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Leaving the Eu: Negotiations

Part of the debate – in the House of Commons at 2:02 pm on 10th July 2018.

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Photo of Vincent Cable Vincent Cable Leader of the Liberal Democrats 2:02 pm, 10th July 2018

It is a lot more than ironic, because this goes back a long way. There has been consensus among successive Governments, starting with Mrs Thatcher and Lord Cockburn through the Blair Government and the coalition Government, on accepting that services exports to the European Union were a major objective of British Government policy. I recall being sent to Berlin and elsewhere to denounce the Germans for their failure to open up their market for services trade and the mutual recognition of qualifications. For example, European countries currently decline to accept British ski instructors, as they do not have mutual recognition of qualifications. A great deal has, however, been achieved, and the Government are now inclined to turn their back on it.

The reasons the Prime Minister advanced for doing so yesterday are partly simply foolish and partly bogus. The folly lies in saying that any services transaction that involves people crossing the border, however valuable, is adding to our net immigration target and is therefore unacceptable, regardless of the economic merit. The bogus argument is to say that this is a problem within the European Union, but it is not going to be a problem if we have trade deals with other countries, because we will be able to proceed with services agreements with them.

However, we already know from the two failed attempts so far to negotiate an outline agreement with India that services trade wherever it is—within the European Union or outside it—involves the free movement of people, and the Indians are insisting that if we are to have a bilateral trade agreement with them, part of the package will be importing Indian services in the form of IT consultants and much else. If we look around the other big emerging markets—Brazil, Indonesia, Pakistan, Nigeria—we can see that what they have to export is people. This is going to be an enormous obstacle to the Government reaching any kind of agreement with any country outside the European Union.