, are held to account by the British people, and that we can make laws in all areas covered by the EU.

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This also has an impact on British membership of the EEA. Article 126 of the EEA agreement explicitly provides that it applies to the territories to which the treaty establishing the European Economic Community—now the European Union—is applied, as well as to the three EFTA member states. Given that the EU treaties will no longer apply to the UK at that point, and given that the UK is not one of the three EFTA member states mentioned in the EEA agreement, it necessarily follows that at that point—the moment of the UK’s departure from the European Union—we will cease to be subject to the provisions of the EEA agreement. In other words, British membership of the EEA will effectively automatically fall at that point.

[Wera Hobhouse]

Does the right hon. Gentleman agree that if we want to trade with other nations, we must have some form of agreement with them? We cannot just trade and have our own arrangements and regulatory systems without any agreement with other nations or states who want to trade with us and without a body acting as referee. We therefore must at some point be part of some sort of agreement or arrangement with other countries, otherwise we will just sit there somewhere in the North sea on our own.

[Mr Jones]

That may well be so, but I invite the hon. Lady to digest the terms of article 126 of the EEA agreement and then consider whether at the moment of our departure from the EU we will still be subject to the EEA agreement. I believe we will not.

For the reasons I have outlined, I invite the hon. Member for Carmarthen East and Dinefwr not to press amendment 217, too.

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[Wera Hobhouse]

Does the right hon. Lady not agree that what we are really discussing is democracy and how we interpret it? As much as I agree that the language has sometimes gone overboard and been very unpleasant for some of us, we are grappling with this because democracy is a very difficult issue.

[Anna Soubry]

The hon. Lady may well be right. I am trying to find solutions. I am trying to find a way to get the best solution for everybody in our country, while putting the economy at the heart of this.

The joy of remaining in the EEA, and indeed in EFTA, is that it is a model sitting on the shelf that can be taken down, dusted off and perhaps tweaked here and there. The benefit for the great British people is that—hallelujah!—the job will pretty much be done, and it will enable our Government to get on with the great domestic issues that we must address. It certainly means there will be a “Hoorah!” right across businesses in this country, because it will give them the certainty and the continuity for which they are desperate, and it will deliver economic benefits. There is not much else to say, but if it is pressed to a Division, I will certainly vote for new clause 22.