European Union (Withdrawal) Act Debate
Full Debate: Read Full DebateDepartment: Department for International Trade
Lucy Powell
Main Page: Lucy Powell (Labour (Co-op) - Manchester Central)Department Debates - View all Lucy Powell's debates with the Department for International Trade
(5 years, 3 months ago)
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Dr Fox
That is why it is to our mutual advantage to get a free trade agreement with the European Union. I hear people say that it would be fine simply to leave purely on World Trade Organisation terms, but if WTO terms were so advantageous, we would not be looking to have a free trade agreement with the United States. It is very clear that free trade agreements are one of the ways in which we can overcome some of the restrictions on most favoured nation status. I imagine that it would be to the advantage of both parties—both the EU27 and the UK—to come to a free trade agreement of some form after we leave so that we can maximise that trade between us.
Dr Fox
I will give way again in a little while.
World trade is at a pivotal moment. We are at the intersection of a series of major global trends—trends so seismic that they have transformed or will transform economies and societies across the world. Services are now a larger part of the world economy than ever before, and they are more easily traded across borders thanks to the internet and digital telecommunications. We live in an emerging knowledge transfer-based trading system, where an engineering report, a 3D printer design, or new advances in machine learning can be just as valuable as the contents of a cargo container.
The transfer of services and expertise in things such as product design and software engineering are becoming ever more important. A revolution in e-commerce is now under way. It is already a major component of world trade—from some of the world’s largest corporations, such as Alibaba and Amazon, to the thousands of small companies that have never before been able to trade internationally. Major new opportunities are arising in the rapidly developing commercial and consumer markets of south-east Asia, Africa and Latin America, and it is essential that Britain leverages its unique strengths to realise them.
Lucy Powell
I thank the Secretary of State very much. Shortly after the referendum, when he first took up the post, he said that the day after we left the EU, which is now only a few weeks away, he would have dozens of trade deals ready to go. How is that going?
Dr Fox
Perhaps the hon. Lady was not listening to the answer I gave earlier, but that process is getting to the point where we are likely to be signing some of those agreements in the very near future, at which point we will put them to the House of Commons.
Not only has there been a revolution in e-commerce, but Britain’s consumers have embraced it, with about 20% of all goods in the UK bought online. At the same time—this is less well known—of all goods sold online, the UK is third globally behind only China and the United States. Last year, one in seven global online shoppers bought UK goods. It is therefore essential that we are able to operate an independent trade policy, allowing us to access the EU market, which remains hugely important to us, without tying our hands in relation to our ability to access markets in some of the world’s fastest-growing economies.
This deal enables us to develop a trade policy that will mean we can make the most of the opportunities of new technologies and the changing shape of the global economy, striking a balance between protecting the markets we already have and tapping into new and rapidly expanding markets elsewhere.
Dr Fox
I have to say in all candour to my hon. Friend that having spoken to a number of my colleagues in Norway, their advice was to retain the ability to have our own free trade agreement and not restrict our freedom in the way that they have.
This House confirmed that we would respect the result of the referendum when we voted overwhelmingly to trigger article 50 and begin the process of negotiations.
Dr Fox
I have already given way to the hon. Lady and I will not do so again.
This was further confirmed by the last general election in which the two main parties, comprising over 80% of the total votes cast, promised to respect the referendum result. Let us imagine that a second referendum were held in which the remain side won, perhaps with a narrow majority but with a lower turnout. Leave supporters like me could well begin demanding a third referendum, a best of three. Where would the process actually end? We have had a people’s vote and we need to respect the people’s vote. Another referendum would not settle the issue or heal our divisions—quite the opposite. It would further divide our already fractious country at a time when we need to come together.
There is also the constitutional issue. If we overturn this referendum result, we will be setting a precedent that could be applied to other referendums too. Furthermore, a second referendum would create prolonged, not diminished, political and economic uncertainty.
Barry Gardiner
I am delighted to say that the rest of my speech will be doing precisely that; I hope it will satisfy the right hon. Gentleman.
Alignment of standards is key to trade. That was properly recognised by the Minister for Trade Policy himself—sadly, he is not in his place at the moment—when he said:
“If we come out of alignment with EU regulations in this area, then there is a penalty to be paid in terms of frictionless trade with Europe.”
Of course, the idea that this particular American President is not going to demand greater access for American healthcare businesses into our NHS is simply a fantasy. So yes—I would love to do more business with the USA. It is already our major bilateral trading partner as a country rather than a bloc, but whatever benefits a trade agreement with it may bring must be weighed against the corresponding losses in our existing or any future trade agreement with the EU.
Lucy Powell
Is my hon. Friend aware that, before the referendum, the right hon. Member for Uxbridge and South Ruislip (Boris Johnson) said that staying in the single market was “essential and deliverable”?
Barry Gardiner
I am glad to say that the one thing that I can honestly claim I have no responsibility for are the words of the right hon. Gentleman.
When listening to some of the more extreme proponents of Brexit, it has often amused me to hear them say that trading with the European Union on World Trade Organisation terms would not be the slightest problem for us; in the same breath, they insist that to achieve our destiny we cannot possibly trade on WTO terms with the United States—and that that is why we need to break free from the EU.
The simple truth is this—I hope it answers the right hon. Gentleman’s question: it makes good sense to have good trade agreements with everyone, but to have the best trade agreements with our closest trading partners. For us, that is the EU, with which we do 53% of our trade and which takes 44% of our exports.
Lucy Powell (Manchester Central) (Lab/Co-op)
I also rise to speak against the deal, but it is clear that the House now needs an opportunity to show what it is for, as well as what it is against. I hope that in the coming days we will have the opportunity to do that.
As my hon. Friend the Member for Hove (Peter Kyle) so eloquently and brilliantly put it, the Prime Minister’s last-ditch attempts to reach out across party lines were too little, too late. Unfortunately, the Prime Minister has shown yet again a tin ear to Parliament. It is a real shame, because we did not need to be here now. She could have taken up the offers from the Leader of the Opposition to have cross-party talks. She could have taken the temperature of Parliament long before we got here. Maybe if she had done so we would not be here now.
We now face deadlock in the Commons while the country is crying out for us to deal with Brexit. I fear that entrenched positions are getting wider, divisions are getting deeper, and our political discourse is getting more and more toxic. Absolutism is ruling, when reaching out and building a compromise and consensus is what is needed. My sense, which I think is reflected in this debate, is that we are now reaching a point where there is a growing appetite for a consensus to be reached. However, there is clearly no majority in Parliament for the Prime Minister’s deal and there is no majority in Parliament for no deal. While I fully respect those who advocate for remain, there is equally no majority in Parliament for a second referendum. I fear that the strategy of all those concerned is to run out of road so that one of the options becomes the last one standing.
That is why I have come to the view that we need a plan B for when the deal is defeated tomorrow. I came together with my friend, the right hon. Member for Harlow (Robert Halfon), to co-author a report seeking a common market 2.0 option with the backing of the cross-party Norway Plus Group. I completely understand that many people want us to remain in the EU—we are better off economically and politically in the EU, and I used to be the director of Britain in Europe, for goodness’ sake—but I understand the sentiment that led to the Brexit vote in the first place, and I respect it. Part of the reason behind the vote was a deep scepticism about politics and politicians, so we cannot ignore or seek to overturn the result. We really cannot say, “Sorry, we cannot reach an agreement. Back to you guys.” What is more, referendums do not give rise to rational decisions on complex matters, either.
“Common Market 2.0” makes the case for a Brexit that delivers on the result of the 2016 referendum while protecting the economic interests of working people by becoming part of a new common market with the existing EU. It would create a long-term partnership that keeps us closely aligned and offers us real frictionless trade through full single market access and a new customs union. It would guarantee workers’ rights and provide new controls over free movement in certain circumstances. It would allow more money for public services, as our contributions would be significantly lower, and would give us a voice over the regulations that govern the single market. I know it is not a lot of people’s first choice or ideal, but it is an option for a plan B that we all need to consider.
Ministers and the Prime Minister have said many times that they want to know what Parliament is for, not just what it is against. I hope that over the coming days, we will be given the opportunity to say what we are for, and to come together and decide that sometimes we cannot get our ideal, but we need to have a plan B.
Mr Hammond
My hon. Friend is of course right. A number of hon. Members have appeared to suggest in their remarks that we might be absolutely worse off in certain circumstances. The analysis the Government have published shows that that is clearly not the case. The country will be better off. The economy will grow in every modelled outcome. The question is merely by how much.
I believe the great majority of right hon. and hon. Members have either come or will come to the same conclusion as me: that the only Brexit that will protect our economy for the long run while honouring the referendum decision is a negotiated, orderly agreed Brexit, with an implementation period to allow a smooth process from our membership of the EU to a future close partnership with the EU that protects the vital trade, economic security and cultural links between the UK and our neighbours—in short, a deal.
Lucy Powell
I thank the Chancellor for his generous comments earlier about my contribution. To be clear—I say this to offer an olive branch to the Government—the EEA, Norway-plus, common market 2.0 option would involve us voting for the withdrawal agreement, but with a different political declaration that would more closely align us with the single market and the customs union. He might want to think about that before dismissing it.
Mr Hammond
The hon. Lady acknowledges something that the Chancellor of the Duchy of Lancaster said in his contribution a couple of days ago. It is important for us to remember that any form of negotiated solution requires a withdrawal agreement, and that has to include provisions around the financial settlement, citizens’ rights and the Irish border. The EU has made it clear that it is not prepared to renegotiate the withdrawal agreement that has already been negotiated.
I am not suggesting that all those who recognise the need for a deal support the Prime Minister’s deal. I know that that is not true, but I want to make the case that this deal can provide a way forward for all those who support a deal. I want to explain why those who call for a deal, but not this deal, as a number of Members from all parts of the House have done—people who dream of a negotiated arrangement without the Irish backstop or of single market access without the entry fee and without free movement of people—are simply dreaming, because the deal that is on the table represents the high water mark. A withdrawal agreement is a necessary precondition to any negotiated deal with the EU and to any form of transition or implementation period. Without a withdrawal agreement, the EU will not negotiate any form of future relationship.
On citizens and money, we have reached good outcomes in the withdrawal agreement. On the Irish protocol, clearly none of us is comfortable with the temporary backstop arrangement, which is why all of us—the UK Government, the Irish Government and the EU—will be seeking to avoid its use under any circumstances and have committed to using our best endeavours to ensure that it will never be used and that in the unlikely event that it is, it is replaced by new arrangements as rapidly as possible. It is not a trivial point that the backstop fundamentally challenges the EU’s core principles.
We should be in no doubt, either, that the EU means what it says about the withdrawal agreement not being open for renegotiation. If we want a negotiated future relationship of any kind—I say this to the hon. Member for Manchester Central—it will be based on the withdrawal agreement that is before the House tonight.