UK Withdrawal from the EU and Potential Withdrawal from the Single Market - Motion to Take Note

– in the House of Lords at 11:37 am on 26th January 2017.

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Moved by Baroness Hayter of Kentish Town

That this House takes note of the impact of the United Kingdom’s withdrawal from the European Union and potential withdrawal from the single market on the rights of European Union citizens living in this country and the United Kingdom’s future economic requirements.

Photo of Baroness Hayter of Kentish Town Baroness Hayter of Kentish Town Shadow Spokesperson (Cabinet Office), Shadow Spokesperson (Business, Energy and Industrial Strategy), Shadow Spokesperson (Exiting the European Union)

My Lords, I want to cover two areas today. One concerns the rights of EU citizens already living in the UK, come our departure from the European Union. The other is the UK economy, on which we depend for jobs and prosperity, and for the tax revenues which fund our defence, education, health and public services.

I think we all know that there is great anxiety among EU citizens living here, to whom,

“the Government is under a moral obligation to provide … legal clarity”,

according to our EU Justice Committee. We must resolve the legal status of these citizens without delay. The 2004 EU citizens’ directive is clear about freedom of movement: it is the right to come and go, to stay here without question for three months, to stay longer provided that citizens are employed, a student or have the resources so as not to need social assistance, and to have health cover. Then, after five years, there is the right to permanent residence.

Those who have been here less than five years may have no right to stay post Brexit under the existing rules, but they are also unsure what criteria they would need to meet to prove that they had been here. It would be quite a challenge for the Government, as well—dealing with 3 million applications. Many EU nationals who have been here well over five years may be unable to prove that they meet the criteria for permanent residency, while others—perhaps elderly relatives—would have no entitlement under current rules. Indeed, proving health cover may be difficult. Giving evidence, the noble Lord, Lord Howard, suggested that an NI number might suffice as evidence, but that would not cover everybody concerned.

We have seen the problems faced by individuals—by the London-born Dom Wolf, whose German parents ensured that he had a German passport but who now, despite living here all his life, faces having to prove that he should stay, including having to take an English test. Then there is the Dutch lady, Monique Hawkins, who was similarly told to prepare to leave the country, despite making her career and family here for over 24 years. I myself, having been born in Germany, started to fill in the 85-page application form to prove residency. It is, I have to say, a nightmare. I would have to produce 15 documents spread over five years—or, if I use my husband as a sponsor, I have to set out when I met him, when I started a relationship with him and when I decided to marry him. I did not like to confess that they were all on the same day.

I ask the Minister to review urgently how we will define EU citizens already resident here and how they can demonstrate this along with offering them the legal clarity that they so need. While those who have been here very many years might be protected separately under Article 8 of the ECHR, those rights are not absolute, with each case being determined on its particular facts, providing little certainty for those involved. Indeed, the Government have not even made any assessment of the number who might be able to get such protection, which seems a little short-sighted. There is also the “indefinite leave to remain” route but, if that looks complicated, the other one is even more byzantine.

Needless to say, UK nationals living elsewhere in the EU are also worried: about pensions, health, employment, education and their residency status and rights. Sandra Stretton, a pensioner in Spain, describes enjoying what she calls, “a very simple life which afforded me serenity and peace of mind until … the Referendum … turned my world upside down”, leaving her “extremely concerned” as to whether she will lose pension increases, and treatment for her health condition, which is helped not just by the treatment in Spain by the climate that particularly helps her condition. As she says, if she is forced to return to the UK and ask for every benefit available, she would lose her “independence and dignity and become a drain on society”. She has never requested financial assistance, and she has paid taxes and NI throughout her working life, but now she feels very insecure.

Then there is John Owen, who moved to Spain believing that his rights to healthcare, free movement within Europe, and a UK state pension were guaranteed by his European citizenship. Now, he says, “We face uncertainty with a particular concern as guardians of our youngest grandchild whom we have cared for since she was five months old, but we soon face decisions concerning secondary school and higher education. Under ‘Brexit’ scenarios it is difficult to visualise any path that does not involve Spanish citizenship”.

These are real cases, in the here and now, but the Government do not seem to take them seriously. Elizabeth Truss declined to meet the Joint Committee on Human Rights, a choice the committee labelled “unacceptable”, while the Government refused to send a Minister to our committee on acquired rights, looking at the impact of Brexit.

We should also consider the UK economy’s future needs. The NHS is heavily reliant on its 160,000 EU nationals, including 10,000 doctors and 20,000 nurses, overwhelmingly from countries which joined the EU before 2004, with a further 90,000 in social care. No wonder the BMA wonders how the NHS will be staffed after Brexit if it loses 5% of its workforce.

In one of our successful industries, tourism and hospitality, EU nationals are essential in places such as London. ABTA and the BHA worry that any cut in these numbers, together with the omission of foreign language as a skill for any points system, would make recruitment to their industry really difficult—a challenge for the food and drink industry, with 100,000 EU employees. Agriculture is worried: the NFU noted that, even by September, farmers were unable to meet the demand for seasonal workers. Normally they would get them from Romania and Bulgaria. The fall in the pound, added to the Brexit effect of insecurity, is already affecting our farming areas.

The Lords EU Committee heard concerns as to whether financial services would get the specialist labour that they need—we hear today of more possible moves of those services out of the UK. They are worried not only about the numbers and whether they would be able to get them, but whether there would be very bureaucratic and cumbersome procedures for recruiting staff from elsewhere in the EU. The chief executive of the British Bankers’ Association has identified banking as probably more affected by Brexit than any other sector, being the UK’s biggest export industry by far. Its need for high-quality staff has an impact on all of us because of the impact on the economy. The Benn Select Committee on Brexit has called on the Government to take account of the importance of EU workers in these key sectors: health, finance and agriculture, as well as manufacturing, where EU nationals make up 15% of workers, and public services, with a quarter of a million EU staff.

The people have indeed spoken about Brexit, but Brexit now needs to think about people. It needs to be managed in a way that safeguards individuals’ rights and which helps our economy to prosper and grow—for the sake of all our people. I beg to move.

Photo of Lord Forsyth of Drumlean Lord Forsyth of Drumlean Conservative 11:47 am, 26th January 2017

My Lords, if ever we needed an illustration of how muddled and in what a mess the Labour Party is on Brexit, one has only to read this Motion, moving:

“That this House takes note of the impact of the united Kingdom’s withdrawal from the European Union and potential withdrawal from the single market”.

“Potential withdrawal”—we are leaving the single market; we are leaving the customs union. The Prime Minister could not have made it more crystal clear. In endless debates during the referendum campaign, representatives from the Liberal Democrat Party, Labour Party and SNP all said that if we leave the European Union, we would not be able to be in the single market. Now they seek to make a distinction.

Photo of Lord Lea of Crondall Lord Lea of Crondall Labour

Is the noble Lord implying that membership of the single market was part of the referendum question? I do not recall that it was. Now we have the option of a hard Brexit or a soft Brexit, and he is implying that the government decision is a decision that binds Parliament. That cannot be the case, can it?

Photo of Lord Forsyth of Drumlean Lord Forsyth of Drumlean Conservative

The noble Lord has a particular view on these matters. I do not know what the difference is between a hard Brexit and a soft Brexit; it seems to me that it is the same difference between a hard pregnancy and a soft pregnancy—there is no difference. If the noble Lord does not understand that Brexit means Brexit, perhaps I can put it more simply: leave means leave. That is what people voted for. The single market, as he well knows as a great exponent of the European Union, does not exist in the treaties of the European Union. It is referred to as the internal market. Perhaps the noble Lord could think about how can we be in the internal market if we are outside the European Union? It would then be easier for him to understand what people voted for.

The Labour Party’s confusion is beyond belief. I heard the Opposition spokesperson on foreign affairs, Ms Thornberry, on “Newsnight” the other night. She said that they agree with the Government on lots of things—they want, for example, tariff-free access to the single market. Well, tariff-free access to the single market is the Government’s policy, but if you want tariff-free access to the single market then, by definition, you are not going to be in the single market.

I have one thing in common with the noble Baroness in that I proposed to my wife within eight days of meeting her and we have been together for some 40 years this year. However, the noble Baroness needs to be more decisive on matters which affect the national interest. She is right about the rights of EU citizens living in our country, and that that issue needs to be resolved quickly. The way to do so is to get on with moving Article 50 and persuading our colleagues in the European Union that we need a reciprocal deal—namely, that British people living in the European Union will be able to stay in the European Union, and likewise people who have come here will be able to stay here. Nobody seriously thinks that more than 3 million people will be expelled from this country. Frankly, it is irresponsible for members of the Labour Party to create fear and anxiety among those people while fighting the referendum campaign at the same time as saying through the other side of their mouths that they are committed to implementing the wishes of the British people. I say to my noble friend the Chief Whip that to give us four minutes each to discuss matters of this importance makes a mockery of this House and our ability to hold the Government to account.

I shall say a word or two about the antics of the Scottish nationalists’ behaviour and our embarrassing First Minister. One thing that the Liberals and the SNP have in common is they are crying out for more referendums but at the same time they do not accept the results of referendums when people vote in them. We have gone from the First Minister threatening an immediate referendum to it being possibly an inevitable referendum. As this argument has gone on in Scotland, it is the only part of the United Kingdom which has seen unemployment go up and not down as uncertainty has been created. I suggest that the First Minister sticks to her day job and concentrates on unemployment and the problems in the health service, education and elsewhere, and does not get involved in foreign affairs. She is, after all, the person whose party made Mr Trump an ambassador for Scotland on behalf of business in the global marketplace, then promptly withdrew that while calling on the Government to ban him coming to this country. Therefore, I suggest that her expertise may not lie in that area and she should butt out of this debate.

Photo of Lord Livermore Lord Livermore Labour 11:52 am, 26th January 2017

My Lords, I believe there is a strong and positive link between the two halves of this debate: EU citizens living and working in this country and a prosperous economy. Therefore, it is of great concern that the Government have chosen to make their national priority not growth, jobs and living standards but reducing immigration, regardless of the economic cost.

This perspective that the economic well-being of the nation matters less than the politics of control has driven the Prime Minister to set out the hardest possible interpretation of Brexit. Her argument is not that this will make Britain more prosperous, but that controlling immigration is so important it is worth pulling Britain out of the single market and the customs union to achieve. Therefore, as we scrutinise this decision, it must surely be right for us to consider what impact restricting the rights of European Union citizens to live and work in this country could have on our economy.

The economic benefits of immigration are clear. It increases growth, provides more tax revenue and helps pay for an ageing society. It creates new job opportunities, brings skills into our economy and makes us more competitive. There is substantial evidence that reducing immigration would damage our economy, and, by lowering tax receipts, put great strain on our public services. The recent Autumn Statement showed that we would need to borrow an additional £16 billion by 2020 to make up for the reduced tax take from falling migration, with a further cost of £8 billion every year thereafter. Yet, despite these arguments, the question of controlling immigration dominated the referendum campaign. Indeed, the Prime Minister believes it was so central to the outcome that we should withdraw from not just the European Union but the single market too, despite estimates that membership could be worth as much as 4% on GDP compared to WTO terms alone.

For this Government, the political priority of ending freedom of movement is more important than the economic benefits of the single market. However, by making immigration their national priority, they are creating huge expectations—expectations they are unlikely to meet for three reasons.

First, there are the numbers. Through constant reference to the burden on infrastructure and the impact on wages, the public have been led to believe that, when we end freedom of movement, not just immigration but the number of immigrants already here will fall. Yet what if—as we all hope they will—existing EU migrants are allowed to stay? What of new trade deals, where every potential new arrangement comes with the demand to open our labour market to that country’s citizens? What, too, of the Government’s record on controlling immigration from non-EU countries, the source of the majority of our immigration, over which we have always had control? The previous Home Secretary tried and failed to meet a target to reduce it and now non-EU net migration alone stands at double the Government’s target of 100,000 per year. The reality is that non-EU migration may have to increase to meet the ongoing demand for skilled and unskilled labour.

The second expectation concerns the cultural impact of immigration: the view that ending freedom of movement will prevent the nature of our communities from changing. Yet, where this happens, much of the impact arises as a result of immigration from outside the EU, which, we should be clear, will be completely unaffected by ending freedom of movement.

Finally, it remains the case that the greatest hostility to immigration is to be found in those parts of the country where there are fewest immigrants. Despite politicians of both main parties advocating immigration control in order to solve the problems of these areas, their problems will not be solved because their problems were not caused by immigration in the first place.

These huge gaps between expectations and reality create a great danger for our country. We risk damaging our economy by leaving the single market only to find that the political promise of control was itself a fiction, and we risk stoking fears about immigration that will never be adequately addressed simply by ending freedom of movement. In this gap between expectations and reality, the politics of extremism will lie in wait. We need urgently to change the terms of debate in this country and focus not on raising expectations that cannot be met but instead on solving the real problems that people face.

Photo of Lord Teverson Lord Teverson Chair, EU Energy and Environment Sub-Committee 11:56 am, 26th January 2017

My Lords, perhaps we could get the record straight on one thing. Three nation states are part of the European single market but not members of the European Union: Norway, Iceland and Liechtenstein. They are in the single market; they are not in the European Union. That is how it works and that was an alternative that we could have had.

I want to concentrate on something that the noble Baroness mentioned in her opening speech. I admit that, when it comes to general elections, I am not a regular Conservative voter.

Photo of Lord Greaves Lord Greaves Liberal Democrat

You are not a regular voter.

Photo of Lord Teverson Lord Teverson Chair, EU Energy and Environment Sub-Committee

I am not a regular voter at all but—if the noble Lord, Lord Greaves, would let me continue—I was very taken by the 2010 Conservative manifesto, which stated:

“Strong families are the bedrock of a strong society. They provide the stability and love we need to flourish as human beings, and the relationships they foster are the foundation on which society is built”.

Absolutely—that was one of the best passages in any of the party manifestos that I read, although, unfortunately, it did not feature in the 2015 Conservative manifesto. It concentrated on families, which is the issue that I want to raise in this debate.

Unfortunately, over the last few years we have made it very difficult for third-country spouses of UK citizens to live in this country. They have high bars to meet on income and other qualifications. A lot of families are split up because one of the spouses or civil partners cannot pass those hurdles in British legislation and so is not able to join them. Currently, European citizens can reside in the UK with their third-country spouses or civil partners under European legislation and the legislation that we brought in as part of that in, I think, 2014.

I have a simple question for the Minister. It is the only point that I want to make. As part of the so-called great repeal Bill, will the spouses and civil partners of European citizens residing in the UK, who we hope will have the right to remain and work in this country, still be able to reside with them and their families after we leave the European Union? The Prime Minister quite rightly said that on Brexit day there should be a seamless movement, in legislative terms, of conditions and rights from the European Union when we stop being a member state. I welcome that. My question is: will spouses of European citizens, as well as those citizens themselves, still be able to reside on a similar basis in the United Kingdom? This issue concerns individuals, families, and the rights of and respect for families into the future. I am interested to hear in the Minister’s response an assurance in this key area, as well as one for European citizens themselves.

Photo of Lord Balfe Lord Balfe Conservative 12:00 pm, 26th January 2017

My Lords, we seem to be connected to Germany. My wife was not quite born in Germany, but my father-in-law was working for the Control Commission in Hamburg. My wife’s parents had such trust in the German health system in the late 1940s that my mother-in-law was flown back to Woking to give birth to my wife. She was almost German; I am just glad that she is not, having heard of the antics the noble Baroness, Lady Hayter, may have to go through.

I will talk about the role of the staff of EU agencies in Britain. We have two EU agencies—the European Medicines Agency and the European Banking Authority—based in the UK with European staff working in them, as well as UK staff. We are saying to them that not only are we leaving the EU, but we are apparently unable to give them any undertakings, even though they are working for the EU, as to whether they will be able to have any continuation of employment in this country. Indeed, we appear to be trying to chase the agencies out of Britain. When the European Medicines Agency goes we will have a lot of work to do in our self-regulation of medicines. When the European Banking Authority goes, I doubt that the City of London will be overjoyed to see the back of an EU agency devoted to banking.

In Britain we also have two other institutions. I am not quite clear whether they will be thrown out. We have the marvellously named European Centre for Medium-Range Weather Forecasts based in Reading and Euratom in Culham. To what extent do the Government intend to withdraw from these agencies? At the moment it is unclear.

The point is that the people who work for these agencies were, effectively, British public servants who went to do the best for their country. They are feeling very let down. The European civil servants are similarly feeling let down. Many of them wanted to come to work in Britain. They were pleased that there were international agencies spread around the European Union making Europe a reality. Now, they are suddenly told—they are not all married to nationals of the same nationality as themselves—that they are to be uprooted, that their children are to be pulled out of schools, and that there are no guarantees being given at all. I put it to the Minister that it would be very simple to give some comfort to these people, either by saying, “You can stay”, or by saying, “If you have to leave, we will at least make it as easy as possible”, and that we will not carry on with what seems to me to be an unreasonable approach to the whole business.

I hope the situation of British nationals working in and for Europe will be fully taken into account. I know people keep saying it is, but the fact is a number of these civil servants do not feel that the Government are yet on side. I hope the Minister will reassure us today that the Government realise the human dimensions of this problem that we have set ourselves—because we voted for it—and will do everything they can to make as easy and humane as possible the lives of these civil servants, their pensions and their future responsibilities. I ask the Minister to take this into account in his reply.

Photo of Viscount Chandos Viscount Chandos Labour 12:05 pm, 26th January 2017

My Lords, I welcome the chance given to the House by the initiative of my noble friend Lady Hayter to debate these hugely important subjects. Like my noble friend, I urge the Government to take the lead by unilaterally guaranteeing the rights of EU citizens currently residing in the UK. It is neither morally nor economically attractive to attempt to use their position as a negotiating ploy; nor is it even a good negotiating tactic. In all circumstances—and particularly when it is the UK that has initiated the change in the relationship with the EU—careful judgment has to be exercised in choosing negotiating positions.

The Prime Minister, on her way to meet President Trump, has, perhaps in preparation, been reading Trump: The Art of the Deal, popularly attributed to the President, even if its co-author and publisher both downplay his contribution. “Use your leverage”, the book advises. Its putative co-author certainly used financial leverage in his business life, and the Prime Minister will find out tomorrow and thereafter how he uses negotiating leverage. But the very inconceivability of not protecting the rights of EU citizens already resident in the UK, as acknowledged by the Chancellor of the Exchequer in Davos, makes the issue poor or non-existent negotiating leverage. It only draws attention to what the Minister—perhaps inadvertently—referred to last week as the weaknesses in our negotiating position. I therefore urge the Government again to give clear and unequivocal guarantees to EU citizens resident in the UK.

For the future, we need to restore widespread public confidence in government control of immigration—I recognise that—including from the EU, while at the same time, at the very least, not handicapping our long-term economic prospects. I commend to your Lordships’ House the report prepared for techUK by Frontier Economics and published on Tuesday. If its analysis and recommendations are specifically for the digitally intensive sectors of the economy, the principles and model are widely applicable. It recommends, inter alia, as well as the immediate confirmation of the rights of EU citizens currently resident here, a low-friction, smart immigration unit and recognition of the importance of UK firms being able to locate UK nationals to work in EU member states.

That said, and notwithstanding the intemperate remarks of the noble Lord, Lord Forsyth, I still believe that a more structured solution, such as the Bruegel think tank’s continental partnership, to which I have previously referred—retaining membership of the single market without being subject to the freedom of movement of people—is both desirable and achievable.

On the same day that the Prime Minister made her Lancaster House speech, Rachel Sylvester wrote in the Times:

Mrs May is missing the EU’s shift on free movement … Her inflexible negotiating position risks ignoring European politicians’ significant changes of attitude to migration”.

I hope that the Minister and the Prime Minister will reflect on this as they finalise the Government’s White Paper.

Photo of The Bishop of Durham The Bishop of Durham Bishop 12:09 pm, 26th January 2017

My Lords, I thank the noble Baroness, Lady Hayter, for introducing this debate. At the outset, I will take the opportunity to thank the Minister, the noble Lord, Lord Bridges, for his participation in ongoing conversations with the Church of England around these issues and for the time he has taken in hearing our concerns.

The last few weeks have brought some clarity to the process for the triggering of Article 50 and to the Government’s priorities in their negotiations. Although that clarity is to be welcomed, it stands in contrast to the continuing uncertainty hanging over families across the UK. I have received a lot of correspondence on this issue, and what many who have been in touch have sought to emphasise is that EU citizens in the UK cannot be abstracted from wider society. The people we are discussing today are mothers, fathers, partners—and, in some cases, priests. For example, I know of cases where an EU citizen is married to a British resident and yet is unable to claim permanent residence, although they are a spouse and primary carer of two young children.

An unwillingness to commit to protecting EU citizens living in this country in many cases appears to be an unwillingness to protect the family life of British citizens. Imagine, as a young child, the amount of worry that the slightest possibility of your parent not being able to stay with you would cause. Similarly, imagine the strain that such a possibility is already placing on marriages.

The shape of the UK post Brexit will be formed by the process of our exit—and by this I mean not just how successful the Government are in the negotiation. Also important is the manner in which we go about it and the language we use, as the most reverend Primate the Archbishop of Canterbury reminded the House on Tuesday. This uncertainty and the resultant stress and strain on family life and children should not have a place in our negotiating strategy. It does not speak to the type of Brexit that we should aspire to—one that supports families and the common good. In her speech last week, the Prime Minister committed to using,

“this moment of change to build a stronger economy and a fairer society”.

Let us start as we mean to go on and commit to keeping families together.

Finally, we should recognise that protecting the rights of EU citizens in the UK is in our national interest. We are talking about people for whom no database exists and who contribute a great deal to our country. For example, I know that in the north-east, where I am based, many of our universities, world leading as they are, draw many of their academics from the EU. Durham University and Newcastle University, for example, have world-class faculties in many subjects. They are world class because of the expertise within them, and some of those experts are EU citizens. Already there are concerns about the loss of these experts. Failure to give them permanent residence will break up the very world-leading research teams that we as a nation need in order to stay as a world leader in academia.

Quite rightly, the Prime Minister recognised the importance of research to a post-Brexit UK, including it as point 10 in her 12-point plan for Brexit. It is vital that, whatever arrangement we reach, these academics know now that they are welcome and valued. I suggest that this is a perfect opportunity to let them know. Whether they are friends, family, faith leaders or workers, the people whom we are discussing today are not bargaining chips; they are a valued part of society, and in these uncertain times they need to know that.

Photo of Lord Patten Lord Patten Conservative 12:13 pm, 26th January 2017

My Lords, I expect that most of your Lordships will remember that about six months ago we had many experts predicting that the UK was soon to become a fog-bound basket case—a kind of incipient North Korea but with added drizzle. It has not quite turned out like that. Just this week we see government borrowing exactly on target for the year end, stock markets booming and 40-year UK government debt with a very low coupon being fought over by foreign investors, who were desperate when the Debt Management Office put it up for sale a couple of days ago. Of course, as we have heard this morning, the United Kingdom’s GDP in the most recent quarter puts us right at the very top of the G7 leader board. It has not quite turned out as most experts predicted. I have to say that I did not predict it, either—I do not count myself as an expert in very much. But no wonder people from abroad want to stay here and no wonder people abroad want to come here, as they will.

It is entirely reasonable that the noble Baroness, Lady Hayter, in opening her debate, concentrated both on the rights of EU citizens here and the rights of the very large number of UK citizens living in the EU. But equivalence will have to rule in any sensible negotiation. Her Excellency the extremely sensible ambassador to the Court of St James from France said in interviews on the record—it was published in the Evening Standard, so it must be true—that we need equivalence and recognition of the rights of citizens in the EU and in the UK. She was right, and I hope she has squared President Hollande and the negotiators on all this. We are just at the beginning of negotiations, when reciprocal and reasonable rights will be one of the issues to be finally resolved.

Most EU citizens are very well settled in and integrated here. One part of my life is down in the West Country, where there is a well-settled European Union community—Polish, as it happens. Opposite the local Roman Catholic church is a delightful shop called Little Poland. I know of no incidents of any sort of anti-Polish sentiment. Problems always come when people feel that immigration has tipped the balance; that is what we see in East Anglia, Lincolnshire and elsewhere. That is why control of our borders is so important.

We also have to recognise that the balance can change quite quickly in the other direction. I am told that a fair number of EU immigrants to this country have left or are now considering leaving because the drop in the pound—which, as we have seen, helps exporters—is hitting the value of their wages, and hence the remittances they can send home. I believe that reasonable control of our borders on a needs-first basis is a national good in the interests of balance in all parts of the country. Whether it is up in the north-east with the right reverend Prelate the Bishop of Durham or elsewhere, we want good, integrated immigration and settlement, not immigration that causes trouble.

In the closing moments of my speech, I want to reflect on what the right reverend Prelate said in the closing moments of his speech. My right honourable friend the Chancellor of the Exchequer has said endlessly since last autumn—and most recently in the fleshpots of Davos—not just, in the oft-repeated phrase, that the UK should be and is open for business but that it will remain open for talent, university teachers, scientists, scholars and entrepreneurs, and not just those in the traditional financial services, where I work, but in the new developing fintech, biotech and artificial intelligence areas. I think that the Chancellor of the Exchequer is right to stress that. It sends a very good, clear message to those we will be negotiating with in future months.

Photo of Baroness Kennedy of The Shaws Baroness Kennedy of The Shaws Chair, EU Justice Sub-Committee 12:18 pm, 26th January 2017

My Lords, I chair the Justice Sub-Committee of the European Union Select Committee. Our committee was really the producer of the Brexit: Acquired Rights report, which was submitted to the House by the European Union Select Committee. The very term “acquired rights” is one that had to be examined because, in the run-up to the referendum, confidence was given to European Union nationals living in this country and to our citizens living in other parts of Europe that they would have acquired rights, that everything would be fine and that they were not to worry. In fact, the notion of acquired rights is a term in international law, and the evidence before our committee showed that acquired rights did not provide very much comfort at all for people living here or for British citizens living in other parts of Europe. It was not designed for that purpose. It relates much more to the state’s compulsory acquisition of companies and assets and so on, and works on a different level. The individual rights that people cherish—the right to live, work and study in this country, or for our citizens to do so in other parts of Europe—will certainly be in question as we leave Europe. Therefore, we should be thinking about this very seriously.

The Justice Sub-Committee was convinced by the moral argument, and it is that that we should think about first and foremost. One thing we have taken pride in is that we do not just operate on what suits us economically, we also think about our responsibilities. We have responsibilities to those who come to live and work and who need a life in this country. Many of those people face real anxiety. As we have heard, many of them have been confronted with serious problems in trying to consolidate their position and take up formal residence. The procedures are elaborate and byzantine—there are 80 pages of documentation—and they have to produce all manner of stuff that most of us would not have kept over many years. A very close friend of mine who is an enormously successful businessman in this country, who has been in the financial sector, describes how after 40 years of living here he has had to employ lawyers. He asks what that might mean for ordinary people trying to engage with this process. This should not be the case for people who have come here to work in our National Health Service, our financial services or our hospitality industries, who do all manner of work or who are here studying. We should also consider how it affects their families. Those people should not be a bargaining chip. While we are of course concerned for the rights of our citizens living in Spain who perhaps retired there because of the climate—I only today received an email from a gentleman living in Spain who went there because of his wife’s chronic illness; she has now died and he is very anxious about his position and his own healthcare now that he is a retiree—people who have come to live and work here should not be a bargaining chip. Our report recommends that we should make a unilateral declaration that we will protect the rights of those citizens into the future as they have had them up until now.

I am the head of an Oxford college. Our vice-chancellor, Louise Richardson, called a meeting for Europeans working at all levels in the university—some were academics, but some worked in staffing and administration and so on. Some 1,700 people turned up, full of anxiety about their future. We should urge the Government to take a unilateral step. That would do a number of things. Any of us who have ever been involved in negotiations know that if you put something out there in the beginning, it wins good will for you in further negotiations. I have no doubt that there will be reciprocity from the other countries of Europe with regard to our citizens living there. But to hesitate at this stage and not to give such an assurance now is wrong. I have heard from firm Brexiteers that they agree that we should act now and not wait until the triggering of Article 50.

We should create a new system of fast-tracking specifically for those from other parts of Europe, and it should not involve the byzantine process that currently exists. We should have a special system for those who were living here at the point of the referendum.

Photo of Lord Greaves Lord Greaves Liberal Democrat 12:23 pm, 26th January 2017

My Lords, those are very wise words. The noble Lord, Lord Forsyth, however, accused opposition parties of creating fear and worry. Who is creating the fear and worry? It is not opposition parties. The fear and worry exist as a result of the referendum decision and what the Government have been saying since then, and of the experience of people who have been trying to get British citizenship and permanent residence.

My noble friend Lord Teverson referred specifically to the right of spouses of British citizens living here to continue to do so even if they are not British citizens. That strikes very close to home with me, because my daughter’s husband is a Danish citizen. He has been based in this country for many years, but he is one of those people who do not go through life hoarding all the documents that are ever sent to them. Some of us are hoarders; he is not. Putting together a case for permanent residence and gathering what is required are tasks that will be almost impossible because of his life generally while he has been based in this country.

In particular, a lot of people are coming up against what is now revealed as the need for comprehensive social insurance, something which many of them who have lived in this country for many years never realised they needed. They were living in family groups but perhaps did not have a permanent or full-time job. They now find that they are penalised because they never had this insurance. Nobody told them that they would need it; nobody imagined that they would be in the position that they are.

The Government say that they want to sort out this problem as early as possible with the rest of Europe, but is this a policy or a procedural matter? Can it be sorted out with the European Union within the two years of the Article 50 negotiations, or is it one of those things where there will have to be new treaty negotiations after Article 50 has been sorted out? The Government have to be very clear on this question. If it is not possible to secure an agreement with the European Union as a whole, do the Government intend to secure bilateral agreements with each of the 27 remaining European Union countries, so that the rights of French citizens here might be different from those of Swedish or Bulgarian citizens, or differ from the rights of Britons in those countries? That is clearly a recipe for a great deal more uncertainty and worry. I think that the noble Lord, Lord Patten, talked about equivalence but we are not talking about that here: we are talking about individual people, not robots. To use these people as poker chips, as has been said—perhaps it is brag rather than poker—is immoral and unethical. It should not be happening.

Unfortunately, the experience that people are having is with the Home Office. From my 15 years of dealing with the Home Office over immigration and asylum cases, I have personal experience of what so many people report: that that organisation is not the most efficient or competent. There have been lost papers. Inquiries for visa extensions are not replied to in time. I know of a couple whose lifetime documents—the letters and communications between themselves—had to be sent to the Home Office. These were very intimate and they have been lost. There have been arbitrary decisions with no common sense, people treated in an offhand and insulting way and bureaucratic obstructions of every known variety. Unfortunately, this is endemic in too much of the Home Office. At a high level, the Home Office is not very competent; at an operational level, it is too often inefficient. It is widely seen by many people as exhibiting what I would call malevolent carelessness. This is coming out too much in the experiences of European citizens who are now in this country.

Photo of Lord Hamilton of Epsom Lord Hamilton of Epsom Conservative 12:28 pm, 26th January 2017

My Lords, many of your Lordships are quite rightly concerned about the status of EU citizens living in this country. But I would have thought that my right honourable friend the Prime Minister had done almost everything she could to reassure them that they would be allowed to stay here. What your Lordships are asking is that she should take unilateral action, but there are many people in senior positions within the EU who never stop telling us that Britain has to be punished for voting to leave the EU. So there is a risk—this has to be accepted—that if we gave guarantees to the EU citizens living in this country, that form of punishment might take place and discrimination might be exerted against British citizens living in the EU. I do not want to dwell on that, but I do think that my right honourable friend has done everything she can to reassure citizens living here. I sincerely hope that, once Article 50 is moved, we will see this at the top of the agenda as something that has to be agreed with the EU.

I want to talk about the White Paper that was agreed to by the Government yesterday. I quite understand the attitude of the Opposition parties; they hope that a tremendous amount of detail will be put into the White Paper so that the Government can be accused at a later stage of not honouring some pledge made in it and therefore of failing in the negotiations. I have no particular inside information on what is going to be in the White Paper, but I have a very strong feeling that it is actually going to be a repetition, probably with rather more verbiage, of the speech the Prime Minister has already given, laying out the objectives of where she wants the negotiations to go. I do not think that there will be much more in it than that. That will be absolutely the right thing to do. It would be against the interests of this country if we laid out in detail what we want, because that would undermine our negotiating position and would not be in the national interest.

We have also got to bear in mind that a number of European countries are fighting elections over the next nine months or so: the Dutch, the French and the Germans. I was talking to a lobbyist from Brussels on Monday whose wife is Italian, and he reckons that the Italians will have a general election by the end of March. They will all be facing Eurosceptic candidates. So if during this process of negotiation from the end of March we ask for any concessions, there would be tremendous momentum to make sure that no concessions are given. This is the problem we are up against in the short term; all the parties that are fighting these elections have to make out that Brexit is a complete disaster.

As my noble friend, who is no longer in his place, pointed out, the British economy is booming at the moment. It will be very difficult for people in Europe to say that Brexit has been a disaster. The pressure on a number of these countries is going to be very great. It even resulted in Chancellor Merkel saying that if we were going to have access to the single market, we would have to agree to the free movement of labour. That is not true. The United States has access to the single market and certainly does not agree to the free movement of labour between Europe and the United States. So we have a long way to go on all this, but let us try to keep the truth beaming out and let us be optimistic that this is going to work out well in the interests of both the United Kingdom and the EU.

Photo of Baroness Warwick of Undercliffe Baroness Warwick of Undercliffe Labour 12:32 pm, 26th January 2017

My Lords, last week the Prime Minister clarified the UK’s negotiating priorities. While I regret the signal that the top line of this negotiating position is a rejection of the principle of freedom of movement and withdrawal from the single market, it is important to know where we stand because, as many other noble Lords have said, so many other aspects of our future relationship with Europe depend on this decision. I declare an interest as a member of council at two universities.

One thing I noted in the Prime Minister’s speech was that she signalled strongly that she will look for continued collaboration with other European member states in the field of science, research and innovation. It is the clearest signal yet that the Government are willing to continue to participate in EU structures and funding for universities and research and to continue contributing to funding them. Will the Minister clarify in his reply whether that is an accurate reading of what the Prime Minister said?

There are many fields in which it is simply impossible to achieve the scale needed to push forward the frontiers of knowledge within a single research group or even a single country. The framework programmes, of which Horizon 2020 is the current incarnation, have been hugely significant initiatives that have provided a platform for multilateral co-operation across Europe. Nearly half of British research publications have an international co-author. Nearly half the co-authors are European. Of the top 20 countries UK researchers collaborate with most often, 13 are other European countries—so it would undoubtedly be damaging to UK research if it were cut off from mechanisms to support this sort of joint work.

I started by saying that the negotiating position on freedom of movement affects many other things, and that is particularly true in this area. It is not at all clear that the UK will be able to reach so-called associate country status without accepting freedom of movement. Indeed, the recent experience of Switzerland, which voted to restrict the rights of Croatian nationals, was that the European Commission acted swiftly to bar it from participation in Horizon 2020. I understand from academics involved in discussions with European partners in Germany, the Netherlands, France and elsewhere that there is a strong desire in many other countries to find a way through this—but it will take political will on both sides.

Once Article 50 has been triggered, I would urge the Government, and the Minister for Universities and Science in particular, to pull out all the stops to engage with other European education and science ministries to persuade them to make common cause here, despite the political pressures to the contrary. Would the Minister explain, either in his response to this debate or afterwards, what plans the Department for Business, Energy and Industrial Strategy has to engage in this way? I would urge it to involve universities in these discussions, in view of the work that Universities UK and others have been doing in Europe to build alliances on this issue.

Finally, the foremost issue for me, as for many others, is access to talent. In setting out her position in relation to freedom of movement and the free market, the Prime Minister has caused deep concern about the basis on which universities will be able to continue to attract the talented staff and students on which we depend. I commend the noble Lord, Lord Hannay, who raised this important issue again in debates on the Higher Education and Research Bill yesterday. The House has spoken on this topic many times. Will the Minister reassure the House that, in crafting a new immigration relationship with Europe, the Government will ensure that universities will continue to be able to welcome academic staff and students from Europe?

We have great universities. They are great because of the people who teach and conduct research in them. They are great because they can attract brilliant students—enough of them to sustain a wide range of subjects. Cut off the flow of talent and the quality of our universities will decline, and we will all lose as a result.

Photo of Baroness Coussins Baroness Coussins Crossbench 12:37 pm, 26th January 2017

My Lords, I want to focus on two specific groups of EU citizens living in this country: teachers of modern foreign languages in our schools and foreign-language assistants. I declare interests as co-chair of the All-Party Group on Modern Languages and vice-president of the Chartered Institute of Linguists.

Thirty-five per cent of MFL teachers are non-UK EU citizens, and the figure for language assistants is 82%. Quite simply, unless they are guaranteed residency status in the UK after Brexit, language teaching in our schools will collapse. The UK alone is not producing enough languages graduates to fill the teacher shortage, which is already estimated at 3,500. These points are among those made in a checklist on Brexit and languages published by the all-party group which is intended to assist government negotiators.

There are, of course, many reasons why learning other languages is a good thing, but given the terms of this debate, I will focus only on the economic benefits, and that boils down to two factors: economic growth, and the employability and mobility of our workforce. Research shows that the language deficit is already costing the UK 3.5% of GDP, or £48 billion every year. The CBI and the British Chambers of Commerce have called for better language skills among British graduates and college leavers in order to boost export performance. They say that language availability rather than market strategy is driving export decisions. We are overdependent on Anglophone markets, and 83% of SMEs operate only in English when over half of them say that language skills would help expand their business opportunities and build export growth.

The employability of UK citizens in a post-Brexit world is also a vital part of our economic well-being. Many employers are forced to recruit from overseas if they need language skills. The all-party group has heard detailed testimony from many businesses and employers’ organisations to this effect. It is no coincidence at all that graduates—in all subjects, not just languages—who have spent a year abroad on the Erasmus programme have an unemployment rate 23% lower than others.

In summary, we need to reverse the decline in language skills in the UK. A reasonable start has been made at GCSE level, but A-levels are in sharp decline and the number of languages graduates has fallen by 57% in 10 years. For the sake of our economic health and competitiveness, we need to do a lot better. I hope the Minister will agree that we should not shoot ourselves in the foot by forcing out EU nationals who are teaching languages in our schools. It is not enough to say, as the Government are currently doing, that residency status will be guaranteed only if reciprocated for Britons abroad. That is self-defeating and I ask the Minister if he will commit to reviewing and improving the position in the long-term national economic interest.

Photo of Lord Hodgson of Astley Abbotts Lord Hodgson of Astley Abbotts Conservative 12:40 pm, 26th January 2017

My Lords, I add my thanks to the noble Baroness, Lady Hayter of Kentish Town, for giving us a chance to debate this matter today, but she will not be surprised to hear that I do not intend to follow the line she pursued, nor indeed the line of the noble Baroness who has just spoken. I take this opportunity to urge my noble friend on the Front Bench, who will play an influential part in the negotiations that are about to begin, to take a really tough line on the issue of the free movement of labour because it is critical.

Before going into that in detail, let me make two points. This is not a rant about immigrants or immigration. I recognise that skilled immigration at a high level has been an important part of our country’s dynamism and that it is should continue at a limited level in the future. Secondly, this is not about EU citizens who are resident in this country. I recognise that they have come here on one basis and we should honour it. Like my noble friend Lord Hamilton, I fear that it can only be part of a negotiation and that reciprocity is an essential part of that. The Prime Minister has made our position clear and I am sure that, with good will on both sides, we can achieve the outcome we all desire.

My argument today is that for too long for British industry, British commerce and British public services, immigration has been the default option. It has been, as the Migration Advisory Committee, the government body which speaks on these matters has said, the “Get out of jail free” card. That has had and is having a deleterious effect on members of our settled population. When I talk about our settled population, I mean irrespective of race, colour, creed, religion and ethnic background. Of course, the default makes perfect economic sense for employers. Why take the trouble to train up a member of the settled population when for the same money they can get a skilled or perhaps overskilled individual from, say, eastern Europe? It also makes perfect economic sense for the person to accept the post because it may well pay three or four times as much as is available in their home country.

Governments of all persuasions—indeed, the noble Lord, Lord Livermore, referred to this—say that immigration increases GDP. If you increase your population, you would expect to GDP to rise and it is counterintuitive for it to be otherwise. What no one focuses on, or focuses on insufficiently, is GDP per head of population, and here the figures are much more nuanced. The cross-party Select Committee of your Lordships’ House looking into the economic impacts of immigration concluded:

“Both theory and the available empirical evidence indicate that these effects are small, especially in the long run when the economy fully adjusts to the increased supply of labour”.

As a result of the widespread use of the default option, there is a real danger that our settled population is being, as commentators now say, “crowded out”. The noble Baroness, Lady Kennedy of The Shaws, talked about the moral option—this is a moral option which has to be faced as well.

I simply cannot give the House examples of how this crowding out is taking place and look at its impacts in a speech of only three or four minutes, but I would like to quote briefly from Dame Louise Casey’s report published last month, The Casey Review: A Review into Opportunity and Integration. It is a hard-hitting report in which she said:

“At the start of this review, I had thought that I knew what some of the problems might be and what I might report on. Discrimination and disadvantage feeding a sense of grievance and unfairness, isolating communities from modern British society and all it has to offer.

I did find this. Black boys still not getting jobs, white working class kids on free school meals still doing badly in our education system, Muslim girls getting good grades at school but no decent employment opportunities; these remain absolutely vital problems to tackle and get right to improve our society”.

This is stirring up trouble for our society in the future. One important, critical way to improve economic opportunities for these people must be to resist and stop the default option, the “Get out of jail free” card, of recruitment from overseas.

That is why I urge my noble friend, as these negotiations get under way, despite the pressures that will undoubtedly be applied to him and the Government to relax the line, to pursue a really firm line on this issue. It is difficult, sensitive, emotive and frequently misinterpreted, but it is essential that we get it right.

Photo of Lord Davies of Stamford Lord Davies of Stamford Labour 12:45 pm, 26th January 2017

My Lords, I shall probably surprise the House by starting my remarks on this subject by saying that I agree very much with the noble Lord, Lord Forsyth. I strongly agree with what he said about the time constraints imposed on us now. I hope that in the months to come the Government, having promised to give Parliament a full opportunity to debate these important issues, will not do so in a way that artificially constrains our debates into periods of two and half hours, one and a half hours or what have you, so that in practice it is impossible for anyone to develop a coherent argument or make an intelligent contribution on the subject.

This is a pressing matter. Personally I have always felt that freedom of movement was a great ideal and an asset that it was important to preserve for our people and for future generations. In my view it has worked extremely well; it is inconceivable that we would have had the growth we enjoyed in the 10 years before the Lehman Brothers collapse and the banking crisis if we had not had the immigration we then enjoyed from other parts of the EU. I think I was the first person to alert your Lordships’ House a couple of years ago to a study done by the University College London economics team showing that the contribution made by eastern European immigrants in this country in the form of national insurance and taxation was far greater, by billions, than their consumption of public services or receipt of any kind of benefits. In other words, every taxpayer in this country was better off as a result of eastern European immigration. That was not true of other groups of immigrants to this country, but it was particularly true of them.

On the whole, the experience has been a very happy one. Of course, it is always possible to say that you can import unskilled labour from any part of the world. That is perfectly true but, if people were to come here in droves from all sorts of places around the globe—from Chad, Eritrea, Somalia, Afghanistan and other places where there is enormous poverty and enormous need—we would find ourselves integrating into this country people who in many cases were almost certainly illiterate in their own languages, coming from countries with traditions of political and religious fanaticism and violence. That would be a problem of a quite different order of magnitude from the integration of people from eastern Europe, which on the whole has been a very happy experience. I speak with some experience locally in Lincolnshire. It has to be said that the great advantage of having that kind of close relationship with neighbouring countries and being in the single market is that the freedom of movement principle is reciprocal, which is not something we get through any such deal with other countries around the world.

Something, however, must have gone badly wrong because the Prime Minister and the Government, far from regarding freedom of movement as an asset, an advantage and an achievement, now seem to regard it as such an evil that in order to escape from it, we should be prepared to pay the enormous economic price of leaving the single market. I do not think the Prime Minister has thought through properly the costs, which will be enormous. Another debate will be required to discuss the economic aspects of Brexit, and I am sure we shall have those opportunities. Still, it is quite terrifying that any responsible Government should even be contemplating such a drastic move as leaving the single market, threatening our position—certainly undermining it—as the financial service capital of the EU. All this in order to get out of freedom of movement.

I wonder what has gone wrong over the last few years. It has been a matter of perception: people have been concerned that there is no limit to the immigration that can result. It is unfortunate that the last Prime Minister did not succeed in negotiating some form of emergency brake; if he had approached matters in a much more communautaire way, he would have been much more successful in that negotiation. A quite different issue has darkened the whole picture: the sense that the whole common external frontier of the EU is not secure. People see on the television pictures of people coming in from Libya across the sea, from Turkey and from Syria. The German Chancellor’s decision to invite 800,000 refugees from Syria to Germany enormously undermined confidence in this country because there was a sense that these people would arrive in Germany tomorrow and be here the next day. That is of course complete nonsense—it is hysteria—but it unfortunately played a critical and negative part in the referendum campaign. Whether we are part of it or not, the European Union will need to look carefully at strengthening the external frontier and to take serious measures, such as the Australians have had to do, to prevent illegal immigration becoming a major social problem.

I hope we have other opportunities to discuss this matter in greater detail, because it really deserves it.

Photo of Lord Oates Lord Oates Liberal Democrat 12:50 pm, 26th January 2017

My Lords, I am grateful for the opportunity to speak in a debate of such vital importance to the millions of European citizens living and working in the UK and, consequently, to the future of our public services and the performance of our economy. The Motion makes specific reference only to EU citizens in the UK but, like other noble Lords, including the noble Baroness who moved the Motion, I hope we will not forget the plight of British citizens who have made their home elsewhere in the European Union.

The EU Justice Sub-Committee, on which I am privileged to serve under the expert chairmanship of the noble Baroness, Lady Kennedy, notes in its recently published report on Brexit and acquired rights:

“The anxiety of EU nationals in the UK is matched by that of UK nationals in other EU States—the evidence we received of their distress is compelling”.

This is not some abstract debate about technicalities or government processes. It is about very real fears and uncertainties for millions of people who, in good faith and reasonable expectation, have made their lives in EU countries other than their own. It is about people who are now afraid that they will no longer have healthcare cover when they are sick or infirm, and will be forced to leave the place that has become their home. It is about children who are uncertain what their future holds: whether in a year or two they may be uprooted from their schools, their friends and all they have come to know.

It is about husbands and wives who are unsure whether they will have the right to continue to live in the same country because of obscure rules relating to comprehensive sickness insurance. It is about people such as Jet Cooper, a Dutch citizen resident in our country for 30 years and married to a British citizen who is, sadly, seriously ill, who has been told by our Immigration Minister that she may not be eligible to remain in the country after Brexit. It is about British pensioners living abroad in the European Union fearing that their pensions will no longer be uprated after Brexit. It is, above all, about millions of people who are unable to get on with planning their lives and are afraid for their futures because, through no fault of their own, they have no idea of the rules which will govern them.

At the time of the referendum, leave campaigners claimed—rather as the noble Lord, Lord Forsyth, did today—that questions about the future status of EU citizens were nothing more than scaremongering. The leave campaigners claimed that EU citizens had nothing to fear because their rights would be protected under the Vienna Convention on the Law of Treaties. The anti-EU campaigner, Peter Bone MP, said:

“Clearly any EU citizen that is legally here would absolutely have the right to remain here. Any other suggestion is just absurd. It is a scare story, full stop. It just shows how desperate the government and the remain campaign are”.

Gisela Stuart, the chair of Vote Leave, similarly dismissed fears, claiming:

“You have got the Vienna convention, which guarantees the rights of existing citizens and existing arrangements.”

Tim Loughton, another Brexit Tory MP, said:

“The entitlement to residency for existing expats after Vote Leave would be unchanged and protected under the Vienna Convention”.

Not for the only time in the campaign, the protagonists of the leave campaign were pedalling falsehoods—or alternative facts, as I believe they are now known. As the report of the EU Justice Sub-Committee, drawing on expert and undisputed legal evidence, states:

“In no sense, therefore, can this provision”,

of the Vienna convention,

“be said to safeguard individual rights under EU law that will be lost as a consequence of the UK’s withdrawal”.

With the legal guarantees asserted by the leave campaign proving, like so many of their claims and commitments, to be a mirage, and in the absence of any certainty from the Government, EU citizens in the UK and UK citizens in the EU are left in limbo and beset by uncertainties. Millions of lives are being blighted by distress and fear.

The truth is that very few senior members of the Government seem to recognise the devastating impact of their failure to act to address these uncertainties. Indeed, the Minister for International Trade is so indifferent to this human aspect that he referred to the status of EU citizens as our “main cards” in negotiations. How shameful—how scandalous—and what callous indifference it shows to the impact on the lives of so many people. What a blot on the reputation of this country.

Photo of Lord Cormack Lord Cormack Conservative 12:55 pm, 26th January 2017

My Lords, I am glad to follow the noble Lord, Lord Oates, because I agree almost entirely with what he said. As my noble friend on the Front Bench knows only too well, I have made this point many times in supplementaries, in questions in the EU Home Affairs Sub-Committee and elsewhere. I have received many letters as a result from people who have been in this country for years and years, who have brought up their children, paid their taxes and now feel threatened. My noble friend Lord Hamilton of Epsom may be right in saying that they should not feel threatened, but in fact they do. The speech made by the noble Baroness, Lady Kennedy of The Shaws, illustrated that vividly—1,700 people gathering in a meeting in Oxford because of their doubt and uncertainty.

The slogan of the leavers, “take back control”, echoes around this Chamber, even though we cannot hear it at the moment. We can take control now and, by a unilateral decision—I never thought that I would refer to myself as a unilateralist, but I do in this context—we can put the minds of those people at rest without risking anything. We can lead by example and say, before we go into the negotiations, “Your position is secure—you are not threatened”. We could take the moral high ground and the moral imperative, and that is what we should do. I hope that when my noble friend winds up, he will show a little more sympathy with that position than he has hitherto. I have great regard for him; he is handling these matters with great distinction and aplomb, but I would like to have a little movement on this matter.

We should not forget that it is less than 30 years since a large number of our fellow citizens in the EU lived under the Soviet yoke. They came into the European Union, and many of them—Poland and the Baltic states in particular—looked to this country as a leader and for an example. I am sorry that the link through the EU is to be severed, but it is; however, what does not need to be severed is the feeling of obligation. My father served throughout the Second World War in the Royal Air Force, and he instructed a number of Poles, who fought with enormous bravery. They flew from the airfields of Lincolnshire, and many did not come back. At the end of the war, when the Carpathian Lancers were disbanded in Lincolnshire, many remained as residents. We have had more Poles recently, and they contribute enormously to the local economy. They are people who enrich our society.

If we are to begin negotiations by saying that we wish to maintain and strengthen our friendship with the other 27 nations of the European Union, which I believe that we do and must, it is very important, and would be a wonderful opening gesture, to say, “Your position is not threatened; you are part of us and, whatever may happen in future we guarantee this now: those of you who have made your home here and made your contribution here, this is your home and this is where you can stay”.

Photo of Lord Judd Lord Judd Labour 12:59 pm, 26th January 2017

My Lords, there is a very strong consensus emerging in the House; I find myself in total agreement with the last two speakers, and I am very glad to follow what they said. I also have the joy of serving on the EU Justice Committee, chaired so well by my noble friend Lady Kennedy of The Shaws. She will remember, as indeed will the noble Lord, Lord Oates, that when we were taking evidence from the French ambassador, there was a very telling moment—a moment for real thought. She was asked what she was encountering in the French community as a response to what has happened. She said very clearly that what is sad is that the people from France felt that they were part of Britain, enjoyed being here and felt that they were part of the community and belonged to it, but now they felt that they are strangers. I think that this deserves a great deal of thought. What are we doing to British society?

In my education at school, let alone later in life, I learned about the importance of citizenship, going right back to the classic Roman and Greek times. Citizenship is something very profound. When this country became part of the Maastricht treaty, people in the European Union had dual citizenship: European citizenship with all that went with that, and citizenship of their own country. Unilaterally, we have removed from our people living abroad and from European citizens living here that status of dual citizenship. They have lost the rights that they believed they had inherited in the situation to which we had come as a free party. I did not hear any evidence from what we heard in our committee that there was any indication whatever at the time that they became European citizens that it was clear to people that it was a conditional citizenship. We have removed their European citizenship.

I would be a much happier man if the message that was going out from this House and Parliament as a whole was “thank you” to the people who have come and contributed and committed their lives to this country—thank you to those in the health service; thank you to those in education, both in schools and universities; thank you to those who have contributed so well to commerce; thank you to those who joined the community, participated and enriched the life of our country by bringing different cultures with them. Thank you—we are absolutely determined that we will preserve your security and well-being into the future, whatever it takes. All this business of turning them into pawns and nothing more than a bargaining counter is totally unworthy of a Britain worth living in.

Photo of Lord Bilimoria Lord Bilimoria Crossbench 1:03 pm, 26th January 2017

My Lords, when the Government lost the case in the Supreme Court, the reason that I thought it was a very good thing for this country was that I believe it was wrong of the Prime Minister and the Government to try to by-pass Parliament in this matter. It is not that I want in any way to delay implementing Article 50—the timing of Article 50, by the way, is a huge negotiating tool and I do not think it was right for the Prime Minister to say we would impose it on a certain date; it is giving away a big part of the negotiation—but, importantly, we are a parliamentary democracy and this Parliament should be involved from day 1. This case has now established that we will be involved from day 1, and the Prime Minister is already U-turning—a White Paper; no White Paper; now we have a White Paper coming and there will be more to come. I am really relieved that this has happened.

We are talking about people—3 million people from the European Union who are over here and working. And in spite of the non-EU workers over here, we have the lowest level of unemployment in our history and the highest level of employment in our history. We need these people. We heard up front from the noble Baroness, Lady Hayter, how the National Health Service would not function without the foreign workers that we have—160,000 are EU workers—and about the care sector and hospitality industry. Sajid Javid wants to build more houses; 250,000 people from the European Union work in the construction industry. You can go to a restaurant or a hotel anywhere in the country—I was in Bristol yesterday—and of course there are EU staff serving you and working very hard. As the noble Lord, Lord Judd, said, instead of being grateful for this, we are treating these people as bargaining chips.

Can the Minister confirm how many EU citizens there are here exactly and how many of them are here beyond five years and eligible to stay under our permanent residency rules? He cannot give us an answer, because we have removed our exit checks from our borders. We have no control over our borders. If we bring back visible exit checks and check every EU person and non-EU person in and out, we will know who is and who is not here. We will not make assumptions that foreign students overstay, when only a small fraction of them do. As the noble Baroness, Lady Warwick, said, our universities are dependent on EU workers. Thirty per cent of academics are foreign and 18% to 20% are from the EU. What happens to all the EU students who might not come because they were reliant on being treated like domestic students and eligible for loans? It is 160,000 students—I am the president of UKCISA and chancellor of the University of Birmingham. We are jeopardising all this and it is seriously dangerous. The Government need to get on and control our borders.

I was with Professor Deepak Malhotra at the Harvard Business School, who is an expert in negotiations. He said that it is very likely that there will be a no-deal scenario—this would be disastrous. His view is that if a deal is going to happen, we need to be creative and we need to be sensitive to the other side. Both sides will have to make concessions. The EU is not trying to punish us. If we look at it from its point of view, it is trying to preserve the Union and keep it together. Smart negotiators know that the goal is not to win but to achieve their objectives. We need to have empathy for the other side.

What really worries me is the mindset of this Government when it comes to immigration—all immigration. It is across the country. This wretched referendum has created race and hate crime that did not exist before. It has unleashed it. It is sad that when the Prime Minister was Home Secretary, she made statements that she wanted foreign students to leave the day they graduated. The Chancellor of the day had to say that it was not Conservative Party or government policy. Amber Rudd wanted companies to list foreign workers. Immediately, there was an outcry in the country. Then a Minister I have never heard of wanted companies to pay £1,000 for every EU worker. This is ridiculous. It shows the mindset of the Government—we have to get out of this mindset. If we are going to get through this negotiation, it must be in the best interests of this country that we treat with gratitude the 3 million EU workers who are here and who have benefited our country and helped to make us the fifth—or sixth—largest economy in the world.

Photo of Baroness Prosser Baroness Prosser Labour 1:08 pm, 26th January 2017

My Lords, I, too, thank my noble friend Lady Hayter for tabling this debate today. It is an important aspect of the consequences of the result of the June 2016 referendum. Many of us are calling for caution and thorough scrutiny of the Brexit process, but the subject of today’s debate needs some speedy footwork if we are not to end up with large swathes of the economy seriously short of labour and very large numbers of EU nationals with their lives turned upside down and no status in a country to which they have committed many years.

Many EU nationals who have made this country their home have wanted to regularise their situation by applying for British citizenship. Since November 2015, a person with at least 12 months’ permanent residence in the UK who wishes to become a British citizen has to apply for a permanent residence certificate or card. This takes us to the notorious 85-page application form and the 18-page guidance note that goes with it.

A young friend of mine is, by birth, Italian. She has lived in this country for 23 years, is married to a British citizen and has two children, both born here. She is a well-educated and intelligent young woman but both she and her lawyer have found the form extremely difficult to deal with and, in parts, contradictory. Inconsistent and contradictory advice has been received from the Home Office on more than one occasion. Of course, applications for citizenship should be thoroughly examined and the process must be rigorous, but the requirement to provide paper proof of utility bills paid, rental agreements et cetera going back five years is not easily met and is nigh on impossible for most applicants.

There is also much confusion regarding the need for those who have had low earnings over the years to pay comprehensive sickness insurance. This brings into play the difference between the right to apply for citizenship via the employment route as opposed to the self-sufficient route. Such confusion would have to be faced by women who have had time out of the labour market to bring up children, for example. Therefore, the requirement to take out CSI could be indirectly discriminatory.

There is a view that even if EU citizens are given the right to stay, there will still be a requirement to complete an application. If this does turn out to be the case, more thought needs to be given to producing a form which is less complicated and less burdensome on the applicant. But supposing it is decided that EU citizens will have to leave these shores. Could the Minister advise the House of the Government’s view of the relationship between the possible expulsion of EU citizens lawfully resident in the UK on 23 June 2016, and their rights under the European Convention on Human Rights?

What, though, of the other aspect of this debate—the loss of thousands of people from the workforce? I seem to remember the Treasury pointing out that immigration to this country gave a net profit to the public coffers. My noble friend Lord Livermore eruditely set out this argument in his earlier contribution. All that tax and national insurance paid in far outweigh the costs involved in immigrants being here. How would we balance the books if that money were to be lost? It is not in the interests of the country to allow this muddle to continue. It is not fair on families, individuals and business, and is not helpful to the country’s economy.

Photo of Lord Owen Lord Owen Independent Social Democrat 1:12 pm, 26th January 2017

My Lords, the rights of EU citizens already living in this country are a matter of honour and it is wholly appropriate that this House should direct its attention to that issue. It is not only a matter of honour for people in this country. We talk about Article 50, but Article 8 deals with good neighbourly relations between member states. Negotiation is an inaccurate word to describe our proceedings on Article 50; rather, it is a discussion. If this discussion is to produce what I call an amicable divorce, it is essential that we are all aware that there is more than Article 50, and that Article 8 should be one of the touchstones of the negotiation.

I agree with the plea of the noble Lord, Lord Balfe, in relation to British citizens who have served the European Union in many institutions. We urged them to go and work there—they were part of our membership of the European Union. We have an obligation to see that they are properly looked after in terms of redundancy and other aspects, and that the cost is borne by this country as it is our decision to leave. I believe that is also an essential element.

I mention Article 50 very briefly. It is a trap and was designed by two extremely clever people, one of whom I believe is in this House, sitting below me. The other was a former Prime Minister of Italy, Signor Amato. Both claim credit for this and boast that it was designed specifically never to be used. The more you look at it, the more surprised you are that any Government have ever used it. I have made it quite clear throughout that I do not believe it is appropriate to use Article 50 and that it would be much better to use the Vienna procedure for leaving a treaty, which has been established over many decades. Nevertheless, we are into Article 50. There is an absolute necessity for the Government not to conduct their negotiation against a cliff edge. There are various ways of doing this and I have suggested some to them. However, at the end of the day, you can certainly limit the negotiating period not to two years but to a year or a little more so that your people have some months at least in which to prepare to leave the European Union. At the moment nothing protects us from the cliff edge.

You can imagine circumstances in which you are negotiating in good faith and perhaps the 27 other member states agree with you. The matter then has to go to the European Parliament, which is famous, particularly in the run-up to elections, for delivering a bloody nose to member states to prove its own virility. The matter also has to go through the procedures of every single Parliament of the 27 member states. Let us be clear about this: the article is designed to damage a country that leaves. It is a disgraceful article and should never have been put into the treaty. It is one of the reasons many of us believe that the Treaty of Lisbon should have been subject to a referendum, and believe it was a disgrace that it was not. A lot of the damage we have suffered since entering the European Union has arisen due to the persistent view that people will not respect one another’s rights or the rights of member states. Article 50 does not respect the rights of member states.

Photo of Baroness McIntosh of Pickering Baroness McIntosh of Pickering Chair, Licensing Act 2003 Committee 1:16 pm, 26th January 2017

My Lords, I congratulate the noble Baroness on securing this debate. I find it very difficult not to be emotional on occasions such as this for the simple reason that my mother was born in Denmark and lived in Copenhagen during the German occupation. I have had many opportunities to study and work in Denmark and Brussels and regret bitterly that future generations will not have the same opportunities.

I take this opportunity to congratulate my noble friend the Minister on the interest he has taken in British citizens who live elsewhere in Europe. I hope that he will put down a marker that we owe a sense of duty to those whom we encouraged to work in the British institutions, as the noble Lord, Lord Owen, said, and to those who, like myself, worked as EU lawyers in private practice. A whole host of people are still studying with a view to working and living elsewhere in the European Union. Others have retired to the European Union or work there in private practice as lawyers, dentists, doctors, bankers and others. There is a willing and ready workforce in European institutions who would be able to put their services to good use in assisting the Government in the difficult negotiations that we face.

I shall focus on the agriculture sector in Essex and Suffolk, where I was an MEP, and in North Yorkshire, where I served as an MP. At the last count, there were about 20,000 EU citizens working in this country in farming, horticulture, forestry and fisheries. Apparently, it is difficult to extrapolate the figures for farming alone. We currently export something like 72% of our food and drink produce to the European Union, so my question to the Minister is: who will take the place of the EU citizens who work in those industries, particularly farming and horticulture? Are we going to revert to the six-month rule? Will it be the case that someone can enter only if they have a position—so will employers have to go to other EU countries to recruit for whatever purpose—or will they still be allowed to visit the UK for three to six months and then have to leave? These are very real questions which, as my noble friend will know, are exercising the minds of those in the farming and growing industry at this point.

It is the first duty of the Government to defend the nation; it is the second duty of the Government to feed the nation. I urge the Prime Minister and my noble friend and his department to stick to their guns. Any negotiation must be done on the basis of reciprocity. It breaks my heart to see that we are giving up a single market of 505 million consumers, with free movement of goods, services, capital and people, for a potential free trade agreement with a number of other countries.

Look at the United States. I was involved with opening up liberalisation with the US carriers. The US continues to stop any new carrier flying within it, yet I hope the Prime Minister will take this very powerful message to President Trump: we will open our markets if America will open its markets. But I hope the Prime Minister will take this opportunity to say that we do not want hormone-produced, steroid-infested beef and chlorine-washed chicken in this country, and that we will continue to eat the very best of Yorkshire and British beef, produced to the highest possible safety and welfare standards, and that the Americans will take our beef in preference to their inferior produce. It has to be done on a basis of reciprocity for the simple reason that otherwise we will cave in before we know what their bargaining terms are.

Photo of Lord Puttnam Lord Puttnam Labour 1:21 pm, 26th January 2017

My Lords, time is very short, so in thanking my noble friend for enabling this debate, and having spoken last week on the right to remain, at col. 346, I will follow the example of the noble Lord, Lord Forsyth, and cut straight to the Brexit chase.

I have always believed that referenda are bad politics. I will go further: I believe their use to be an abrogation of political leadership, made more dangerous by the inexplicable decision to opt for fixed-term Parliaments. On a number of occasions in your Lordships’ House, I have stated my belief that we live in a far more fragile democracy than we appear to appreciate, one in which the introduction of an ill-informed and prejudiced referendum, an increasing threat of deselection, and the catastrophic loss of trust in public and private institutions have all served to undermine the principles of strong representative democracy.

Few politicians remain brave. In the end, more often than not, calculation trumps principle. By way of example, Stanley Baldwin told the House of Commons in 1933 that he had been unable to pursue a sensible policy of rearmament because of the strong pacifist sentiment in the country. Two years later, in 1935, 11 million people went so far as to sign the Peace Ballot, pledging support for the reduction of armaments. Imagine if instead of a petition there had been a referendum and 51% of the electorate had voted against rearmament. They would have been avidly supported by the Daily Mail, as well as very many members of my own party. Would noble Lords have behaved undemocratically if we had sought to reverse that expression of public will based on what this House sincerely believed to be growing and ever-more compelling evidence of Hitler’s intentions?

Should Winston Churchill have been deselected by his local party in Epping when early in 1938 he gave possibly his bravest speech to a largely hostile House of Commons, during which he said:

“I do not grudge our loyal, brave people … but they should know the truth … they should know that we have sustained a defeat without a war … they should know that we have passed an awful milestone in our history, when the whole equilibrium of Europe has been deranged … And do not suppose that this is the end … This is only the first sip, the first foretaste of a bitter cup”?—[Official Report, Commons, 5/10/1938; col. 3723.]

I believe we have once again sustained a self-inflicted defeat without a war. I am convinced that we have yet to taste the first sip of what could follow.

Surely I cannot be alone in finding an anomaly in the fact that according to the Daily Telegraph’s post-referendum analysis, the vote split along age, class and educational lines, with the future economic security of the elderly and most vulnerable now largely dependent on those whose clear wish was to remain in and share their future with Europe. I cannot convince myself that this conforms to any kind of sustainable outcome.

I have never been able to explain to my children why my name was in the “Content” column when the vote was taken in this House on the second Iraq War, in the absence of any well-thought-through post-conflict plan. I sincerely believed that the then Government had a fuller understanding of what we were blundering into. I now know myself to have been duped, foolish and wrong. I will not make that same mistake twice.

Finally, it is my sincere belief that we are engaged upon a hopelessly ill-thought-through misadventure. Irrespective of what may emerge as the attitudes or tactics of my own party, I will at every opportunity speak and vote against what I consider to be the most self-destructive policy ever to have been pursued in this country in my lifetime. The torrent of disinformation directed against Europe for 20 years and more by Murdoch, Dacre and others has done its worst, which is why the last word must be reserved for the thoughtful consideration of the whole of this Parliament.

HG Wells memorably described civilisation as,

“a race between education and catastrophe”.

I can hope only that before it is too late we in Parliament might find the courage and the perception of Winston Churchill to finally bring this nation and its leaders to their senses—on this issue and many others.

Photo of Baroness Smith of Newnham Baroness Smith of Newnham Liberal Democrat 1:26 pm, 26th January 2017

My Lords, this has been an excellent debate, which has highlighted many issues that have been discussed over the past seven months since the decision of 23 June, when the United Kingdom, by a majority, voted to leave the European Union. The debate has highlighted some serious differences, even if we have heard some similarities of views on many sides on one particular issue. The one area where I think there is almost universal agreement is the importance of securing the rights of EU nationals already resident in the United Kingdom. That is something I shall come back to repeatedly.

Two different aspects are listed in the Motion in the name of the noble Baroness, Lady Hayter. It refers to the rights of EU citizens already here, but one issue that has been raised throughout the debate has been the rights of EU nationals and UK nationals in terms of free movement of people. That is about the future. In my remarks I will suggest that there are three things we need to think about: the rights of EU citizens who are already here; future free movement issues, which are quite separate; and the future needs of the UK economy. Those issues are all interrelated, yet in this debate we have heard very little about the future needs of the UK economy. Almost all the discussion has been about the rights of EU citizens—perhaps not surprisingly.

Before I get into those questions, the noble Lord, Lord Forsyth, suggested that the Labour Party may be muddled because the Motion refers to the “potential” leaving of the single market. Clearly, the Motion was tabled before the Prime Minister outlined her objectives. She has made it clear that Brexit means Brexit—whatever that means—and, more clearly, as the noble Lord, Lord Forsyth, says, leave means leave, and that on all sides during the referendum, that is what we had been saying. I certainly did say in referendum debates that leave means leave, but that meant: we will not have the opportunity to rerun the question. It was not something where we could say, “If we get the wrong answer, let’s try again”. It was about saying, “This is not a game”.

Leaving meant leaving the European Union—that decision was clear. Far less clear at any point was what leaving actually meant. The Labour and Liberal Democrat Front Benches and the Cross Benches pressed the Government to outline the alternatives to membership of the European Union. They produced a rather pusillanimous document on the alternatives to membership, which suggested a Canadian-style relationship, the Turkish customs union or the EEA model. If we had decided to go down the EEA route, we would still have been in the single market, so it was not inevitable that by voting to leave the European Union we would leave the single market.

Photo of Lord Forsyth of Drumlean Lord Forsyth of Drumlean Conservative

Throughout the whole of the referendum campaign, the noble Baroness and her colleagues on the Liberal Democrat Benches, as well as the Opposition Benches, argued that a Norway or EEA model would be the worst of all worlds. They said that we would end up in the single market without any ability to change the rules. They described it as the worst of all worlds but are now presenting it as the best of all worlds.

Photo of Baroness Smith of Newnham Baroness Smith of Newnham Liberal Democrat

My Lords, I will not at this stage get into the details of the full Liberal Democrat policy on what we think should happen in the negotiations generally. However, it is important to recognise that there was no clarity from the leave campaign over whether it thought being in the EEA was the best or worst thing. At various times, supporters of the leave campaign suggested that we could remain in the single market. There was no clarity, the Government did not have a plan B, and the leave campaigners kept saying, “It’s not for us to say what leave will look like—it’s up to the Government to decide”. Now is the time for that to be discussed.

The Prime Minister has said that we will leave the single market and has ruled out staying in, precisely because she has now realised what the 27 other member states have been suggesting for quite some time: we cannot be in the single market and not have free movement of people. This is essentially a binary choice. Here I touch on one aspect of Liberal Democrat policy that is essential for this debate. The Prime Minister is talking about wanting “the greatest possible access” to the single market,

“through a new, comprehensive, bold and ambitious Free Trade Agreement”.

However, surely the greatest possible access is via continued membership of the single market. That is how we get the best of the single market, not via access that does not mean membership. That is why the Liberal Democrats have been pressing for ongoing membership of the single market and the benefits that it brings. It might be less good than membership of the European Union, but it would bring considerable benefits to the British economy and give certainty over the rights of EU citizens. However, that means the right of free movement of people, which clearly the Brexiteers do not want. The context of the debate today is clearly in line with the Prime Minister’s stated objective of leaving the single market.

That leaves us with the question of what rights EU citizens will have in the light of leaving the single market. We have been told by many of those on the Government Benches that there is an issue of reciprocity. There is also, however, an issue of what it is right to do. One of the things that Members from all sides of your Lordships’ House have been saying for the last seven months is that the rights of EU nationals already resident in the United Kingdom should be guaranteed. There is no need for reciprocity. That is something on which we can act unilaterally, now. It is not about the future but about citizens who are here, now. It is about EU nationals who have exercised their rights as EU citizens, who are here and who have not taken out British citizenship, because they never thought they would have to. Some of them may do—some may be able to. Others will not be able to afford it and, as we heard from the noble Baroness, Lady Hayter, and many others, the forms are complex and difficult and many people do not have the appropriate paperwork. As EU citizens, they never needed it. We need to guarantee the rights of those people right now, so that we do not tear apart our society and communities, as the right reverend Prelate said. This is something on which the United Kingdom can take the moral high ground, and we can make a decision now. The Liberal Democrats call on the Government to secure the rights of EU nationals resident in the United Kingdom.

The rights of UK nationals resident elsewhere in the European Union are clearly also important. We have all received emails from people who are concerned about their pensions and about whether they will be able to stay in the countries where they are. If we take the lead, however, we can try to negotiate the rights of UK citizens resident abroad. To use EU nationals currently here as pawns is completely wrong.

The future rights of UK and EU nationals and free movement is the subject of the future negotiations. I could ask whether the Government will tell us what will be in the negotiations, but I am sure I will get the answer that we are not going to get a running commentary, as that will damage the negotiations. I therefore would rather suggest a set of things that perhaps the Government can consider in future negotiations, about what sort of United Kingdom we want to be and what sort of relationship we need with the rest of Europe to secure our economic future. The NHS, financial services, the agricultural sector, higher education—people in all those areas have already expressed concerns that if we lose the benefits of EU nationals who are here, we will face problems. It is vital for the British economy that we keep some sort of rights of free movement of labour—free movement of people may not be there if we are outside the European Union—which will be beneficial to the UK economy. Surely the Government can think about that when they lay out their negotiating hand. In addition, please can we not have the imposition of visas on EU nationals? To keep the economy open, it is vital that we do not create barriers that we have not seen in the past and will not benefit us in the future.

Photo of Lord Bridges of Headley Lord Bridges of Headley The Parliamentary Under-Secretary of State for Exiting the European Union 1:36 pm, 26th January 2017

My Lords, I thank all noble Lords who have contributed to this excellent debate. I start by heeding the remarks of my noble friend Lord Forsyth and the noble Lord, Lord Davies, about the length of speaking time. I note that, and I will have conversations. It is important that we give everyone the opportunity to scrutinise these important matters as we proceed in the weeks ahead.

I will put today’s debate in a little more context. Leaving the European Union will, obviously, touch on every aspect of our nation. As the great, late Lord Denning put it, European law has been like “an incoming tide”. It has flowed into the estuaries and up the rivers of our communities, our businesses and our lives. Today, with Brexit, we are seeking to do what no nation has done before: to create a new relationship with an economic and political entity whose regulations and laws we currently observe and with whom we co-operate and collaborate on a range of issues, from justice and home affairs through to education, science and space.

As I have said and will continue to say, we are leaving the European Union but we are not leaving Europe. It has always been and will always be in our interests for Europe to be stable and prosperous—a continent with which we can trade freely and with whose nations we can collaborate and co-operate where it is in our national interest. Given this, it is entirely correct that we should look to forge a unique relationship with the European Union: one that befits a nation that is one of the largest economies in the world, which has been an EU member for over 40 years, and which has deep links, not just across Europe but around the world.

This is why, as the Prime Minister set out last week, our approach is to forge a new partnership with our European neighbours, in which, as a sovereign, independent nation, we have a new, comprehensive, bold and ambitious free trade agreement with the European Union. This agreement should allow for the freest possible trade in goods and services between Britain and the EU’s member states. It should give British companies the maximum freedom to trade with and operate within European markets—and let European businesses do the same in the UK.

On the noble Baroness’s Motion, I will say a little about the word “impact”, which lies at its heart and which brings me to what the noble Baroness, Lady Smith, said passionately. In the referendum campaign, the debate was, obviously, about the economy—about matters of pounds and pence. However, it was also about something more profound, which my noble friend Lord Forsyth mentioned. It was about parliamentary sovereignty and national self-determination. In a word, as my noble friend Lord Cormack said, it was about control.

After that debate and the referendum, the majority of people voted to leave the EU, which is what we are now going to do. That is why the Prime Minister has been clear that the UK will no longer be a member of the single market nor abide by the common external tariff or the common commercial policy. As my noble friend Lord Forsyth mentioned, we need to consider the impact of our not following the course of action the Prime Minister set out. Remaining a member of the single market would mean accepting that the European Court of Justice still has direct legal authority in our country, so the impact of not leaving the single market would be, to all intents and purposes, to keep the UK under the aegis of the EU. We would not control our laws, nor our borders. We would not be leaving the EU.

As to the point from the noble Lord, Lord Livermore, his remarks were very well judged in many respects, but I disagree with him. We are not putting immigration control above free trade. That is not the case. As I have been arguing, we want a new partnership in which we enjoy free trade, and we wish to control immigration. That is our ambition, and it will be spelled out in the White Paper, which we are now committed to publishing. I turn to what my noble friend Lord Hamilton said: the White Paper will build on the 12 negotiating objectives laid out in the Prime Minister’s speech to build a global Britain with this strong new partnership with the EU after our exit.

I am not going to go into further great detail now, but I will say a couple of words about the White Paper’s components to pick on what a number of your Lordships said on specific issues. First, I know that the noble Baroness, Lady Warwick, speaks with a lot of authority about higher education. I can confirm that we will continue to look at how we can continue to co-operate and collaborate with European partners so we can build on our world-class universities and our record in research and development. I have been fortunate to meet a number of the representatives of universities—I hope to continue to do so—to hear about their needs. The noble Baroness might have mentioned that there was some connection between Horizon 2020 and freedom of movement. That is not my understanding. I do not think it is correct to say that all models of co-operation require the acceptance of freedom of movement.

We would also be willing to take the same approach on co-operation for Erasmus and other schemes. Erasmus was referred to by the noble Baroness, Lady Coussins, who has great expertise on the teaching of foreign languages. On that point, I entirely heed the points she made about the need to continue to ensure that we are training our young people to have the right skills in modern languages. That is why we are increasing the amount we are spending on training and the help we provide teachers in that area.

To briefly touch on financial services, which the noble Lord, Lord Davies, touched on, the Government are obviously incredibly conscious of the challenges faced by financial services right across the sector. I am certainly not complacent about the future, but I was heartened to read that the chief executive of Barclays said within the last few days that he thinks the UK,

“will continue to be the financial lungs for Europe”.

Likewise, the chief executive of HSBC said he thinks that,

“actually, London will remain a global financial centre”.

Finally, the German Finance Minister said:

“London as a financial centre will play an important role for Europe even after Brexit”.

The Prime Minister was quite clear in her speech how we will negotiate. The noble Lord, Lord Owen, made some very interesting remarks about Article 50 and the process around it, which I have noted. I will not add to what the Prime Minister has said, other than to repeat that we expect to get an agreement in two years. We look to negotiate our exit agreement and the new relationship at the same time, as set out in Article 50.

I will now focus on the position of EU nationals now and after Brexit, which has been raised by a large number of your Lordships. I start by thanking the right reverend Prelate the Bishop of Durham for the contribution that the Church of England has made and continues to make in hosting events with church groups across the country. I am extremely grateful for that. It has provided a welcome forum in which to have a very wide-ranging discussion. I also thank the noble Baroness, Lady Kennedy, for the contribution that her committee makes and made in its report.

On this point, of course I recognise the important role that EU nationals make in a vast number of areas in our society and to our economy. Obviously it has been the Government’s approach and wish throughout to provide as much certainty for them in the days and months following Brexit as possible. That is why the Prime Minister in her speech last week made protecting the status of this group of EU citizens a top priority. It is also why we must move to trigger Article 50 as soon as possible. I will spell out why that is the case. The Prime Minister has made it clear that she stands ready to reach an agreement right now. Indeed, she has already told EU leaders that we could give people the certainty they want straightaway—a point the noble Lord, Lord Bilimoria, might like to bear in mind. However, we know that they are not open to any negotiations before Article 50 is triggered. To provide that certainty, I argue that we need to proceed, as the Government intend, to trigger Article 50 by the end of March. Then, we can proceed to seek an early agreement when we have begun formal negotiations, while being very mindful, as the noble Lord, Lord Owen, so rightly mentioned, of Article 8.

Despite this strong signal from the Prime Minister, I understand and have heard today that a number of your Lordships and others wish us to make a unilateral move to grant assurances now, ahead of the negotiations. The noble Lords, Lord Teverson, Lord Greaves and Lord Oates, the noble Baroness, Lady Kennedy, my noble friend Lord Cormack and a number of other people have made these points. I sense the strong feeling there is on this issue.

I am sorry to disappoint your Lordships, but I am not here to move the Government’s position. The Government disagree with this point. We need to ensure that the rights of EU nationals in this country are seen concurrently and negotiated alongside protecting the rights of UK nationals in the EU. I argue as some have done—the noble Lord, Lord Oates, mentioned this—that there are currently living in other EU member states more than 1 million UK nationals. I argue, as my noble friend Lady McIntosh of Pickering picked up on, that we as a Government have an obligation to them. They are UK citizens after all.

I add that there have been no changes to the rights and status of EU nationals currently in the UK as a result of the referendum. Until exit negotiations are concluded we remain a full member of the European Union, and all the rights and obligations of EU membership remain in force. This includes the right, as transposed from the free movement directive under EU law, for any EU national who has been lawfully residing in the UK for more than five years to automatically acquire permanent residence.

The noble Baroness, Lady Hayter, and the noble Lord, Lord Greaves, mentioned the delays that EU citizens face. I am sorry to say I am not going to comment on individual cases—I am sure your Lordships would not expect me to—but the terms under which an EU national can be considered as lawfully living in the UK are set by EU law. Guidance is available for EU nationals wishing to obtain a document to provide permanent residence. To simplify and ease the process that the noble Baroness, Lady Prosser, mentioned, the Home Office has introduced a European passport checking service to avoid the need for EU nationals to send in their passports.

The noble Lord, Lord Teverson, asked about the rights of individuals, in particular spouses. I cannot go into detail on this point right now, but I will say that there has been no change to the right of EU nationals to reside in the UK, as I said, and therefore no change to the circumstances in which someone could be removed from the UK. EU nationals can be removed only if they are considered to pose a genuine threat to the public or if they are not lawfully resident, and, as he referred to, the Government are obviously aware of Article 8, on the right to a private and family life, and Article 1, on the right to property, of the ECHR. I repeat that the Government have no plans to withdraw from the ECHR.

I will now say a word about UK nationals in EU institutions. I thank from the start my noble friends Lord Balfe and Lady McIntosh of Pickering for their contributions on this issue and for the time they have spent talking to me about it. The Government are very seized of this issue: I have had conversations with both officials here in London and those based in UKRep about it. I will return to the fray in the light of what my noble friend Lord Balfe said about wishing to signal this more strongly. If he feels that his message has not got across to those UK nationals in EU institutions, I will redouble my efforts.

UKRep is currently undertaking engagement—which I have asked to be stepped up—with our British nationals out in EU institutions, to ensure that their concerns are heard. On top of that, we are recruiting the necessary expertise from within the UK Civil Service as well as opening some positions up to external recruitment.

As regards pensions, the rights and entitlements that will apply following the UK’s exit are subject to the wider negotiation on our future relationship with the EU. I can assure your Lordships that at every step of these negotiations we will ensure the best possible outcome.

Let me now turn to the future immigration system. I entirely concur with the comments of the noble Lord, Lord Bilimoria, who made a very powerful speech, and of the right reverend Prelate. We need to be extremely sensitive with regard to both the language that we use and the approach that we take. We are looking to take control of immigration. That is sometimes misunderstood or misread as meaning “ending immigration”. This is absolutely not the case. As my ministerial colleagues and I have said on many occasions, we still want to attract to this country and retain the brightest and the best of European talent and talent from right across the world. I agree with what my noble friend Lord Patten said about the need to make sure that we attract them to work not just in financial services, but in creative industries—in which the noble Lord, Lord Puttnam, is interested—biotech and academe, upon which the right reverend Prelate remarked. Meanwhile, as we look to create a new system, we also should not do anything that would cause labour shortages in other sectors such as construction, agriculture and finance.

We are extremely conscious of these points and we are also looking at means by which to improve the opportunities for British people, which my noble friend Lord Hodgson mentioned. The Government have set out how they intend to do so in their industrial strategy earlier this week, which furthers existing proposals, and therefore we are looking at the vast panoply of measures and implications that taking control of immigration involves.

As the Prime Minister set out in her speech last week, we want to ensure that this country emerges from Brexit stronger, fairer, more united and more outward-looking than ever before. We will have further debates of this kind, and it is absolutely right that we do so as the Government’s thinking is set out before your Lordships and before the country. I welcome the chance for your Lordships to scrutinise that policy and I thank noble Lords for the contributions that have been made today.

Photo of Baroness Hayter of Kentish Town Baroness Hayter of Kentish Town Shadow Spokesperson (Cabinet Office), Shadow Spokesperson (Business, Energy and Industrial Strategy), Shadow Spokesperson (Exiting the European Union) 1:53 pm, 26th January 2017

I join the Minister in thanking everybody for their contributions today. He might not like the content of them as much as I did: it was a very strong plea to recognise the rights and expectations of those 3 million people already living here. I regret that he was not able to make any move on that.

The Minister might say that there is no change now, but two years is a very short period, particularly for those with children, making arrangements for their future. As has been said, these are families: they should not, in the words of my noble friend Lord Judd, be seen as pawns, or, in the words of a Home Office Letter, as “negotiating capital”. As the right reverend Prelate said, they are not bargaining chips to be used: they are human beings, our friends and colleagues. We urge the Government to make a commitment not to use these people as a negotiating hand. Indeed, as my noble friend Lord Chandos said, it is not a good technique: it is not a good tactic in negotiating to start using human beings. It will not be looked at very well by the other side, particularly as it was we who opened this whole negotiation for change.

The right reverend Prelate the Bishop of Durham said that the manner of how we leave will say something about us as a country, but it will also be of wider international interest. As the noble Lord, Lord Owen, said, it is a matter of honour and of our future good relationships with our EU neighbours. Therefore, while we recognise and welcome the commitment to look after UK nationals living abroad, who are also uncertain of their future, we hope that there will be a grown-up approach to this and that we will recognise the rights of people living here without saying that as something that is a reciprocal tool to be played with. If, as I am sure she is, the Prime Minister is such a good negotiator, she will have other cards up her sleeve that will enable us to get a good deal and other tricks to play to ensure, without trading the rights of people living here already, that UK nationals living abroad will also have their future guaranteed.

The Minister quoted Lord Denning saying how EU laws have flowed up the river into every part of our lives. The Government might find, like the earlier Canute, that waters do not withdraw quite as easily as they think. This very short Bill that we have in our hands today is only the start of the process: I hope that we do not make these EU citizens wait the full two years to know what their future is. In the very short term, I ask him to look at that form. I reassure the noble Lord, Lord Balfe, that my mother got to a military hospital while his mother-in-law was coming back to England, so I was actually born British. I do not have to fill in the form, but lots of others do, so will the Minister look at that and see whether the paperwork can be simplified?

With that, I thank everyone for, I hope, the strong noises that they have left ringing in the Minister’s ears. I beg to move.

Motion agreed.