Brexit: Dispute Resolution and Enforcement (European Union Committee Report)

Baroness Hayter of Kentish Town Excerpts

Wednesday 17th October 2018 Lords Chamber

[Baroness Hayter of Kentish Town (Lab)]

It is always a pleasure to follow the noble Baroness, Lady Ludford. I am afraid we are becoming a bit of a double act. I am not sure it is one the Minister always appreciates, but there you are—it is his penalty in life.

I also thank my noble friend Lady Kennedy of The Shaws, and her committee, for yet another insightful, clear and informative report. Like the noble Lord, Lord Hannay, I only wish that the Government could be as clear and incisive—and also, perhaps, speedy, as the noble and learned Lord, Lord Hope, so politely put it—on how they propose to deal with the issues raised in the report.

Perhaps the most urgent issue raised in the paper—although there is competition for urgency—is the one on which the Government have said the least, which considers any disputes arising from the withdrawal agreement. Both my noble friends Lady Kennedy and Lord Anderson of Swansea have quoted Michel Barnier as calling this the second most difficult issue after Ireland.

I remind the Minister that, on Monday, the Prime Minister claimed that real progress had been made on the withdrawal agreement, with,

“the shape of the deal across the vast majority … now clear”.—[Official Report, Commons, 15/10/18; col. 409.]

Yet the response to this report from the Government states that the dispute resolution mechanism “is a matter for negotiation”.

So I ask the question, along with that posed by the noble Earl, Lord Kinnoull: if it is subject to negotiation, how is that going? Has it been negotiated and, if so, what is it? Is there to be an arbitration panel, or is the ECJ itself to do the dispute resolution during transition? As my noble friend Lord Judd said, in case anyone has forgotten, time is getting very short. We should by now have rather more detail than we have been given, both about the withdrawal Joint Committee and also about any arbitration panel being discussed. Who will be the members, particularly on the Joint Committee? What will be its terms of reference? Will it be a transparent body? Will its meetings be open? Will its decisions, and the reasoning behind them, be made public?

The Joint Committee, as we know, has the,

“power to adopt decisions and to make recommendations”,

and that power is to be reached “by mutual consent”. But what if such an accord cannot be reached?

Anyway, one must assume that the committee—which, I assume, will be made up of political persons appointed by the two sides—will not actually be independent, but will be a purely political negotiating entity. The question arises: who could take issues to that Joint Committee? Given that businesses, and indeed citizens, may want to challenge both the interpretation and the implementation of the withdrawal agreement, will they have access to that Joint Committee, or to any arbitration panel that is established, should the implementation disadvantage them? If they do not have that direct access, will our Government have a mechanism for referring any business disputes to an arbitration panel, or some other way of enabling those issues to be raised? As my noble friend Lady Kennedy said, while the Government seem to accept that dispute resolution should be accessible, they have given no information on how this might be achieved.

Turning to the Joint Committee itself, which—if we have read it correctly—might only meet once a year, does the Minister actually think that this is going to be adequate to deal with all the queries that could arise? Will the Minister also say something about the enforcement mechanism for any finding from the Joint Committee or, indeed, from any arbitration panel?

The EU agencies of which we are currently members have been mentioned. When is it envisaged that we would leave these, assuming that there is a deal? Alternatively, if, in transition, we remain members and the Government accept that we would abide by the rules and “respect the remit” of the CJEU in that regard, would that also entail businesses being able to take relevant issues to the CJEU if they were party to any of the cases being held there? As with the withdrawal agreement query, would businesses and citizens have the same rights as now, not only for their disputes to be heard but to any remedy should a case be found in their favour?

The EU Committee noted that the Government seemed rather sanguine about being subject to the CJEU in certain circumstances while having no UK judges there. Whether or not the Government think it would be helpful to maintain a UK presence there, has the issue even been raised in negotiations? I have heard suggestions that this would not be completely unthinkable. As raised by the noble Lord, Lord Anderson of Ipswich, should a longer transition now be envisaged, that matter might become even more pertinent. It would therefore be helpful to know whether such discussions have taken place with the EU. Will the Minister also give some thought to the interesting proposal from the noble Lord, Lord Thomas of Gresford, for a special committee in the CJEU? It is beyond my remit to comment on the legality of such a proposal.

Turning to the civil, family and commercial issues—including insolvency, as stressed by the noble Earl, Lord Kinnoull—will the Minister update the House on negotiations relating to the recognition and enforcement of judgments across the EU after exit day, with particular reference to divorce, maintenance, adoption and child custody, in the way described by the noble Baroness, Lady Shackleton? There is real urgency in this—the committee said it had “significant concerns” in its recent letter to the Lord Chancellor—because families form or change according to timetables completely unrelated to the Government’s priorities. As we have heard, lawyers in this field worry that children will be badly affected if there is any uncertainty at the time we leave.

Regarding lawyers themselves, the Government’s response to the report states that during the transition,

“our lawyers will maintain their rights of audience”,

at the CJEU. Can the Minister confirm that this has been agreed by the court and the Commission and that it applies to all cases, not just those to which the Government are a party? Will he also inform the House what discussions have taken place regarding the ability of UK lawyers to retain rights of audience at courts within member states, on the same sort of fly-in, fly-out basis as now, during the transition period, where a UK national or business is party to a case in one of those domestic tribunals?

There are big issues facing our country and our negotiators, both today, as we have heard, and in the days and weeks ahead. There are political challenges within the Prime Minister’s own party and there has been a failure—so far—to agree a deal likely to win support among the EU 27 and, indeed, in the House of Commons. It would be unpardonable to complete a deal without having in place robust, open and transparent mechanisms for ironing out future difficulties and disagreements, and even more so to leave our citizens—such as families dealing with adoption, maintenance or divorce—or businesses without clear, reciprocal, fair and transparent legal processes to replace those now in operation, as described by the noble Lord, Lord Bilimoria.

This report covers some of these issues, as have others by the same committee. Answers from the Government are needed in order to offer certainty to everyone likely to face difficulties as a result of our withdrawal, even assuming that we have a deal. Needless to say, however, the no deal scenario is even more worrying, with very little comfort coming from the Government’s technical notices—as I think they are called—on handling civil legal cases involving EU countries, in that situation. As we have heard, tried-and- tested EU rules currently determine which country’s court will hear cross-border civil, commercial or family law cases, and how judgments in one member state are recognised and enforced in another, mainly on the basis of reciprocity. Without a deal, such co-operation will fall away, possibly on 1 April.

This paper—the so-called advice from the Government—states only that any party to such a cross-border dispute would need to consider the effect of these changes on any existing or future cases, or seek professional advice. It is, however, precisely the professionals who need to hear what the Government intend, because they will be unable to advise their clients without that clarity. Family lawyers are highly alarmed about the implications of the sudden withdrawal of co-operation, recognition of judgments and lack of enforcement. We are talking about families—families who are divorcing, dividing assets or arguing over custody of their children.

Some Brexiteers may say that no deal is perfectly bearable, probably because they will not suffer the costs. It will be families that take the hit if the negotiators fail in their task, or give in to extreme Brexiteers who seem to think that no deal is acceptable to the UK. Will the Minister, therefore, take these concerns back to those of his friends who are in that group? Will he make sure that we do not face that outcome?

However, assuming for the moment that there is a deal—let us be positive—we, and indeed the businesses or individuals who may be affected by it, still need far more clarity on the issues raised today about disputes over either the interpretation or the implementation of the withdrawal deal. We look forward to the Minister’s response.

Brexit: EU Commission

Baroness Hayter of Kentish Town Excerpts

Wednesday 10th October 2018 Lords Chamber

[Lord Callanan]

I am afraid I am unable to give a precise timescale at the moment. We are negotiating. At this moment our negotiating teams are meeting in Brussels and we are confident of a deal. As soon as we have one that we can share with the noble Lord, I will be sure to let him know.

[Baroness Hayter of Kentish Town (Lab)]

I note that the Minister continues to use the words “implementation period”. Will he now admit that after the end of March we will still be in negotiations and it will be a transition period because negotiations will be carrying on and we will not have the sort of deal that simply needs implementing? Does he agree that in future it is about a transition not an implementation period?

[Lord Callanan]

No I do not agree with the noble Baroness. It is an implementation period. We expect to agree the withdrawal agreement and the future economic partnership in the next few weeks—in the autumn—and the implementation period will be about implementing that deal.

Brexit: Negotiations

Baroness Hayter of Kentish Town Excerpts

Tuesday 9th October 2018 Lords Chamber

[Baroness Hayter of Kentish Town (Lab)]

I thank the Minister for repeating the Statement but I wonder whether the Government actually own a calendar. After 18 months, and just 171 days before we are due to leave, we have more pages on no deal than on the deal, or indeed on the framework for our future relationship. Do the Government really want us to crash out despite the warm words we just heard in the Statement, or dare they not set out their plans given their fear of the Eurosceptics on their own party Benches?

The Government promised that the deal to be put to Parliament will include a “clear blueprint” for our future relationship with the EU. When will we see this blueprint? I had thought we would see a draft tomorrow but I gather it has now been delayed—perhaps because it is so vague that it is more a leap into the unknown than a blueprint for future policy. Or does the Minister think there is a third way—neither Chequers nor no deal—as David Davis set out today in his letter to MPs, albeit one he was not able to negotiate himself during two years as Secretary of State? Or perhaps the Minister thinks, along with Jacob Rees-Mogg, that we should have a “supercalifragilisticexpialidocious Canada”—hardly a game for serious negotiators.

Given that the Government have effectively and finally retreated from their claim that a deal would be done by October, could the Minister be a little more specific than “autumn” as to when he anticipates it will be done and when the deal will be brought to this House, as required in legislation? What assurances can he give the House that the Government’s solemn commitment to a legally binding backstop in Northern Ireland “in all circumstances” will be honoured? Have the Government accepted the view of this House that the UK should be in a customs union with the EU to ensure frictionless trade? This is not only important in itself, but the only viable solution to the Irish border.

The Statement includes,

“the commitment that no new regulatory barriers should be created between Northern Ireland and the rest of the UK unless the Northern Ireland Executive and Assembly agree”,

which leaves the door open. This possibility is, of course, what would lead to a border in the sea despite the assurances just given in the Commons and repeated. Different rules in two areas mean checks between the two. That possibility—mentioning only the Northern Ireland Executive and the Assembly—also raises questions about the role this Parliament would have in any such change, and it challenges earlier government undertakings of no diminution of standards or rights, since any regulatory boundaries between Belfast and London sounds like different standards between the two.

The Statement says:

“The UK’s White Paper proposals are the best way of ensuring there is continued frictionless trade in goods after Britain leaves the EU”.


It still sounds like “Chequers or no deal” despite, as we know, Chequers being acceptable to neither this Parliament nor our EU allies. The no-deal option is not acceptable to business, the public, our allies or, indeed, to Parliament, let alone to the people of Ireland and Northern Ireland, where there would have to be an immediate border.

The last time I asked the Minister whether he had been to the port of Dover, he said he had not. Has he now been, and has he discussed a no-deal option at the port? I was in Rotterdam yesterday, where thought, planning and preparation is in hand at its massive port to deal with a no-deal outcome—preparation to safeguard its economy and trade. Has the Minister any shame about how less prepared the UK—the country that filed for divorce—is for such an eventuality? Has he digested, as I have had to, these 77 technical notices, which alert us to green cards being reissued? Many in this House are old enough to remember those—down the other end, less so.

There is also the possibility of new driving licences being needed; the end of free movement of trade, with customs and tariff checks; the adoption of new classifications of goods, with a wonderful example given of how a grand piano would be classified if exported to the EU; the end of “goods on the market” rules; data exchange challenges; drastic changes to civil law enforcement; the end of mutual recognition of testing for safety of consumer goods; and uncertainty over travel to the EU. Are these all issues that the Minister feels it is reasonable to threaten at the end of March? As the CBI states, serious disruption will be caused to business and families. Is the Minister really serious that that is a realistic option for our country, and is it useful for the Government to threaten to refuse to pay the £39 billion divorce settlement if the EU fails to give Britain a precise future trade deal within weeks, when it is the UK that cannot get unity on its own Benches within its own Parliament on a future trade deal?

This House needs to know where the Government stand on the deal they want, and particularly on our future relationship. It needs to know whether they are with Steve Baker, who seems to prioritise a trade deal that leaves us independent over and above a trade deal that is good for the economy, or with Boris Johnson, who says that we should “chuck Chequers” and have a super-Canada FTA, spending money on,

“all the customs procedures … needed to ensure … frictionless trade, and to prepare … for a WTO deal”.

It seems he does not understand that frictionless trade comes from having the same regulations and rules rather than having a barrier of border agents checking for all the disparities in rules and regulations.

Regrettably, we are no clearer from this Statement than from what we have been reading in the press over the summer. Because I am a great optimist, I just hope that beneath everything that is going on there is serious negotiation taking place below the water level so that we can find a deal that is neither Chequers, as that is not acceptable, nor no deal, but a deal that is good for the whole economy across the whole country.

[Lord Wallace of Saltaire (LD)]

My Lords, I start by remarking that I went to the Printed Paper Office to ask for a copy of the Written Ministerial Statement and technical notices that have been published today, but they were not available. I find that very regrettable, as we need to be informed about these things, and I hope that the Minister will ensure that on the next occasion the Written Statement is available.

I find this a profoundly worrying and in some ways surreal Statement. It talks about preparing the UK for Brexit, irrespective of the outcome of the negotiations—in other words, if necessary at the end of March to break all our relations with the European Union. Can the Minister assure us that the British Government are really prepared for that? As the noble Baroness has just said, Rotterdam is well in advance of the port of Dover in its preparations. We are beginning to train the extra customs officials that we would like and to reverse the cut in the number of Border Force officers that the Government have pushed through in the last three years, but there is no way that we can do that between now and March.

I find the confusion within the Government deeply worrying. For example, the Home Secretary has said that we will have the same visa regime for European exchanges as we have now for the rest of the world. In the last two weeks, I have been collecting a certain amount of evidence on how far universities are suffering from the refusal of the visa authorities to allow academic and scientific researchers from outside the EEA to attend conferences in Britain. If we start doing that to the EEA next April, we shall blow up half the networks for scientific research that we have in this country. I speak with particular passion because my son is involved in many of them.

There are elements here which one can really only be humorous about. I congratulate the Government on the element of irony in the Statement with the reference to their pragmatism and the suggestion that it is the European Union that is being rigid while the Conservative Party, which is so well represented on those Benches, is being entirely pragmatic.

On the Northern Ireland issue, I recognise that this is the Conservative and Unionist Party, which by its rigidity in dealing with the Irish problem over 100 years ago contributed to the division of Ireland. It seems to me that now its rigidity may well risk losing not only Northern Ireland but also potentially Scotland. I wonder whether the Government have considered taking more seriously Boris Johnson’s proposal to build a bridge across the Irish Sea. It would have a number of advantages. We could maintain the temporary customs arrangement until the bridge was completed and opened, which would certainly take us 20 or 30 years, and if one were to construct the bridge in such a way that there was room for customs arrangements to be conducted on the bridge, it could become a garden bridge in the event that those arrangements were not needed.

To move on, my wife has just been to a conference in Geneva to discuss as a model EU-Swiss relations, on which she has been an expert for some years, and the question of whether the Liechtenstein model should be taken more seriously. As some people will know, it has a customs union with both Switzerland and the European Union. That seems almost as attractive as the Jersey model, which has been talked about by various sources. The Government refer to their “ambition”, but ambition that would perhaps take us as far as being like Liechtenstein or Jersey is really beyond a joke.

On the question of how we get from here to April, I ask the Minister how far the Government will take the other parties into their confidence over the management of the business that is required. We do not know what has happened to the Trade Bill. When are we going to continue with its Committee stage? What other major pieces of legislation do we need to take through between now and March? The Institute for Government has just produced a report on the very large number of statutory instruments that we will need to consider between now and March. Can the Minister assure us that both Houses will be given time to consider these legislative instruments properly and that they will not be bulldozed through in a panic at the last minute?

I should like to move on to the subject of the future relationship. There was no reference to it in this Statement or to any sort of declaration about our future foreign policy and defence relationships. Again, the Government seem to be in great confusion on this. We have a new Foreign Secretary, who compares the European Union to the Soviet Union. Clearly, we would not wish to maintain foreign policy and defence relationships with an area that was naturally so hostile, yet for the last 40 years much of Britain’s foreign policy and security relationships externally have been conducted multilaterally in partnership with the European Union. When will the Government tell us a little more about what they consider to be important and what sort of pattern they intend the future relationship to have?

Perhaps most worrying is the reference in the Statement to a potential gap, in the case of a delay, between the end of the implementation period and the entry into force of the treaty on our future relationship. Do the Government consider that there may well be a hole whereby we have come to the end of the implementation period but have not yet negotiated a treaty on the future relationship and there is somehow a void, with no firm treaty foundation for the relationship between, say, 2021 and 2024 or 2025? If so, that is deeply worrying. I presume that that is the point at which we would go back to WTO terms, or perhaps that is another piece of loose wording in the Statement.

Brexit: No Deal

Baroness Hayter of Kentish Town Excerpts

Tuesday 11th September 2018 Lords Chamber

[Lord Callanan]

Yes. The withdrawal agreement—about which we spent many a happy hour debating in this House—enshrined that in statute. When we have negotiated a deal, it will be put to a so-called meaningful vote in the House of Commons and it will also be debated in this House.

[Baroness Hayter of Kentish Town (Lab)]

Many people in this House will be thinking about the D-day celebrations next year, and of course they will be the first since we will have withdrawn from the great lesson of the war which led to the setting up of the European Union.

If there was to be no deal, it is hard to know what would be the most fearful thing. Would it be that 2 million UK citizens living in the EU had lost their status? Would it be a hard border in the island of Ireland? Would it be the sudden VAT rules, rules of origin and tariff checks at the border? Perhaps it will be the faces of the Brexiteers who meant only to blow off the wheels, not crash the whole economy. The Government are saying that Chequers is the only game in town, but they are throwing millions into preparing for no deal. Will the Minister take a message back to the Secretary of State that Chequers really has no chance of flying and that, by November, we have to have a deal that is acceptable both to Parliament and to our partners in the EU?

[Lord Callanan]

I can agree with the very last part of the statement made by the noble Baroness. Yes, we want a deal that is acceptable to Parliament and acceptable to our partners in the EU.

Brexit: Financial Settlement

Baroness Hayter of Kentish Town Excerpts

Tuesday 11th September 2018 Lords Chamber

[Baroness Hayter of Kentish Town (Lab)]

Does it? It would be quite nice to hear from the noble Lord whether he really means that it would fall away. But whether or not the Government will honour the commitment they have given, can he confirm that they will honour the promises they made to our farmers, and indeed the recipients of other EU funds—whether structural or research money—to maintain the full amount that they receive from Brussels at the moment?

[Lord Callanan]

Yes, we stand by our commitments.

UK-EU Future Relationship: Young Voters

Baroness Hayter of Kentish Town Excerpts

Monday 10th September 2018 Lords Chamber

[Lord Callanan]

People have opportunities to record their opinion all the time. It is the nature of a democratic society. As people reach maturity, they vote in local council elections—or some do—and in general elections, and occasionally, one or two of them might even vote Liberal Democrat.

[Baroness Hayter of Kentish Town (Lab)]

The Minister’s colleague until very recently, Steve Baker, warns of a Conservative split if we stick to Chequers. Boris Johnson used his usual rather distasteful language also to undermine Chequers, and this morning, Simon Clarke of the ERG seemed to want anything other than Chequers, whereas the noble Lord, Lord Maude, in this House now supports the EEA. Whether the final deal is agreed by the Commons or by the people, is it not time that the Minister fessed up and admitted that this Chequers deal will simply never fly?

[Lord Callanan]

The noble Baroness has illustrated the breadth of opinion that there is on the subject in her party as well as in mine. All we can do as a Government is to set out a credible, realistic proposal. We are negotiating on that basis and waiting for a formal response from the European Commission. We will negotiate the best possible deal that we can for the United Kingdom and then, as we have said, we will put that agreement to a vote in the House of Commons and MPs will determine whether it meets with their approval.

Brexit: Negotiations and No-deal Contingency Planning

Baroness Hayter of Kentish Town Excerpts

Tuesday 4th September 2018 Lords Chamber

[Baroness Hayter of Kentish Town (Lab)]

My Lords, I thank the noble Lord for repeating the Statement. I welcome him back, though I regret that, while we were all at the seaside, his Government—as is clear from the Statement—have failed to provide a workable path through the morass of negotiating objectives. To quote Bloomberg:

“As politicians dither, Britain’s economy is taking a hit”,


with Brexit costing 2% of economic output, even before we have left.

During a summer of government squabbles, I spent time watching how fast lorries could load on to European ferries at the moment. I then went on to feel the effect of the falling pound, while hearing about the likely lack of Danish sperm—I kid you not—portaloos along the M20 and the ending of the EMA pharmaceutical approvals for our Medicines and Healthcare products Regulatory Agency. Meanwhile, I was reading Charlie Clutterbuck’s Bittersweet Brexit, though I have yet to find the sweet bit.

Meanwhile, back here, we have a plethora of groupings, mostly within the governing party. There is Better Brexit, Stand Up 4 Brexit, the ERG’s “Hell, any sort of Brexit”, David Davis’s “I won’t vote for Chequers” Brexit, Boris Johnson’s “diddly squat” Brexit, the Leave.EU members in the Conservative Party’s Brexit, an alternative Best For Britain Brexit, Macron’s “blind Brexit” or perhaps a Europe of concentric circles, a “half DExEU staff leaving” Brexit or even a “jump off the cliff” Brexit. These sound funny, but this is serious stuff. What is clear is that, 44 days before the October summit, Chequers will not fly. We said so at the time; we said that it ignored services, failed Northern Ireland and was logistically unworkable. We now know that the EU will not accept it, but neither will the House of Commons, where there is simply no majority for it.

So, please, no more nonsense of just “some risks” to no deal. And, please, let there be less money wasted on preparatory work which is somewhat otiose. We need a deal that can work. It is time that the Government got honest and ruled out no deal once and for all. It is time that the Prime Minister ended the uncertainty for UK citizens in the EU and for EU citizens here and made firm commitments not just “when” the agreement is “signed”, as in the Statement that the Minister has just read out, but now.

I agree strongly with the No. 10 spokesperson who said:

“What we need at this time is serious leadership with a serious plan”.


But that is not what this Statement provides. Indeed, a survey in the Conservatives’ most marginal seats showed that three-quarters are dissatisfied with the Government’s handling of Brexit—they clearly have judgment.

It is time for the Prime Minister to ditch her red lines and get real. If we want trade to thrive with our nearest neighbours, if we want to continue inward investment as a path into European markets, if we want to continue free flow of our food and agricultural products and if we want a border-free Ireland, we have to be in a customs union with the EU and we need a deal on services. We also have to recognise that while the withdrawal agreement has only—“only”—to win the approval of the Commons, the European Parliament and the European Council, the subsequent trade deal will need the consent of every member state, their various parliaments and assemblies. That will mean us negotiating a deal to win their support. Closing off doors now, with unrealistic demands, will mean only U-turns down the line.

It must be evident to this House that the Government must change course and propose a credible plan that can command the support of Parliament, protect jobs, the economy and the environment, avoid a hard border in Northern Ireland and be acceptable to our partners. The Statement that the Minister has read out gives us no confidence that that is the way that we are going. The Government have six weeks to get this right. More of the same will not do. So will the Minister pledge not just to listen to his hard-Brexit friends but to seek to navigate a way forward that can win parliamentary and EU endorsement?

[Baroness Ludford (LD)]

My Lords, the DExEU website today displayed a rather apt message:

“We’re experiencing technical difficulties. Please try again later”.


That perhaps sums up the incoherent, divided and irresponsible position—or, rather, positions—of this Government. That the Trade Secretary could on Sunday dismiss the Chancellor’s forecast of the need for extra borrowing of £80 billion by 2033 while staying in post shows the Prime Minister’s utter, weak inability to impose rationality or discipline on her Government. The Chequers plan is a dead parrot, so the important question is: where do the Government go from here? I would like an answer and I think that Parliament deserves an answer, as do the people.

The Statement claims that the no-deal notices, of which we expect another batch, “prioritise stability”. The way they seek to get any continuity at all in the event of no deal is, in fact, by relying on a series of mini-deals to prevent the absolute disaster of grounded planes and the absence of crucial trade. The Government are saying, “Please, Brussels, can you rescue us from our absurd no-deal threat?”

There will be a particular set of 5 million people who will be badly hit by no deal: the 3 million EU citizens in this country and the 2 million Brits in the rest of the EU. The failure to give a unilateral guarantee two years ago—which would have been reciprocated, as the noble Lord, Lord Lawson, said at the time—is creating an agonising limbo of anxiety and depression. Meanwhile, Brexiteers are moving assets or citizenship to other EU countries.

To get a little personal, I do not know whether the Prime Minister gets her glucose patches—on which I can comment, as she is commendably open about them—from abroad, but my type 1 diabetic husband gets his glucose sensors and insulin from elsewhere in the EU. There are many other people with medical conditions who are vitally dependent on such imports. That a Government could calmly contemplate upsetting such a flow and creating distress and potentially worse is breath-taking in its dereliction of a basic duty of care.

The prominence of no-deal planning seems to fulfil a number of purposes, all of them within the Tory party. It is a sop by the Prime Minister to the hard Brexiteers, who positively want this outcome, and a warning to the “chuck Chequers” brigade to accept Chequers as somewhat less bad. There are two things that it does not do: it does not put pressure on the Brussels negotiators and it does not inspire confidence in the public—on the contrary.

There is this sentence in the Statement:

“While it is not what we want, a no-deal scenario would bring some countervailing opportunities”.


This is obviously a bone thrown to the ERG faction. What exactly are the “countervailing opportunities” for small businesses losing their export markets, or patients losing their essential medical supplies? The no-deal scenario means lots more costs to businesses, higher prices for consumers, an avalanche of new bureaucracy—such as pharmaceutical companies having to register medicines twice, showing that EU red tape ain’t got nothing on Tory red, white and blue tape—and more taxpayers’ money spent on quangos and civil servants, stockpiling and so on.

Panasonic and Muji are but the latest companies to announce that they are moving their HQ across the Channel. We face this dire outcome because the Tory Government have proved totally unable to deliver a workable or tolerable Brexit deal. Indeed, not only do they provide absolutely no reassurance about how to resolve issues between the UK and Ireland in the event of no deal, they actually advise businesses and individuals to contact the Irish Government. We know that the Tory Government love outsourcing, but this surely goes shamefully too far in abdicating responsibility for the border communities.

Can the Minister tell us that the Government will reverse their refusal to guarantee that MPs will see the full impact analysis of a no-deal Brexit before the final vote on any departure from the EU? Both the previous and current Brexit Secretaries have, in the past, supported a second referendum, so presumably they think that it is a demonstration of democracy, exposing the PM’s comments as a sham. We on these Benches insist on a final say on the deal. We are joined, it is announced today, by 70% of Mumsnet subscribers: a very sensible bunch.

Brexit: Legislating for the Withdrawal Agreement

Baroness Hayter of Kentish Town Excerpts

Tuesday 24th July 2018 Lords Chamber

[Baroness Hayter of Kentish Town (Lab)]

I thank the Minister for repeating the Statement. Perhaps I may use this opportunity to clarify one exchange that I had with his colleague, the noble Baroness, Lady Goldie, on 20 July. We had anticipated this White Paper last week. As I am sure the Minister will recall, he said on 12 July at col. 996 that the White Paper would be published “next week”, which of course would have been last week. However, his boss, the Secretary of State, used the rather more familiar word and said that it would be published “shortly”, which is why it was able to slip over to this week.

We welcome the White Paper, which is always the best way of understanding and scrutinising a Bill. We congratulate the Government, clearly with me in their mind, on producing the document in time for me to pack it with my bucket and spade as I head off for my holidays, for it is what I will spend the time reading.

I am also glad that we will have the Bill. As the Minister will recall, in the original Bill introduced into this House, the whole of the implementation and withdrawal would have happened under Clause 9 by secondary legislation. We called for it to be under primary legislation and we are delighted that that change was made.

However, I am curious, and concerned, as to why there was no mention of Northern Ireland in the Statement. I understand that it may not be in the White Paper, because it is not yet agreed, but for there to be no mention of it when it is of such importance to us, to our partners and to Parliament was a little curious.

The other curiosity will concern those historians about whom the noble Lord, Lord Hennessy, spoke yesterday. Those historians may evince some surprise as to how much of the very recently passed European Union (Withdrawal) Act will now need to be repealed, starting at the beginning of that Act with Clause 1. As paragraph 56 of the White Paper makes clear,

“EU law will continue to have effect in the UK in the same way as now”,

during the implementation period; that is, until the end of December 2020.

One might ask how that can be, given that Section 5(1) of the EU withdrawal Act, which received Royal Assent just 28 days ago, removes the supremacy of EU law after exit day and that Section 1 repeals the European Communities Act 1972 on exit day. Of course, it is only that Act that gives legal authority for such direct effect of EU law. The answer, given in paragraph 60 of the White Paper, is that the implementation Bill will amend Section 1 of the withdrawal Act by saving the ECA, as has just been covered in the Statement.

Much the same will happen with the European Court of Justice. Clause 6(1)—sorry, but the Minister and I became a bit anoraky on the Bill and we understand all the section numbers—of the EU withdrawal Act just passed, removes the role of the ECJ on exit day, but Article 126 of the draft withdrawal agreement says that during transition, so from December 2020 the ECJ,

“shall have jurisdiction as provided for in the treaties”.

Paragraph 80 of this White Paper preserves its full role until December 2020. As my noble and learned friend Lord Goldsmith asked when we were scrutinising what is now Section 6, why do this, given we are going to have to repeal it very shortly?

A last example is Clause 5(4) of the withdrawal Act just passed, which extinguishes the Charter of Fundamental Rights on exit day, whereas Article 122, paragraph 1(a), of the draft agreement makes it clear that during the transition—that is, until December 2020—the whole chapter shall apply apart from those articles that enable us to be represented in the European Parliament. So another part of the new Act bites the dust.

Unless there is a withdrawal agreement to implement, this proposed legislation will not even be redundant, because it will not even be introduced. It will be introduced only once the agreement has been through Parliament, but then a whole range of rights, obligations and issues will be left without any legal foundation. As the Minister knows full well, a “no deal” would be a disaster for the UK in myriad ways. Can he confirm that, if there were to be no deal, there would be no agreement on citizens’ rights, no agreement on the financial settlement, no transitional arrangements and no arrangements in Northern Ireland, including any to ensure there is no hard border?

I turn to a point that we raised at some point last night—we were here until near midnight, and I am afraid I cannot remember exactly when it was—about the financial settlement. The Secretary of State spent the weekend emphasising that the UK would not pay anything without an agreement on the future framework. Yet the Chancellor of the Exchequer, who is of course in the same Government, has previous dismissed this possibility:

“That is just not a credible scenario; that is not the kind of country we are. Frankly, it would not make us a credible partner for future international agreements”.


Needless to say, I agree with the Chancellor of the Exchequer, but it would be useful to know whether the Minister does too.

Has that financial agreement really been agreed? It is about past commitments, not about buying future access to trade. It is because we were full members, signed up to various programmes as members, and our undertaking, as I have understood it from the Prime Minister, is that we will pay that regardless, not dependent on whether the future framework is agreed. Is that correct, as Mrs May said, or are we back to it being conditional?

A final word on the timetable: despite the claim, repeated frequently by the Minister, usually with a straight face, that everything will be agreed by October, even the framework for future relations, there are rather a lot of people, I have to say, in Brussels as well as here, who do not quite share his optimism. If, as seems perhaps more likely, the agreement is reached in November or December, perhaps he can explain how the Government can ensure that there is proper scrutiny and accountability to Parliament in what will be a very tight timetable. Given that I think that that is possible—I look towards the noble Lord the Chief Whip at this point—will it be possible to have a proper debate on this White Paper, so that when we get the Bill, which might be on a very tight timetable, we will have done a lot of the heavy lifting in advance?

Finally, I wish the Minister a very happy holidays. I have not always agreed with everything he has said, but he has brought commitment, hard work and real effort to persuade us of the right of his case, and I hope that he can get rid of that cough, enjoy a very good rest and come back, ready for the fray, well suntanned, well rested and up for perhaps a long Session after the summer.

Brexit: Parliamentary Processes

Baroness Hayter of Kentish Town Excerpts

Tuesday 24th July 2018 Lords Chamber

[Lord Callanan]

We will discuss the White Paper later, and the noble Baroness will have a chance to ask further questions on it then. The Executive are accountable to Parliament. DExEU Ministers have given evidence to a broad range of committees on a total of 37 occasions, we have made 108 Written Statements in both Houses, and I think we spent about eight hours last night discussing the very issues that the noble Baroness refers to.

[Baroness Hayter of Kentish Town (Lab)]

My Lords, it is perhaps fitting that John Major’s papers are released today. They show how he had to take on, and indeed vanquish, the Eurosceptic Rees-Mogg—that is, Rees-Mogg the elder. Can we hope that today’s Prime Minister will show the same courage with Rees-Mogg the younger, and can the Minister take seriously the need for the Government to find a negotiating mandate as to how we exit that would find favour not just within the governing party but within Parliament?

[Lord Callanan]

As we have said, Parliament will get a vote on the deal. We will discuss the legislation to implement that deal later, and there will be a parliamentary vote on the issue. We hope that it will find favour with Parliament, and no doubt we will extensively debate the legislation to implement it.

Brexit: Preparations and Negotiations

Baroness Hayter of Kentish Town Excerpts

Monday 23rd July 2018 Lords Chamber

[Baroness Hayter of Kentish Town (Lab)]

Well, my Lords, it is all going so well, is it not? Actually, I do not think even the Minister thinks so.

We are delighted to hear that the other White Paper will appear tomorrow. It was, of course, promised for last week, but we are delighted that it will be appearing. It would indeed be churlish not to welcome the appearance of this White Paper, albeit perhaps a year after it was needed, since it has to be reflected in the political declaration which describes the framework for future relations within the withdrawal agreement.

However, it is a White Paper that is: unacceptable to two Cabinet Ministers who had agreed it; unacceptable to the EU, which rubbished it; unacceptable to the Government, who accepted the ERG amendments that undermined it; unacceptable to much of industry, the City and business; unacceptable—I am sort of guessing—to this House; unacceptable to the Commons without DUP votes, Lib Dem no-shows, a handful of rogue Labour—

[Noble Lords]

Oh!

[Baroness Hayter of Kentish Town]

Have a bit of humour. I am saying, a handful of rogue Labour votes, and some dubious—

[Lord Wallace of Tankerness (LD)]

It is very clear that those Lib Dem votes would not have made a difference. How many Labour Members voted with the Government?

[Baroness Hayter of Kentish Town]

That is what I have just said. I called them rogue Labour votes. Clearly, the Minister did not help here. There was also some dubious government whipping—just in case noble Lords think anyone was left out.

And it is a White Paper unacceptable to the Opposition, being grounded on flawed facilitated customs arrangements, an absence of migration clarity, inadequate plans for services and a failure to guarantee the Good Friday agreement. Apart from that, it is pretty good.

Why is it so unacceptable? First, of course, it is based on a fallacy; secondly, it is devised to satisfy a divided Conservative Party rather than satisfy UK plc; and, thirdly, because some think that the talk of no deal will somehow bring everyone on board, yet pretending to threaten a no deal, which could cost households £1,000 and see an 8% drop in GDP—twice that in the north-east—is nonsensical if the Conservatives ever want to win an election again. Crashing the economy would never be forgiven, not just by workers and consumers but by business, the City and manufacturing, which have of course traditionally trusted the Tories to manage the economy in the national interest. Borrowing the words of a former Prime Minister from the party that took us into Europe and who herself wanted the single market, “No, no, no”—no deal is not an option, so we should stop being diverted by it.

For all the positives—and there are some, in the common rulebook, a role for the ECJ, which the noble Lord, Lord Campbell, has just mentioned, and a catalogue of issues almost lifted from the reports of our EU committees—the White Paper is based on the fallacy that there are profitable and exciting markets across the globe, currently closed to us, which would magically open the moment we left the EU. The notion that we are leaving in favour of some wondrous US trade deal better than we have with our nearest 500-million strong market, as well as the 57 agreements that we have through the EU, just does not hold water. It is a fantasy that we 60 million can negotiate better than the EU’s half a billion.

[Lord Anderson of Swansea (Lab)]

Is my noble friend aware that the European Union as a whole agreed a trade deal with Japan? Is it feasible that Britain on her own could improve on that deal?

[Baroness Hayter of Kentish Town]

It does not seem to have the evidence to support the idea that we could. Indeed, the trade policy experts, of which of course my noble friend is one, think that our status as a supplicant means that we will struggle to secure good deals, especially from the US, China and India—and, no doubt, Japan as well.

Furthermore, we face a highly protectionist President. What is his catchphrase? America First. He is a President who is unleashing trade wars with China, the EU, Canada and Mexico. He has filed five WTO complaints against his own trading partners and even queried the future of the WTO. He has imposed import tariffs on solar panels, washing machines, steel and aluminium. What does he want from the UK? When he is not calling the EU a “foe”, he claims that the EU has treated the US unfairly, so he wants more access to our market, not opening up their market to us. It is a predatory policy towards a Brexit Britain, designed to take advantage of our need for trade deals. He wants America to sell us more agriculture and cars—and I see that Liam Fox is offering to reduce tariffs on US cars imported here. I am not sure that that will help our automotive industry. Trump is not interested in a deal if we maintain EU standards. He says that the Prime Minister has probably killed off hopes of a deal by staying close to those EU standards.

And what of business? The CBI president says that, without a customs union, sectors of manufacturing risk becoming extinct. Following Chequers, more than 100 entrepreneurs and business leaders wrote:

“The cost, complexity and bureaucracy created by crashing out of the customs union and adopting alternative arrangements is the last thing that our businesses need as we seek to grow and employ more people”.


Your Lordships have often heard in this House from Airbus, Rolls-Royce, the Freight Transport Association and others, but there is a new example in UK publishing, the world’s largest exporter of books, one-third of them going to the European Union. The Publishers Association fears that Brexit could damage this, as:

“It’s not just tariffs … It’s the non-tariff barriers, customs checks and delays … That means having books sat in a customs warehouse in Calais rather than in a bookshop in Duesseldorf”.


Services are even more alarmed, not only as it is often impossible to distinguish goods from services, as complex manufactured products—for example, aircraft engines—combine servicing, design, IT, training and marketing into the physical components which get screwed together. Even more, banking, medicine, leisure, law, accountancy and IT comprise 80% of our economy and an even higher proportion of employment. Their healthy trade surplus helps to offset a deficit on manufactures and agriculture. Yet services drew the short straw in the White Paper, causing alarm to financial organisations and companies, which describe it as a,

“real blow for the UK’s financial and related professional services”.

The financial sector had anticipated a deal based on “mutual recognition”, with the EU accepting that its and our financial regulations were equally robust. The City was therefore deeply disappointed that this was abandoned in favour of an “expanded” equivalence, which is patchy and unilateral. The White Paper itself admits that we,

“will not have current levels of access”,

to EU markets, yet it is vague on how services and millions of jobs will be protected, and on how our competitive advantage will not be shipped to New York or the continent.

What do our partners think? The plan has yet to find favour with the Commission, which insists that the four freedoms are indivisible, added to which, we seem to want only the EU’s most talented citizens, apparently putting the rest in the queue with Koreans and others with whom we trade. The Commission doubts that the facilitated customs arrangement, which is hardly business-friendly, could be made to work, and has yet to be convinced that we have sorted out the Irish border.

As for the public, only 13% think that the Prime Minister is handling Brexit well, 75% judging that she is making a mess of it. They may be right about that. But it is not just remainers. The Labour Brexiteer John Mills reckons that the negotiations could hardly have been worse handled. Indeed, he goes further and says it is not clear that there is now a good Brexit solution available. Yesterday’s poll must make hard reading for the Government. They must know that the more they pretend that no deal is viable, the harder it will be to sell a negotiated deal as satisfactory. So all their dancing around a band of irreconcilable anti-Europeans itself undermines navigating a realistic way forward.

For Labour, the absence of a deal for services is a major shortcoming. This is not a “nice to have” add-on but key to our future prosperity. Both for Ireland and across the borders, the facilitated customs drivel is simply impractical. IT cannot check the safety of food in vans or the composition of manufactured goods to assure compliance with rules of origin, let alone the imposition and forward allocation of tariffs, which I think the noble Lord, Lord Forsyth, was querying.

The truth is that the Prime Minister is stranded in a mire of her own making. She tried to escape the clasp of the ERG, only to retreat at the first whiff of gunfire. She must now complete the task of facing it down, move away from its impossibilist demands, discard red or blue lines and step towards the majority opinion in Parliament—indeed, along the lines that Labour has long sketched out—embracing a customs union and a single market deal. The Prime Minister must unite the Commons and the country by prioritising the economy, jobs, agriculture and the environment, peace in Ireland, and the national interest.

Another former Conservative Prime Minister, Sir John Major, said yesterday that every Tory should prioritise “People, people, people”. That means negotiating a deal which is in their interests, and putting a good deal ahead of the Conservative party’s civil war. If the Prime Minister changes course, she can deliver a majority for that deal—a majority that this White Paper will not create.