Exiting the European Union: Sanctions

Debate between Meg Hillier and Hannah Bardell

Wednesday 19th July 2017 Commons Chamber

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

It is a great pleasure to follow two such excellent maiden speeches. I congratulate the hon. Member for Saffron Walden (Mrs Badenoch) on her speech. We share a background and a love for the London Assembly, of which we have both been members, and for Nigeria; I sense that she shares not just my love for it, but my frustration that that wonderful country still faces so many challenges. I look forward to working with her over the coming years. I also congratulate the hon. Member for Northampton South (Andrew Lewer) on his speech. He has described his interesting and illustrious predecessors, but his track record, both in Europe and as an excellent council leader, augurs well for his future here. I am sure that he will be named similarly in future maiden speeches. I welcome them both to this place.

Today, we are here to focus on exiting the European Union and sanctions. I want to discuss both those things—together and slightly separately—because they are very connected. I reiterate the comment made by my hon. Friend the Member for Bishop Auckland (Helen Goodman), which is: where is the Bill, Minister? We have already seen the publication of the grand repeal Bill, but this Bill has a pretty important connection with that. We cannot do the one without the other, and it really sums up, as the hon. Member for Livingston (Hannah Bardell) said, the challenges of how we timetable and deliver on this hugely challenging programme for our Parliament over the next 20 months. The Minister’s response to that from the Dispatch Box underlines the lack of planning that we have seen on the Public Accounts Committee, which I have had the privilege of chairing for the past two years, where we have repeatedly heard examples from permanent secretaries about the lack of planning—a deliberate policy.

For example, on 7 July, the permanent secretary to the Treasury confirmed, when questioned, that the Prime Minister had said at several points that the civil service was not, as a whole, preparing for Brexit. On 13 July, Sir Martin Donnelly, the permanent secretary to the then Department for Business, Innovation and Skills, said:

“We were following the guidance given by Ministers, which was not to make contingency plans for this outcome.”

On 26 October, we heard from Jon Thompson, the permanent secretary and chief executive of Her Majesty’s Revenue and Customs, of the eight serious areas that his Department has to consider now that Brexit is a reality. I will not run through them all, because it is not the main point of the debate, but let me just mention customs. He said that,

“we run £40 billion-worth of the benefits system in tax credits and child benefit…there is excise and the decisions to be made there…there is VAT…and the question of what difference this would make to direct taxes and state aid.”

He went on to list other big concerns.

Let me take HMRC as an example of the challenges that this Government, this Parliament and this country face as we move to leaving the European Union over the next 20 months. That Department is already going through huge change in its estate management, in its IT and in the way that it tackles and deals with taxes.

We all know that it takes about 18 months on a fair wind to make a major change to the tax system, which is why budgets are planned some time in advance for those technical points, and yet the permanent secretary and the chief executive of HMRC has listed to our Committee and to this House eight other serious areas of concern—more than one Government Department can realistically manage—and that is just one Department. I have to say that that permanent secretary was the only one who actually had a long list. Other Departments—I will not name them all—mentioned the discussions they were having, but nothing really concrete about how they were planning to implement our exit from the European Union.

[Hannah Bardell]

The hon. Lady is making some pertinent points about HMRC and the challenges of the customs system going through a transitional phase when it is already creaking under the pressure. Does she not also share my concern that in constituencies such as mine in Livingston, a high proportion of staff who are highly skilled in such systems and processes will be lost because of the transition the Government are going through? If we put Brexit on top of that, it becomes a perfect storm that is about to hit us.

[Meg Hillier]

The hon. Lady makes an important point. If we add on the other changes in Government Departments—the DWP is going through some changes of property and where jobs might be—that poses a challenge. We face a challenge with skills in this country anyway, and we can add to that our exit from the European Union and the fact that we have so many unanswered questions about what will happen to EU citizens residing in the UK and others who need to come here. We heard only the other day that the NHS needs to bring in a large number of GPs from the European Union because we are unable to recruit in this country. Whatever one might have thought of these policies before, we are now seeing skilled people who are potentially unable to move to new locations and we do not yet have a skills strategy to fill not just those gaps but the others we might see as we leave the EU. A perfect storm is perhaps a polite way of putting it; I could think of fruitier ways of describing it, but I will leave the fruity conversation to the hon. Member for Saffron Walden, who stretched the boundaries further than I will on this occasion.

I will not list every Department and its problems, but we have a long list if other hon. Members are interested in seeing it, given the challenges that each Department faces in its exit from the EU, the lack of planning, and the lack of joined-upness across Government. A problem in one Department, such as HMRC, will have knock-on effects in another, such as the Department for International Trade. We cannot see these things in isolation and there is not yet a coherent plan.

I hope that when he sums up the Minister can reassure me that what I am saying is not true, but the evidence we have seen in Committee suggests that this is the reality. As I have said, senior civil servants acknowledged that they were told very definitely not to plan for the leave scenario, which has put us very much on the back foot.