No Deal: Economic Impact

Exiting the European Union – in the House of Commons on 27th June 2019.

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Photo of Anna Turley Anna Turley Labour/Co-operative, Redcar

What recent discussions he has had with the Chancellor of the Exchequer on the effect on the UK economy of the UK leaving the EU without a withdrawal agreement.

Photo of Bill Esterson Bill Esterson Shadow Minister (Business, Energy and Industrial Strategy), Shadow Minister (International Trade)

What recent discussions he has had with the Chancellor of the Exchequer on the effect on the UK economy of the UK leaving the EU without a withdrawal agreement.

Photo of Diana R. Johnson Diana R. Johnson Labour, Kingston upon Hull North

What recent discussions he has had with the Chancellor of the Exchequer on the effect on the UK economy of the UK leaving the EU without a withdrawal agreement.

Photo of Stephen Barclay Stephen Barclay The Secretary of State for Exiting the European Union

I have regular conversations with Cabinet colleagues on all aspects of our EU exit. The Chancellor has provided £4.2 billion to prepare for all areas of our exit.

Photo of Anna Turley Anna Turley Labour/Co-operative, Redcar

I have spent this week at the Community trade union conference, the steelworkers’ union, trying to reassure steelworkers around the country from British Steel that their industry has a future and that the right hon. Gentleman’s Government are doing all they can to support them. If we leave the European Union with no deal, however, there will be an instant 25% tariff on steel exported to the European Union, which will cost the British steel industry £1 million a day. The industry has been very clear with me: no deal means no steel. Please, will the Secretary of State rule it out?

Photo of Stephen Barclay Stephen Barclay The Secretary of State for Exiting the European Union

Again, the way to rule out no deal is to back a deal, but the hon. Lady raises an important issue in relation to British Steel. As she is well aware, the Government have been working very closely with the industry and the owner, Greybull Capital. She will be well aware, given her constituents’ interests, of some of the global issues in terms of demand, but this is a live issue. I am discussing the issue with industry leaders and trade unions, too.

Photo of Bill Esterson Bill Esterson Shadow Minister (Business, Energy and Industrial Strategy), Shadow Minister (International Trade)

Even the International Trade Secretary appears to recognise that article 24 of GATT cannot be invoked unilaterally. There will be no transition period in the event of no deal. That much must be clear to everyone by now. Will the Secretary of State agree that no self-respecting Minister could possibly serve in the Government of a Prime Minister in denial about the reality of a no-deal Brexit?

Photo of Stephen Barclay Stephen Barclay The Secretary of State for Exiting the European Union

The clue is in the hon. Gentleman’s own question. He talks about “unilaterally”. Clearly, GATT 24 would need to be agreed. I think all the leadership contenders recognise that.

Photo of Diana R. Johnson Diana R. Johnson Labour, Kingston upon Hull North

Beckie Hart, the director of Yorkshire and the Humber CBI, said recently that many firms are unaware that it is not just their relationship with EU customers that is at risk from a no-deal Brexit, but relationships across the globe. Tonight, Hull MPs and the shadow Brexit Secretary are meeting the Hull and Humber chamber of commerce to discuss our region’s economic prospects under Brexit. What reassurances can the Secretary of State give to Humber businesses on what is being done to avoid a no-deal Brexit, and what is being done to prepare for it to minimise the damage to the northern powerhouse from years of underfunding and austerity from his Government?

Photo of Stephen Barclay Stephen Barclay The Secretary of State for Exiting the European Union

The hon. Lady raises a number of issues within the question of how we are preparing for no deal. It is essential, which is why the Government are investing in that preparation. I am keen to see to us do so at pace. In terms of the wider economy, it is about looking at, if we were in a no-deal situation, what flexibilities we could exploit, what issues of mutual benefit to the EU and the UK we can agree on, and where the flexibilities are that we can work on with the industry in that particular region. Those are the discussions we are having with applicable sectors. We are looking at key sectors to the region, such as offshore wind, and seeing what support the Government could provide in that situation.