Leaving the Eu: Preparations

Part of the debate – in the House of Commons at 5:04 pm on 3rd September 2019.

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Photo of Michael Gove Michael Gove Chancellor of the Duchy of Lancaster 5:04 pm, 3rd September 2019

This is the first time I have appeared at the Dispatch Box since I moved on from the Department for Environment, Food and Rural Affairs. I would like to take this opportunity to thank the superb team of civil servants at that Department, who do so much to improve the lives of so many across this country.

With your permission, Mr Speaker, I would like to make a statement about preparations for our departure from the European Union. More than three years ago, in the biggest exercise in democracy in our country’s history, the British people voted to leave the EU, but so far this Parliament has failed to honour that instruction. Now, our Prime Minister has made it clear that we must leave by 31 October, and so we must. Trust in this House depends on it and trust in our democracy depends on it.

Of course, this Government are determined to secure our departure with a good deal, one that paves the way for a bright future outside the single market and the customs union, and the response the Prime Minister has received from European leaders shows that they are ready to move—they want a deal, too. And they are moving because the Prime Minister has been clear that matters must be resolved by 31 October. If we drift, the incentive on them to deliver will quickly dissipate, so I hope that my colleagues in the House of Commons will give the Prime Minister the time and the space he needs to pursue the opening he has secured and to get a good deal that we can all support.

But of course we must be prepared for every eventuality; the European Union may not change its position sufficiently before 31 October, and it may be that a deal is not secured. So we must be ready to leave without a deal on 31 October. Leaving without a deal does not mean that talks with our European partners end altogether. In those circumstances, after we depart without a deal in place, we will all want to discuss how we can reach new arrangements on trade and other issues. But while those conversations go on, we must ensure that we are ready for life outside the EU as a third country, trading on World Trade Organisation terms.

There has been extensive speculation about what leaving without a deal might mean for businesses and individuals. Moving to a new set of customs procedures, adjusting to new border checks and dealing with new tariffs all pose significant challenges, and nobody can be blithe or blasé about the challenges we face or the scale of work required. But provided the right preparations are undertaken by government, business and individuals, risks can be mitigated, significant challenges can be met and we can be ready. Leaving without a deal is, of course, not an event whose consequences are unalterable; it is a change for which we can all prepare, and our preparations will determine the impact of the change and help us also to take advantage of the opportunities that exist outside the EU.

We have, of course, to prepare for every eventuality, and that is the function of Operation Yellowhammer. It is an exercise in anticipating what a reasonable worst-case scenario might involve and how we can then mitigate any risks. Operation Yellowhammer assumptions are not a prediction of what is likely to happen; they are not a base-case scenario or a list of probable outcomes. They are projections of what may happen in a worst-case scenario, and they are designed to help government to take the necessary steps to ensure that we can all be ready in every situation.

Since the new Government were formed, at the end of July, new structures have been put in place to ensure that we can be ready in every situation and that we can accelerate our preparations for exit. Two new Cabinet Committees have been set up—XS and XO—to discuss negotiating strategy and to make operational decisions about exit respectively. XO meets every working day to expedite preparations for exit, and we are in regular contact with our colleagues in the devolved Administrations, including the Northern Ireland civil service, and thousands of the best civil servants across the UK are working to ensure the smoothest possible exit.

We have all been helped by the Chancellor’s move to double Brexit funding for this year, announcing an additional £2.1 billion, on top of expenditure already committed. So £6.3 billion in total has been allocated to prepare for life outside the EU. That money is being used to provide practical help to businesses and to individuals.

Guaranteeing the effective flow of goods across our border with the EU is, of course, central to our preparations, and that will require action by business, to adjust to new customs procedures, and intervention by government, to ensure the freest flow of traffic to our ports. That is why Her Majesty’s Revenue and Customs has announced an additional expenditure of £16 million to train thousands of customs staff, traders and hauliers, so that trade with the EU continues as smoothly as possible. It is also why today we are announcing £20 million more to ensure that traffic can flow freely in Kent and trucks arriving at Dover are ready to carry our exports into the EU.

On business, we have automatically allocated an economic operator registration indicator—EORI—number to 88,000 companies across the UK, and businesses can also register for transitional simplified procedures to delay the submissions of customs declarations and postpone the payments of duties. New transit sites have been built in Kent to smooth the flow of goods into the EU, and we are recruiting 1,000 new staff to help to maintain security and to support flows at the border.

The Government will do all that they can to support businesses to get ready, but many of the steps required to ensure the smooth flow of trade fall to business. We will provide advice, finance and flexibility over how revenue payments may be settled, but it is important that businesses familiarise themselves with the new requirements that exit will involve. That is why we have launched a public information campaign, “Get ready for Brexit”, to give everyone the clear actions that they need to prepare. As well as TV and radio advertising, there is now a straightforward, step-by-step checker tool, available on the Government’s website at gov.uk/brexit, so we can all identify quickly what we may need to do to get ready.

The Government have also acted to provide assurance that business and individuals can have the maximum level of confidence about the future. We have signed continuity agreements with countries, covering more than £90 billion in trade. We have replacement civil nuclear energy trading agreements with Canada, America, Australia and the International Atomic Energy Agency. We have secured aviation agreements with 14 countries, including the US and Canada, and we also have arrangements with the EU on aviation, roads and rail to ensure smooth travel between the UK and European nations. We also have arrangements on education exchanges, social security, fisheries, climate change and a number of other areas. Agreements are in place covering financial services, so that transactions can continue to take place and financial and market stability can be underpinned. Of course, we have a robust legal framework in place: six exit-related Bills that cater for different scenarios have been passed, and the Government have also laid more than 580 EU-exit secondary instruments.

Of course, the Government are determined to ensure that we protect the rights both of UK nationals in the EU and of EU citizens in the UK. I personally want to thank the more than 3 million EU citizens who live and work here for their positive contribution to our society: you are our friends, family and neighbours—we want you to stay and we value your presence. Under the EU settlement scheme, more than 1 million EU citizens have already been granted status. Let me be clear: EU citizens and their family members will continue to be able to work, study and access benefits and services in the UK on the same basis as now after we exit the EU.

The Government will of course do everything in our power to make sure that UK nationals can continue to live in the EU as they do now, but the Government cannot protect the rights of UK nationals unilaterally. We welcome the fact that member states have drafted or enacted legislation to protect the rights of UK nationals; today, we call on member states to go further and fully reciprocate our generous commitment to EU citizens, so that UK nationals can get the certainty they deserve.

There are other decisions that the EU and member states have said they will take that will have an impact on us all if we leave without a deal. The EU’s commitment that we will be subject to its common external tariff in a no-deal scenario will impose new costs, particularly on those who export food to Europe. Indeed, the EU’s current approach to the rules of the single market will, as things stand, require the Republic of Ireland to impose new checks on goods coming from Northern Ireland. For our part, we will do everything that we can to support the Belfast agreement, to ensure the free flow of goods into Northern Ireland and to mitigate the impacts on Northern Ireland, including by providing targeted support for our agriculture sector and for Northern Ireland’s economy.

Although there are risks that we must deal with, there are also opportunities for life outside the EU. We can reform Government procurement rules, get a better deal for taxpayers and forge new trade relationships. We can innovate more energetically in pharmaceuticals and life sciences, develop crops that yield more food and contribute to better environmental outcomes, manage our seas and fisheries in a way that revives coastal communities, and restore our oceans to health. We can introduce an immigration policy that is fairer, more efficient and more humane, improve our border security, deal better with human trafficking and organised crime, open new free ports throughout the country to boost undervalued communities, and support business more flexibly than ever before.

There are undoubted risks and real challenges in leaving without a deal on 31 October, but there are also opportunities and new possibilities for our country outside the EU. It is my job to mitigate those risks, overcome those challenges and enable this country to exploit those opportunities and extend to every citizen those new possibilities. That is why I commend this statement to the House and why I am confident that as a nation our best days lies ahead.