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My Lords, the last time I spoke in the House in a debate about Brexit and trade, I said that as a member of the EU Committee of this House, it seemed to me that every meeting raised new and unforeseen complexities. It was all much more complex and difficult than anybody anticipated before the referendum. That speech was made before the general election. Having worked in constituencies in the north, which largely voted to leave, and in the south, where a large majority of the electorate voted to remain, it is clear to me that the country is very divided—I believe dangerously so.
The PM tries to cling on to a mandate for her version of Brexit, but she lost that mandate in the general election. While more of the electorate than she was expecting voted for her exit, not everyone voted for her Brexit—and we are now in a bit of trouble. There is a sense that the Government are flailing around, trying to find solutions and unity that are just not there.
As the Chancellor said recently, no one voted to make themselves poorer. My neighbours who voted to leave—the people in my community in the north-east—did so because they had suffered from cuts to in-work benefits while their wages had stagnated. They believed that migration was a big reason for why they felt worse off—even though you can count the number of migrants in our small town on one hand.
Our region derives the highest proportion of its per capita income from manufacturing. In many senses, we are the manufacturing heart of the country and most of that manufacturing is exported to Europe. Per head of population we have the highest export ratio to Europe, so we absolutely depend on manufacturing and manufacturing exports to Europe. But we have a declining population and, overall, young people are still leaving the region, so our population is becoming more elderly. We also still have real problems in getting new business start-ups. I suspect that there is some connection. Access to skilled labour and the single market is therefore crucial to the north-east. Think about Nissan, Hitachi, Siemens or the chemical and pharmaceutical industries, which are the core drivers of our exports: all of them want to remain in the single market and the customs union.
The Government remain, to me, very unclear in their vision. They gave us no signal in the Queen’s Speech as to how they will address more effectively the skills gap, which we know will be a huge challenge in the north-east over the next 15 years. I support the proposal to remain in the single market and customs union as I believe it is the only way that we can secure the level of exports being sustained, let alone expanded and developed. For example, Hitachi has located in Newton Aycliffe to build trains. One of its reasons for locating there was that Teesport is nearby, and it wants its main market to be in Germany. There are two arms to the site, both of which it had plans to develop; those developments are on hold. I want them to go ahead but there is no way that they will go ahead unless we are in the single market and the customs union. I really want the Government to think about that.
We have to be much more honest about what will be in the best interests of the country. My party leader is right to call for a deal that prioritises jobs and the economy. I wish only that he and others in the leadership had campaigned during the referendum with the enthusiasm and effectiveness that they showed in the general election. I believe we would then be in a very different place because many of those young people who are now distraught about the outcome, as the noble Lord, Lord Cormack, said, would have understood more why they needed to be there.
We have to be much more honest and engaged not just with businesses but with the British people, so that they know what the choices are. It is not just the rhetoric but the reality, and the reality is that whatever choices we make will involve compromises. It is about time that the Government stopped trying to pretend that it will all be motherhood and apple pie, and that they were honest and engaged with us and with the public about what those choices and compromises are.