The First Secretary of State and Chancellor of the Exchequer (Mr George Osborne)
I very much welcome this opportunity to update Parliament and the country on some of the economic challenges that we now face. I welcome the hon. Member for Salford and Eccles (Rebecca Long Bailey) to her new position as shadow Chief Secretary. I will not welcome all the new members of the Labour Front Bench because it would be a bit like the presentation of the Bills that we just saw, but it is very good that the shadow Chancellor is still in place, and he has 80% of the support of the Conservative parliamentary party to remain there.
May I respond to this sober debate with a message of reassurance and realism? I say at the outset that because this is a challenging time and this is a good opportunity for the House to discuss these issues, we are not going to seek to divide the House on the motion today.
That message begins with the reality that I have never shied away from telling the country the truth, as I have seen it, about our economic challenges, and we do now face very significant economic challenges as a result of the referendum decision last week. I do not resile from any of the concerns that I pointed to before the referendum, but I want to provide reassurance that we are about as well placed as we could possibly be to meet the challenges that lie ahead. The shadow Chancellor was correct to raise problems such as low productivity growth, which bedevil many western economies, but the British economy has been the strongest advanced economy in the world in recent years. We have the highest employment rate in our history. The capital requirements for our banks are 10 times higher than they were before the financial crisis. Inflation is low and stable, and real wages and household disposable incomes have been growing. These things did not happen by accident—they happened because over the last six years we took difficult, sometimes painful decisions in order to rebuild our economy, to strengthen our banks and to put our public finances in better order. We said we would fix the roof—and thank goodness we made the progress that we did.
While I personally gave everything to campaigning for a different outcome, we saw a clear result in the referendum. I accept that result and the Government accept that result. Now we need to implement that decision and deliver for the British people on the instructions they have given us.
John Redwood
As the 10-year cost of borrowing has fallen from 1.4% to under 1% and the rate for 30-year money is now under 2%—record lows—does that not mean that there will a windfall element from lower interest charges? Will the Government consider funding the debt longer at this advantageous time for borrowing?
Mr Osborne
My right hon. Friend is right to point to the fall in UK gilt yields, but there has been something of a flight to safety. In the last six years, we have made UK Government debt a safe haven in stormy waters, and on this side collectively we can take enormous pride in the fact that we have done that. It is very different of course from the situation six years ago when yields were increasing in the face of economic difficulties, whereas here they have come in.
In terms of the financing of the debt, I have already on a number of occasions over the last six years changed the skew of the Debt Management Office’s debt plan and made sure we have more longer-dated debt than we would otherwise have had. One of the reasons why international investors and others have confidence in the UK gilt market is that we do not chop and change all the time every week, so while my right hon. Friend makes a very good point, I do not think we should immediately respond to the events of the last week by changing our financing remit. Indeed, the message we need to be sending very clearly is one of stability and reassurance. That brings me to the plan I believe we should now follow.
First, it involves ensuring financial stability, and that is precisely what we have been doing in the past few days. In the run-up to the referendum, the Treasury worked closely with the Bank of England and the Financial Conduct Authority to put in place robust contingency plans for the immediate impact of a leave vote. I met the Governor of the Bank of England to discuss it on a number of occasions, and the Financial Policy Committee and the Monetary Policy Committee both had special meetings to discuss those contingency plans. The Prudential Regulation Authority—essentially, our bank regulator—worked systematically with each major financial institution to make sure they were financially sound and prepared for whatever the outcome of the referendum was going to be. The Bank of England pre-announced additional liquidity auctions to support the banking sector. People will have seen this week from the result of those auctions that that liquidity has been provided. Over the last few days, we have been working closely alongside Finance Ministers and central bank governors across the G7 nations and the nations of the European Union to make sure that we are monitoring developments closely and are ready to respond. The president of the European Central Bank updated the European Council yesterday—the Prime Minister reported on that to the House earlier—but it has to be said that the update was not particularly rosy. Let us be clear: these contingency plans were designed to prevent disorder in markets; they were not designed to stop markets adjusting to the new economic reality.
I can reassure the House today that our major banks are resilient. Capital and liquidity remain strong, and this morning we have seen greater stability in the major banks’ share prices, and the currency markets are continuing to function effectively. But there have been significant adjustments, and we have to be realistic about the impact of the referendum on the financial markets.
George Kerevan
The resilience and stability of our banks is to be welcomed, but it is clearly at the price of pumping so much central bank money into the system that bank share prices are falling, and the future commercial prospects for our banking system have been undermined. The system is not as stable as the Chancellor is telling us.
Mr Osborne
The stability of our financial institutions is there for people to see. It has been assured by our regulators. If the hon. Gentleman is saying that the market is making new assessments about the future earnings of banks, yes, that is so, and it is quite striking that it is banks that face the UK economy that have seen the sharp falls in their share prices, not banks that face the European and international economy. We have to be realistic: markets—free markets—are going to make those kinds of adjustments. We have seen those—the shadow Chancellor noted them—but it is striking that there has been the largest one-day fall against the dollar on record for our pound sterling. Equity markets, particularly the FTSE 250—which largely comprises companies that, again, face the UK domestic market—fell by 14%, and they are now 9% below their level. The particular sectors that have been affected are British retail banking, house building and short-haul airlines, some of which have seen their share price fall by more than 40%.
Kit Malthouse
Notwithstanding what the Chancellor of the Exchequer has said, will he acknowledge the benefits of a weaker exchange rate? For a country that is running a large trade deficit, having a significantly weaker exchange rate will make a large difference, particularly to exporters, and it means that we are more likely now to avoid deflation in the economy, which not a few months ago people were forecasting was likely to hit us.
Mr Osborne
I agree with my hon. Friend that a free-floating currency is a shock-absorber that we have the benefit of. We do not have a fixed exchange rate, and of course we are not part of a single currency, so the currency can take some of the strain, and that is reflected in the currency market.
The only thing I would caution my hon. Friend on is this: in 2008 we saw a sharp fall in sterling, and that was sustained, but it did not lead to the boost in exports that people expected at that point. That was partly because other markets, including European markets, were depressed, but, as we came to discover, it was also the case that integrated supply chains these days are more international. For example, car exporters might benefit from the fall in the currency in terms of the price they sell their cars for, but they will have imported parts and will have seen import prices go up. Unfortunately retailers are also warning us that prices in supermarkets, for example, may well now rise because of the fall in the currency, but we will wait and see.
Of course the other challenge we face is from the credit rating agencies—not that everything they say is gospel. Unfortunately, we lost our triple-A rating with Standard & Poor’s and were downgraded two notches a few days ago.
Mr Jim Cunningham
Are we still using quantitative easing, and if not, when did that end?
Mr Osborne
The shadow Chancellor raised questions about monetary policy. Obviously the Bank of England is independent. The MPC set out the challenging trade- off it might face between a fall in output and a rise in inflation. We will have to wait and see how MPC responds to the judgment it has to make.
The central bank has not been undertaking quantitative easing, but the arrangements put in place by my predecessor Alistair Darling—essentially, the authorisation arrangements —remain in place. In other words, the MPC will be able to use any of the monetary policy instruments in its toolkit, but that is entirely a judgment for it. We will wait to see how it responds to the challenges it faces.
Mims Davies (Eastleigh) (Con)
This June, sadly, the sun is not shining, and like many MPs I have been contacted by constituents who may wish to delve into a second referendum. Democracy gives us a say, not necessarily our way. Does the Chancellor believe that even looking at a second referendum would do massive damage to our improved finances and delay and disrupt further infrastructure projects which are so vital to our communities?
Mr Osborne
I fought passionately to remain in the European Union, not because I was a massive fan of the EU with all its problems but because I thought it was better for Britain to be in the EU than outside it, but I absolutely accept the result of the referendum. I do not think it is credible, in the days after the result, to say, “The people got it wrong. We need to elect a new people.” In our democracy, we need to respect the result that the British people have given us and, as representatives of the population in this Parliament, our obligation is now to get on and deliver what they have asked us to deliver, to the best of our ability.
Ian Blackford (Ross, Skye and Lochaber) (SNP)
The Chancellor is being very candid in his remarks this afternoon. He has referred to the situation with the banks, and I have noticed that Goldman Sachs has downgraded its profit forecast for the UK banking sector by €10 billion over the next two years. Will he reflect on what that means for the UK economy and for tax receipts? Will he also reflect on the importance that is placed on getting out of our banking holdings over time? Does he not think that this is a self-induced problem that has been created by the Conservative Government’s manifesto commitments? Does he not regret the fact that it is the Conservative party, through its internal dispute, that has got us into this terrible mess in the first place?
Mr Osborne
The short answer to that is: no I do not. I do not think that it is wrong, in a democracy, to ask the people about very big constitutional issues. In all the years that I have been a Member of Parliament—and, indeed, before that—the question of our relationship with the EU has hung over our political system and our body politic. I am surprised to hear a Scottish nationalist raise doubts about the effectiveness of referendums, but there we are.
We have well thought-through contingency plans and they remain in place in case financial conditions should deteriorate. The market should not doubt our resolve. We are absolutely determined that, unlike eight years ago, Britain’s financial system will help our country to deal with any shocks and dampen them, rather than contributing to those shocks or making them worse. As the shadow Chancellor requested earlier, I shall of course keep the House informed. However, we have to accept that some investment and hiring decisions will continue to be paused as firms adjust to the uncertainty caused by the referendum. There is already survey evidence and anecdotal evidence of this. So the second part of our plan—the first part involves financial stability—has to be to resolve that uncertainty as quickly as is practical in a democratic system.
Nick Smith (Blaenau Gwent) (Lab)
European Union funds have helped economic development in my constituency. What measures is the Chancellor going to take to ensure that areas such as south Wales continue to receive support for infrastructure and to help to boost jobs in our valleys?
Mr Osborne
We are going to face some big questions about providing support to the institutions, regions and sectors that have been receiving European Union assistance, most notably the regional support that has been provided to areas such as south Wales, the ongoing support that the EU provides for research in our universities and the support for our farming community. We in the House of Commons are going to have to address all those issues in the coming months and possibly beyond. However, at the moment we remain a member of the European Union—I shall talk about the procedure for our departure in a moment—and the European funding and grants will continue to be made. We are looking specifically at areas where questions have been asked about long-term uncertainty in relation to particular projects, and I will keep the House updated. This is a challenging question, which we have to answer, and we are looking at it very intensively now. But at the moment nothing has changed and we remain a member of the European Union.
That brings me back to the question of trying to resolve as quickly as is practical the uncertainty about the new relationship we are seeking with the European Union and our European neighbours. We need a bit of realism and we need to offer reassurance. It is apparent that the uncertainty will be fully resolved only when we as a country have negotiated an agreement with our European partners on the relationship we now want to have with them. We know what the broad options are. The Government spelled them out and set out the different relationship models over the past few months in the Treasury and Cabinet Office papers that were produced in advance of the referendum. We could join the European economic area, like Norway; we could forge a new negotiated bilateral agreement with the EU, like Canada; we could adopt the Swiss model; or we could rely on World Trade Organisation rules.
As the Prime Minister set out at this Dispatch Box, the Government have established a new unit at the heart of Government made up of some of the best civil servants, reporting to the Cabinet, that will help us as we make that decision. I stress, however, that Members of Parliament and other organisations can feed in to the work that is taking place, so that we have the fullest possible information on the decision that we will have to take collectively as a Parliament on our new relationship with Europe.
My view is clear that we should move towards an arrangement that provides us with the closest possible economic ties with our European neighbours. Close to half of our exports go to the EU and millions of jobs are supported by our trade with the EU. Leading industries, such as car manufacturing, farming and our services industry, are reliant on that relationship, and we should be moving towards an arrangement under which—if we reach it and can negotiate it—the trade of both goods and services, including financial services, is as free as possible. In the meantime, returning to a point I made earlier, UK firms continue to have exactly the same status as any other EU firm. Business continues in the City and elsewhere, including for euro-denominated trading in our financial markets.
However, I am a realist—we have to be realistic about this—and we must acknowledge that we cannot have all the benefits of the EU without accepting any of the costs and obligations. It will be for this Parliament to decide what the accommodations and compromises should be.
Wes Streeting (Ilford North) (Lab)
So much of the leave argument was predicated on shifting our focus to the world beyond Europe. If the Chancellor agrees with that assumption, we need to ensure that we can get there. Given that Heathrow expansion would deliver a £16 billion privately financed shot in the arm, up to £211 billion of economic growth—predominantly outside the south-east—180,000 jobs and 10,000 apprenticeships, I urge the Chancellor to commit to giving Government Members a free vote safe in the knowledge that there will be sufficient votes on the Opposition Benches, irrespective of whipping arrangements, to deliver that result.
Mr Osborne
We await the work that is being done on air quality around the airport. When we discussed the matter some months ago, people were a bit dismissive, but to be fair to the new Mayor of London, he raised air quality issues during the London mayoral contest that resonated with voters’ concerns—the hon. Gentleman would know that as a London MP. Before Parliament makes a decision, it is important that we have addressed the issues, concerns and questions about air quality. It will be nothing new if I tell the House that the decision will be controversial when we come to take it, so it is important that no one cries foul over the process. We can then make a decision on the merits of the case. People know my view, which is that we need additional runway capacity in the south-east of England, but where that capacity should come from must be a matter first for the Government and then for Parliament.
Mr Osborne
I will give way to the right hon. Gentleman and then make some progress.
Mr Dodds
As with so many issues, Northern Ireland has a direct interest in runway capacity in the south-east, and we want a decision on the issue raised by the hon. Member for Ilford North (Wes Streeting) as quickly as possible as well. Can the Chancellor assure me that the Treasury is talking to the Department of Finance in Northern Ireland and the Northern Ireland Executive so that Northern Ireland’s interests and concerns are very much in the thinking of Her Majesty’s Government?
Mr Osborne
That dialogue is taking place and I assure the right hon. Gentleman that it will continue to take place. We were on different sides of the argument when it came to the referendum, but he shares my view that Britain needs to be open to the world and trading with the world. That means having sufficient airport capacity to fly to the world and to allow the world to fly to us. I am sure that that view is universally accepted across the House, but we will find out.
The key challenge, to which I think we can rise, is working out through collective discussion and decision making the new relationship that we should seek with the European Union. Until we have agreed on an approach, we should not trigger article 50 and begin the process of exiting the European Union. As the Prime Minister said, “triggering article 50” is rightly a decision for the new Prime Minister and the new Government, and it is a decision that we will take at the right time, when we are ready and not before.
The economic uncertainty will have an impact on our public finances that is likely to be both cyclical and structural. The Office for Budget Responsibility will make its assessment of the economy this autumn—let me tell the shadow Chancellor that, to get the best possible forecast from the OBR, we have to wait a little for the dust to settle—and it will be for the new Government under a new Prime Minister to take the decisions about the adjustments that will be required to meet the new fiscal realities, but we should never forget that fiscal stability is the absolute bedrock of economic security. We must be realistic, but I want to reassure the House that our economy remains competitive and open for business—we have the lowest corporate taxes in the G20, more people in work than ever before thanks to our welfare reforms, and our science and our universities are world class.
Let me pick up on a point that has been made throughout the debate in the country and in Parliament. We need to go on forging our links with key partners beyond Europe, such as with China and India. I never thought that we had to choose between Europe and forging new links with the rest of the world. Germany exports three times as much as we do to China, so it is clearly possible to do that within the European Union, but outside the European Union those links are more important than ever before.
I will travel to China next month as part of the G20 Finance Ministers meeting there. To pick up on a point that my hon. Friend the Member for Harrow East (Bob Blackman) made in an intervention, I have spoken to the US Treasury Secretary and the Speaker of Congress in the past couple of days about strengthening our ties with our great ally, America.
Kevin Hollinrake (Thirsk and Malton) (Con)
Does the Chancellor agree that it is about not just new trade deals but the supply chains that he mentioned earlier and building those customer relationships over many decades, as we have with the European Union? We simply cannot take our trade from Europe one day and move it to the US or China the next.
Mr Osborne
My hon. Friend is completely right, but we should not have to choose between the two. It is perfectly possible to do a lot more business with India, America and China while also doing a lot of business with Europe. That would be a key part of Britain’s economic strength in the future. As I have said, in respecting the decision of the British people to leave the EU, we should now be seeking the closest possible terms of trade with the EU not just in goods but in services, including financial services.
The third and final part of the plan that we need to pursue was touched on by the shadow Chancellor—we think of it as a social issue, but it has economic ramifications as well—and that is that we must unite across the political spectrum and offer a very loud and clear message to this country that we have no tolerance of intolerance, hatred and bigotry. We need to send a message of reassurance to all the communities in our very successful, multi-faith, multi-race democracy that we will not tolerate those who want to divide us.
The reports of the graffiti on the Polish community centre in Hammersmith, of the people who have lived in this country for decades being told, “We voted you out”; and of the figures that have shown a big increase in the report of hate crimes all point to incidences that are appalling and unacceptable. It is not the British way. We should unite in condemning it. The Prime Minister and the Under-Secretary of State for the Home Department, my hon. Friend the Member for Staffordshire Moorlands (Karen Bradley), set out some of the additional steps that we are taking to combat this intolerance, but in this economic debate I say to business leaders that they should also play their part and make it clear that intimidating bullying of any kind in the workplace based on nationality or race should be identified and punished. Britain is an open, tolerant and diverse society where people of all faiths and none and of all nationalities and ways of life are welcome, as they have helped to build this successful country.
Therefore, there are three key things that we need to do now: go on ensuring financial stability; ensure that we resolve the economic uncertainty by working together to determine the model for our new relationship with the EU; and send out a strong message that we will not tolerate intolerance. If we deliver on those three parts of the plan, we will be doing the best we can to make this decision work for Britain and to fulfil the instructions of the British people. I must be straight with people in this country: the weeks and months ahead will not be easy, but, as has always been the case in our history, it is during the moments of greatest challenge that our country must demonstrate its greatest resolve, and it often does.
The Chief Secretary to the Treasury (Greg Hands)
I thank the Opposition for tabling this motion and giving the House the opportunity to reflect on the momentous events of the past week. I also congratulate the hon. Member for Salford and Eccles (Rebecca Long Bailey) on her meteoric promotion to the shadow Cabinet. My right hon. Friend the Chancellor has already congratulated her, but I thought it worth repeating in case there have been any further changes in the past three hours. In all seriousness, I welcome her to her role, and I wish her good fortune in what could be a difficult time in the Labour party.
It is two weeks to the day since we last gathered in the Chamber to debate whether it was in our best interest to stay in the EU, or whether to plot our own course ahead—indeed, I had the last word for the Government in that debate, but we have seen what can happen in two weeks. I said that although I believed the EU needed reform we were better off in. Many hon. Members on both sides of the House spoke in support of that view, just as others—again, on both sides of the House—put the case to leave. That is the mark of a good democracy. With such a big decision about our future, it was right that the ultimate choice was for the people who make this country what it is. In the past few months and years, this has not been a question confined to the halls of Westminster. It is one that has been debated in homes and streets, on the way to school and on the way to work.
Last Thursday, we braved a typical British summer in large numbers to each have our own say on the question. That is the mark of a healthy democracy. Now we have made the collective choice to leave the European Union, countries around the world will see at least that Britain has a Government who listen to the direction its people set and plot their course accordingly. I am sure my hon. Friends will agree that that is the mark of a true democracy.
Stephen Gethins
On the mark of a true democracy—I made this point earlier—does the Minister agree that we should have a timetable to scrap the House of Lords, given the vote about democracy?
Greg Hands
This may come as news to the hon. Gentleman—he was not here in the previous Parliament, although some of his SNP colleagues were—but we had a very extensive set of debates, including a number of votes, on the future of the House of Lords. I do not think that, at this time of great interest in the nation’s constitutional affairs, another debate about the future of the House of Lords would be sensible.
We heard some very good speeches, including from my hon. Friend the Member for South Suffolk (James Cartlidge). I agree with him that it is no use going back to what might have happened. We need to move forward in reasserting our strengths as a nation and as an economy. I could not agree with him more that we need to continue with a fiscally prudent regime and build a surplus before the end of this Parliament.
George Kerevan
Is the Minister therefore saying that the Treasury is still committed to running a budget surplus in 2019, come what may?
Greg Hands
The fiscal rules provide for action in the event of particular eventualities. I do not see a need to revise the rules at the moment. We move forward from here. The most important thing is for all of us to unite in moving forward and to make the best possible case for our renegotiation in the European Union.
We heard from the right hon. Member for Birmingham, Hodge Hill (Liam Byrne), who is a predecessor of mine in this role. I totally agree with him about being loud and clear on the rights of existing EU nationals in this country. I can tell him that my own wife, Frau Hands, would very much agree with him as well.
Greg Hands
I am going to talk a little more about the debate.
My hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) made a very powerful speech, referring to his very strong business background. Like me, he strongly supported the remain campaign. He made strong points about business and the importance of making sure we secure business and trade in our new arrangements.
The hon. Member for Ilford North (Wes Streeting) said he is one of the youngest Members of this House and that he had not been alive when the country had been outside the European Union, which is food for thought. All the years he has been alive, the country has been in the European Union. He was right to say that if an economy goes wrong, it is very likely to be the poor who suffer most. That would also apply in London, which we both represent. He issued a warning to the skeleton Front Bench of his own party. It is not appropriate for me to reflect too much on that, but I am sure his points landed with those he wished to make them to.
My hon. Friend the Member for Bexhill and Battle (Huw Merriman) made a strong contribution. He made an interesting observation at the beginning of it, when he said he hosted debates with high-quality speakers in his constituency and came away thinking that they did not seem to sway voters either way. He also said that the economy will bounce back if we act with resolve, which was an important point.
We then heard three speeches from Scottish National party Members—the hon. Members for Kirkcaldy and Cowdenbeath (Roger Mullin), for Ross, Skye and Lochaber (Ian Blackford) and for North East Fife (Stephen Gethins)—and I have taken a couple of interventions from them. They made impassioned speeches and some pretty familiar points.
Greg Hands
No, I will carry on.
The result may not have been what some of us wanted, hoped for or even expected, but that does not mean that the Government were unprepared for it. In the past six years, we have been working hard to bring our economy back from the brink and get our public finances back under control. We said we needed to fix the roof for any economic storms ahead, and that is what we have done. We have brought down the deficit, and we have steady growth, record employment and a resilient financial system, which we spent the past six years strengthening.
We have done the analysis on what leaving the EU might mean, and considered the potential impacts on our economy in both the short and the long term. There was general consensus in the House a fortnight ago on the risks we might face, so hon. Members recognise that it will not be plain sailing and that there are challenges ahead, but thanks to the measures we have taken over the past six years our economy is as well prepared as it could be to face whatever comes our way.
We anticipated that there would be an immediate impact on the value of our currency and the stability of the financial markets. The Treasury, the Bank of England and the Financial Conduct Authority have extensive contingency plans in place and we are watching the markets closely. Although we have seen volatility, the markets nevertheless continue to function effectively.
The Prudential Regulation Authority has worked closely with major financial institutions to prepare extensively for the consequences of a vote to leave. The Bank of England stress tests show that UK banks have enough capital and liquidity reserves to withstand a scenario more severe than the country currently faces. Thanks to our work to strengthen our financial stability, banks in the UK have raised more than £130 billion of additional capital in the past six years, and have more than £600 billion in liquid assets to ensure that they can keep lending to UK businesses and households during challenging times. The Bank of England can provide more than £250 billion of additional funds to support the banks and the smooth functioning of the markets. It can also provide liquidity in foreign currency if required. The authorities have all the necessary tools in place to protect financial stability. They are monitoring developments closely and will not hesitate to take further measures as required.
As we embark upon the renegotiation of our relationship with the EU, I reiterate the reassurances of the Prime Minister that the result does not mean that everything changes overnight. For British subjects living in the EU and EU citizens living in this country, there will be no immediate changes. People can still travel across the EU, businesses can trade as they did and our services can be sold as before.
The Prime Minister has been clear that there will be no immediate triggering of article 50, the procedure by which a member state can leave the EU. That gives us time to plan the new arrangements we are seeking with our European friends and neighbours. It also gives the Prime Minister’s successor the opportunity to make any adjustments to economic policy and our public spending, informed by an assessment of our economic situation from the independent Office for Budget Responsibility this autumn. In the meantime, we will continue to work hard to maintain the fiscal stability we have always worked so hard to deliver. A new unit will be set up in Whitehall bringing together experts from across the civil service, and in answer to the right hon. Member for Birmingham, Hodge Hill I can say that it will extend right across Whitehall, including all Departments likely to be affected, and that it will be given the resources it needs.
Greg Hands
Yes, it will include the Home Office, and it will advise on the many options we face as we determine our future relationship with the EU. As Chief Secretary to the Treasury, I expect to play my own part in that task over the coming months.
Danny Kinahan
Does the Minister agree that the unit needs to consider how we hold the Union together and build the relationships between Scotland, England, Wales and Northern Ireland, given the direction in which Scotland seems to want to move and the need to maintain our relationship and trade with Ireland?
Greg Hands
I thank the hon. Gentleman for his intervention. Of course, we have to keep on board all the devolved Administrations and make sure we get the right deal for all the nations of this country and, indeed, for Gibraltar. I know that different parts of the UK voted different ways—my constituency voted 70% to remain—but we must come together and ask for, and get, the best possible deal for the UK as a whole in the negotiations. That is absolutely the key point. This is not a time for division between our nations and communities.
Now is also the time to heal divisions in the country and in our communities. I was one of the first to condemn the disgraceful attack this weekend on the Polski Osrodek Spoleczno-Kulturalny—POSK—which is in what used to be my constituency in Hammersmith. I was delighted that—people have commented on this—perhaps for the first time in 20 years the hon. Member for Hammersmith (Andy Slaughter) and I have found something to agree on. We were retweeting each other in condemnation of the attack. It was an absolutely disgraceful attack on the Polish community in particular and on EU nationals and foreigners in general.
There was some irony there. I am not sure that the people responsible had any sense of what POSK did. POSK was set up in the 1960s. It had nothing to do with EU freedom of movement and labour or our joining the EU in 1973—even if it did, of course, the attack would still not have been correct. POSK was founded back in the 1960s, as a focal centre for the local Polish community, many of whom fought shoulder to shoulder with British servicemen in the second world war, fighting for our values and protecting our way of life. Never has the word “solidarity” felt more appropriate in how we reach out to the Polish community and other EU communities in this country. Sadly, that attack was not the only incident of xenophobia across the country, but every right-thinking person, on both sides of the House and the referendum debate will see them for what they are: ignorant and unwelcome displays of hatred, which have no part to play in the future of this country.
Both professionally, as the representative of a constituency where about 17% of local people are EU nationals and which benefits from their contribution, and personally, as the husband of a German wife and father of half-German children—they were in tears on Friday morning after hearing the referendum result—I want to send the message loud and clear from this Chamber that our fellow Europeans are still welcome in the UK, as are those from beyond the continent.
Lyn Brown (West Ham) (Lab)
I had an Italian constituent in tears on Saturday—she had been here for 30 years and had raised her family here—asking whether we were going to deport her and her children. We need to get a grip and the Government need to get a plan.
Greg Hands
The Government have been loud and clear in condemning these events, and a statement was made earlier on what the Government are doing in response. A vote to leave the EU is not a vote for hatred and intolerance; it is not a vote to turn our backs on our European friends; and it is not a vote to pull up the drawbridge and turn away from the world. At the same time as we find the best way forward for this country, we must uphold the very best values.
This debate has moved on from a fortnight ago. It is no longer a question of whether we should leave the EU, but how. We have got our decision; now is the time for all of us to roll up our sleeves, get on with the job and keep building the best future for this country. I have every confidence that this is precisely what our hard-working people will do; it is precisely what our businesses will do; and it is precisely what this Government will do. Investors across the world will see that our economy is fundamentally strong and that we are still very much open for business. In government, we will continue to build on those foundations to seek the best opportunities for people across the UK. That has always been our aim, and it will remain our aim as we plan the way ahead.
Question put and agreed to.
Resolved,
That this House recognises the risks posed to the UK economy following the decision to leave the European Union; notes with concern the loss of the UK’s triple A credit rating, the potential output cut, potential job losses, risks to investment and the volatility in the equity and currency markets; and calls on the Government to bring forward measures to protect jobs and support businesses in the nations and regions in relation to the short, medium and long-term potential consequences of the referendum decision, and to address the current threats to community cohesion.