Brexit: Preparations and Negotiations - Motion to Take Note

Part of the debate – in the House of Lords at 7:53 pm on 23rd July 2018.

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Photo of Lord Haskel Lord Haskel Deputy Chairman of Committees, Deputy Speaker (Lords) 7:53 pm, 23rd July 2018

My Lords, as I think the noble Lord, Lord Cavendish, has just told us, the White Paper is too little and too late. It was intended as a compromise between the various factions in the Conservative Party, as many noble Lords have observed, but sadly it seems to be unravelling. As a result, while Ministers are working on national recognition agreements, the rest of us are having to prepare seriously for the absence of these agreements. We have to prepare for shortages of goods and medicines, we have to prepare for disruption in deliveries at ports and airports and, as my noble friend Lord Browne of Ladyton explained, we have to prepare for an increase in security risks. The EU has issued a 15-page document with these warnings and, although firms are busily looking up the WTO rules, they will find blanks in many service areas and in areas dealing with medicine and health. As the Minister told us, our Government are preparing to issue 70 technical notices of their own.

I do not agree with the noble Baroness, Lady Deech. The economic implications of no deal are enormous. There are warning red lights flashing all over the place. That is because instead of addressing a sensible, negotiated agreement phased over a two-year transition period, we are having to prepare for no agreement within a few months. What concerns me is that, while all this is going on, we do not clearly state whose side we are on in world trade. We have to be on the side of multilateralism, international order and international co-operation, supporting the institutions that are dedicated to their maintenance—the UN, the WTO and, yes, the EU. On the other side are nations whose terms of trade are that each stands only for itself: world trade without rules or standards. I know which side I want to be on.

As my noble friend Lady Hayter explained, America is pursuing trade actions against China and against its near neighbours, Canada and Mexico, as well as against the EU. It is a trade war where might makes right. Moreover, WTO rules, already under attack, then become meaningless. This is what it means to be free to trade with anybody anywhere in the divided world that the noble Lord, Lord Forsyth, seems to prefer. Compare that with the recent agreement negotiated by the EU extending the common market to Japan, which many noble Lords have mentioned.

The White Paper tried to rescue us from this as far as manufacturing is concerned and that is welcome. If agreed, it may save jobs and avoid a dilution of labour standards, environmental standards and all the other standards that make up our quality of life. That is because it is these standards that are invariably the victims of a trade war. We can maintain these standards only in an orderly world of trade agreements and non-regression clauses.

Our ability to trade with the EU in services will have to come under a new legal structure. But before the Government go down that road, I urge them to make sure that we all agree on what services are. The distinction between goods and services has become very blurred. The Office for National Statistics has said that in 2016 we had a surplus of some £23 billion on our trade in services with the EU, but has the Minister looked at this from the Brussels standpoint? According to Eurostat, the remaining 27 have a surplus in their trade in services with us of a similar amount. Presumably we cannot both be right, unless we are counting different things. The ONS does not have an explanation.

You only have to listen to this debate to realise that the chances are slim of Parliament, never mind the Conservative Party, agreeing on a deal in the time remaining. Added to that, regulators now find that one side in the referendum broke the law and that, during the campaign, personal data was used illegally. To be constructive, as the noble Lord, Lord Butler of Brockwell, has asked us to be, a strong and principled leadership would seek to extend the Article 50 process until there is a good chance of consensus in Parliament and clarity on the legal issues. The Government could use the time to deal with people’s concerns about immigration, as the noble Lord, Lord Heseltine, suggested. Can the Government concentrate on finding a moral middle ground, which probably means staying in the common market, because that is what will work best for all of us in Britain? If we do not, a few may flourish, but most of us will become the victims of the inevitable rising inequality.