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European Union (Withdrawal) Bill - Report (6th Day)

Part of the debate – in the House of Lords at 7:00 pm on 8th May 2018.

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Photo of Baroness McGregor-Smith Baroness McGregor-Smith Conservative 7:00 pm, 8th May 2018

As noble Lords may know, I come to this debate from a business services background having worked in the services industry in the UK and globally for more than 30 years. I am passionate about growing services businesses and that is why I am speaking today. I understand the sensitivities and the challenges of this amendment but I want to talk about the impact on businesses, not party politics. I completely accept leaving the EU next March and I absolutely respect the referendum result.

As my noble friend Lady Verma has outlined, services are a vital part of our economy and we must ensure that our services sector as well as our goods producers have access to our closest and biggest market. The latest CBI report, Smooth Operations, from 11 April 2018, points out that there are much greater costs than opportunities if the UK chooses to move away from the EU rules and regulations. This is based on conversations with thousands of businesses and many trade associations over recent months.

In saying that, I know that there are concerns when we talk about the single market. This amendment seeks to offer an alternative that could square the circle between the referendum result and safeguarding our economy, access to trade and jobs. The noble Lord, Lord Alli, touched upon the differences between membership of the EU and the EEA. These differences could address a number of concerns, including the jurisdiction of the European Court of Justice. The EEA extends the benefits of access to the European market and is based around the four freedoms, of goods, people, services and capital. It is governed differently from being a full member of the EU and can offer more flexibility. This may satisfy some of the concerns that have led us to where we are today. The EEA has its own regulatory, governance and institutional frameworks. The administration and management of the EEA structure is shared between the EU and EEA EFTA states. As such it is not the same as being an EU member.

We are coming to this debate back to front: we are considering a withdrawal Bill before there is a withdrawal agreement. The details of our future trade structures are either up in the air or they are not known. We have no idea what the withdrawal agreement will look like and there remains a possibility that there may not be one at all, which for me and everyone would be a devastating option for our businesses and the economy.

On 8 March 2018, the CBI published a paper on the five steps needed to protect services post Brexit. It recommended five steps that negotiators will need to secure a strong future for services businesses after Brexit. These are: first, removing the cliff edge for trade in services; secondly, ensuring access to talent and the mobility of people; thirdly, ensuring free data flow between the UK and Europe; fourthly, negotiating ambitious mutual market access; and, finally, investing in regulatory co-operation between the UK and the EU and the UK and the rest of the world. Those five steps sound common sense to me. Creating barriers and uncertainty for business and all of our services sector is not what we need today.

That is why my noble friend Lady Verma, the noble Lords, Lord Alli and Lord Bilimoria, and I have come together with this amendment to seek to give our services sector the free trade that the customs union would give to our goods producers. It would also show that we recognise the concerns and tensions that the referendum exposed in our country. We believe that EEA and EFTA membership could be a bridge between the referendum result to leave the EU and the need to safeguard jobs, communities, businesses and the economy.

I was asked to join this House so that my many years of experience in business could help shape the laws of this land, and it hugely pains me to be on a different side of the argument from many of my noble friends. However, I firmly believe that I am present in this Chamber today for the experience that I bring from the business sector, particularly the services world, of which I am extremely proud to be a part. It is with that experience in mind that I ask noble Lords to consider the EEA as a way of respecting the will of the people and ensuring that British business can continue to thrive once we leave the European Union.