What recent discussions he has had with Cabinet colleagues on promoting green industrial jobs in Scotland.
What recent discussions he has had with Cabinet colleagues on promoting green industrial jobs in Scotland.
The Secretary of State for Scotland meets Cabinet colleagues regularly to discuss all matters of importance to Scotland. This Government are committed to levelling up across the whole United Kingdom, and that is why the Prime Minister has set out his ambitious 10-point plan for our green industrial revolution, which will support up to 250,000 jobs.
The SNP has joined the Tory party in abandoning workers at BiFab, forgoing the green industrial jobs they claim to want to encourage. Within days of the Scottish Government withdrawing their support for BiFab, they launched the Scottish National Investment Bank, stating it would support Scotland’s transition to zero carbon emissions. They say one thing and do another. What discussions has the Secretary of State had with Scottish Ministers about protecting jobs at BiFab and developing a green supply chain in Scotland to facilitate the expansion of its offshore wind capacity?
After exploring all options, both the UK and Scottish Governments have concluded that there is currently no legal right to provide further financial support to BiFab in its current form. A joint working group will be formed between the Scottish and UK Governments to consider ways to strengthen the renewables supply chain in Scotland and to secure future possibilities and opportunities. Both of Scotland’s Governments have committed to exploring options for the future of the yards and to strengthen measures to support the renewables supply chain.
The Minister’s seeming disinterest belies the whole problem. His original words were fine. The reality is that when BiFab, the only manufacturer of the steel cases for these turbines, went into administration, the Edinburgh Government and the London Government walked hand in hand away from that situation. What does that say about the ambition to be the Saudi Arabia of offshore wind production, and what does it say to the workers and the skills base at BiFab when the Government simply abandon them?
The situation at BiFab is a culmination of a number of issues, the main one being the unwillingness of the parent company and majority shareholder, JV Driver, to provide working capital, investment or guarantees for the company. We are determined to secure a new future for the yards in Fife and the Western Isles, and we will explore options for the future of these sites and, through the new working group, work with the Scottish Government to strengthen the renewables and clean energy supply chain.
Does my hon. Friend share my disappointment at the SNP Scottish Government’s continued dogmatic opposition to nuclear power, despite the fact that in recent weeks it has been the leading source of zero carbon generation in the UK? Does he agree with me that the refusal to contemplate a replacement of the Chapelcross power station at Annan in my constituency is depriving the area of the high-quality green jobs from which it has benefited from the last 60 years?
It will come as no surprise that I do share my right hon. Friend’s disappointment. This Government believe that nuclear has an important role to play in reducing greenhouse gas emissions. Nuclear power stations provide the dependable, low-carbon power that is required to complement renewable energy to ensure a low-cost, reliable, diverse generating mix to meet our net zero ambitions for 2020.
Mr Speaker, this is the first Scottish questions since the Scottish football team qualified for Euro 2020, so I am sure you will allow me to pass on my congratulations to Stevie Clarke and his team for cheering up our nation, and of course we look forward to being further cheered when we win at Wembley in the championships in June next year I am sure the Minister is aware of the Proclaimers song “Letter from America”, which includes the line “Methil no more”, and that is what the decision of his and the Scottish Governments have delivered in reality for that community in Fife. Just a few weeks ago, the Prime Minister announced that he was launching a 10-point plan for a green industrial revolution that would deliver a quarter of a million new green jobs. I did not of course realise he meant jobs that were overseas. Can the Minister inform the House how many current and potential green jobs will be lost following the Scottish and UK Governments’ joint decision, in the words of the Scottish Trades Union Congress, to collude to “pull support” from BiFab in Fife?
I share the hon. Gentleman’s enthusiasm. As a former card-carrying member of the tartan army myself, I might be enthused about rejoining it, but being a member of the Whips Office, I am not sure I would always get slipped to attend the matches We understand from the Scottish Government, who are closest to the company, that there is no commercial way forward that is compatible with state aid. The UK Government are equally bound by the state aid rules, at least for the moment, and therefore there is no legal way for either Government to intervene at this stage.
I am sure that it will not have escaped anyone’s attention that the UK and Scottish Governments have just hidden behind EU state aid rules—the irony of that. The Minister did not give a figure, so let me give the figure: 500 highly skilled green jobs in Scotland abandoned. And it is not just the Tories who are to blame; unbelievably, the SNP has repeatedly hidden behind the same EU state aid rule, despite initially agreeing to support BiFab and then pulling it without notice. It has ignored a Scottish parliamentary vote to sort it out, and on the SNP’s watch fabrication contracts for offshore wind farms have recently gone almost exclusively—where? —overseas. The post-covid recovery has to be about jobs, yet both Governments are unnecessarily abandoning good clean jobs, and this Government are risking a disastrous no deal Brexit, which will further decimate jobs. So I ask the Minister this: the Prime Minister has broken his promise of an oven-ready Brexit deal, so how many jobs will be lost in Scotland as a result of the Tories delivering a no deal Brexit?
I have already discussed this Government’s commitment to the 10-point plan and the up to 250,000 jobs across the whole of the UK. That is still in play, but this is obviously a disappointing situation, and the recent revelation that a private firm bought a majority stake in BiFab for just £4 before it went into administration raises serious questions about how the SNP Scottish Government could pour tens of millions into a company without securing that yard’s future. I agree with the hon. Gentleman that this whole matter requires a proper inquiry.
What steps his Department is taking to support UK armed forces in Scotland.
My Department meets regularly with the Ministry of Defence to help raise concerns that are specific to Scotland. British armed forces personnel in Scotland play a crucial role in defending the whole of the United Kingdom, keeping us safe both at home and abroad, and assisting with such dedication at the height of this covid-19 pandemic.
I welcome the landmark £24 billion investment in our UK armed forces, as announced by the Prime Minister just last month, bringing economic and security benefits to all four nations of our great United Kingdom. Does my right hon. Friend the Secretary of State agree, therefore, that this demonstrates the true value of the Union to Scotland, bringing jobs to Scotland, enhancing the security of the nation, and delivering on the Prime Minister’s levelling-up agenda across the country?
I absolutely agree with my hon. Friend. Scotland has always played a crucial role in the UK’s defence, and the projects that are supported by this spending, including shipbuilding on the Clyde, will directly benefit the people of Scotland, bringing security and economic benefits. This level of spending and investment is only possible through Scotland’s place in the United Kingdom.
I very much welcome the Secretary of State’s response, but can he set out what support the British Army is providing to the Scottish Government to ensure the efficient delivery of the coronavirus vaccine in my constituency in the borders, but also across Scotland more widely?
The Scottish Government requested a military planning team to assist with the planning for the roll-out of the vaccine in the borders and across Scotland, and I am very pleased that I was able to approve that request. The scale of the task is very considerable, but the logistics expertise with the British armed forces is making a huge difference.
The Secretary of State will be aware of the work that soldiers from Kinloss barracks in Moray have done throughout this pandemic in our fight against covid-19: they have been in Liverpool since last month, and earlier this week started assisting Wirral Metropolitan Borough Council in its community testing programme. This is in addition to the work they did throughout the highlands in the summer, covering 80,000 miles and conducting well over 3,000 tests. Will the Secretary of State join me in congratulating everyone at Kinloss on the effort they have put in during this pandemic, and agree that it underlines yet again the outstanding work they do in Scotland and across the United Kingdom?
I absolutely join my hon. Friend in thanking everyone at Kinloss barracks. At the start of the pandemic our British armed forces distributed essential equipment and personal protective equipment. They helped build hospitals across Scotland and were instrumental in getting vital equipment to the Glasgow lighthouse lab. They operated the mobile testing centres, and, currently, as I said to my hon. Friend the Member for Berwickshire, Roxburgh and Selkirk (John Lamont), there are 21 military planners working with Scottish health boards and the Scottish Government on logistical planning for vaccine deployment. Our offer remains open: if the Scottish Government require further assistance from our amazing armed forces, they are standing by and are ready to help.
What progress has been made on the publication of the Tay cities deal.
Good progress has been made on the Tay cities regional deal. The Chancellor announced at the spending review on 25 November that the UK Government investment will now be compressed to 10 years. We are working with local partners to get the full deal signed on 17 December.
It has been almost a year since I was elected, and in all that time we have been assured that the Tay cities deal is just around the corner. I am delighted to hear that the deal is over the line. It will be a Christmas present for North East Fife and elsewhere, for which people have been waiting for some time.
I am grateful to the hon. Lady for those comments. I know of her hard work especially in helping the Eden Campus project in her constituency to be a leading part of the deal. I had hoped to be up visiting it a few weeks ago, but unfortunately covid restrictions precluded that. I very much look forward to visiting in the new year when circumstances allow.
I too thank the Minister for the reprofiling of the Tay cities deal from 15 years to 10 years. That will really help the projects. We now need to know when it will be signed. He will also know that we have an issue with the internationally renowned James Hutton Institute in my constituency. That is primarily a UK Government-financed project, but its place in the Tay cities deal has been put in jeopardy because of all the delays. To ensure that it can be started in year one, the Hutton needs the Government to draw down its funding early. Will the Government do that? If not, how do they intend to ensure that this crucial project can be guaranteed?
I have had many constructive dialogues with the hon. Gentleman on the Tay cities deal, and I am happy to confirm that we look good to go next Thursday to sign the deal. The delay was for a very good reason: as he alluded to, we were trying to get the UK Government side of the deal down from 15 years to 10 years. I am aware of the specific circumstances at the James Hutton Institute. I had a very constructive meeting with it on Friday last week, and I can assure the hon. Gentleman that we are exploring every option to ensure that it gets its funding but that all the other very worth- while projects in the deal do too.
What steps his Department is taking to support hydrogen projects in Scotland.
As confirmed in the Prime Minister’s 10-point plan for a green industrial revolution, the Government are committed to the development of hydrogen as a decarbonised energy carrier for the UK. We are developing our strategic approach to hydrogen and its potential to deliver against our net zero goals, and we will set out our plans shortly.
SGN has just secured vital funding from Ofgem to progress its landmark trial of green hydrogen in a new domestic gas network. I congratulate everyone at SGN and those working on the project in Fife on achieving that. Does the Minister agree that innovations such as that trial and the H21 project in Teesside, which is led by Northern Gas Networks, prove that the UK is leading the world in the hydrogen economy?
I certainly agree with my hon. Friend, and I congratulate him and the all-party parliamentary group on hydrogen, which he chairs, on their work advancing the hydrogen agenda. I also congratulate SGN on achieving up to £18 million from Ofgem’s network innovation competition to support development of a hydrogen demonstration network in Levenmouth, bringing carbon-free energy to around 300 homes from late 2022.
What recent discussions he has had with Cabinet colleagues on the effect of the United Kingdom Internal Market Bill on Scotland.
I have frequent discussions with Cabinet colleagues on the United Kingdom Internal Market Bill, which is vital to protect seamless trade and jobs across all four corners of the United Kingdom following the end of the transition period.
Of course, what the Secretary of State did not say is that the internal market Bill is a blatant attack on devolution. That should not come as a surprise, because just three weeks ago the Prime Minister said that devolution was Tony Blair’s biggest mistake—a bigger mistake than even the illegal Iraq war. Does the Secretary of State disagree with the Prime Minister?
What the Prime Minister said was that devolution was a mistake when it was set up to be put in the hands of separatists, and I completely agree with that. I totally agree with it. The Scottish National party is a campaigning organisation for independence—for separation of the United Kingdom—masquerading as a party of Government.
The Secretary of State has regularly explained that, as we leave the EU, the United Kingdom Internal Market Bill will serve to strengthen the UK’s economy and the Union as a whole. Does he feel that the announcement yesterday from the Chancellor of the Duchy of Lancaster and Minister for the Cabinet Office that Northern Ireland will have the “best of both worlds”, meaning that Northern Ireland will still have access to both EU and UK markets after Brexit, undermines his claims about the Bill?
No, not remotely. What we have delivered on is unfettered access. We promised unfettered access at the time of the withdrawal agreement and we have delivered it.
As the Secretary of State knows, Scotland voted to remain in the EU. The Scottish Government subsequently published a framework for how Scotland could still have access to the single market post Brexit. That was rejected outright by the UK Government. Given that Northern Ireland has been promised the very same thing, will he now make the case for Scotland to get the same concessions, and, like his predecessor, will he consider his position if such a request is not granted?
Scotland is in the fortunate position as part of the United Kingdom of not having a land border that it needs to worry about. The Northern Ireland situation is different—it has special circumstances. We have resolved the problem as we promised we would.
The Secretary of State would do well to remember that the SNP is a democratically elected party of Government in Scotland. Although we take nothing for granted, pollsters continue to suggest that the SNP will win a majority of seats in the Holyrood elections this coming May, and 15 consecutive polls show a clear majority mandate for Scottish independence. Does he believe that his Government’s disastrous internal market Bill has contributed to that rise in support for the SNP and Scottish independence?
There is nothing disastrous about a United Kingdom Internal Market Bill that has mutual recognition and non-discrimination at its base, and that protects jobs in Scotland and people’s livelihoods, when 60% of Scotland’s trade is to the rest of the United Kingdom, worth over £50 billion and, as the Fraser of Allander Institute said only last week, providing 554,000 jobs.
As Mark Fletcher is not here, would the Minister like to give the answer to his substantive question? Then I can bring in shadow Minister Elmore.
The Secretary of State for Scotland and I have frequent discussions with colleagues on the opportunities for COP26. That includes through the COP26 devolved Administration ministerial group, which brings the COP president, territorial Secretaries of State and devolved Administration Ministers together to ensure effective engagement and collaboration on COP26 and net zero.
I am exceedingly grateful to you, Mr Speaker, for allowing the Minister to answer the question COP26 in Glasgow, as the Minister knows, is no ordinary summit. It is a huge opportunity to set the global agenda we need to tackle the climate emergency, but in my opinion the Government have so far not afforded it the attention and weight it requires. That has to change—urgently, I would argue—to make the summit the success the planet needs it to be. Cutting overseas aid has had a devastating effect on countries on the frontline of the climate emergency. That will undermine our role as hosts of COP26, as well as our international standing and moral authority around the world. What steps is the Scotland Office taking to ensure that, as hosts of COP26, we are leading by example and not turning our back on those who are living on the frontline of the climate emergency?
I am grateful to the hon. Gentleman for his question. I point out that we will still be one of the world’s largest net donors to the most deprived communities around the world. That commitment remains absolute. We will be working over the next months to ensure that COP26 in Glasgow is as big a success as it can be. We will lead the global climate change agenda and I can think of nowhere better than my home city of Glasgow to be the showcase for that. There are lots of partners, from very small local companies right up to big multinationals, who will be playing a part. My colleagues and I will be engaging with them very much over the next few months.
What discussions he has had with the Scottish Government on their preparations for the end of the transition period.
What recent discussions he has had with the Scottish Government on preparedness for the end of the transition period.
I have regular conversations with the Scottish Government on preparedness for the end of the transition period, including meetings of the EU Exit Operations Cabinet Committee and the Joint Ministerial Committee on EU Negotiations.
I thank my right hon. Friend for that answer. I know he will agree with me that the Scottish Government have failed to prepare for the end of the transition deal and are letting the Scottish people down, in particular by failing to recruit the required number of environmental protection officers to assist our fishing industry as we leave the transition deal at the end of this year. Will he confirm that the British Government stand ready to assist the Scottish Government, should they require it, to get the required number of protection officers in place to support our fishing industry?
As my hon. Friend knows, it is the Scottish Government’s responsibility to ensure adequate certifier capacity for exports to the European Union. The UK Government have been engaging closely with the Scottish Government, Food Standards Scotland and Scottish local authorities to clarify the capacity in Scotland for certifying export health certificates, and with them, we have determined the level of additional capacity that is needed. That is the sort of boring answer. I would add that we have provided the Scottish Government with £138 million of Brexit preparedness support for this purpose.
Dearie me, Mr Speaker. Let me try this one. NHS Tayside has stated that a hard Brexit could “lead to an inability to deliver safe and effective care”, and NHS Lanarkshire says that Brexit poses a “very high” risk to the delivery of healthcare services. We also know that the Ministry of Defence is putting plans in place to fly the Pfizer vaccine into the UK to avoid the Government’s entirely self-inflicted border ports chaos. Given that we did not vote for any of this and that 15 polls in a row now show support for independence, does the Secretary of State still believe that the Union is “firing on all cylinders”, as he wrote at the weekend?
The Union is absolutely firing on all cylinders, whether it is the support of over 900,000 jobs in Scotland, the UK Government procuring, supplying and paying for all the vaccines for the United Kingdom, or the armed forces helping with the roll-out. As regards the scare story the hon. Gentleman is trying to start over the MOD flying the vaccine into the United Kingdom, all good Governments have robust contingency plans. That is No. 5 on the list of contingency plans, and they are not just for the transition period outcome. Those contingency plans are made for potential strikes, weather events and so on. It is entirely responsible to plan that way.
The end of the transition period has been described by Scottish businesses as a “catastrophic” situation. Some have argued that if they cannot trade with the EU, they are out of the game—it is an existential threat. Can I ask the Scottish Secretary to actually show some authority in the Cabinet and insist on a minimum six-month grace period, so businesses do not fall foul of regulations which are not yet developed for a deal that is not yet agreed, but which is supposed to be in place in barely three weeks’ time? This needs to be done; it needs to be done today. Otherwise, businesses will struggle dreadfully on his watch.
There has been a major public information campaign running for businesses and citizens, telling them exactly what they need to do. We have always been clear that, whether it is deal or no deal, there are steps that have to be taken when the transition period comes to an end. We are not going to delay the end of the transition period, because it is only by sticking to that date that people can prepare responsibly, and it also holds the EU’s feet to the fire in getting a deal. We have been clear what measures they need to take. They need to look at the UK Government website, where they can see very clearly what preparations they need to make for the end of this month.
What recent steps his Department has taken to help ensure co-ordination between Scotland and other nations of the UK on the response to the covid-19 outbreak.
What recent steps his Department has taken to help ensure co-ordination between Scotland and other nations of the UK on the response to the covid-19 outbreak.
An effective response to covid-19 does indeed need to be a co-ordinated response across the whole United Kingdom, informing every aspect of the UK Government’s response. For instance, on 24 November, the UK Government and the three devolved Administrations published a joint statement on UK-wide arrangements for the festive season. We are currently working with the devolved Administrations on the deployment of vaccines and community testing across the UK.
Last month, an opinion poll revealed that 68% of Scots want the Scottish and UK Governments to work more closely together. Minister, why is it that, despite that, the Scottish and UK Governments are not able to work in a co-ordinated manner, and why are we constantly seeing mixed messages and infighting?
It is not for me to say what mixed messages the hon. Gentleman might see in the press or get from political parties. The UK Government and all assemblies across the whole UK work together on a co-ordinated basis to deliver not just what has been delivered up to now; there was the excellent news yesterday of the first vaccines being provided across the whole UK—not in one part of the UK or another but across the UK on the same day. Vaccines are an excellent example of that co-operation between the UK Government and the devolved Administrations, and the UK Government are procuring vaccines on behalf of the UK as a whole. The prioritisation of the vaccines is a devolved matter—
Order. We must go on to the next question.
The news of the vaccine’s approval is incredibly encouraging, but we now face the greatest organisational challenge perhaps since the second world war in distributing it to all who want and need it across the four UK nations. Given the botched roll-out of the flu vaccine in Scotland this year, how is the Minister going to ensure that Scottish Ministers are able to get the delivery of the covid vaccine right?
I am conscious of the time, so I shall give a very brief answer. Local deployment of the vaccines is a devolved matter, but Ministry of Defence Ministers have made military planners available to the Scottish Government to facilitate the complex task of mass deployment.
  If he will list his official engagements for Wednesday 9 December.
I visited Guy’s and St Thomas’ hospital yesterday to see the first clinically approved vaccine being given to people in London, as it is now across the country. This is a fantastic moment for all of us in this House, and I know that everybody will want to join me in thanking the NHS, the vaccine taskforce, the scientists and all the volunteers who have made this possible This morning I had meetings with ministerial colleagues and others. In addition to my duties in this House, I shall have further such meetings later today.
When I was a spear carrier in the Brexit referendum campaign, led by my right hon. Friend, we assured the British people that a trade deal was entirely achievable, so may I urge him to make one last effort? Surely that deal is achievable, because we have no intention of lowering our standards, but the EU should know this: if, consistent with national security, he cannot secure that deal for us, this parliamentary party will back him to the hilt, because strength comes with unity.
I thank my right hon. Friend. He is entirely right: a good deal is still there to be done, and I look forward to discussing it with Commissioner von der Leyen tonight, but I must tell the House that our friends in the EU are currently insisting that, if they pass a new law in the future with which we in this country do not comply or do not follow suit, they should have the automatic right to punish us and to retaliate. Secondly, they are saying that the UK should be the only country in the world not to have sovereign control over its fishing waters. I do not believe that those are terms that any Prime Minister of this country should accept. I must tell the House and reassure my right hon. Friend that, whether our new trading arrangements resemble those of Australia’s with the EU or whether they are like those of Canada with the EU, I have absolutely no doubt that, from 1 January, this country is going to prosper mightily.
I join the Prime Minister in his comments about the vaccine roll-out. It was fantastic to see the first person, Margaret Keenan, receive the vaccine yesterday. It is a huge national effort, and I want to thank everybody who has been involved with it. Mr Speaker, I also want to thank you and the House authorities for enabling me to participate today, notwithstanding the fact that I am self-isolating A year ago, the Prime Minister stood on the steps of Downing Street and promised the country “a permanent break from talking about Brexit” Can the Prime Minister tell us: how is that going?
I am delighted to welcome the right hon. and learned Gentleman here, from his vantage point of exile in Islington, his spiritual home, and wish him all the best in his self-isolation. His own silence on this matter has been sphinx-like. I wonder quite what it is that has kept him from asking this question for so long. We delivered Brexit on 31 January, in case he failed to notice.
It is Camden, not Islington. The Prime Minister starts straightaway by deflecting—it is the same old, same old, whether on covid or Brexit. Twelve months ago, he told the British people that he had an “oven-ready deal”. He did not say he had half a deal or that the next stage would be very, very difficult. In fact, he faced the British people and told them, before the election, that the chances of no deal were “absolutely zero”. The Chancellor, as he is now, obviously took him at his word, because the Chancellor said in the run-up to the election: “We won’t need to plan for no-deal because we…have a deal.” So a year on, why should anyone who trusted the Prime Minister when he said he had a deal, including his Chancellor, apparently, believe a word he says now?
I hesitate to accuse the right hon. and learned Gentleman of deliberately trying to mislead people, but let us be in no doubt that we had an oven-ready deal, which was the withdrawal agreement, which the people voted for, as he rightly points out, and by which this country left the customs union and the single market, and delivered on our promises. I can tell him, although he must know this, that whatever happens from 1 January this country will be able to get on with our points-based immigration system, which we have put into law, in fulfilment of our manifesto commitment. We will be able to get on with instituting low-tax free ports, in places where jobs and growth are most needed around the country. We will be able to honour our promise to the British people and institute higher animal welfare standards; we will be able to do free trade deals; and we will get our money back as well. I do not know what else he wants to see from 1 January, but all those things will be delivered.
Oh, I see. Apparently, “Get Brexit done” just meant the first part of it—the easy bit. I do not remember that being written on the bulldozer at the time. Last September, the Prime Minister actually hit the nail on the head when he said that leaving without a deal would be a “failure of statecraft”. It would be—it would be a total failure—and it will be the British people who pay the price. Does the Prime Minister agree with his own spending watchdog, the Office for Budget Responsibility, that the cost of that failure—of leaving the EU with no deal—would be higher unemployment, higher inflation and a smaller economy?
The more the right hon. and learned Gentleman talks about Brexit, the more I can see why he tried to avoid the subject for the past year. We did leave with a very good deal, and in any circumstances this country will prosper mightily. He talks about the possible adverse consequences for this country of a deal on Australian terms—I think that is what he is talking about—but we have yet to hear from Labour party members what their view is of that matter. Would they vote for it, yes or no? He remained totally Delphic last week about his policy on fighting coronavirus and he is totally Delphic about what to do on Brexit as well.
The Prime Minister talks about indecision; he is absolutely stuck—this is the truth of it—and dithering between the deal that he knows we need and the compromise that he knows his Back Benchers will not let him make. I genuinely hope that this is the usual Prime Minister’s bluster and that, like one of his newspaper columns, a deal arrives at the last minute. But for some people, and their jobs, it is already too late Yesterday, INEOS, a major employer in this country, announced that it will not now build the new Grenadier car in Bridgend and will move production to France instead. This is a project that just two months ago the Prime Minister said was “a vote of confidence”. Hundreds of skilled jobs now will not go to Bridgend. Can the Prime Minister tell us how many more British jobs have to go overseas before he gets on with delivering the Brexit deal that he promised?
I think it is a bit much of the Leader of the Opposition to criticise the Government for failure to come up with a policy on Brexit and to attack the putative consequences of coming out on Australian terms when he cannot even say whether he would vote for that deal—yes or no. If he cannot say whether he would vote for our deal—yes or no—he simply cannot attack the Government’s policy. Until he is able to come up with a position of his own, wrap a towel round his head and decide what he actually thinks, I find it very difficult to take his criticisms seriously. What I can say is that this country will be ready for whether we have a Canadian or an Australian solution, and there will be jobs created in this country—throughout the whole of the UK—not just in spite of Brexit but because of Brexit, because this country is going to become a magnet for overseas investment. Indeed, it already is and will remain so.
The Prime Minister asked me how I will vote on a deal that he has not even secured. Secure the deal, Prime Minister; you promised it. I can say this: if there is a deal—and I hope there is a deal—my party will vote in the national interest, not on party political lines, as he is doing. This is about leadership. The Prime Minister has done 15 U-turns, he has had five different plans on covid, and last week 53 of his own MPs voted against him, so if I were him I would not talk about leadership The Prime Minister has not always wanted to listen to business—we know what his message to business is —but he should. Let me quote the CBI, which says that the message from business is this: “get a deal…quickly”. The National Farmers Union says: “Time is really running out and…it’s very hard to get final preparations in.” These are the people the Prime Minister should be listening to, not his Back Benchers On the question of preparation, the Government knew months ago that they needed 50,000 customs agents trained and ready to go from 1 January—deal or no deal—so can the Prime Minister tell the House how many of the 50,000 agents will be in place on 1 January? That is in 23 days’ time.
It is wonderful to get to the end of that question. I can tell the right hon. and learned Gentleman that we have already invested £1 billion in getting this country ready for whatever the trading relationship is that we have on 1 January. We have invested £84 million into supporting customs agents across the UK and £200 million into supporting our ports, and they are doing an amazing job. I want to thank business for the incredible job it is doing to get ready. We have all got to get ready, because under any view there is going to be change from 1 January—there will be change in the way we do business and there will be more opportunities for this country around the world. I am delighted by what I take is the increasing signalling from Camden, because the message from Camden seems to be that, given the choice, the right hon. and learned Gentleman would vote for a deal rather than not. Did my Back-Bench colleagues get that impression? I think I did.
Hopefully, the final question will be a little shorter.
I take it that the answer is the Prime Minister has no idea whether the 50,000 customs agents will be in place on 1 January. He either does not know or he does not care. The Prime Minister said he had a deal. He did not. He said he would protect jobs. He did not. He said he would prepare for any outcome. He has not. Whatever may happen in the next few days, there is no doubting that his incompetence has held Britain back. Will he end this charade? In that uncertainty, will he get the deal that he promised and allow the country to move on?
I want to thank the right hon. and learned Gentleman for his final baffling question. Last week, as I have said, he sphinx-like avoided any pronouncement on how this country was going to fight covid. He refused to support the measures that we have put in place. This week, he remains deafeningly silent on what he really thinks about a Brexit deal. While he puts a cold towel round his head, lost in thought, and tries to work out what his position is, we are getting on—[Interruption.]
Order. Mr Bryant! I suggest the Whip has a word with him. We are not having that disgraceful behaviour.
Mr Speaker, you should summon him back—he seems to have vanished While the right hon. and learned Gentleman tries to work out what his position is, we are getting on with the work of government. As he says, it is a year since this people’s Government were elected and I am very proud that we are delivering on the people’s priorities: 6,000 of the 20,000 police officers; 14,800 of the 50,000 nurses already; and we are getting on with building every one of the 40 hospitals—it is about 48 hospitals—that we are going to deliver, along with the biggest programme of infrastructure investment in this country for a century. We are uniting and levelling up across the whole of the UK. Whether the outcome is Canada or Australia, we will be taking back control—we have already taken back control—of our money, our borders and our laws and we will seize all the opportunities that Brexit brings.
Today is the 60th anniversary of “Coronation Street”, the world’s longest running TV drama series. This is an amazing landmark, so congratulations to it. Sometimes it feels as if we have been discussing infrastructure in the north almost as long. However, we have had the Oakervee report, which recommended that the Government committed to HS2 and its full y-shaped network serving both sides of the Pennines. We have had the positive decision to proceed with it. As the plans for the eastern leg of HS2, phase 2b, are developed, will my right hon. Friend consider starting construction from the north? That would be good for jobs in the north and for connectivity with the east midlands, all of which, of course, drive my right hon. Friend’s levelling-up agenda.
My hon. Friend is a big expert in this field and a great campaigner for transport. He is right about the massive impact that these programmes can have on jobs. [Interruption.]
Mr Bryant, I think we need to have this conversation later.
I was saying, Mr Speaker, that my hon. Friend is completely right about the power of great infrastructure projects to deliver jobs, which is why we are getting on with both the eastern leg of HS2 and Northern Powerhouse Rail. What I have asked the National Infrastructure Commission and Network Rail to look at is how those two projects can best be integrated to boost the economy of the whole of the north of the country.
Yesterday, by this Government’s own admission, it was confirmed that Northern Ireland is getting the best of both worlds: access to the EU single market and customs union. This is great news for businesses in Northern Ireland, but it leaves Scotland, which also voted to remain, dealing with the hardest of Brexits. What is good for Northern Ireland is surely good enough for Scotland. Why is Scotland being shafted by this double dealing? Can the Prime Minister explain to Scottish businesses why this is fair?
In common with the whole of the rest of the United Kingdom, Scotland will benefit. It will benefit from substantial access to devolved powers, it will benefit from the regaining of money, borders and laws, and, as I never tire of telling my friend, the right hon. Member for Ross, Skye and Lochaber (Ian Blackford), that, in spite of all his jeering, Scotland will take back control of colossal quantities of fish, which is something that the people of Scotland deserve to be able to exploit for the advantage of those communities.
The Prime Minister can spin all he likes, but everybody can now see the total contempt that this UK Government have for Scottish interests. Northern Ireland gets the single market and customs union; we get nothing. Members of his Scottish branch office told him how unfair and damaging it would be to deny Scotland’s access to the EU single market and customs union while at the same time delivering it for Northern Ireland. Ruth Davidson even said that such an act would “undermine the integrity” of the United Kingdom. The former Scottish Tory constitution spokesperson said that it would be the end of the Union. They, along with the former Secretary of State for Scotland, said that if this were to happen, they would all resign. Since the Prime Minister is ready to sell out Scotland’s interests with his Brexit deal, does he expect to receive these resignation letters from Baroness Davidson and her cohort before or after her travels to Brussels tonight?
The only reasonable answer to that question is that I think it is highly unlikely that those letters will arrive. The right hon. Gentleman does a gross injustice to Scotland and the future of Scotland, which will be assured within the single market of the United Kingdom. In spite of the slight negativity that I detect from him, I believe that Scotland, along with the rest of the UK, will benefit from a very strong trading relationship with our friends and partners across the channel, whatever the circumstances, whatever the terms we reach tonight.
I am supporting “Turn on the Subtitles”—a campaign led by my Bishop’s Stortford constituent Henry Warren. There is a wealth of evidence that default same-language subtitling can have a dramatic effect on children’s literacy, particularly for disadvantaged children. I know that that is a great priority for the Prime Minister, given the potential impact of covid on the attainment gap. Will he support a Government consultation to turn on the subtitles in order to really explore this potentially transformative opportunity?
I am sure that I speak for many hon. Members when I say that I am a massive supporter of subtitles myself—particularly with some of these crime dramas from America. The campaign that my hon. Friend mentions is excellent. All the Departments that have a stake in this will be working with her to see what we can do to take the matter further.
Last week, we learned that UK Export Finance has been approached to back the east African crude oil pipeline. This is a climate catastrophe that will produce emissions equivalent to all the UK’s annual flights. Not only that, but a recent response to one of my written parliamentary questions confirmed that UKEF has six more fossil fuel projects under consideration. Ahead of the climate ambition summit this weekend, how can the Prime Minister claim any climate credibility while ploughing public money into dirty fossil fuel projects overseas? Are these the actions of a rogue, out of control Government Department—or, worse, does the Prime Minister actually approve of them?
I hope the hon. Lady knows that we are moving away dramatically and at speed from UK Export Finance supporting fossil fuel exploration around the world, but, of course, hydrocarbons remain a significant industry in Scotland and many other places. In so far as there are legitimate contracts that are at risk of being frustrated, we cannot do that. I really think that her criticism of the Government is absurd. Look at the overall record and ambition of this Government; this is the first country in the developed world to set a target of net zero by 2050. I know that when she is being less polemical, she has had some kind words to say about the Government’s programme, and I certainly support her in that.
Will my right hon. Friend confirm that our future immigration policy will welcome law abiding citizens of other countries to our country, and that those who come to this country and are subsequently convicted of serious crimes, including rape and murder, should expect to be removed from this country to keep our citizens safe?
Indeed; I was astounded to see that 42 Opposition Members wrote to the Home Secretary opposing the deportation of foreign national criminals, while the leader of the Labour party maintained his characteristic delphic silence on the matter.
Why does the Prime Minister think we have now seen 15 consecutive polls showing majority support for Scottish independence?
The people of Scotland, as the hon. Gentleman knows very well, voted in 2014, by a substantial majority, to remain in the UK. I believe that was the right decision, and I believe that were they ever to be asked the same question again in the future, it would be the same answer. But has he has said, and as his hon. Friends have said, many times, it was a once-in-a-generation event.
Staffordshire is currently in tier 3, so unfortunately, due to restrictions, many local businesses are either unable to open or having to operate differently, which is having a significant impact on my constituents’ lives and livelihoods. So will the Prime Minister commit to providing sufficient testing in Staffordshire to help us to get out of tier 3 as soon as possible, and will he assure me that he will do all he can to support businesses and protect jobs in Stafford, as well as creating new employment opportunities for young people after 31 December?
I thank my hon. Friend. No. 1, yes of course we will do everything we can with NHS Test and Trace, plus our armed forces, to roll out community testing in Stafford; and No. 2, of course we want to support Stafford and the people of Stafford with a massive programme of business support, including nearly £1.4 million in bounce back loans, grants, rate relief and VAT deferrals.
  The Prime Minister will fully appreciate that the use of gross domestic product as a measure is abstract in terms of dealing with and understanding prosperity, but people talk about a 15% drop in GDP as a result of the pandemic. Looking at a simple analysis of car sales as an indicator of economic performance, relative to Germany, we have lost 184,000 car sales in the UK, or versus France, 100,000. Behind those numbers, which are a big hit to UK plc, are jobs and businesses. How does the Prime Minister explain this relative economic performance?
The Government of this country have done everything we can to support business and support lives and livelihoods throughout this pandemic, with now, I think, more than £260 billion of support, and that remains the case. The hon. Gentleman mentions France and Germany. He should know that unemployment, in spite of all the difficulties this country has faced, remains lower in this country than in France, Italy, Spain and the United States. Yes, it is tough, but we are going to get through it and we are going to get through it together.
Can I commend my right hon. Friend’s bold 10-point plan for a clean, green industrial revolution and ask for his support to help me deliver a 26-hectare renewable energy manufacturing hub at Oldside in the port of Workington, continuing to deliver on our promises of 12 months ago when I turned Workington blue?
I thank my hon. Friend and congratulate him on his achievement and on his anniversary. The Department for Business, Energy and Industrial Strategy is looking very seriously at the project that he mentions. I know that the Department is going to be assessing that application very carefully and will keep him informed.
  The Prime Minister did not quite answer my hon. Friend the Member for Glasgow East (David Linden) on why support for independence is so high, so maybe I can tempt him with a couple of reasons. First, there is the leadership of the First Minister, which Scots contrast with him. Then there is his crazy, chaotic Brexit—a Brexit that Scotland did not vote for. But it is also down to him personally. He is probably the biggest single recruiting sergeant that we have, and for that we mightily thank him. So can I ask him, on behalf of all of us who want to see an independent Scotland: could he please take a bow and accept our many thanks?
I am delighted to accept the thanks of the hon. Gentleman. I have to say that it is really thanks to him and the Scottish National party that we have been able to keep our wonderful United Kingdom together, because it was the sheer incoherence of their position, their refusal to address the tough questions of what breaking up the UK really means—the impact on our budgets and our economy and the impacts on Scotland and on our whole country—and their manifest inability to explain what they actually mean that meant that the people of Scotland voted in 2014 to remain part of the UK. They were right then, and they will be right in the future to stay.
It is now three and a half years since the Grenfell fire tragedy that cost the lives of 72 people, yet there are still 3.6 million leaseholders living in potentially dangerous, unsaleable and unmortgageable properties. The Government rightly set aside a billion pounds towards the remediation of non-aluminium composite material cladding, but that expires on 31 December this year. It is clear that it will be insufficient to cover the costs, so will my right hon. Friend set out for the House what the plan is for next year to remediate the cladding? Will he give a cast-iron guarantee that leaseholders will not have to pay a penny piece towards the cost of replacing this unsafe cladding?
My hon. Friend is absolutely right to draw attention to this injustice and what is happening with leaseholders at the moment. That is why we have put £1.6 billion into removing unsafe cladding. I do not want to see leaseholders being forced to pay for the remediation, and I can assure my hon. Friend that we are looking now urgently—before the expiry of the current arrangements—at what we can do to take them forward and support leaseholders, who are in a very unfair position.
Is the Prime Minister aware that his Government risk failing a generation of children in my constituency of Enfield North and across the country, as analysis shows this week that only one in six pupils on free school meals—those who are most likely to fall behind their peers—will benefit from the programmes to help them catch up on learning lost as a result of covid? Does the Prime Minister agree that is simply not good enough, and can he explain why we are in this dire situation nine months on?
I share the hon. Lady’s anxiety about the impact of differential learning on kids in our schools across the country, because there is no doubt that different groups have been affected in different ways by the pandemic. That is why we have put a billion pounds or more into the catch-up funds, but it is also why it is so important to ensure that kids go to school and stay in school. That is why we have put all the emphasis, as we have throughout this pandemic, on maintaining kids in school, even if that has put pressure on the hospitality sector and other parts of our economy.
I wonder whether my right hon. Friend, were he to find a small gap in his very busy diary, would join me on a visit to the Black Country Living Museum, where I would introduce him to a plate of Black Country battered chips and a pint of Holden’s Golden Glow, all after he has reviewed the arrangements that the museum has made to become a covid vaccination centre.
I am thrilled that the Black Country Living Museum is in line to be a covid vaccination centre. I have had many happy meetings with my hon. Friend in the Black Country, and as a proud former resident of Bilston, I look forward to returning before too long.
Mr Speaker, I know you are a strong supporter of the Falkland Islands. The Falkland Islands face the prospect of their fisheries exports to the European Union being subject to tariffs of between 6% and 18% from 1 January. Fisheries exports to the European Union account for more than 40% of the islands’ gross domestic product, and up to 60% of their Government’s revenue. This poses a serious challenge to the Falkland Islands. Will the Prime Minister raise this matter when he meets with the President of the European Commission later?
Indeed. The hon. Gentleman is right to raise the issue of the Falkland Islands and, indeed, other Crown territories and overseas dependencies around the world, whose future and future trading arrangements must be secured. That is indeed something that we have raised and will continue to raise on their behalf to make sure that they get the satisfactory assurances they need.
The Prime Minister is aware of the continuing concern in rural communities, such as those in North East Hertfordshire, about intentional unauthorised development where caravans suddenly appear on land without planning permission. Many of my constituents and I support proposal 24 in the planning White Paper, which proposes new powers for councils to tackle this. Will the Prime Minister put his authority behind it so these changes can be made as soon as possible?
I will indeed. I think everybody in the House recognises the distress that unauthorised camps and encampments can cause to local communities, and my right hon. and learned Friend is right to draw attention to this. He is also right to call attention to the new powers we are giving both to the police and to councils to tackle the matter, and I am glad to have his support.
Could the Prime Minister kindly explain to the people of tier 3 Birmingham, with a population of over 1 million and where almost 2,000 have lost their life, why he has not considered them a priority for receipt of the vaccine?
I really must respectfully disagree with the hon. Gentleman. The Joint Committee on Vaccination and Immunisation has set out very clear criteria for the groups, starting with those over 80, care home workers, NHS workers and those in care homes, and he knows the criteria very well. Birmingham, of course, will be among them, and of course that is right. I am afraid that I simply cannot accept the premise of his question.
Conservative colleagues across Derbyshire have been working very hard on our bid for community testing to help us tackle covid. Will my right hon. Friend ensure that the bid from Derbyshire County Council receives the resources and attention we need to help us in our fight to get out of tier 3?
Yes, and just this morning I was discussing Derbyshire’s bid for a big community testing programme. We will obviously do everything we can to support them, and I thank my hon. Friend and local leaders for what they are doing to promote community testing.
Real-terms pay cuts for millions of public sector workers, an insulting 37p increase in benefit levels and broken promises on minimum wage increases show that the Prime Minister wants to pay for this crisis on the backs of the working class. Would it not be fairer to impose a windfall tax on the wealth of the super-rich and on those who have made super-profits out of the covid crisis, including those who won contracts because of their links to top Tories?
I must, again, strongly disagree with what the hon. Gentleman says. Everybody on this side of the House is proud not just of the living wage but of record increases in the living wage, of above inflation pay rises across the board and, of course, of what we have done to support nurses and the NHS with record investment. I do not think anybody who looks at the investment this Government have made in the public sector could doubt our commitment. We will continue to do that, but what we want to see is our economy recovering and our strong and dynamic private sector, which the hon. Gentleman disparages, enabling the country to forge forward as it should.
  It has been almost 12 months since I and many of my colleagues were elected to this House for the first time, and it was a great privilege to deliver my maiden speech on Second Reading of the Environment Bill and be on the Bill Committee for this landmark piece of legislation. Does my right hon. Friend agree that protecting the environment is not only a moral duty but presents an economic opportunity, including the creation of jobs for my constituents in Meriden?
It is crucial to understand that the 10-point plan for the green industrial revolution is about jobs, jobs, jobs. This plan, whether it is retrofitting homes or making wind turbines, will generate 250,000 jobs across the country in just the first few years.
Many constituents, especially those emanating from the Punjab and other parts of India, were horrified, as I was, to see footage of water cannon, tear gas and brute force being used against peacefully protesting farmers. However, it was heart-warming to see those very farmers feeding those forces who had been ordered to beat or suppress them. What indomitable spirit—it takes a special kind of people to do that. Will the Prime Minister convey to the Indian Prime Minister our heartfelt anxieties and our hopes for a speedy resolution to the current deadlock? Does he agree that everyone has a fundamental right to peaceful protest?
Of course. Our view, as the hon. Gentleman knows well, is that we have serious concerns about what is happening between India and Pakistan, but these are pre-eminently matters for those two Governments to settle. I know that he appreciates that point.
The Queen Elizabeth Hospital in King’s Lynn is at the heart of our local community, but it is in need of urgent modernisation. Most recently, cracks in the concrete roof have led to the closure of the physiotherapy gym. With his enthusiasm for building hospitals, can my right hon. Friend offer the people of west Norfolk hope and back our bid to build our future hospital?
I thank my hon. Friend for his campaign and for everything he does for his constituents. I can tell him that the bid process for the remaining eight hospitals, on top of the 40, is currently being designed. The Department of Health and Social Care is working with a variety of trusts, including the Queen Elizabeth Hospital King’s Lynn NHS Trust, as that work continues.
May I gently say to the Prime Minister that next week will be the final Prime Minister’s questions before Christmas? Will he update the House on the leak inquiry? It would be helpful.
I will do my best.
Thank you, Prime Minister In order to allow the safe exit of hon. Members who participated in this item of business and the safe arrival of those participating in the next, I suspend the House for a few minutes.
With permission, Mr Speaker, I would like to update the House, and indeed the people of Northern Ireland, on the implementation of the Northern Ireland protocol as part of the withdrawal agreement with the European Union. Throughout 2020, we have worked intensively to ensure that the withdrawal agreement, in particular the Northern Ireland protocol, will be fully operational on 1 January 2021. Our aims, and the proportionate and pragmatic way that we intended to pursue them, were set out in the Command Paper that we published in May, “The UK’s Approach to the Northern Ireland Protocol”. This set out three key commitments that we believed needed to be respected in all scenarios We had to ensure that Northern Ireland businesses retained unfettered access to the rest of the UK market. Northern Ireland’s place in the UK’s customs territory had to be protected, and that meant that goods that stayed in the UK were not subject to tariffs. We had to ensure that the important Great Britain-Northern Ireland trade flows, on which lives and livelihoods depend, were not disrupted; we needed to ensure a smooth flow of trade with no need for new physical customs infrastructure I am pleased to say that on Monday, the European Commission Vice-President Maroš Šefčovič and I, as co-chairs of the Joint Committee set up to negotiate the implementation of the protocol, came to an agreement in principle on a deal that meets all those commitments and puts the people of Northern Ireland first. I would like to begin by paying tribute to Maroš Šefčovič and his team for their pragmatism, collaborative spirit and determination to get a deal done that would work for both sides. I would also like to thank the First Minister, the Deputy First Minister and all the Members of the Northern Ireland Executive for their crucial intervention at significant moments to ensure that the rights of the people of Northern Ireland were protected I turn now to the first Government commitment. This deal protects unfettered access for Northern Ireland businesses to their most important market. As the Prime Minister underlined, this had to be protected in full, and that meant removing any prospect of export declarations for Northern Ireland goods moving from Northern Ireland to Great Britain. That is what our agreement will do. There will be no additional requirements placed on Northern Ireland businesses for these movements, with the very limited and specific exceptions of trade in endangered species and conflict diamonds On the second commitment, the deal safeguards Northern Ireland’s place in the UK’s customs territory. As recently as July, the Commission had envisaged a default tariff scenario in which “all goods brought into Northern Ireland” were “considered to be at risk…and are as such subject to the Common Customs Tariff.” If that had been implemented, that would have raised the prospect of a 58% tariff on a pint of milk going from Scotland to a supermarket in Strabane or a 96% tariff on a bag of sugar going from Liverpool to the shops of Belfast. As we have repeatedly made clear, this could never have been an acceptable outcome. Instead, I am pleased to say that under the agreement that we have reached, Northern Ireland businesses selling to consumers or using goods in Northern Ireland will be free of all tariffs, whether that is Nissan cars from Sunderland or lamb from Montgomeryshire. Internal UK trade will be protected as we promised, whether we have a free trade agreement with the EU or not Thirdly, this deal would keep goods flowing between Great Britain and Northern Ireland in January and provide some necessary additional flexibilities. It protects Northern Ireland’s supermarket supplies. We heard throughout the year that traders needed time to adapt their systems. That is why we have a grace period for supermarkets to update their procedures. Our agreement prevents any disruption at the end of the transition period to the movement of chilled meats. British sausages will continue to make their way to Belfast and Ballymena in the new year, and we have time for reciprocal agreements between the UK and the EU on agrifood, which can be discussed in the months ahead. This deal also protects the flow of medicines and vet medicines into Northern Ireland. That means we will grant industry a period of up to 12 months to adapt to new rules under the protocol, which will avoid any disruption to critical medical supplies So those are three commitments entered into, and three commitments that we have upheld. But this agreement goes further still, providing additional flexibility that will enable us to make the most of the opportunities that face us as the transition period ends. As you know, Mr Speaker, this House has been concerned about the risk of so-called reach-back from the state aid provisions that the protocol applies. The concern that many colleagues had was that a company in Great Britain with only a peripheral link to commercial operations in Northern Ireland could be caught inadvertently by the tests within the protocol’s text. That would not have been acceptable, nor was it what the protocol had envisaged. That is why I am pleased that the agreement we have addresses that risk. It means that firms in Great Britain stay outside state aid rules where there is no genuine and direct link to Northern Ireland and no real foreseeable impact on Northern Ireland-EU trade. That is an important step forward in dealing with an issue raised by a number of Members across the House This deal also ensures that Northern Ireland will be out of the common agricultural policy, which means that the Northern Ireland Executive have full freedom to set their own agricultural subsidies for Northern Ireland’s farmers. It also means appropriate and flexible arrangements, so that more than £400 million of spending each year is totally exempt from state aid rules. As well as that, the deal ensures that support for fishermen in Northern Ireland will be exempt from EU state aid rules, which means more than £15 million of flexibility for Northern Ireland’s fishermen over the next five years. And, of course, Northern Ireland’s services industries are totally outside the scope of the protocol and its state aid measures The agreement also respects the protocol provisions, which were endorsed by Parliament, that allow some EU officials to be present at Northern Ireland ports as UK authorities carry out our own procedures. Let me be clear: there will be no Belfast mini embassy or mission, as some in the EU originally sought, and the EU officials will not have any powers to carry out checks themselves. There will instead be sensible, practical arrangements, with co-operation and reciprocal data sharing, so that both sides can have confidence in these unique arrangements. We also want to leave no doubt about our ongoing commitment to peace and prosperity in Northern Ireland. My right hon. Friend the Northern Ireland Secretary will set out in the coming days further measures of financial support to help businesses and communities to prosper and thrive from the end of the year and beyond We have been able to deliver a package which now means that the protocol can be implemented in a pragmatic and proportionate way. It takes account of the Belfast/Good Friday agreement in all its dimensions, and it protects the interests of both the EU single market and, more importantly, the territorial and constitutional integrity of the whole United Kingdom. This agreement will be approved officially at a Joint Committee meeting in the coming days. Of course, the agreement we have reached also enables the Government to withdraw clauses 44, 45 and 47 of the United Kingdom Internal Market Bill and avoids the need for any additional provisions in the Taxation (Post-transition Period) Bill. Having put beyond doubt the primacy of the sovereignty of this place as we leave the EU, we rest safe in the knowledge that such provisions are no longer required We know that we now need to get on and give further clarity to business as to the specifics of what this deal means for them and how it will work in practice, and we will do that through the publication of further guidance. That will sit alongside the ongoing intensive work that we will take forward to implement the protocol. Above all, we will always work with the interests of the people and businesses of Northern Ireland in mind, as this agreement and the important flexibilities it will provide reflects. We must all remember that, if the protocol is to work, it must work for the whole community in Northern Ireland. Whether it is to be maintained in the future, as the protocol itself sets out, is for the people of Northern Ireland to decide through the democratic consent mechanism that my right hon. Friend the Prime Minister negotiated. On that critical note of the primacy of democracy, I commend this statement to the House.
I thank the Minister for advance sight of the statement. We welcome it and are pleased that a decision has been reached on the Northern Ireland protocol. The Good Friday agreement is a source of immense pride on this side of the House, given the role that Tony Blair’s Labour Government played in building on the work of Sir John Major in achieving it. Neither of those Governments would play games with the peace process, and nor would a Government led by my right hon. and learned Friend the Member for Holborn and St Pancras (Keir Starmer). Game playing, with threats to break international law, has consequences, and it is also a dangerous distraction Northern Ireland’s Department of Agriculture, Environment and Rural Affairs says that the border infrastructure simply will not be ready in time. Manufacturing NI says that just 9% of businesses in Northern Ireland are ready for the end of the transition period. The systems needed to make trade flow, such as the trader support service, reportedly will not even be going live until 21 December—eight working days before the end of the transition period. This really does give new meaning to “the night before Christmas”. Last December, the Prime Minister said: “We’re a UK government, why would we put checks on goods going from NI to GB or GB to NI? It doesn't make sense.” With that in mind, will the Minister explain why today’s documents confirm that on trade from GB to NI there will indeed be a range of checks? The trusted trader scheme will be removed after three and a half years and reviewed then, with further uncertainty at that point The exemption on agrifood checks is available for only three months, so will the Minister tell us what guarantees there are on prices and availability of fresh food supplies in Northern Ireland after 1 April? Will custom checks be required just three months into 2021? All that raises the question: did the Prime Minister actually know what he had signed up to last year, and then give false assurances to the House, or did he simply not care? This is a disgraceful way to treat businesses in good times, never mind in the middle of a pandemic On the trade deal needed for Northern Ireland, and for Great Britain too, we are told that the level playing field remains an outstanding area of disagreement, yet the Prime Minister’s political declaration, which he signed with the EU, spoke of a future relationship with “open and fair competition, encompassing robust commitments to ensure a level playing field.” Some Conservative MPs are agitated by the idea of a floor on workers’ rights. Indeed, no fewer than three Cabinet Ministers jointly wrote a book that said that British workers are “among the worst idlers in the world.” We on this side of the House do not agree with that statement. Neither do the people of our country, who want more security at work, not less. There are some siren voices among those on the Government Benches, who appear to view any agreement with the EU as a betrayal. The Minister should know that the true betrayal would be job losses, border chaos and price rises in our shops The Minister referred to cars from Nissan and lamb exports from Wales, and that they will be tariff-free in Northern Ireland, but as he knows, they need to be tariff-free with the EU too. We on this side of the House want the negotiations to succeed. We want the Government to keep their promises and come back with the oven-ready deal that we were promised at the general election less than a year ago. Sometimes it feels as though we on this side of the House want the Government to succeed and bring back this deal more than those on the Government’s own Back Benches do Deal or no deal, there are preparations that still need to be made for Northern Ireland, and for Great Britain too. I want to ask again about customs agents, because just minutes ago, the Prime Minister did not seem to have any answers on how many there are. Earlier in the year, the Minister agreed with industry estimates of 50,000 customs agents needed. Since then, he has told the BBC that the number had increased fourfold, but he omitted to tell us what the figure was. Let us give him another chance: how many customs agents are in place and are we ready for the end of the transition period It is not just me asking these questions. Richard Burnett, chief executive of the Road Haulage Association, says: “The big issue that we face is that there are insufficient customs agents” and that without them and the correct paperwork, “we are likely to see vehicles being turned around… That is going to create significant chaos and significant queues.” On lorry parks, will the Minister tell us how many inland border facilities are ready and will they ensure the free flow of lorries and vehicles from 1 January? Can he guarantee the House that there will be no disruption to medical or food supplies from 1 January Ours is a great country, and Labour wants to see a good life for all our people, but, as great as our country is, it cannot afford to be afflicted by Government incompetence. Every price rise, every traffic jam, every lost contract and every redundancy caused by this Government’s mistakes and poor planning holds our great country back. Next year must be a year of rebuilding and recovering from covid-19, not dealing with the fallout of reckless decision making, tariffs or incompetence. So this is decision time for this Government, and it is time to get the deal.
I am very grateful to the hon. Lady for the warm welcome that she gave to this agreement, and I also thank her for the kind words she offered Sir John Major: the process of concluding the Good Friday agreement, as she quite rightly reminds us, was a signal achievement of Tony Blair’s Government but was also achieved as a result of hard work across this House. And of course there has been since the Good Friday agreement was concluded 22 years of progress in Northern Ireland, and it is important that we seek to underpin and secure that The hon. Lady asked about border infrastructure. Let me emphasise that this border infrastructure is there to ensure that sanitary and phytosanitary checks can be made. As she and the House know, it is already the case that the island of Ireland is a single epidemiological zone, and therefore when live animals move from Great Britain to Northern Ireland there are physical checks. There will be border facilities in order to ensure that these limited and proportionate SPS checks can be carried out at the port of Foyle, Warrenpoint, Belfast and Larne, and we have reassured the Commission, and indeed others, about the speed and effectiveness with which the necessary limited infrastructure will be in place The hon. Lady also asked about the trader support service, which is there to help Northern Ireland businesses. I am pleased that we spend over £200 million in order to support Northern Ireland businesses, and I think it is the case that more than 10,000 businesses are now signed up to the trader support service in order to ensure that they will incur no costs as a result of the protocol The hon. Lady also asked about the future of the trusted trader scheme, which, as she rightly pointed out, guarantees that goods being sold in Northern Ireland and businesses operating in Northern Ireland will face no tariffs. It is the case that we will have an opportunity to review how that scheme operates, but it will only need to be reviewed if there is a demonstrable diversion or illegal activity, and in those circumstances there is an obligation on both parties to seek alternative arrangements. I should stress again that no additional customs checks will face goods going from Northern Ireland to Great Britain. The hon. Lady asked about customs agent capacity overall. It is the case that £84 million has been made available in order to increase capacity, and the latest survey by HMRC shows that there has been a fourfold increase in capacity. Of course, one of the reasons why we are phasing in import controls over six months next year is to ensure that the sector can increase even further, but that fourfold increase in capacity gives us the confidence we need that all the staff will be there The hon. Lady mentioned Richard Burnett of the Road Haulage Association. He, along with Dave Wells of Logistics UK and other figures in the haulage and logistics industry, has played an invaluable role in making sure that the Government do everything necessary to prepare, but I would never shirk from saying that more needs to be done The hon. Lady asked about the level playing field and workers’ rights. We have a proud tradition of upholding workers’ rights and ensuring that we have social and environmental protections in this country that are higher than in many other European countries. That will not change—that is a source of pride—but one thing we cannot accept in the course of the level playing field negotiations is the demand from some in the EU that if the EU adopts new laws, we would automatically have to follow those laws or face penalties. We are not afraid to say that our standards are high and we will uphold them, but we are also not afraid to say that the people of this country voted to take back control, and that is what this Government will do.
The implementation of the Northern Ireland protocol has become my right hon. Friend’s equivalent of the Schleswig-Holstein question, given the variety of interpretations that surround it, but fundamentally does what my right hon. Friend agreed yesterday make it more or less likely that a free trade agreement with the European Union that, crucially, ensures United Kingdom sovereignty in its entirety can be secured?
I thank the Chairman of the Select Committee on Public Administration and Constitutional Affairs for his question. I think it was Palmerston who said that there were only three people who knew the answer to the Schleswig-Holstein question: one was dead, another was mad, and he himself had forgotten what the answer was. But on the Northern Ireland protocol, there are all sorts of hon. and right hon. Members in this House who have played a part in making sure that we can indeed secure Northern Ireland’s constitutional future within the UK and ensure that we leave the European Union as one country, whole and entire.
I thank the Chancellor of the Duchy of Lancaster for his statement. It is one of these statements that I suppose is good news until we actually see the scale of the Brexit horrors that are now just in front of us. We are now at the stage of this chaotic Brexit where we have a sort of Schrödinger’s deal—one that is sort of there but also not I do not know whether the Chancellor of the Duchy of Lancaster has come to the House today looking for some sort of “congratulations and well done” for all this. I suppose it is “well done” for taking us all to the very brink with the very worst of negotiation statecraft on what was supposed to be the easiest deal in the world, “well done” for the emerging chaos at our ports and businesses taking flight, or maybe even “well done” for in a few weeks denying our young people the right to live, work and love freely across a continent. Tonight, we are going to have the last supper—but we know it is the British people who will be crucified Yes, what Northern Ireland has got is great for it. “Best of both worlds” is a phrase that we in Scotland are pretty much familiar with; it is what we were promised in 2014. Now, in 2020, we are faced with the worst of all worlds. We would give our right arm for access to the EU single market and unfettered access across the rest of the UK market, so can the Chancellor of the Duchy of Lancaster explain to the Scottish people exactly why Scotland is the only part of the United Kingdom that will not get any part of what it voted for on Brexit?
I am very grateful to the hon. Gentleman once again for his questions; they are masterpieces of metaphorical concatenation. He managed to bring in both Schrödinger’s cat and the Easter and Passiontide narrative before he eventually got to his question. It was a masterpiece, as I say, of lyrical concision, which we would expect from Runrig’s principal star On the basic question, it is the case—the hon. Gentleman recognises, as I recognise—that Northern Ireland has a unique position within the United Kingdom as a result of having a land border with the European Union, which no other part of the United Kingdom does, and that requires specific arrangements. But whatever those specific arrangements, it is the case that Northern Ireland, by the will of its people, remains part of the United Kingdom. Long may it remain so.
I very much agree with what the Prime Minister said today at Prime Minister’s questions. Does the Chancellor of the Duchy of Lancaster also agree? And is there anything in his statement that would be allowed to undermine the unfettered sovereignty of the United Kingdom as asserted by successive democratic votes and the referendum, and successive Acts of Parliament, including sections 30 and 38 of the European Union (Withdrawal Agreement) Act 2020 Will the Chancellor of the Duchy of Lancaster also confirm today that he will appear before the European Scrutiny Committee? As he knows, he has declined to do so on at least three occasions, most recently on 26 November. We put this to him in writing but so far he has not been able to come. Will he please commit right now, today, to coming before the Committee as soon as possible?
On the first point, my hon. Friend is absolutely right: section 38 of the Act that gave effect to the withdrawal agreement upheld the sovereignty of this place, and there is nothing in what we have concluded that in any way diverges from that. On the second question, I am very sorry that I have played hard to get, but I will make sure that we can have a date before Christmas when the two of us can meet in suitably covid-compliant surroundings.
I welcome the right hon. Gentleman’s statement, because it shows what can be achieved with political commitment, and I do hope that we will see more of that later today. However, he seems to have brought back not a permanent arrangement but a series of grace periods, and I want to ask him about that For example, it has been reported that food products coming from GB into Northern Ireland will be exempt from export health certificates for a period of at least three months, and that chilled meats—the right hon. Gentleman referred to sausages—will be allowed for a period of time, pending a review, after which they might be prevented any more from moving from GB to Northern Ireland. What is going to happen after those dates? How exactly are businesses going to be able to prepare when they have not yet seen the detailed arrangements, because the Joint Committee is not going to meet for a couple of days, and when those details may well change yet again in a few months’ time?
I am very grateful to the right hon. Gentleman for his questions—and indeed for the work of his Future Relationship with the European Union Committee, which has helped us as we have sought to resolve these issues—and his welcome is very welcome. On the detailed points he makes, we have been talking to traders, supermarkets in particular, to make sure that they are ready for any export health certificate requirements. We know that some supermarkets are already ready. One or two others need time in order to get ready, and they requested a grace period. Originally, those in the Commission argued that that would be impossible or, if it did exist, that it could only be a matter of weeks. We have managed to secure three months, which is sufficient time, we understand, to ensure that supermarkets are ready. On the chilled meat provision, it is the case that we have secured a six-month period during which there will be absolutely no change. Again, it was the case that there were some in the EU who argued that that should be a strictly non-renewable provision. We secured an approach that meant we could keep under review how things were operating in order to ensure that we provided people in Northern Ireland with access to the food they currently enjoy, without any disruption to the integrated supply chains that supermarkets have and which they will adjust.
Many of the life science and other businesses of South Cambridgeshire export to Northern Ireland. Can my right hon. Friend reassure them that they will not face any new bureaucratic obstacles or tariffs as they sell their goods and services there?
My hon. Friend is a brilliant advocate for the life science sector, and I know that it provides jobs and investment in Cambridgeshire and beyond. It is also the case that there is a thriving life science and pharmaceuticals sector in Northern Ireland, and it will be the case that there are no impediments to the continued successful integration of that work.
The right hon. Gentleman and I have known each other for many years, and while we might have differed on Brexit, there is another issue—and it is Scotland—on which we are very much in agreement. Can the right hon. Gentleman assure us today that every effort will be made to ensure that this agreement, good as it is for Northern Ireland, is not used to undermine Scotland’s position within the Union, and does he consider that my constituents in Edinburgh West and elsewhere might benefit from the same sort of phasing-in agreement as has been agreed for Northern Ireland?
I have known the hon. Lady, as she says, for a few years—she is a brilliant MP and she is absolutely right. The shadow Minister said that people should not play politics with the Good Friday agreement, and I do not think they should. I think it is important to recognise that Northern Ireland is in a unique position within the UK, and I think the majority of people in Scotland and across the UK recognise that, but it is also important—the hon. Lady is absolutely right—that in our arrangements with the EU, we take specific account of the needs that Scotland has. On everything from the provision of seasonal agricultural workers to making sure that we can expedite fish and shellfish from the north-east to the EU, and indeed the principled position that my right hon. Friend the President of the Board of Trade is taking on whisky exports, it is absolutely important that we recognise that Scotland has distinct needs and that working with the Scottish Government and Scottish MPs, like herself, we can advance Scotland’s interests.
Does my right hon. Friend agree that the EU’s request for a mini embassy in Northern Ireland was inflammatory for communities in Northern Ireland and is not required to allow the EU to supervise processes carried out by UK authorities?
My hon. Friend is absolutely right. There were some in the EU who wanted to mount a sort of land grab, as it were, and to have a part of Northern Ireland that was forever Brussels. But what we have agreed is a pragmatic approach, which means that the EU, quite rightly, can have people in Northern Ireland so that it can be assured that the UK officials who are carrying out our own sovereign procedures are doing so in a way in which everyone can have confidence. I want again to place on record my thanks to Vice-President Maroš Šefčovič for making sure that it was pragmatic arrangements, rather than symbolism, that won through.
I know that the right hon. Gentleman is as passionate as I am about the Union. Article 6 of the Act of Union states very clearly there should be no barrier to trade between Great Britain and Northern Ireland, as is now. Article 16 of the Northern Ireland protocol also makes it clear that if “this Protocol leads to serious economic, societal or environmental difficulties that are liable to persist…the United Kingdom” Government “may unilaterally take appropriate safeguard measures.” Safeguarding the Union is not a three-month, six-month or three-year project; it is an enduring commitment. Will the Chancellor of the Duchy of Lancaster now give a commitment that, if necessary, the Government will introduce safeguard measures to ensure unfettered access in both directions for trade between Great Britain and Northern Ireland?
The right hon. Gentleman makes a very important point in drawing attention to a very important provision within the Northern Ireland protocol. The Government came under criticism from some for having provisions in the United Kingdom Internal Market Bill that upheld the sovereignty of this place in order to uphold the constitutional and territorial integrity of the UK. We no longer need to use those provisions, because of the agreement we have reached, but he is absolutely right. Of course, that provision remains, but I hope it will be the case that through patient and pragmatic discussion we can resolve any future issues in the way that we have resolved existing issues.
I congratulate my right hon. Friend on reaching his agreement in principle, which shows that Britain is willing to make constructive compromises. As it now stands, is there any part of the withdrawal agreement that requires direct application of EU law to any part of the UK?
Yes, it is the case that as a result of some of the provisions in the Northern Ireland protocol, there will be a requirement on some businesses in Northern Ireland specifically to follow the acquis. That is one of the ways in which we can ensure that there is no need for border infrastructure between Ireland and Northern Ireland.
We welcome yesterday’s agreement. We want for Northern Ireland just what we want for Wales: unfettered access to our most important markets with the rest of the UK and with the EU. However, the fundamentals of trade, particularly between Wales and Northern Ireland and indeed the Republic of Ireland, remain uncertain. Hauliers fear serious disruption on the Holyhead to Dublin route, with the Welsh Government’s plans, agreed on Monday, for contraflows and parking lots being too little, too late. What steps has the right hon. Gentleman taken to lessen this potential disruption?
I am grateful to the hon. Gentleman for his question. I know that because of the geographical proximity of his constituency to Ynys Môn—to the island of Anglesey—he has a particular concern. However, we have been working well with the Welsh Government—I particularly thank their Counsel General, Jeremy Miles—to make sure that we will have infrastructure in Holyhead that can ensure that the second busiest roll-on roll-off port in the UK continues to prosper.
May I just point out to my right hon. Friend that whatever he agreed in the Joint Committee yesterday remains subject to the jurisdiction of the European Court of Justice under the disputes procedure? Moreover, whatever he agreed yesterday was agreed only because we had the clauses in the UKIM Bill that were threatening to block the ECJ’s jurisdiction. Does he agree that it is very important that we maintain the position that this House can at any time put blocks in front of the ECJ while this withdrawal agreement remains in force?
My hon. Friend is right: this House is sovereign. This is as a result of bringing forward the UKIM Bill. I understand some of the unease and controversy that it generated, but he is absolutely right that following on from that we were able to make progress. We are now no longer in a position where we need to bring forward those clauses, but of course it is the sovereign right of this Parliament to legislate as it thinks fit.
We welcome details that businesses have sought anxiously all year, and of course we keenly anticipate a wider trade deal that might finally allow us to continue to enjoy the conditions that we currently enjoy. How does he propose to ensure continuity of supply for squeezed Northern Ireland households so that they can have choice and affordability after mitigations on export health certificates expire in six months?
We have been working with supermarkets and other traders to ensure that their supply lines and the provision of all the goods that consumers in Northern Ireland currently enjoy, which I hope in future will be enhanced, can remain. The Trader Support Service is there, alongside other support that we are giving to businesses in Northern Ireland and indeed across the UK, to make sure that a fully integrated part of the UK internal market enjoys the same access to the same goods as the rest of us.
Can my right hon. Friend assure me and all my constituents that, should we strike a trade agreement with the EU, we will not compromise in any way on our fishing waters, our borders and our laws, and, most importantly, that any governance arrangements that may flow from any trade agreement are completely consistent with those of a fully sovereign country?
My hon. Friend is bang on.
I wish we were in a different place, where we did not need the protocol, but I recognise the progress that has been made through the provisional agreement. Does the Chancellor of the Duchy of Lancaster recognise that there is a range of unfinished business in relation to protecting the Northern Ireland economy, including on issues such as: transit from Great Britain via the Republic of Ireland into Northern Ireland; access to EU free trade agreements, particularly for our agrifood and dairy sectors; data adequacy and the protection of the service sector on an all-Ireland basis?
I am grateful to the hon. Gentleman for those points. He is right that there is important work still to be done. As I think he noted, it is the case that the services sector in Northern Ireland is totally exempt from any state aid provisions. However, it is also the case that Northern Ireland has benefited from commercial links with the Irish Republic, as well as its strong position within the UK internal market. More work is required to strengthen Northern Ireland’s formidable competitive position.
The good people of my Workington constituency stand squarely behind my right hon. Friend and Lord Frost in the negotiations. Will he confirm that, with the agreement on the protocol in place, the UK will leave the transition period at the end of this month regardless of whether we reach an agreement with the EU?
My hon. Friend is absolutely right. Whatever happens—and we do hope that we get a free trade agreement—we will leave the customs union and the single market on 31 December.
The Secretary of State will be—I hope—aware that many of us will feel very sad that his career will end in failure if we do not get an agreement with the European Union today or very soon. The Committee on the Future Relationship with the European Union, of which I am a member, recently listened to leaders from the Northern Ireland business, manufacturing and farming communities saying that they do not think that everything is fully operational. They do not think anything is oven-ready. They think that if anything were in the oven, it would be pretty thin pickings. Will he please, please, at this late stage, make every effort to make sure we get a deal, rather than leave without a deal?
I am very grateful to the hon. Gentleman for his words. We will do everything we possibly can to get a deal, but it cannot be a deal at any price. As for his point about my career ending in failure, my career has, I am afraid, been marked by failure consistently in so many ways. Often in politics I am reminded of the words of Winston Churchill, who said that success means going from failure to failure with undiminished enthusiasm. That is what I hope to do.
I thank my right hon. Friend for his statement and careers advice. I warmly welcome the news of this significant progress, but can he reassure the House that while the Government have said they will withdraw clauses 44, 45 and 47 of the United Kingdom Internal Market Bill, the rest of the Bill will remain in place, so we can ensure that goods can move seamlessly across the UK, benefiting businesses and consumers across all four nations?
My hon. Friend is absolutely right. The United Kingdom Internal Market Bill is a critical piece of legislation which safeguards the rights of producers and consumers across the UK. The clauses she mentions excited controversy, but I think they were necessary. In any case, that controversy can now pass because they are being withdrawn. I hope the Bill will pass as well.
The Government’s “Get Ready for Brexit” campaign looks lovely, but it does not answer the question: get ready for what? Deal? No deal? What deal? Businesses have a pandemic to deal with. Will the right hon. Gentleman admit that the combination of Brexit shambles with the absence of proper support for small businesses facing covid-19 measures, and the total exclusion from support of so many businesses, means that the Government are totally letting down small businesses in the north-east and across the country?
It will probably not surprise the hon. Lady to learn that I do not agree with her. When it comes to Brexit transition, we know that because we are leaving the single market and the customs union, and whether or not we secure a free trade agreement, much of what most businesses need to do is broadly the same, and of course the Government stand ready to help businesses to adjust The fate and the future of businesses in the north-east are very dear to me, having lived and worked in Newcastle in the past. It is striking how many of those who work for businesses in the north-east voted Conservative just 12 months ago, which is why Conservative MPs in Blyth Valley, in Bishop Auckland, in Redcar and across the north-east are standing up—[Interruption.] I will mention more constituencies that the Conservatives won if the hon. Lady likes: North West Durham, with Consett, is now a Conservative constituency; Sedgefield, with Spennymoor, is now a Conservative constituency—[Interruption.] Anyway, as the hon. Lady and the House know, the north-east is Tory, and that is because we stand up for workers.
I remind Opposition Members that we all want a deal. There is no one on this side who does not want a deal, but it must be a fair deal and one that respects the UK’s integrity. On that point, my right hon. Friend has said on many occasions that we must leave together. In answering questions from my right hon. Friend the Member for North Somerset (Dr Fox) and my hon. Friend the Member for Harwich and North Essex (Sir Bernard Jenkin), he said—unless I am incorrect—that EU law will apply in Northern Ireland, as will the European Court of Justice. We have gone to all this effort to be free of those structures. Can he say whether I have got it wrong or he has got it wrong—one or the other?
My hon. Friend never gets it wrong, and he is right. It is there in the withdrawal agreement and in the protocol that we accept the acquis in a specific number of areas in Northern Ireland. That is part of the withdrawal agreement, which was signed before the general election, and which many, though not all, Members of this House supported. It was also in the Conservative manifesto. Of course there were understandable concerns that the way in which the protocol applied would mean that we would face tariffs and other restrictions. The agreement that we have concluded means that that will not be the case. The UK will leave and Northern Ireland will be capable of benefiting from trade deals that we do as a result of Brexit; it will also be outside the common agricultural policy and it will benefit from the Australian-style points-based immigration system that applies across the UK.
While the Minister is telling Northern Ireland that it can have the best of both worlds, he is using the same reasoning to tell Scotland, “Shut up and get back in your box,” all the while claiming that any negative impacts are not Brexit-related. Perhaps he has now become the Government’s very own Bart Simpson, causing chaos in presenting their agenda regardless of cost while claiming, “I didn’t do it. Nobody saw me do it. You can’t prove anything.”
The Simpsons character I most remembered was Groundskeeper Willie, because he is an Aberdonian. [Interruption.] I am not sure what his position is on independence, but as jannies go, he is certainly one of the best. To the hon. Gentleman’s point, Scotland does have the best of both worlds. It has a devolved Administration in Holyrood and representation by great MPs such as himself here in Westminster.
I commend my right hon. Friend for the role he has played and very much welcome this agreement. It is good news that the EU has compromised; its previous position on everything from unlimited checks to export declarations could have choked trade between Great Britain and Northern Ireland. Given that this agreement will add an impetus to the wider trade talks, will he commend the Prime Minister for not making last-minute compromises just to get a trade deal over the line? The Prime Minister has the support of the Conservative party, should he decide to walk away and trade on Australia and Canada terms. After all, a trade deal is for keeps, not just for Christmas.
My hon. Friend is absolutely right. The point he makes, and the point that my right hon. Friend the Member for Gainsborough (Sir Edward Leigh) made earlier, reinforce the fact that the Conservative party is united behind the Prime Minister. It is willing him to get a deal, but it is also ready to accept that if we cannot get the deal we want, we will not accept a deal at any price. That has to be the right way forward.
Some 95% of Cumbrian farm exports are to the single market, so our farmers too need unfettered access to that market. The Secretary of State for Environment, Food and Rural Affairs said at the weekend that British farmers would not find tariffs with the EU to be “manageable”. In addition, in three weeks’ time, deal or no deal, English farmers will see the beginning of huge, uncompensated cuts to their income. We risk the loss of hundreds of family farms in the Lakes, the Dales and elsewhere. Does the right hon. Gentleman agree that a country that cannot feed itself has no sovereignty?
The hon. Gentleman makes several very important points. The first is that we absolutely need to support upland farmers, not just in his beautiful constituency and Cumbria, but across the United Kingdom. It is the case that sustainable livestock farming is the only way in which we can make sure that we have agriculture in the future in upland and grassland areas such as the one that he represents. The second thing is that, yes, there is a prospect of tariffs if we do not secure a free trade agreement, which is why we need to have support systems in place for those. The third point is that the new system of support that we are giving to farmers combines support not just for small farmers, but for the climate change and environmental goals that we both share. It is important that we reform the common agricultural policy in that way, but I look forward to continuing to work with him, because I know that his commitment to rural England and our farmers is resolute.
I welcome the principle that exit summary declarations for goods from Northern Ireland to the rest of UK will not be required, but while it is reasonable for EU authorities to supervise the application of the protocol to Northern Ireland, can my right hon. Friend assure me that all processes in UK sovereign territory will be carried out by UK authorities?
My hon. Friend is absolutely right. It is about UK authorities carrying out our procedures in our territory under our laws.
This was the never-ending story, but it seems a bit like it is turning into a never-ending nightmare for businesses, which have been told not of a settled situation, but that the can is going to be kicked down the road for three to six months. Is it not time to be honest with the British people and say, “This will never end. Negotiations will continue forever,” because this Government are just not capable of securing decent deals that are settled wills with the European Union?
I absolutely take the hon. Gentleman’s point, but it is the case that in the future we will be negotiating new free trade deals, as it happens, with other countries outside the European Union that we could not have negotiated inside the EU. These negotiations are led by my brilliant colleague, the President of the Board of Trade. She has secured deals—for example, with Japan—that are even better than that we had in the EU, so negotiating going on is what Trade Secretaries do, and we are lucky to have the best in the world.
I welcome my right hon. Friend’s statement, in which he spoke of the importance of providing clarity for business. Will he confirm that clarity will include ensuring that manufacturers from across the UK will continue to be able to trade freely with a market of 500 million consumers who are on our doorstep?
My hon. Friend makes an important point. He has been a consistently strong and coherent voice for manufacturing, not just in his native west midlands, but across the United Kingdom. One of the things that we want to secure is a free trade agreement that ensures that our manufacturing and advanced manufacturing sector can continue to sell into a market on our doorstep.
I call Emma Lewell-Buck. Not here.
I, too, welcome this package and what it means for business, peace and our Union. Dare I say that news of tariff-free lamb comes close to being glad tidings for the shepherds on the hillsides above Aberconwy this Christmas time. Lest we get lost in that kind of detail, will my right hon. Friend confirm that there is nothing in this agreement that compromises the integrity of either our sovereignty or the Union?
My hon. Friend is absolutely right. This House remains sovereign and it is the case that the territorial and political integrity of the United Kingdom remains robust.
The Democratic Unionist party opposed the protocol and warned about all the problems that the Minister is now having to address. We welcome the changes that have been made today. Nevertheless, the real test will be how these measures work on the ground, rather than the spin that we get in this House. As far as EU officials are concerned, is it not a fact that although they will not carry out the searches and investigations, they will be able to direct UK officials on the ground, and, under article 5 of the protocol, UK officials will have to carry out their demands? The Irish Government are now spinning that the six-month period is simply to allow supermarkets in Northern Ireland to source their products from the Irish Republic. Does the Minister believe that we have gained back sovereignty if we are allowing EU officials to direct our officials and other Governments to tell us where we can get our food from?
As the right hon. Gentleman quite rightly points out, there were a number of very principled opponents of the whole idea of the protocol itself. He and his colleagues in his party laid out some of their concerns in a very cogent fashion. In the end, the House of Commons decided that the protocol, as part of the withdrawal agreement, was the right way to proceed, but, as he quite rightly points out, it was important that a number of difficult questions were addressed. He is also absolutely right that the proof will be in the implementation on the ground Let me turn to the two specific areas that the right hon. Gentleman mentions. It is the case that the limited number of EU officials—I think it is probably no more than two dozen at most—who will come into Northern Ireland will be working alongside UK officials. The UK officials will be in the lead there, but we want to provide the EU with assurance. On the matter of where goods are sourced from, I cannot think of any better place for goods in Northern Ireland supermarkets to be sourced from than Northern Ireland itself. Wonderful though produce in the Republic of Ireland is, I do not think it is the case that there is any better producer—[Interruption.] The hon. Member for Glasgow North (Patrick Grady) asks about bananas. I think he is referring, of course, to SNP policy on trade. But when it comes to pork products, there is nothing better than an Ulster fry.
Thank you, Madam Deputy Speaker, for your kindness—and I thank my right hon. Friend the Minister for the Cabinet Office for his kindness—towards my many children, who have been here on many occasions. My nine-year-old, Atticus, said to me when he got sight of the question that I was going to ask today, “But, dad, the answer to that question is so obvious!” I am going to ask it anyway. Despite our desire for a good trade deal with the European Union, does my right hon. Friend agree that we must never again cede control of our borders or coastal waters to a foreign power?
Well, I knew that my hon. Friend was a great dad, because his son absolutely hits the nail on the head in saying that the answer to that question is obvious. No, we absolutely should not cede that control. Very good question; the answer is clear. Excellent son; brilliant dad.
The vehicle industry has consistently warned that a no-deal Brexit risks the future of UK plants and skilled, unionised jobs. Without a deal, Luton-made Vauxhall vans could face tariffs of 22%. Coupled with covid, cuts to our council and no support for our aviation industry, for Luton no deal would make this a job-killing Government. With just 22 days to go before the end of the transition period, can the Minister guarantee that there will be no tariffs on vans and cars made in this country?
The automobile sector is important not just in Luton, where there are so many skilled people producing fantastic products, but across the UK. Of course, if we secure a free trade agreement, it will be a zero-tariffs, zero-quota agreement. If we do not secure that agreement, there will be tariffs, but there will also be tariffs on automobiles coming into the UK, and that will have an impact on industry in the EU.
We are only halfway through the call list. It would be best if I can manage to get everybody who wants to ask a question on this very important subject in to ask such a question.
Hear, hear!
I see that I have some agreement from the right hon. Gentleman, who is quite far down the list. I must therefore insist on having questions—just short questions—and not great big statements. We all know what has already happened. Let us just have questions for the Minister, so that we can then just have answers from the Minister.
I welcome the agreement and thank my right hon. Friend and his civil service team for getting us to this stage, but may I urge him to spend some time with the Protestant Unionist loyalist community, who have retained concerns about the detail? I suggest that Mikala’s Kitchen on the Shankill Road is the best place for that engagement. Could he also now spend some time with the nationalist community, unaligned voters and passionate supporters of the European Union in Northern Ireland to demonstrate to them that the practical approach that he and the EU have taken on the protocol can now be replicated on issues such as climate change, health, jobs and the future of all people across the island of Ireland?
My right hon. Friend is absolutely right: there is more work to do. I always enjoy any opportunity to be in Northern Ireland with my right hon. Friend the Secretary of State for Northern Ireland. My right hon. Friend the Member for Skipton and Ripon (Julian Smith) was an outstanding Secretary of State for Northern Ireland, and he makes a series of very important points that I take completely to heart.
Honda has just announced that it has had to pause production because of problems with getting components through ports. Does the Chancellor of the Duchy of Lancaster suggest that failing to get those parts is entirely down to Honda, or do the Government share some of the blame?
No, I do not think that it is Honda; I think that there is a global problem with container traffic. That point has been well made by those who are leading our major ports.
Is the recent removal of clauses from the United Kingdom Internal Market Bill a sweetener for the European Union or an indicator that early white smoke might be forthcoming on a wider trade deal?
We made that decision as a Government because we believed that we had satisfied all our aims in the discussions on the protocol. It was a sovereign decision, but I hope that it will help to ensure that we get a free trade agreement.
I welcome the withdrawal of clauses 44, 45 and 47 of the United Kingdom Internal Market Bill, but has the Chancellor of the Duchy of Lancaster any plans to carry out an assessment of the impact of the threats to breach a recently signed treaty on the United Kingdom’s international standing and its ability to enter future agreements, given that it is now known across the world that the United Kingdom is prepared to break its word to get its way?
The hon. and learned Lady will know that since we introduced those clauses into the Bill, we have succeeded in signing any number of trade agreements with other countries. That is because the reputation of the UK continues to stand high.
My right hon. Friend has played a blinder, but given that the EU withdrawal means that British Government procurement will no longer be subject to Official Journal of the European Union rules, what concrete steps will he take to ensure that Northern Ireland companies and businesses across Great Britain that wish to procure contracts with Government can do so only if they employ a significant number of apprentices?
The Chairman of the Select Committee on Education makes a very important point. My noble Friend Lord Agnew will shortly bring forward a paper on procurement reform, which will show exactly how we can achieve the ambition for apprenticeships that my right hon. Friend has so consistently and brilliantly put forward.
May I follow on from the question asked by my hon. Friend the Member for Warwick and Leamington (Matt Western) about the situation with Honda? Given that chaos at ports is already occurring before the end of the transition period—I understand that that is because people are stockpiling because they are so worried about what will happen next year—can the Chancellor of the Duchy of Lancaster confidently say that the perfect storm of Christmas, Brexit stockpiling, covid restrictions and the new customs regime will not lead to significant disruption come January?
It is a very fair point that a number of things are coming together this Christmas, and it is helpful that the hon. Lady contextualises the fact that the situation with containers is a result of many factors. We are doing everything we can to ensure that trade continues to flow freely, but as she quite rightly points out, there are a number of factors with which all Governments are having to grapple.
With clauses 44, 45 and 47 of the United Kingdom Internal Market Bill now withdrawn, can my right hon. Friend reassure the House that seamless trade between Northern Ireland and the rest of the UK will continue, despite any suggestion from the European Union to interpret the withdrawal agreement in such a way as to prevent our internal market, which has functioned for centuries?
My hon. Friend is absolutely right. I should stress that there were some in the EU who did have precisely that agenda, but Vice-President Maroš Šefčovič has done a great job of making sure that this is an arrangement that works for everyone. The superb ceramic products made in my hon. Friend’s constituency will continue to flow on to tables in Belfast, Ballymena, Strabane and Derry/Londonderry.
Does the Minister regret the fact that the Government abolished the expert trade advisory groups, which were set up to advise the Government on customs and continuity in trade, and were disbanded in July because some of the members refused to sign non-disclosure agreements? Would it not have made more sense to keep the trade advisory groups going to help to avoid the disruption we have been hearing about at the ports and the delays in essential food and manufacturing parts that are being widely reported today?
Well, that is all news to me, but maybe the hon. Gentleman has a point—I do not know.
I commend my right hon. Friend, and also the vice-president, for reaching an amicable and sensible agreement. I also wish the Prime Minister well, and hope that neither of the two diners tonight gets indigestion and that they achieve an acceptable deal for both the EU and, in particular, our own country At the end of last month, Jim Harra told the Public Accounts Committee that Her Majesty’s Revenue and Customs is concentrating on seven key IT systems that need to be changed or built from new to enable GB-EU trade to continue and to enable us to comply, particularly, with the Northern Ireland protocol. Will my right hon. Friend update me on those systems? Will they be completed before the end of the transition period?
My right hon. Friend is absolutely right. There are a number of systems: the trader support Service, or TSS; the movement assistance scheme, or MAS; the goods vehicle management scheme, or GVMS; and CDS, or the customs declaration service, which is the new replacement for CHIEF—customs handling of import and export freight—in HMRC. That is quite a lot of acronyms. A lot of work has gone into making sure that we will be ready. Some of it is close to the wire, but I am confident that everything will be in place.
From 1 January onwards, if he was a business owner primarily exporting to the UK, would the right hon. Gentleman prefer to be located in Northern Ireland or Wales?
That is the most difficult question I have ever faced in this House, because I love Northern Ireland and I love Wales as well, and there are all sorts of advantages to being located in either jurisdiction. I suspect that my choice would be made even more difficult if I had to choose between, say, Carmarthenshire and North Antrim—two uniquely beautiful parts of the United Kingdom. It is Sophie’s choice, in business terms, because wherever you are located in the United Kingdom, you benefit from having a strong Government determined to ensure that this country can take advantage of global opportunities.
Will the jurisdiction of the European Court of Justice continue to prevail in relation to the Northern Ireland protocol, and if that is the case, how is that state of affairs compatible with the restoration of United Kingdom sovereignty?
In the withdrawal agreement that we concluded before the last election and which this House voted on—not every Member, of course, supported it, but a majority did—we made it clear that within the Northern Ireland protocol there would be a limited portion of the acquis relating to goods in the single market that would apply in Northern Ireland. It was the aim of this House and the aim of this Government to ensure that we could reach a satisfactory arrangement on the protocol in line with the principles that we laid out in the Command Paper, and that is what we have done. That upholds the territorial integrity of the United Kingdom and the ability of every citizen of the UK to benefit from all the opportunities that Brexit provides.
Will the Minister comment on the UK Government’s commitment to the Peace Plus programme, which, as he will know, has played such an important role in underpinning peace and reconciliation in Northern Ireland?
We are totally committed, and the Secretary of State for Northern Ireland will be saying more about that in the coming days.
Can my right hon. Friend reassure me that in tonight’s negotiations, and in the ongoing negotiations with the EU, the Prime Minister and his team will remember just how important securing a deal will be to Cumbrian farmers, and indeed farmers across the four nations?
Absolutely. For Cumbrian farmers, and also for manufacturers in Barrow, we will be doing everything possible to get the best possible set of arrangements.
The temporary food waiver for trusted traders is very much to be welcomed and my right hon. Friend is to be congratulated on securing it, but may I press him a little on the detail of what will then follow, because businesses need certainty? What he has had to say will of course be welcome to the big supermarkets, but smaller operators, small shops and street traders, on whom the great Ulster fry depends so much, will still be left in a level of uncertainty, particularly if they are not signed up to the trusted trader scheme. Will he say to what extent the trusted trader scheme will extend to small operators of that sort?
My right hon. Friend, who was an outstanding Northern Ireland Minister, is absolutely right. Once the Joint Committee concludes, we will go into more detail on exactly how we can safeguard the interests of small and medium-sized enterprises as well. We will notify the Commission of those businesses that need to take advantage of the grace period that we have got.
RTÉ reports on the derogation for sausages, chilled meats and unfrozen prepared meals and notes that “once a derogation period has elapsed, Northern supermarkets will have to source such products locally or from the South.” Will the right hon. Gentleman explain why it is acceptable to him to disadvantage Scotland and our food exporters in such a way? Is it not just another example of why Scotland would be better off as an independent nation state within the EU?
If Scotland were an independent nation state, it would face trade barriers at Berwick and Cairnryan. By leaving the European Union, Scotland would be—[Interruption.] I am just pointing out the inevitable consequences of the course on which the hon. Lady has set her heart, which would make sure that if Scotland became independent, it would face tariff and regulatory barriers to access its biggest market, which is the rest of the UK. [Interruption.] The hon. Lady asks why; that is the inevitable consequence of independence, alongside the abandonment of the pound sterling and re-entry into the common fisheries policy. It is a terrible course to go on. Because I admire the hon. Lady so much, I hope she will recognise that the future of her Glasgow constituents is better secured by staying in the United Kingdom than by going down the perilous path to separation that the SNP have argued for, like a pied piper, for many decades.
I welcome the pragmatic approach that has been taken in reaching this agreement, which respects the UK’s sovereignty and independence as we leave the EU while recognising the need for the EU to protect its single market. Does my right hon. Friend agree that that same pragmatism now needs to be applied to a trade deal, while respecting those same principles? Will he join me in wishing the Prime Minister well at his dinner tonight?
I absolutely do, and I also hope that on the EU side we see something of the same pragmatism that we have seen on this particular issue.
If there is no data adequacy agreement by the end of this month, what is the right hon. Gentleman’s current estimate of the legal and admin cost to businesses of putting in place the new contractual clauses they will have to introduce in order to continue to exchange data with their European partners?
That is a very important question. I do not have an exact estimate of what the cost of the standard contractual clauses would be, but because we are currently compliant with the general data protection regulation, I see no reason why data adequacy should not be granted.
I welcome my right hon. Friend’s statement and congratulate him on his hard work in achieving this agreement. Will he confirm that this is a pragmatic and sensible approach to protect Northern Ireland’s place in the UK’s customs territory?
Absolutely—my right hon. Friend has been a consistent champion for business and enterprise in all his years in this House, and he is absolutely right. This pragmatic approach works for businesses in his constituency and in Northern Ireland.
Will the right hon. Gentleman correct his claim on this morning’s “Today” programme that, in the event of no deal, we will continue to benefit from free healthcare if we visit the rest of Europe after 1 January and our students will continue to benefit from the Erasmus programmes?
It is the case that students who are currently engaged on Erasmus programmes will continue to be part of them until the end of that academic course. It is also the case that UK citizens who have been living in EU countries are covered by the withdrawal agreement rights that we all voted on—I think the right hon. Gentleman voted against, but nevertheless we protected their rights.
Absolutely outrageous.
Order.
I am grateful to my right hon. Friend for suggesting the lucrative opportunity of exporting conflict diamonds, but just how burdensome will the additional paperwork of which he spoke be?
Given that there is very little trade that I am aware of in conflict diamonds from Northern Ireland to Great Britain—if anything, it is an even smaller trade than, for example, endangered species products such as tiger skins—I suspect that the bureaucratic burden will be so small as to be almost naked—sorry, I mean invisible to the naked eye. [Laughter.]
The mind boggles I am all for pragmatism, because that is the best way to sort out a deal that works for Welsh lamb farmers and, for that matter, British car manufacturers and all the rest of it, but I want to ask the right hon. Gentleman about the foreign policy element. On a pragmatic basis, we have always done rather well out of persuading other countries in Europe to adopt, for instance, sanctions against Putin, and we have tried to get people on board with our policy on Hong Kong. How will we be able to do that in future if we have poisoned the well by not having any long-lasting trade deal at the end of the week?
The hon. Gentleman makes an important point. Obviously it would be in our interests to secure a deal, but not at any price. He has been a consistent champion of a tougher approach towards Russia and an advocate of the Magnitsky sanctions. The Foreign Secretary also was a consistent champion for that. We adopted those sanctions, and the EU followed. That is no criticism of the EU, but it is the case that we can continue to have influence. Obviously, if we have a satisfactory arrangement with the EU, that would work for everyone.
Does my right hon. Friend agree that today’s welcome announcement is the perfect combination of principle and pragmatism—an approach to the negotiations that our businessmen take every day, which will serve them well as we embrace the future, and that only the Opposition seem to find exceptional?
My hon. Friend has had a brilliant business career, and he is absolutely right: we need to negotiate toughly and be prepared to be flexible in certain circumstances but know ultimately what we want. As we heard from the Leader of the Opposition earlier, I am afraid that when it comes to Brexit, we still do not know what Labour wants.
If Brexit is shaping up to be such a success, why is it that four and a half years after the referendum, no other European country is seeking to follow the UK out the door? Why are they not looking at these deals being negotiated with envy and thinking that they want a piece of the action? In fact, what is happening is that countries such as Scotland are looking at the European Union and deciding that that is where they want their future to be. It is the United Kingdom that is being left isolated.
What a remarkable rewriting of history. Just yesterday I was watching CNN, and I saw an amazing 91-year-old gentleman called Martin Kenyon—one of the first people in the world to be vaccinated, and he was vaccinated here in the United Kingdom. It is because of the United Kingdom’s superb regulatory work, our vaccine taskforce, our NHS and our Health Secretary that the first people in the world to be vaccinated were here in the United Kingdom. There are vaccines in Scotland thanks to the UK. The rest of the world is looking on in admiration at our British NHS. On today of all days, it would be nice—and, to be fair, lots of Scottish nationalist Ministers have made this point—to acknowledge that the UK Government have been working in the interests of everyone, and people have been looking at Britain and saying, “That’s great.”
I commanded on and off a hard checkpoint on the A5 between South Tyrone and County Monaghan for up to two years, where we had chicanes, sangars and obstacles. Can my right hon. Friend assure me that, on 1 January, there will be no sign of that hard checkpoint left?
My hon. Friend, like so many who served with distinction in Northern Ireland, contributed to ending terrorism. Those were hard-won gains, and there will certainly be no return to physical infrastructure of the kind that he had to negotiate when he so bravely served his country.
Can the right hon. Gentleman give me an indication of when we will finish negotiating and debating Brexit, given that 10 months on from getting Brexit done, we are still debating the same issues, and he said in his statement that further details will be worked through in the month ahead?
Far be it from me to prevent Liberal Democrats talking about whatever they wish to talk about. As I recall, the first person in this House to argue for an in/out referendum was the former right hon. Member for Sheffield, Hallam and Deputy Prime Minister, Nick Clegg, and people in the Liberal Democrats are still calling for referendums. I am a traditionalist; I love the fact that the Liberal Democrats are consistent in their determination to ensure that, however many referendums we have, we must have more. I am sure that Gladstone, Grey, Harcourt and Chamberlain would all salute the determination of the Liberal Democrats to stay true to their tradition and, when everyone else has settled the question, to say, “Let’s reopen it.”
I congratulate my right hon. Friend on securing this agreement. It is absolutely right that it must be only the UK authorities that perform any checks. When it comes to the EU authorities supervising or observing, will he confirm that they will be paying for that and that they do not expect UK taxpayers to pick up the bill for their presence?
It is absolutely the case that the EU will be paying for it. I hope that while people from the EU’s agencies are in Northern Ireland, they will take advantage of Northern Ireland’s wonderful hospitality as well.
The Democratic Unionist party has remained consistent that there must be no border down the Irish sea. Can the Chancellor of the Duchy of Lancaster give me an assurance that in 2021, the year we mark the centenary of the Union, the good people of Strangford will have no impediment placed on them by Brussels to buying foodstuffs from fellow British citizens in England, Scotland and Wales?
Absolutely. The citizens of the beautiful Ards peninsula will continue to enjoy the rights that we uphold as shared UK citizens.
My constituents will be joyed by the changes to the United Kingdom Internal Market Bill, as my right hon. Friend knows. The Joint Committee has clearly done its job and shown that rumours of compromise’s demise are greatly over- stated. The British Government have moved and shown much seasonal goodwill, but does he agrees that this announcement truly works for us all only if it is followed imminently by good news on the wider EU-UK trade deal?
The deal works in its own right. It shows the virtue of principle and pragmatism allied. If we do secure a free trade agreement, that would be an additional helpful bonus.
I thank and congratulate my right hon. Friend on arriving at the position that he has. The Good Friday agreement is protected, the Union has been secured and, more importantly, the rule of law has been upheld. I seek his assurance that, during the grace period, he and his ministerial colleagues will provide strong and active support to businesses of all sizes in Great Britain and Northern Ireland to ensure that they are able to meet the challenges of the new regime successfully.
My hon. Friend makes an absolutely critical point. I thank him and the Northern Ireland Affairs Committee, which he chairs, for the rigorous scrutiny that they have applied throughout this process, which has ensured that the Government have been kept up to the mark. He is right that concluding the agreement is just one step. We need to continue to support businesses in Northern Ireland, large and small, as they face the challenges and take advantage of the opportunities ahead.
I will now suspend the House for three minutes to allow Members to leave safely and compliantly, and to allow other Members to come in.
With permission, Mr Speaker, I would like to make a statement to update the House on UK support for the UN stabilisation mission in Mali, which supports the peace process, helping to counter the spread of instability in the Sahel This month, 300 United Kingdom troops led by the Light Dragoons battlegroup will complete their deployment into the United Nations mission in Mali, known as MINUSMA. Over recent years, Mali has become one of the most unstable countries on the African continent. Terrorist aggression and conflict between communities have been on the rise and the United Nations Multi- dimensional Integrated Stabilization Mission in Mali is mandated to support the Malian people in their effort to secure sustainable peace, to support the re-establishment of state authority, to protect civilians and to promote and protect human rights in Mali By 22 December, the majority of our 300 UK armed forces personnel will have deployed to MINUSMA and completed quarantine. Our contingent consists of 250 troops from the Light Dragoons, the Royal Anglian Regiment and other attached personnel, and a further 50 forming a national support element. They will soon begin operations in Mali, joining some 60 other nations contributing to the UN mission The UK has committed to a three-year deployment to MINUSMA, with a review to be held at the 18-month point. UK personnel will deploy on six-month operational tours. Accordingly, the first deployment, led by the Light Dragoons, will be replaced by a second contingent, led by the Royal Anglian Regiment, in the summer of 2021. This Government take their responsibility as a permanent member of the UN Security Council seriously. Our deployment to MINUSMA reflects our continued commitment to, and growing leadership in, multilateralism and international peace and security. Our nation has a proud peacekeeping track record, as we demonstrate global Britain in practice. This deployment builds on a successful multi-year commitment to the UN mission in South Sudan, where UK peacekeepers were responsible for building hospitals, bridges and roads In the Sahel region, more than 15 million people need humanitarian assistance. Some 11 million are food insecure and more than 3 million are displaced because of the conflict. As with many conflicts around the world, women and girls in Mali are disproportionately affected by the continuing instability. The Sahel is the worst region on earth to be an adolescent girl seeking 12 years of quality education, as it accounts for an astonishing 7% of the world’s population of primary age girls who are out of school. By 2030, almost one in five women aged 20 to 39 in the continent of Africa who have no education will be living in the Sahel Mali is at the forefront of countries in the Sahel affected by instability. Terrorism and conflict are sharply on the rise. Mali has already registered more deaths due to violence this year than any previous year in the past decade. This violence is costing lives, hindering development across one of the world’s poorest countries and spreading instability to the wider region. International action is the right thing to do from a humanitarian perspective, but history shows us that international efforts to restore law, order and security are also the best way to prevent unstable regions from becoming safe havens for terrorist groups. It is in the UK’s interests to act Terrorist violence and conflict have risen sharply over recent years, and the permissive environment provided by the current instability in Mali and the wider region creates the space for developing threats. That harms UK interests and also those of our allies and partners, especially France and others in Europe. It is in all our interests that we work together to protect civilians and help build a safer, healthier and more prosperous future for the region Our contribution will provide critical capabilities to the UN mission at a vital time. We can have genuine impact on the mission’s overall approach. To help reduce the spread of conflict and insecurity contributes to the protection of civilians and supports Mali’s pathway to sustainable peace. This deployment is a vital part of our work in the Sahel to build stability, bolster conflict resolution, improve the humanitarian response and strengthen partnerships between the international community and regional governments in responding to the crisis We will be joining a UN mission led by a civilian special representative of the UN Secretary-General and an international peacekeeping force of over 60 nations, led by the Swedish UN mission force commander Lieutenant General Dennis Gyllensporre. It is a truly global collaboration, with contributions from our western allies, including Germany and France, and African nations contributing large contingents to support their regional stability The initial objective of the first rotation of troops will be to understand the operating environment so that they are best placed to support the UN mission going forward. The UK taskforce will be under command of the Light Dragoons’ commanding officer. Armed with cutting-edge technology, our troops will provide a specialist reconnaissance capability, which aims to improve the mission’s overall performance, particularly in protecting civilians. Our contingent will offer crucial support to the mission to better understand threats and to shape the mission’s response, enabling intelligence-led operations across the mission’s mandate Our MINUSMA deployment complements existing commitments we have in the region, including helicopter support to Operation Barkhane, the French-led counter-terrorism initiative in the Sahel region. Although the two missions are complementary, they are distinct in their objectives and tactics. Our experience in Mali will also help to develop our world-class training for peacekeepers that we provide each year in Africa. Our aim is that the response to more security challenges in Africa will be African-led, and we are mentoring and training others on the continent to help us achieve that goal The UK believes in peacekeeping as a way to stabilise and contain conflict. Our contribution to MINUSMA, alongside our enduring commitments to the UN peace- keeping operations in Cyprus and Somalia and the staff officers we have deployed to six other UN missions, is the UK playing its part in a multinational effort to contain the worst consequences of violent conflict and to help build confidence in the political process under way supporting longer-term peace and reconciliation UN peacekeeping operations are currently protecting more than 125 million of the world’s most vulnerable people across 13 different missions, consisting of more than 98,000 troops, police and civilians. Combined, they provide a critical tool in containing and reducing conflict in the world’s most fragile environments To function effectively, UN peacekeeping relies on contributions from its members, especially more experienced militaries such as the UK’s. Our deployment is a highly capable contingent able to support stronger mission performance and longer-term reform. The UK’s military contribution to UN peacekeeping in Mali is a clear illustration of how our defence and security capabilities can contribute to the UK’s role as a force for good in the world, working hand in hand to support the Government’s development and diplomatic agenda It is important to stress that deploying to MINUSMA does not come without risk. However, our forces are world-class and we have provided them with the right training, equipment and preparation to succeed in a complex operating environment. We have taken steps to mitigate the risks, and I am confident that our troops will make the UK proud by having a strong impact on the ground in Mali. They will bolster our standing in the United Nations and will help us in our endeavours to make the UN and its peacekeeping missions as effective as possible As a permanent member of the United Nations Security Council, we are fully committed to supporting the UN’s peacekeeping missions around the world and to encouraging them to be as effective as possible. Our MINUSMA deployment is a key part of that commitment and, as the Prime Minister recently noted, our uplift in defence spending should allow the UK to shape international security and provide a stronger contribution to global Britain Finally, may I thank all those serving in Mali and around the world this Christmas for their service to our nation and extend that gratitude to their families, friends and loved ones who will be celebrating Christmas in their absence? I know everyone in all parts of the House will want to wish all our service personnel serving over Christmas a safe tour and as merry a Christmas as they can manage.
I thank the Minister for advance sight of his statement. It was good to have the written statement last Thursday, as troops began to arrive in Mali; it is better still to have his oral statement today, with the Minister ready to answer the range of questions that arise from this new deployment Let me say at the outset, as I said to the House on Monday, that Labour strongly supports this commitment of UK troops to the UN peacekeeping mission in Mali, and we do so with our eyes wide open to the risks they face. The public expect Ministers to be open about this too, so I hope the Minister will undertake to give regular reports on progress to Parliament during this deployment. The Minister rightly said today that deploying “to MINUSMA does not come without risk.” The UN has described this as its most dangerous mission, with 227 personnel killed since 2013, so what assessment has he made of these risks and what specific steps have been taken to reduce them? Last week the French base in Mali at Gao was attacked; where will our troops be stationed and how secure will the British base be The Defence Secretary has told us: “This deployment reflects our continued commitment to multilateralism and international peace and security”.—[Official Report, 3 December 2020; Vol. 685, c. 14W.] As a permanent member of the UN Security Council, Britain does have this special responsibility, which we in Labour also take seriously; too often, however, there has been a view that, somehow, peacekeeping is beneath Britain, so I hope to see confirmation in the integrated review that this has changed as part of the Government’s plans for a post-Brexit global Britain Certainly, as with Mali, where Britain has special military skills we should step up, and the Light Dragoons and the Royal Anglian Regiment are filling a capability gap in Mali as long-range reconnaissance specialists. Since the Government first announced the intention to deploy these troops in July 2019, however, Mali has become more complex, less stable, more violent. This deployment is rightly limited; what measures must be met for the Government to judge it a success, are there circumstances in which the Government would widen the scope or increase the size of this UK military mission, and could troops in this UN deployment also serve in the distinct and complementary French-led Barkhane mission The Government have said that “it is stepping up its engagement in the Sahel across the development, diplomacy and defence pillars” The Minister says that there is, rightly, very significant development interest in Mali, with 6.8 million people in need of humanitarian assistance. There are also significant security concerns, with drugs cartels, arms traffickers, and al-Qaeda and Islamic State terror groups all active in the region. When co-ordinated action and help are clearly needed, the deep cuts made in the spending review to the conflict, stability and security fund could not have come at a worse time for the Sahel. Will the costs of this Mali deployment be met from that fund? How much in development aid is planned for Mali and the other Sahel countries over the three-year period of this military deployment, and how are Britain’s development, diplomatic and defence activities being co-ordinated within Government Finally, Britain’s responsibilities as a leading UN member are being met with this Mali mission, alongside our continuing commitment to peacekeeping operations in eight other countries around the world. I pay tribute to our armed forces personnel who serve in these missions. They will, as the Minister says, continue to make the UK proud.
I thank the right hon. Gentleman for his positive response to the statement. As we were saying in the Remembrance Day debate a few weeks ago, as people deploy on missions such as this it matters enormously to see support on both sides of the House for what they are going out to do. He rightly asked some questions that I will do my best to answer, starting with, of course, an intent to regularly update the House either verbally—although that met with no support from my hon. Friend the Member for Beckenham (Bob Stewart)—or otherwise on the progress of the mission and the threat as it evolves The right hon. Gentleman is absolutely right to pick up on the line in my statement that says that this mission is not without risk. This is a dangerous part of the world in which to be operating. It is because it is such a dangerous part of the world that the case for being there as part of a peacekeeping force is so easily made. We should be clear that, despite all the training, all the equipment and all the mitigations that we will put in place—I will explain some of those in a second—our troops are accepting a risk to life and limb in serving in the Sahel, and we thank them for that. We genuinely believe that it is in the interests of the UK and the people of Mali that we contribute to that mission We have recognised that in previous deployments perhaps there has been a gung-ho willingness to expand the mission quickly and get on with things without fully understanding the realities of the threat on the ground and how that manifests itself in relation to military operations. In this first rotation—the first six months—we will be expecting the Light Dragoons battle group to deploy and to find its way in the immediate vicinity of Gao, the city in which the UN camp where they will be based is. If, over time, we come to understand that they can operate at range, we will consider that on its merits, depending on the mission design from the UN force commander. Our intention is to find our way slowly, to build our confidence and our understanding, and then to grow the mission, within the confines of MINUSMA. It is important to stress that there is no UK agency in being able just to decide what we do; we are under the command of the UN force commander The right hon. Gentleman asked me about the camp. It is a brand-new camp, and it is indeed in the UN super-camp at Gao. That camp is protected by a German early warning system called MANTIS—the modular, automatic and network capable targeting and interception system—which picks up the IDF, or indirect fire attack, which the right hon. Gentleman mentioned in his reply. That allows people in the camp to take cover and adopt all of their drills when there is incoming indirect fire. Sadly, as a veteran of Iraq and Afghanistan, I know that that is just the reality of being in camps in those places, but these early warning systems give people great confidence that they can find cover before the rounds start landing This is, indeed, a complex mission. The UN’s mission is made all the more challenging as a consequence of the changing political tides in Mali—there was a coup only four months ago—and that means that the military mission, as designed by the UN force commander, and the political mission have some work to do to evolve and to react to those new political realities in Mali, hence our caution over the speed at which we unleashed the Light Dragoons on their mission. We want to see how things develop, and we will update the right hon. Gentleman and colleagues as that happens There is no scope to widen the size of our force; we are limited by what the UN requires of us. There is also no scope for us to decide unilaterally, as the United Kingdom, that we want to do more; we are within the UN’s mission. MINUSMA and Operation Barkhane are entirely separate; there is no opportunity to flex one from the other, as to do so would be to break the rules on UN peacekeeping contingents. In any case, the missions are so different; Barkhane is a more offensive, counter-terrorism operation, chasing both JNIM—Jamaat Nusrat al-Islam wal-Muslimin—and Islamic State in the Greater Sahara around not only Mali, but Burkina Faso and Niger. MINUSMA is a Mali-only peacekeeping operation led by the UN Finally, the right hon. Gentleman asked me about funding. We are talking about £80 million over three years, which is indeed funded by the conflict, stability and security fund. It will matter enormously to people deploying on this operation to see the tone of these exchanges. Our intention is to keep the House informed as best as we can. This is a dangerous mission, but our people are well-trained and well-equipped. They are ready and they are up for it, and I wish them a good tour.
I join the Opposition and our Front-Bench team in wishing our forces well and a very safe tour. The Minister speaks about wanting to increase our profile in the Sahel. The west has been without resolve in that area; this has been a hidden conflict. I am pleased that we want to close down this permissive environment, which he spoke about, of extremism, criminality, human trafficking and regional conflict spilling out beyond the Sahel. However, I hope that that commitment is matched by a greater western resolve to tackle the underlying causes of those issues, because we will not solve the challenges there through military means alone I must tell the Minister—I am pleased that the Defence Secretary is in his place— that I am sorry to learn that as we have in the Sahel taken a step forward with greater resolve, here we are taking a retrograde step with talk of reductions to our reserve forces and to their training. They are the very people who are the in-fill to the regular forces that go out to these places; I have not been on an operational overseas tour where I did not have reservists under my command as well. I say to the Minister that I hope that as we step forward with greater resolve on the international stage we will think more carefully about these cuts to our reserves.
I am delighted to say that there are a number of reservists within the deployment to Mali. Their skillset is well valued and they will do a great job. The Secretary of State and other Ministry of Defence Ministers have, like me, all served alongside our fantastic reservists in various theatres over the course of our military service. Their value is undeniable and they are an integral part of the force. My right hon. Friend the Member for Bournemouth East (Mr Ellwood) is right to say that to some degree this is a hidden conflict, although with the drawdown of troops in Afghanistan and Iraq we now have the largest western troop deployment on earth in the Sahel. However, it is incomplete, no matter what the size of the force, unless a political and diplomatic effort goes around that response. He is right to encourage, not just here in our diplomatic and aid effort, but within the UN and across all the troop-contributing nations, the political effort to match the military one.
I thank the Minister for advance sight of his statement. It is important that the House is kept fully informed on issues such as this. The Scottish National party firmly supports the deployment of UK personnel in supporting the UN mission in Mali. It is important that the UK continues to promote global justice and peace. I support the Minister from a humanitarian perspective and echo his point that international efforts to support law, order and security are also the best way to prevent unstable regions from becoming safe havens for terrorist groups. Many areas of concern in Mali need to be addressed by this international action, including food security, health and child protection. This conflict has led to displacement and death, and most disturbing are the UN reports that rape is being used as a weapon of war, with both women and young girls the target of these attacks. It is therefore conspicuous that while the UK is sending personnel to the area, which of course is most welcome, it is also cutting aid by 30%. These two issues cannot be considered separate when we are looking at the humanitarian response The Minister stated that the UK troops will support the Government’s development and diplomatic agenda “as a force for good in the world” Will he explain how the cuts to aid described could impact the UN mission in Mali? Will he detail whether any civilian support has been cut on the ground, including to those working with victims of sexual violence? Given the increase in terrorist activity and instability in the region, what safeguards are being considered for the personnel who are being deployed? At what point will our troops be withdrawn, and what are the success criteria for that to happen Finally, I would like to pay tribute, on behalf of those on the SNP Benches, to all those serving in such missions, especially all those personnel who will be away from their loved ones over the Christmas period.
On the official development assistance point, rather a lot of MOD activity, which has huge humanitarian advantage, was not counted under the ODA definition. We are rather proud of the amount that we do that does not make it into the accounting against that budget I thank the hon. Lady for raising the importance of human security as part of this mission. I had the pleasure the other week of doing a roundtable with the Countess of Wessex and the vice-chief of the defence staff, using Mali as a case study for exactly how the UK should lead in human security, and the role of the MOD and our armed forces in that leadership. The hon. Lady will be pleased to know that within the deployment to MINUSMA are specialist human security officers, who will add immeasurably to the emotional intelligence of the deployment and a recognition of the needs of women and other minorities in the community, so that human security can be integral to the UK’s effort within MINUSMA The hon. Lady asks about the term of the mission and the success criteria. This is very different from Iraq and Afghanistan, where the circumstances for our withdrawal were principally around political intent in London. We have signed up for a three-year commitment to the UN MINUSMA mission. We have said that we will review that commitment after 18 months to check that we still think it is the right contribution for us to be making. It is a time-limited commitment to the UN and we leave at the end of it, just as we did very successfully from South Sudan earlier in the year.
By way of a declaration, I am a reservist. I welcome the Minister’s statement. Terrorists and insurgents are exploiting open borders in this region to smuggle weapons, arms and drugs. Do the British Government support the French initiative to increase regional co-ordination through the G5 joint force to deploy 5,000 personnel from five neighbouring states? With France’s key role in intelligence in the Sahel region, what does the Minister make of the point made by some that France should be included in the Five Eyes intelligence-sharing system?
My hon. Friend’s last point may require a statement entirely in its own right. France is clearly an important partner in the international activity in the Sahel. It is really important, however, to note that the French-led Barkhane mission is entirely separate from MINUSMA. The Secretary of State and I both participate in conferences with other NATO Defence Ministers and Defence Ministers from across the Sahel, so we are aware of and support what France is doing to generate more mass to its Barkhane mission, but it is really important to note that that is separate from what we are doing with MINUSMA.
I thank the Minister for providing such a comprehensive statement this afternoon, so soon on the back of last week’s written ministerial statement. That is deeply welcome, and I want to place on the record our support for our service personnel as they deploy. The Minister will know through correspondence from the Defence Committee and media reports that there are some concerns about the availability of the appropriate equipment for the circumstances, so may I ask him to place it on the record publicly this afternoon that those who are prepared to put themselves in harm’s way will have adequate and appropriate protection for the situation in which they will find themselves?
I thank the hon. Gentleman for his question. The environment in Mali requires a balance between ballistic protection against the threat of improvised explosive devices, and an environmental challenge where heavy rain and mud can easily lead to heavy vehicles getting bogged in. It is our assessment that Foxhound, Ridgeback, Coyote and Jackal—all of which were purchased for the Afghanistan deployment, have proved themselves against a far more severe IED threat than the one in Mali, and have been upgraded in the decades since—achieve that balance between the ballistic protection required against an IED threat such as this and the environmental challenge of such weather as is likely to be experienced in Mali.
This is the latest in a long line of peacekeeping and humanitarian missions undertaken by our armed forces with the support of this Conservative Government. Does my hon. Friend agree that, thanks to this Government’s support of our armed forces, in words and in actions, they have been able to deliver an immeasurable impact on the lives of those most in need of security and stability across the world?
Yes, I do. This is in addition to Defence’s contribution to the life of the United Kingdom this year, of which we are very proud. Within the next week or two, our armed forces will be actively involved in peacekeeping operations in Mali, in addition to all that Defence is doing at home in response to covid, in addition to all that the Royal Navy is doing to protect the UK’s interests around the world, and what we are doing in Afghanistan, and what we are doing in Iraq, and, and, and, and, and. Our armed forces are a fantastic example of the very best of British and we in this Government are delighted to be supporting them in their endeavours.
May I too pay tribute to the troops involved in this deployment and others globally at this time? Reports from the United Nations High Commissioner for Refugees that 230 children were recruited by armed groups in Mali in the first half of 2020 alone, compared with 215 cases in the whole of 2019, are deeply concerning. What steps are the Government taking with international partners to help to protect vulnerable children who have been taken advantage of in this way and to ensure the sustainability that the Minister referred to in his statement?
The hon. Lady makes a very important point. The recruitment of children to the conflict is something we abhor. I refer her to the answer that I gave to the SNP spokesman on our enthusiasm for growing our human security capability. Those human security officers are within the force to deliver exactly this sort of thing—to recognise the needs of women, protect vulnerable children and ensure that the needs of the whole community are considered as we go through peacekeeping missions such as this.
I too welcome the statement. At heart, all UK Defence operations are focused on building stability and security worldwide, from which all nations and people are able to benefit. Can my hon. Friend assure me and the House that, thanks to the record spending review, we will be able to continue to contribute to global safety and prosperity in the years to come?
I can, and what we aim to do, through a more forward presence of our armed forces around the world, is find ourselves in a position whereby we can more easily respond to the needs of different regions where there are UK interests or where the UK simply needs to be a force for good, alongside friends and allies in the international community. This integrated review gets after exactly the problem my hon. Friend describes, and we are excited about what the opportunities in the IR mean for us to do the right thing in different parts of the world in future.
Mali is one of the world’s poorest countries, but it seems to be the vast network of small gold mines that is attracting jihadist and other terrorist organisations there. What can be done as part of this international effort to try to get those gold mines put to use in getting the country out of poverty, rather than funding terrorism?
If I am honest, the hon. Gentleman raises a point that I have not come across in all the briefings I had before the deployment. I will of course look into that dimension, but I am not sure that those terrorist groups are motivated simply by any pecuniary advantage arising from securing the mines that he mentions. These people are ideologically opposed to any sort of religious freedom or social freedom, and I fear that their determination to disrupt and to be violent would endure irrespective of what natural assets lay beneath the earth, but I will of course go and inform myself on that point.
The Minister says that this force of 300 will form a specialist reconnaissance capability. To do that, the troops will have to speak to the local people. Some 5% to 10% of the local people speak the official language, which is French, and the rest do not. When I took 900 soldiers to Bosnia, I required 20 interpreters—minimum. I suspect we will need at least seven for this force. May I ask my hon. Friend whether there is an ability to recruit interpreters locally, and whether interpreters in both French and local languages—there are quite a few of them—have been thought about? I am sure the answer is yes.
I thank my hon. Friend for his question. He is absolutely right: interpreters are an essential part of any population-centric military mission. There are French-speaking personnel within the force itself and we will be recruiting local interpreters to join the force. Crucially, they will not just be male interpreters who stand on the shoulder of the male platoon commander but female interpreters who work alongside human security officers, so that we are able to engage with all parts of the community in the course of our mission.
We all send our best wishes to our troops on this mission. The Sahel is a complicated place. It has a lot of long-term problems in terms of both security and long-term development and governance. I appreciate that the Minister says this is a three-year deployment, but is he confident that the UN has criteria and definitions of success in which we can be confident, and an exit strategy for the mission?
The Algeria accords still set the conditions for the both the political and military response of the United Nations. I do not think anybody involved in the UN political mission in Bamako would dispute that the coup and political instability in Mali over a number of years have made the political mission very challenging, but that does not affect, necessarily, the duration of this military commitment. The way that UN peacekeeping missions work is that you sign up to do your turn, and we have done so. That notwithstanding, we of course want to see greater success from the political mission and an enduring political stability in Bamako, so that the UN mission can succeed.
It is not, of course, for MPs to dig into the tactical weeds of military deployments, but given the vast lines of communication in Mali can the Minister please assure the House that British forces will be operating with sufficient mass, force protection and an effective reserve to deal with a potent insurgency?
There speaketh a voice of great experience. My hon. Friend’s caution is well noted. He will be reassured to know that, as I said in my statement, we will start with the first rotation focusing on understanding the ground immediately around Gao. As we develop that understanding, grow in confidence and develop our in-country ability to support ourselves at greater range, then we will expand the mission as the UN mission commander requires.
I very much welcome this deployment, as I think everyone here does. In the ’90s, Britain was one of the largest troop-deploying nations for UN peacekeeping forces and now we are not. This is 5% or thereabouts of what Bangladesh, the largest troop-deploying nation and one of the poorest countries in the world, contributes. While the money the Government have agreed to invest in our armed forces is welcome, it does not include an increase in personnel and it does not include an increase in reservists—in fact, the opposite. Will the Minister look at changing some of that, and will he consider the fact that troops might help to stop violence but they do not bring peace? Development does, so what are the Government doing to make sure development money pours into this country so that our troops can leave it stable?
On the last point first, I do not think that anybody in uniform within the Ministry of Defence or even MOD Ministers would pretend that a military solution uniquely is the answer to any of the world’s problems. Of course, the military sets the conditions within which prosperity and a political process can succeed. The hon. Gentleman also makes the excellent point that the campaigns of the past few years in the Balkans, Iran and Afghanistan have consumed UK military effort to the detriment of our contribution to peacekeeping missions. One of the great opportunities afforded by the end of major combat deployments to both Iraq and Afghanistan is that we now have the mass available to support very worthwhile missions like this one in Mali.
In order to ensure that this peacekeeping mission does not become permanent, may I ask my hon. Friend what steps he is taking in conjunction with our partners in the UN to support the Government and armed forces in Mali with investment, equipment and training so that they can tackle the jihadist threat in the longer term?
It is not part of the UN MINUSMA explicitly to be developing the capability of the Malian armed forces, but that clearly has to be a part of delivering a lasting peace in Mali, and the political mission does, of course, have within it security sector reform. I have said that our exit from Mali is time-limited, based on the three-year commitment, but what we hope to do as part of the MOD’s wider effort in west Africa is to develop during that time the capability of other west African states, so that they are better able to replace us in three years’ time as the troop-contributing nations in Mali. We think that that is the right way both to deliver success within the mission itself and to ensure that the mission continues to succeed in our absence, after we have gone.
I would like to extend my wishes for a successful deployment to everyone involved in what is seen as the UN’s most dangerous peacekeeping mission. According to the UN, about 12.9 million people are affected by the crisis in Mali, with 6.8 million in need of humanitarian assistance. Does the Minister agree that the situation highlights a strategic weakness inherent in the UK’s cutting international aid budgets?
No, I am not sure that I do. I think it highlights the success of being a part of a successful UN mission that is resourced in terms of its ability to make political progress, and that it is adequately resourced to make military progress. I am confident that the military part of MINUSMA is well resourced, and the UK will play an important part within it. As I said in response to a number of hon. Members’ questions about the political mission, we just need the politics in Mali to stabilise so that the UN political mission can gain traction too.
It is absolutely right that the UK should play its part in this, but MINUSMA is the most costly of the UN’s peacekeeping missions, it is the most dangerous, and it is arguably one of the least successful. Furthermore, Mali can hardly be said to be a country of primary interest to the United Kingdom. Can the Minister assure me that our involvement will be largely technical and logistical in nature, that it will be modest, rather like our engagement with Operation Barkhane, and that we will not be subject to mission creep?
I can reassure my right hon. Friend that there will be no mission creep. This is a UN mission and our role is confined to that. I cannot, however, tell him that it is limited to logistical and technical involvement. This specialist reconnaissance force has been committed to MINUSMA precisely to provide an ability to understand where the threat is and to deliver a population-centric peacekeeping mission. This is time-limited and necessary. I accept that there is no obvious UK interest in Mali itself, but there is a great deal to be said for being there: first, because the humanitarian situation requires it; and, secondly, because the Sahel is a huge space on Europe’s southern flank in which violence is flourishing, and it is in the interests neither of countries in Europe nor of countries in coastal west Africa, where the UK has more obvious interests, that we do not work against the violence in the Sahel, but see it exported to places where the UK has more obvious interests Virtual participation in proceedings concluded (Order, 4 June).
On a point of order, Madam Deputy Speaker. My point of order naturally draws on comments that the Minister for the Armed Forces made in his statement to highlight the importance of reservists. Over the past several months, I have been very encouraged by the strength of feeling in the Chair that Parliament has primacy, and that it is important that when announcements are made, we hear them first and have the opportunity to probe and challenge them. In the Select Committee on Defence yesterday, we spent two hours interrogating the Ministry of Defence’s accounts, but no mention was made of the announcement that appeared in The Daily Telegraph today that 2,700 Royal Navy reservists would be stood down for four months, in order to penny-pinch. That decision has been described as “short-sighted”, and it is ill-judged. Could you advise me, Madam Deputy Speaker—I am grateful that the Secretary of State for Defence has remained in the Chamber—how parliamentarians who believe in the reservists and believe that we need to explore the matter further can best get an appropriate opportunity to do so?
rose—
Order. I will take the point of order raised by the hon. Member for Belfast East (Gavin Robinson) first and then come to the right hon. Member for Bournemouth East (Mr Ellwood) I thank the hon. Member for Belfast East for his point of order and for giving me notice that he intended to raise it. I will repeat what Mr Speaker has said many times from the Chair: if an announcement is to be made by a Department or a Minister, it must be made first in this Chamber. Any announcement must be made to Parliament. If there was an article in The Daily Telegraph or any other medium, I cannot comment on its veracity; that is not a matter for the Chair. However, it most certainly is a matter for the Chair if an announcement has indeed been made by other means than to this House and in this Chamber.
I think that there has been a slight element of confusion, Madam Deputy Speaker. The management of the three services—the Navy, the Army and the Air Force—is obviously a matter for the chiefs of staff. As they manage their services, throughout the year they make thousands of decisions about activity, deployments, training and so on. This is not a matter on which a single statement would have been made by any Government. I think the hon. Member for Belfast East (Gavin Robinson) was referring to a newspaper article, but there are hundreds of announcements on a weekly basis. I think that that is where the point that he refers to comes from.
I am grateful to the Secretary of State for responding to the point of order. I take it from what he says that he is undertaking that if any notable announcement is to be made by him or his Department, it will be made first in this Chamber and to this House.
indicated assent.
I am grateful for the Secretary of State’s assent.
Further to that point of order, Madam Deputy Speaker. I am grateful to you for allowing a little latitude on this important issue. I am also grateful for the Secretary of State’s clarification, because there are concerns that the size of our reserves will be reduced and that, just as concerning, their training hours will also be reduced at this critical time. It would be helpful if he came forward with more information and at least quashed the stories and rumours that are going around, because they do damage to the reputation and morale of those in the armed forces.
I allowed the Chairman of the Defence Committee his moment, but he knows and we all know that it is not a point of order. He has made his point to the Secretary of State and I am sure that there will be other opportunities to explore the matter further.
Further to that point of order, Madam Deputy Speaker. I am very grateful for your indulgence, as I speak as one of the reservists in question. I just want to point out that it is deeply demoralising for members of the armed forces if they are not told about this in advance but learn about it from the pages of The Daily Telegraph, excellent though The Daily Telegraph is. Can I seek your advice on whether you feel that that is appropriate?
No, the right hon. Gentleman cannot seek my advice, because it is not my business to decide whether it is appropriate. However, given his position in this House I have allowed him to make his point, and I believe that it has been heard and paid attention to by the Secretary of State and the Minister.
On a point of order, Madam Deputy Speaker. I seek your helpful advice on getting a response from the Home Secretary to 17 constituents for whom I have made representations. I have been chasing and chasing for a reply. Some of these constituents have been waiting for years, most for many months, and all have life-changing issues that affect their whole family. Surely it is the duty of the Home Secretary to respond to letters from Members of Parliament?
Once again, I will repeat from the Chair what Mr Speaker has said on many occasions: it is indeed the duty of every Minister to respond to letters and questions from Members of this House. I know that, as constituency MPs, we are all finding it very difficult to get responses to our inquiries on behalf of our constituents within a reasonable time. It is noted that the Home Office is possibly not giving the Home Secretary and her Ministers the support that they need at a time such as this to answer our inquiries on time. I am grateful to the hon. Lady for raising this point of order and I merely repeat what Mr Speaker has said many times, but I do hope that not only Ministers but those who are employed and trusted to support Ministers would please pay attention to this situation.
On a point of order, Madam Deputy Speaker. I would like some guidance on the question of the content of the Taxation (Post-transition Period) Bill, which we are about to discuss, relating to the question of taxation and, on the basis of a statement made yesterday by the Chancellor of the Duchy of Lancaster, the removal of the clauses—the “notwithstanding” clauses—that would otherwise have appeared. They remain part of the United Kingdom Internal Market Bill, from which they have not been removed. I am putting down amendments to reinsert the “notwithstanding” clauses on Report, and I would be grateful if, first, you could note that, Madam Deputy Speaker, and, secondly, you could provide some guidance.
I thank the hon. Gentleman for his point of order. Is it about the timing by which he can submit amendments for Report? Obviously, the amendments for the Committee stage are already submitted and we will very soon be debating them. We will come to Report tomorrow. Is he asking me by what time he can submit amendments for tomorrow?
I am most grateful to you for the way you put that, Madam Deputy Speaker. First, I want to be clear that I am going to do it, and, secondly, I would like to know by what time I need to put my amendments down. With all this virtual stuff, it is quite difficult to know.
It is indeed difficult to know. I decided yesterday to have the deadline today at 12 o’clock. I am not quite certain exactly at this moment what the deadline will be for tomorrow, but I have noted what the hon. Gentleman has said. I am asking the Clerk to note and to pass on to the appropriate offices that he wishes to submit amendments. Thank you There was to be another point of order, but the hon. Gentleman concerned has left the Chamber.
I beg to move, That leave be given to bring in a Bill to criminalise paying for sex; to decriminalise selling sex; to create offences relating to enabling or profiting from another person’s sexual exploitation; to make associated provision about sexual exploitation online; to make provision for support services for victims of sexual exploitation; and for connected purposes This is a Bill to bust the business model of sex trafficking. Today, the UK is a high-value, low-risk destination for sex traffickers. Why? Because our law fails on two critical fronts: first, it fails to discourage the very thing that drives trafficking for sexual exploitation—demand—and secondly, it allows ruthless individuals to facilitate and profit from sexual exploitation. What does this mean in practice? It means that the minority of men in England and Wales who pay for sex do so with impunity, fuelling a brutal sex trafficking trade and causing untold harm to victims. It also means that profit-making pimping websites operate free from criminal sanction, helping sex traffickers to quickly and easily advertise their victims and reaping enormous profits from doing so Right now there is a sexual-exploitation scandal playing out in towns and cities across the UK. An inquiry by the predecessor of the all-party parliamentary group on commercial sexual exploitation, which I chair, found that the UK sex trade is dominated by organised crime, with sex trafficking taking place on an industrial scale. Vulnerable women are moved around networks of brothels and hotel rooms to be raped and abused by men who pay for sex. The trauma and suffering inflicted on victims of this abhorrent trade is truly horrific One woman who was trafficked by an organised crime group and abused by men in the UK recalls: “To begin with [the offenders] were my friends but, as soon as we came to England, they started to physically abuse me. He beat me many times because I was not earning him enough money…Even though the clients did not physically abuse me I felt abused because I was forced to have sex with them even when I did not want to do so. Sometimes that was painful. After a while, I felt disgusted by what I was doing and I wanted to stop but [he] wanted more money and he forced me to continue. I was scared because he kept threatening me that he was going to hurt my mother.” So, who are the women who are being subject to this horrific abuse? Research by the APPG shows that it is predominantly vulnerable, non-UK-national women who are being abused in brothels across Britain, and a significant proportion of them come from one particular country: Romania. Over a period of two years, Leicestershire police visited 156 brothels, encountering 421 women, of whom 86% were from Romania. Northumbria police visited 81 brothels over two years, and of the 259 women they encountered in those brothels, 75% were Romanian What motivates the traffickers and pimps? The answer is simple: money. Trafficking for sexual exploitation is the most profitable form of modern slavery. Take, for example, a British man who was convicted in 2017 of trafficking and sexually exploiting vulnerable women. He made £1.6 million a year from his brothels. Sex trafficking is profit-driven. The crucial question to ask, though, is where those profits come from. The answer is sex buyers. Only 3.6% of men in the UK have paid for sex in the past five years, but this demand drives the supply of vulnerable women into brothels in Britain. It is these men who commit the thousands upon thousands of rapes and sexual assaults perpetrated against victims of trafficking every year in this country Here is what one sex buyer wrote on a website dedicated to men’s reviews of women they have paid for sex: “Very pretty and young girl…If you want to try a fresh, young (says she is 18) and pretty girl is ok, but maybe as she just started to work, is quite passive, scarcely kiss without tongue, doesn’t want to be kissed on the neck or ears, can’t do a decent blowjob and really rides badly on you…she really can’t speak a word of English (is Romanian) so even [girlfriend experience] is a zero.” He paid £70 to do that Here is another reviewer: “This is a classic case of ‘the pretty ones don’t have to work hard’…She’s Polish, and her English is not good…I was reminded of the Smiths song ‘Girlfriend in a Coma’...All the while she seemed completely disinterested and mechanical...I finally decided to fuck her…All the while, she kept her face turned to one side.” That man paid £100 to do that to her Any would-be trafficker who wants to get their hands on sex buyers’ money receives a very special helping hand in the United Kingdom: from pimping websites, where they can advertise victims to sex buyers completely legally. The advertiser simply fills out an online form and pays to publish the advert. Meanwhile, sex buyers browse the website for free. Adverts show how much she will cost, what sex acts he can select, where she is based and when she is available. The sex buyer, remaining completely anonymous, simply calls the mobile number to place his order A few highly lucrative pimping websites dominate this online market, centralising and concentrating the UK customer base for traffickers. It makes the whole business of sex trafficking easier, quicker and more efficient. One police force reported to the APPG that a trafficker it caught had spent £25,000 advertising his victims on a pimping website, but the police were not alerted. Instead, the man was given his own account manager To stop women being raped and abused for profit, we must dismantle the business model of this sex trafficking trade. That will require two key measures: first, preventing the demand driving sex trafficking by criminalising paying for sex; and secondly, stopping website companies and other third parties aiding and profiting from this appalling crime by making it a criminal offence to enable or profit from the prostitution of another person. We must also stop the appalling practice of victims of sexual exploitation being prosecuted for soliciting. That offence should be removed from the statute books. Instead, we should establish a well-resourced, comprehensive network of support and exiting services for people who have been or are sexually exploited. Those measures would shift the burden of criminality from women and place it where it belongs: on those who perpetrate and profit from this abuse This demand reduction approach is already in place in countries including France, Sweden, Ireland, Northern Ireland, Israel, Iceland and Norway, and it works. An official evaluation of Sweden’s Sex Purchase Act reported: “it is clear that the ban on the purchase of sexual services acts as a barrier to human traffickers and procurers who are considering establishing themselves in Sweden.” As Dr Monica O’Connor of the Sexual Exploitation Research Programme states, “simply allowing the prostitution industry to grow, increases the flow of trafficked people to that jurisdiction; conversely, addressing demand and reducing the size of the market for prostitution-related activities is an effective anti-trafficking measure.” That is why the United Nations Palermo protocol stipulates: “States Parties shall adopt or strengthen legislative or other measures…to discourage the demand that fosters all forms of exploitation of persons, especially women and children, that leads to trafficking.” There are some who do not want to reduce demand for sexual exploitation, and myths and misinformation are spread about efforts to achieve it, so let me be absolutely clear: sexual exploitation is not a solution to poverty. Our continued tolerance of this harmful trade puts vulnerable women and girls at an ongoing risk from traffickers and pimps who seek to profit from it. Suggestions that criminalising paying for sex will only serve to drive sexual exploitation underground fundamentally misunderstand the nature of this trade. Sex buyers need to locate women to sexually exploit, and if sex buyers can find the women, so can the police and support services. As an analysis published by the European Commission points out, “Sex markets are reliant, by definition, on buyers finding spaces and places where it is possible to pay for sex.” The absolute necessity of deterring demand is why, at a recent international summit organised by UK Feminista to confront the rampant sexual exploitation of Romanian women by men in the UK, the president of the Romanian Women’s Lobby, Laura Albu, said: “The solution is simple: end demand in the UK. The UK can end demand and prosecute buyers of sex and close this so-called market.” We must heed her call. We have the power to bust the business model of sex trafficking. That is what my Bill would do, and the Government would do well to adopt it.
It is an absolute pleasure to follow my hon. Friend the Member for Kingston upon Hull North (Dame Diana Johnson) because, as Members will know, she is indeed a close friend. I respect her and value her enormously, and it is only because our friendship is so strong that I feel able to stand here and speak against some aspects of her proposed Bill. I hope that, by doing so, we will begin a debate that informs rather than confuses and in which there are no binary sides, but just an honest and desperate attempt to talk about and try to resolve something that is still difficult in our society today I hope I do not need to spell out that we all oppose trafficking and exploitation. It is real, it is utterly horrifying, and it is rightly illegal. We absolutely need laws that target exploitation and abuse, and we need them to be better enforced. The part of my hon. Friend’s Bill that I cannot support involves putting into the law of England and Wales what is called the Nordic model. The Nordic model is not about tackling trafficking or exploitation directly. It criminalises the buying of sex, and it can also criminalise many of the means by which sex workers market their work. That is counterproductive and it will put women at greater risk In France, after the model was introduced in 2016, 42% of sex workers said that they had become more exposed to violence. Tragically, there is some evidence that murders of sex workers increased significantly. Between September 2019 and February 2020, at least nine sex workers were murdered, according to the French newspaper, Libération. When all clients are frightened of being arrested, and therefore insist that meetings happen in darker corners where the dangers for women are greater, sex workers cannot refuse those risks. They can no longer distinguish between clients who are a threat and those who are not I will give voice to some women who are involved in sex work. Jenny from Manchester said, “The harms to me come from the laws that they have. Having a record is a harm. There’s a major difficulty for women who want to exit prostitution. The services don’t address it. They can come up with the courses for you to go on, but they cannot take away the charges. You can’t get housing and there are jobs that aren’t available because of what you’ve done. Women who have sex work convictions often find it almost impossible to leave.” We must address that, because it limits life chances and makes women more vulnerable to the coercion of pimps and traffickers Reports on the implementation of the Nordic model have found that it has caused sex workers to be less likely to refuse risky clients as income has fallen. They are also less likely to report violence to the police. In France, 70% of sex workers said that relationships with the police had become worse or were unchanged, despite the Nordic model reforms decriminalising some aspects of their work. The Nordic model even made 38% of sex workers less likely to use condoms, because their power to refuse clients was reduced, which made it harder to insist on safe sex only. That is why criminalisation is opposed by the World Health Organisation, STOPAIDS and the Royal College of Nursing My hon. Friend the Member for Kingston upon Hull North and others want to give women who are trapped in the sex trade a way out, and I share that goal. The Nordic model in France included an exit programme. Two years on, researchers found that only 39% of sex workers were even aware of it, and of those, only a quarter had any intention of applying. I do not believe that any individual programme will give most women a genuine alternative, because their circumstances are complex. Ultimately, as we know, it is poverty, inequality and the legacy of unjust laws that trap women in the situations we have been raising today, force them to do work that they do not want to do, and expose them to the risks of abuse, violence and exploitation The truth is, I believe, that sex work will be around for as long as there is poverty and inequality—and frankly, poverty and inequality are rife in our communities. Last year, before covid hit our communities, 2.4 million people were destitute in the UK, including more than half a million children. That is a rise of 54% in just two years since 2017. Those numbers will include many sex workers and their children There will also be sex workers who stay out of destitution only because of the income that their work brings in. Louise, who works in the sex trade in Doncaster, said, “The police don’t protect us, and the biggest problem I face is the laws. Some women have been dragged under the control of pimps, but criminalising everyone doesn’t help that. We are boxed in by poverty. Criminalising clients would take away our income when people around the country are living on the edge and women are expected to fill the gap.” If the law prevents sex workers from finding clients online, what happens then? My hon. Friend has quoted despicable misogynistic comments about women posted online. None of us likes that. The comments create a society in which women are objectified, but shutting down the websites will push them underground, moving them to encrypted message apps or sites on the dark web instead, making it harder for sex workers to have a discussion with clients at a safe distance before agreeing to meet, and harder for sex worker groups such as National Ugly Mugs to monitor what clients are doing. These changes could unintentionally make it harder for women to identify the men who are a threat to them and to report clients who are violent and abusive I think we have to create policies so that women have the power to create the lives they want. In New Zealand, an emphasis has been put on reducing harm and ensuring that sex workers have access to their rights and to justice. These reforms enable sex workers to work together without fear of prosecution and thereby in greater safety. Coercion of people into sex work or to provide a share of the money received is, of course, illegal in New Zealand, and because sex work is treated as a normal form of work and taxed, all normal laws apply. In my view, the evidence from New Zealand is positive, with trust in the police improved, increased reporting of offences, better safety and health for sex workers, and, most importantly, an increased ability for sex workers to refuse clients I am not here today to recommend any particular changes to the law, although I am open to considering them. Whatever happens, I think we can agree that we need much stronger enforcement against trafficking, coercion, grooming, violence and harassment. We agree that women deserve protection, and we need to eliminate the barriers that prevent women from leaving sex work. That includes convictions for sex work offences, which can be an anvil around necks. I do not think that the Nordic model is the right one, but I do think that a debate about how we deal with sex work and workers needs to begin now in this place, in good faith and between friends. Question put and agreed to. Ordered, That Dame Diana Johnson, Ms Harriet Harman, Sarah Champion, Fiona Bruce, Carolyn Harris, Dame Margaret Hodge, Mrs Maria Miller, Rosie Duffield, Stella Creasy, Mr Virendra Sharma, Gavin Robinson and Derek Thomas present the Bill Dame Diana Johnson accordingly presented the Bill Bill read the First time; to be read a Second time on Friday 29 January 2021, and to be printed (Bill 228).
On a point of order, Madam Deputy Speaker. I wonder whether you have heard from the Secretary of State for International Trade, who I believe is in Singapore at the moment, about whether she intends to come to the House and make a statement on the UK’s decision to opt out of tariffs imposed by the World Trade Organisation on the US. The article appeared in the Financial Times this morning rather than there being a statement to this House. This sends a terrible message to Airbus and the steel industry in north Wales, which have already been very hard hit by the covid crisis, and it undermines our relationship with our European partners. This Prime Minister promised to stand up for British jobs. He clearly did not mean it. This decision shows terrible weakness and the Government need to come to this House and explain themselves.
I thank the right hon. Gentleman for his point of order. Of course, what Ministers say, wherever they say it, is not a matter for the Chair. But what is a matter for the Chair, as Mr Speaker has said many times, and I repeat now, is that if any Government Minister has an announcement to make that is of any importance whatsoever, it should not be made in the pages of newspapers; it should be made and must be made first here, in this Chamber, to this House. I am grateful to the right hon. Gentleman. I am quite sure that if the Secretary of State whom he mentioned does have an announcement to make, she will come here and make it in the appropriate manner.
I want to make a few comments about this business of the House motion, because I think it is indicative of where we have got to After four years, we have a Bill on the taxation arrangements after Brexit that is to be debated in less than four hours. Not only that, but it is a Bill of over 100 pages in length that was published less than 24 hours ago. The Minister may claim that the House has passed emergency legislation in a single day in the past, and of course that is true: the House can do that in emergency circumstances. But this deadline that we face at the end of the year is not new. It is not a surprise. It has been known ever since the withdrawal agreement was reached. The Government have said repeatedly over the past year that this was an immovable deadline. So why is it, just three weeks before that deadline, that the Government are only publishing these arrangements and this timetable now Businesses in Northern Ireland, and those that do a lot of trade with Northern Ireland, could have been given some idea of what was coming long before now, but as it stands, not even the Bill before us gives them certainty, as so much of it has to be followed up with further regulations. The truth is that there was no need for this last-minute legislative scramble. The real reason we are in this position—the reason why this business motion is before us and gives the House so little time—is that the Government thought that it was a good negotiating tactic to breach the agreement, or to threaten to breach the agreement, that they reached with the EU last year. They threatened to do that in this Bill as well as in the United Kingdom Internal Market Bill. As so often, it was a threat posing as strength that ended up doing more harm to us than to anyone else. That is why this Bill was so late, and that is why the time to debate it is so short The Government, immediately before they embark on a new future based on trade deals, chose to advertise around the world that they were willing to break the last one that they signed. Boasting about your willingness to go back on your word is not an illustration of strength; rather, it is a graphic portrayal of what Brexit has done to the Conservative party.
Will the right hon. Gentleman give way?
I am going to continue, because I do not have long to go As the House has been reminded, it was Mrs Thatcher who said: “Britain does not break treaties. It would be bad for Britain, bad for our relations with the rest of the world and bad for any future treaty on trade” The threat to do so has left us with the timetable for this Bill. That inevitably means that scrutiny of today’s measures will be severely truncated and parts of it will go through without being properly examined. What we have before us is the appearance of scrutiny, not the reality—Potemkin scrutiny. That is what a timetable like this gives us. This is not just about us here in this House—it also leaves businesses affected, with little or no time to absorb and understand what is being planned. There have been many comments on the state of things in recent days, but perhaps the most pithy has come from the chief executive of the Road Haulage Association, who said this week, commenting on the border arrangements: “Frankly, it’s just a mess.” The bigger point here is that the reason why we are in this position is that the Government’s approach to all of this has relegated concerns about business, prosperity and people’s livelihoods to a distant second place. This motion and the approach behind it are not only bad for the legislative process, but bad for the country too.
I would simply say this in response to the right hon. Gentleman: the Government have been moving at great speed, and much of the regulation is already in the public domain, together with an enormous amount of further communications and support systems. The Government are putting in front of the House today a Bill that encodes the Northern Ireland protocol and a Command Paper that has been in the public domain for many months, and if the right hon. Gentleman wished to have more scrutiny, he perhaps might have considered not having a debate on this motion.
I am aware that some Members would like to make points on this, but I am afraid that it is not in order for them to do so, because under current rules I have to stick to the speaking list. Just as a matter of fact, interventions would have been fine, but not speeches Question put and agreed to.
I beg to move, That the Bill be now read a Second time It is a delight to speak under your chairmanship, Madam Deputy Speaker In three weeks’ time, the transition period will end and this country will take its place as a fully sovereign trading nation once more. It is a very important moment in our nation’s history, one that will undoubtedly provide us with great opportunity in the years ahead, but the Government are acutely aware that at this time they also have a great responsibility to provide certainty to people and businesses and to preserve this nation’s unity, and the fundamental purpose of this Bill is to achieve those goals. It seeks to ensure that businesses in every part of the UK can continue to trade smoothly after the end of the transition period, but its particular focus is on businesses based in Northern Ireland or those that work with Northern Ireland companies The Government have always been clear that we must deliver on our pledge to provide unfettered access for Northern Ireland’s businesses to the rest of the UK internal market, and we have been equally unstinting in our determination to uphold our commitments to the people of Northern Ireland under the Northern Ireland protocol and to protect the progress made under the Belfast Good Friday agreement. This Bill will help us support those commitments by providing legal certainty for the customs, VAT and excise systems in Northern Ireland after the end of the transition period If I may, I will start with the customs elements of the Bill. The House will know that the UK is a single customs territory, with article 4 of the Northern Ireland protocol giving a clear legal commitment to this. However, the protocol also requires a new and unique set of arrangements to be put in place for goods moving from Great Britain to Northern Ireland. Under these arrangements, the only circumstance in which there should be charges on goods moving between Great Britain and Northern Ireland is if those goods are destined for the EU single market or there is a clear and substantial risk that they may be.
I am grateful to the Minister for giving way in this Second Reading debate before we get to Committee. Will he confirm that under the proposals in this last legislation the European Court of Justice will be the ultimate arbiter of excise and VAT arrangements within Northern Ireland, and that the European Union will be placing staff in our country to supervise this?
VAT in Northern Ireland will be subject to the EU principal VAT directive, and for that purpose the ECJ will be the judicial body. I cannot comment as to whether or not there will be anything more than staff, except to say that excise processes in Northern Ireland will be carried out by Her Majesty’s Revenue and Customs.
The Minister was asked by his right hon. Friend the Member for Wokingham (John Redwood) whether the ECJ would be the ultimate arbiter, and the Minister replied that it would be the judicial authority. Is that the same thing?
Yes, I was simply paraphrasing the point that my right hon. Friend made Under the terms of the protocol, we need to treat goods at risk of such onward movement into the EU differently from those groups that are not at risk. On the specific details of what will be defined as at risk or not at risk, the House will be aware of the EU-UK joint agreement made this week setting out that an agreement has been reached in principle regarding the implementation of the Northern Ireland protocol. In accordance with that statement, the draft texts will now be subject to further consideration in both the EU and the UK. Once that is complete, a joint committee will be convened to adopt them formally. Further details will be set out in due course, and before the end of the year.
In reply to my right hon. Friend the Member for Wokingham (John Redwood) and the right hon. Member for Orkney and Shetland (Mr Carmichael), the question of jurisdiction was raised, and perhaps it is best to use the right expression, rather than paraphrasing. The fact remains that EU officials will be there for the purposes of enforcing the jurisdiction of the European legal arrangements, which will be enforced subject to the European Court. In those circumstances, will the Minister now accept that actually there is an infringement of sovereignty in that respect? As the “notwithstanding” clauses are being taken out, there is therefore a further complication, and if I may say so respectfully, that is slightly in contradiction of his allegation that we would now take over as a sovereign, fully independent power.
I thank my hon. Friend for the question. He is right that it is expected that there will be EU officials. The checks will be levied and done by HMRC inspectors, and the system that we are putting in place gives effect to the Northern Ireland protocol, which, as he will recognise, already recognises the balance that is being struck in Northern Ireland between its status under the Union customs code and its status within the UK customs system If I may proceed, the Bill will allow the Government to put in place decisions made by the Joint Committee on goods that are not at risk of entering the EU, ensuring that they do not have to pay the EU tariff. However, if I may underline the point, this Bill does not itself seek to specify the classes or categories of goods or movements that are at risk or not at risk. Instead, that will be set out by regulations that the Bill permits us to make once legal texts have been formally adopted. The “at risk” or “not at risk” definitions will also determine whether the UK or EU tariff applies when goods arrive in Northern Ireland from rest-of-the-world countries, again in line with the Northern Ireland protocol. In relation to the so-called “notwithstanding” clauses, as part of yesterday’s EU-UK joint statement, the Government have agreed not to introduce these provisions into this Bill, and we have also committed to remove the three “notwithstanding” clauses from the United Kingdom Internal Market Bill.
Will my right hon. Friend give way?
I suspect we are going to go around this many times, but I am happy to give way again.
Could I simply say to my right hon. Friend that this does raise a question? I am not going to go into it in an intervention on him, but I will in my speech. I believe that those provisions may well be needed, because we do not know the outcome of the negotiations yet. I will leave it at that for the moment. We do not know, but we have been told that the clauses are going to come out. The question of whether they should have been put in is a separate question, which I dealt with yesterday.
I am not quite sure where that was heading, but we have the Bill in front of us and the Government have made it clear that the so-called “notwithstanding” clauses will not be introduced The legislation follows from commitments made in the Government’s Command Paper on the implementation of the protocol, which was published in May. The Bill will ensure that EU goods moving into Northern Ireland remain free from customs duties or processes. Although we recognise and are addressing the challenges relating to the movement of goods from Great Britain to Northern Ireland, we should not lose sight of the benefits to Northern Ireland of having continuing access to the EU market In addition, this legislation will ensure that the UK customs regime applies to goods moved from Northern Ireland to Great Britain if they do not qualify for unfettered access. The Bill will also introduce anti-avoidance rules to prevent goods from being rerouted through Northern Ireland to avoid UK customs duties or associated obligations, and its measures will ensure that customs enforcement and penalties, along with review and appeal processes, are in place in relation to duty and that they continue to work alongside EU legislation in Northern Ireland and can be applied, where required, to movements of goods between Northern Ireland and Great Britain.
I welcome the thrust of the Bill. We have heard a lot about the anti-avoidance approach in recent months, but we have never seen any detail as to how it will work. This is a critical issue, particularly for the agrifood sector, to make sure that inferior product is not coming into Northern Ireland and taking advantage of the protocol, and there is the risk of organised crime in Ireland as well. When will we see detail on exactly how it will look?
As the hon. Gentleman will know, goods that are, as it were, normally circulating in Northern Ireland will be open to go into Great Britain from the beginning. There will be some goods that, over time, will be designated as non-qualifying goods for these purposes, and HMRC has well established practices for identifying, discussing and targeting those, as may be necessary, and will be applying them to prevent avoidance and to keep the market honest As I have said, the Bill will ensure that the UK customs regime applies to goods moving from Northern Ireland to Great Britain if they do not qualify for unfettered access. These anti-avoidance rules will prevent goods from being rerouted through Northern Ireland to avoid UK customs duties or associated obligations, and its measures will ensure that customs enforcement and penalties, along with review and appeal processes, continue to work alongside EU legislation in Northern Ireland and can be applied, where required, to movements of goods between Northern Ireland and Great Britain The Bill also amends and modifies certain provisions in relation to VAT and excise for Northern Ireland.
In many of these debates over the past four years, the Government have referred to “frictionless trade” between the mainland and Northern Ireland. The Government now say that they want VAT accounting treatment for goods moving between Great Britain and Northern Ireland to remain “as close as possible” to the current approach. Will the Minister confirm whether we have now accepted that frictionless trade is not possible? Can he tell us a little more about what “as close as possible” actually means for businesses in Northern Ireland that are looking forward to 1 January with some trepidation?
I thank the hon. Gentleman for his question and, yes, the legal basis on which VAT is charged will change. I will spare him the details of the difference between import VAT and acquisition VAT, but it will change. The experience of those who pay VAT will be very similar, if not identical, to the system we have in place at the moment. HMRC and the Government have identified flexibilities, which allow that to be put in place. Of course, there will continue to be the normal processes of enforcement that one would expect to see from HMRC in order to make sure that VAT is properly paid in the usual way.
These are urgent and important issues. We heard earlier from the Chancellor of the Duchy of Lancaster that there are various delays to the full implementation of trade arrangements into and out of Northern Ireland as a result of his negotiations. Will they be incorporated into this legislation, and do they provide a brake on the immediate introduction of these complex double-taxation arrangements?
I have no doubt that the Chancellor of the Duchy of Lancaster will be updating the House over time as the different provisions he has negotiated come into force but, from our point of view, the position remains as stated, that is to say that VAT will become chargeable by a slightly different legal means, but in substantially the same way in Northern Ireland as it is at the moment. The mechanisms we have put in place are designed to ensure that, as far as possible, VAT will be accounted for in the same way as it is today. Existing rules in relation to movements of goods between Northern Ireland in the EU, including the rules relating to acquisitions and distance selling, will continue to apply. Goods entering Great Britain from Northern Ireland will be subject to VAT as though they were imports under the relevant UK legislation. Similarly, goods entering Northern Ireland from Great Britain will also be subject to VAT as though they were imports and relevant EU or UK legislation will apply, but let me add that the Government are adopting an approach that minimises any changes for goods moving between Northern Ireland and Great Britain.
On a point of order, Mr Deputy Speaker, can you clarify whether Members in the Chamber should be socially distancing by staying on the seats that have ticks on them?
Yes, that is what the ticks are there for. I hope that all Members will abide by them so that we can have safe social distancing. Thank you very much.
In addition, the Bill amends current legislation for excise duty to be charged when certain goods, such as alcohol and tobacco, are moved from Great Britain to Northern Ireland. The changes are necessary to ensure that there is a fully functioning VAT and excise regime in place in relation to Northern Ireland at the end of the transition period In line with the protocol, Northern Ireland will maintain alignment with existing EU excise rules. That means a change to excise duty is required when goods are moved to Northern Ireland from Great Britain, but the Government are adopting an approach using flexibilities and EU rules that minimises changes for excise goods moving between Great Britain and Northern Ireland A small number of other taxation measures also need to be in place before the end of the transition period. The Bill introduces a new system for collecting VAT on cross-border goods. That includes moving VAT collection on certain imported goods away from the border and involving operators of online marketplaces in the collection of VAT at the point of sale In addition, measures in the Bill will remove the VAT relief on imported low-value items so that VAT will be due on all consignments, irrespective of their value. The relief has been the subject of long-standing abuse and removing it will build on Government efforts to level the playing field for UK businesses still further by protecting high streets from VAT-free imports. Together, the changes will improve the effectiveness of VAT collection on imported goods, tackle non-compliance and protect the flow of goods at the border.
I very much support the measures that the Minister is talking about. Why is the measure just for low-value goods? There will be other goods where a similar loophole applies, such as watches or jewellery that have a value above £135. Is this not an opportunity to close that loophole as well?
I thank my hon. Friend for his question, and I will take that under review. We have put in place a set of measures designed to tidy up the position that particularly arises in relation to the Northern Ireland protocol, as he will be aware, and the end of the transition period, and that has meant a change to low-value consignment relief and the changes I have described. I am grateful to him for his contribution and suggestion The Bill also includes provision for an increase in the rate of duty on aviation gasoline, which will apply across the UK. Otherwise known as avgas, the fuel is a form of leaded petrol predominantly used in leisure flying. The change made by clause 6 of the Bill will increase the avgas rate by half of a penny to 38.2p a litre from 1 January next year. By way of explanation, the Northern Ireland protocol requires that Northern Ireland continues to comply with the EU’s energy taxation directive following the end of the transition period. It sets a minimum level of duty in euros on unleaded petrol used for propulsion. After some careful consideration, the Government have chosen to apply the change to the whole of the UK to ensure consistency between Great Britain and Northern Ireland, avoid burdens on business and reduce compliance risks for HMRC The Bill also includes a clause to ensure HMRC has access to the same or similar tools to prevent insurance premium tax evasion as it does at present, regardless of whether an insurer is based in an EU member state. Overseas insurers are liable to pay insurance premium tax when they supply general insurance for UK-located risks. Occasionally, overseas insurers do not pay the insurance premium tax they owe, so it is important that HMRC has access to tools that deter and tackle that form of evasion. Up to now, it has been using EU provisions to prevent evasion by insurers based in EU member states Separately, HMRC can issue liability notices in cases involving insurers based in any country outside the EU with which the UK does not have a mutual assistance agreement. Given that the EU provisions expire at the end of the transition period, this clause will enable HMRC to issue liability notices in evasion cases involving insurers based in any country with which the UK does not have a mutual assistance agreement, including EU member states Finally, the Bill introduces new powers that will enable HMRC to raise tax charges under the controlled foreign companies legislation for the period from 1 January 2013 to 31 December 2018. This is a technical provision that will deal efficiently with the legacy state aid decision relating to the period before the UK left the European Union This Bill will give people and businesses throughout the UK certainty about the arrangements that will apply from 1 January next year. It will play a part in further safeguarding the unity and integrity of this country, both in the months ahead and long into the future. I commend the Bill to the House.
Before I call Anneliese Dodds, let me say that the wind-ups will begin at 5 o’clock at the latest, and that 13 Members wish to speak and are all here. We therefore know that there will definitely be 13 Members speaking, so colleagues should really be thinking about speeches lasting for six minutes. Even if I do not put the clock on, it would be really useful if everybody shows at least some discipline on that, so that everybody can get a fair crack of the whip.
It is a year to the day since the Chancellor boasted that there was no need to plan for no deal because “we will have a deal.” Yet today, as we debate this Bill, we stand on the brink of a no-deal Brexit that would destroy jobs and livelihoods right across the United Kingdom. We have only 22 days to go until the end of the transition period, with still no deal in sight When we debated yesterday the Ways and Means resolutions associated with this Bill, a number of Government Members claimed that agreements between nations are often only finalised at the last minute—that there is nothing out of the ordinary about this Government’s approach. That is because for run-of-the-mill agreements there is a fall-back option, a status quo. But failing to reach a deal now does not mean a return to the status quo—that we stay as we are. It means extensive economic damage to the tune of an additional 2% loss of GDP, on top of the 4% loss of GDP that the Office for Budget Responsibility has calculated would be the impact of a very thin deal: the type of thin-as-gruel deal that the Conservatives look set to deliver.
My hon. Friend is absolutely right, but even the statistics that she refers to regarding the overall impact on the economy mask the absolutely catastrophic impact that no deal would have on individual businesses and individual industries. I had the pleasure of visiting the Toyota factory in Derby. No deal means that the entire purpose of that factory being based in Derby is under serious threat. Alongside those statistics about the overall impact, it is really important that we recognise that the situation is much worse than that for individual businesses and industries.
My hon. Friend is absolutely right. There is potentially a very, very severe impact from no deal, but, as I will go on to explain, there is already a concrete and very acute impact on our economy. I am particularly concerned about the situation for many businesses based in Northern Ireland This damage will be long lasting, likely to outlive even the impact of the current covid crisis. Our country cannot afford this. We have already experienced the steepest economic downturn in the G7 due to the covid crisis, and are predicted by the OECD to experience the slowest recovery in the G7. Just the prospect of a potential no-deal outcome is already leading to chaos in the midst of a pandemic. Stockpiling by companies, caused by the threat of no deal, is exacerbating supply blockages at our ports.
The economic damage that the hon. Member is talking about should a deal not be agreed would also be inflicted on the European Union, particularly certain parts of the European Union, such as the Republic of Ireland. She criticised the UK Government for the way that they have negotiated. Does she have no words of criticism for the EU negotiators in this two-way negotiation?
Of course we need application and a determination to conclude a deal on both sides; that surely is obvious. But the fact remains, as I will go on to describe, that it was the UK Government that, rather than tabling this Bill many weeks ago, which they could have done, decided to effectively retain provisions that threaten to break international law. That is on the Government’s head, and it is something that the Government must surely be responsible for The irresponsible approach that we have seen recently speaks to a wider pattern over the last 12 months of recklessness with public finances, broken promises to the British people and short-term thinking that is doing long-term damage to our country. The Prime Minister promised the British people that he would get Brexit done. He said he had an “oven-ready” agreement. Whatever he has got cooking ahead of his dinner with von der Leyen tonight, my message to him is to get on and deliver what was promised.
I would just like to point out to the hon. Lady that Labour Governments, not to mention Conservative Governments or the coalition Government after 2010—there is a host of examples by a number of Governments—have passed treaty overrides, on exactly the same principles relating to Finance Bills, in the past. If she wants to construe that as breaking international law, she can, but the reality is that it is consistent with article 46 of the Vienna convention.
I am pleased that the hon. Gentleman mentions that situation, because it has been referred to by those who favoured the Government’s approach previously. However, I gently state to him that if he is referring in particular to provisions against tax avoidance—the example of a general anti-avoidance rule—then, sadly, I believe he is mistaken. In that case, that commitment and the ability to apply such rules was actually a fundamental principle agreed to by this country as part of a multilateral agreement that it concluded with the OECD, so I fear that that example is not as telling as he may wish it to be With just three weeks to go until the end of the transition period, the Government published late yesterday afternoon the 116-page Bill that we are discussing now, setting out detailed new rules for tax and customs duties. Members of this House have been given less than 24 hours to scrutinise a major piece of post-Brexit legislation that will impact businesses and individuals across the country, especially in Northern Ireland. Many of the clauses in the Bill, particularly those covering customs and excise duties, require the Treasury to make regulations that will set out the actual detail of its proposals at a later date, so even with the publication of the Bill, businesses and individuals still do not have the information they need to prepare for the end of the transition period Earlier today, the Chancellor of the Duchy of Lancaster said there would be “further clarity” forthcoming on these matters, but again without saying when. In fact, the Minister talked a few moments ago about those details coming in due course. His letter to Members spoke about the fact that there would be information on this later; “in the coming days” was the formulation at that time. How can he really expect businesses to plan on that basis—on the never-never up to 1 January This last-minute approach was not necessary. It is no use pointing to the complexity of the ongoing negotiations. We know that this Bill could have been published a long time ago because the Government have been floating a Finance Bill for months, so why yet another last- minute scramble? My right hon. Friend the Member for Wolverhampton South East (Mr McFadden) set it out very clearly: because the Conservatives had a not-so-cunning plan to use this Bill as negotiations reached a critical point by threatening to override the withdrawal agreement. At a time when we are seeking to negotiate new trading relationships across the international community, and when the Government are trying to project an image of global Britain to the world, this tactic certainly sent a clear message, albeit not the message the Government intended It is welcome that the Government finally saw sense yesterday, although we have already seen damage being done. Both in relation to the provisions in the Bill and more generally, the time is running out to ready our country for the challenges ahead. The Public Accounts Committee was clear last week that: “Government is not doing enough to ensure businesses and citizens will be ready for the end of the transition period” It expressed concern at reports from industry bodies that the Government had not provided the key information needed for businesses to prepare. Indeed, the Committee indicated that more than a third of small and medium-sized enterprises still believed that the transition period would be extended The Cabinet Office has admitted that it is well behind in recruiting the customs agents desperately needed for 1 January, despite more than £80 million having been spent so far. Yet again, earlier today, the Chancellor of the Duchy of Lancaster refused to specify exactly how many additional customs agents had been recruited. Overall, £4.4 billion has been spent by the Government on preparations for Brexit and the end of the transition period, yet we are still not ready.
I am terribly grateful to the hon. Lady for giving way. She has criticised the Government for spending £80 million in support of traders and a facilitated approach to the border. Could she tell us whether she thinks that number is too large or too small?
With enormous respect to the Minister, the problem with his Government’s approach is the fact that they do not indicate what they have got with that spending. As I said, £4.4 billion has been spent on preparedness for Brexit and for the end of the transition period, and the £80 million that he refers to, but there is no indication from the Government of how many additional customs officers we have received as a result of that spending. I hoped that he was intervening on me to provide an indication of the additional workforce that has been recruited. It is a matter of regret that he was unable to do so.
The hon. Lady is quite rightly querying how money has been spent. I do not know whether she has had letters from the Government asking MPs, as small businesses, to get ready for Brexit. I got two of them, including one that referred to me as an MSP, so perhaps the Government are not spending their money particularly wisely or accurately.
I am grateful to the hon. Member for that very relevant point. I am sure that it is not only Opposition Members but Government Members who have had many businesses contacting them, often in despair, about the communications and advertisements asking them to get ready when there is so little indication of what they have to get ready for Yesterday morning, the Business, Energy and Industrial Strategy Committee heard from the Food and Drink Federation, which said that the guidance being published now was already too late. Some 43% of its members who supply Northern Ireland have said that they will not do so in the first three months of next year. That is desperately worrying. TheCityUK said that in the worst-case scenario, 40% of the UK’s EU-related financial activity could be lost. Every day between now and the end of the year counts to get a deal, and failing that, to plan for the no-deal outcome that the Prime Minister himself conceded would represent a failure of statecraft With that in mind, Labour supports this Bill passing. Labour is a responsible Opposition, and we are determined to see the minimum disruption possible, but we cannot support such continued lack of clarity on critical issues. When businesses need clarity as a matter of urgency, it is not good enough to state that further guidance will be forthcoming. At the very least, they need a timetable for the provision of that greater certainty. They need to know what rules of origin will apply from 1 January. The continued lack of clarity could create unprecedented new costs. They need to know when appropriate tariff codes will be published. They need to know whether the Government will be providing easements, and they need to know these things in concrete terms, not through the winks and nudges that have substituted for clarity so far Businesses need to know whether there will be a pause in penalties arising out of this legislation and, if so, what would be done to counterbalance that and prevent wilful avoidance. They need to know whether the measures in the Bill countermand the existing guidance provided to Northern Irish businesses, some of which was updated just on 7 December. They need to know, as revealed in The Irish Times, whether and when the information on the trusted trader scheme for Northern Irish business—details of which have allegedly been coming out of internal communications —is going to be fully published, so that businesses can follow that scheme I want to end my contribution by asking the Minister to place himself in the shoes of a small manufacturing company. We have many excellent such companies across the United Kingdom—in Northern Ireland and in Great Britain. Companies will already have faced enormous challenges during this period because of covid. Potentially, they have staff off because they have to self-isolate. Potentially, there is continuing uncertainty about the future of furlough because of this Government’s unwillingness to provide that certainty. Potentially, they were counting on the job retention bonus, but they are not going to receive it. They are now trying to plan which members of staff they will need to have in the company at work to get ready for 1 January. The stress and strain are immense The Minister and his Government must do all they can to overcome those uncertainties and help businesses to plan. That is the least they can do for businesses and the people who work for them, who have had such a hard year.
I simply would like to put on record it on Second Reading the fact that, as I made clear in a point of order earlier, consideration on Report will take place next week and a lot will happen between now and then. The UKIM Bill at the moment has the “notwithstanding” provisions in it; they have not yet been taken out. We do not yet know what will transpire this evening or at any point between now and the Report stage of this Bill next week. Therefore, I have given instructions for the tabling of amendments to reinsert the “notwithstanding” provisions for the purposes of this Bill, which would have appeared but for the fact that the decision had already been made yesterday, before a statement was made to the House of Commons. That was dealt with today in principle, although not the question of what actually is going to be done. Therefore, for practical purposes, all I need say on Second Reading is that there are relevant provisions within the scope of this Bill, in clause 9, which is entitled “Recovery of unlawful state aid” Earlier this afternoon, I chaired, as I always do on Wednesdays, the European Scrutiny Committee. We have a 10 or 15-page paper on this question. The report, which will be signed off today and then published, covers reform of state aid rules and potential implications for the UK and includes a full description of what the state aid rules would mean; what the evaluation is at the moment by the European Commission; what it intends to do with respect to state aid in relation to enforcement proceedings; matters of sovereignty regarding the United Kingdom; the timetable for amendments to the EU state aid rule book; and the continued relevance of EU state aid law to the UK I am reading out some headline points, which also include infringement proceedings for state aid granted before 31 December; state aid law under the protocol on Ireland and Northern Ireland; state aid commitments—this is of course highly relevant to what the Minister said at the beginning, and I strongly advise him to read the report carefully—and state aid commitments in the EU-UK trade agreement, which the Prime Minister is going to be discussing today, and we do not know the outcome of that; the impact of EU subsidy controls on the competitors to UK businesses; and article 10 of the protocol on Ireland and Northern Ireland, which my right hon. Friend the Member for Wokingham (John Redwood) referred to. Indeed, I did too this afternoon, when my right hon. Friend the Chancellor of the Duchy of Lancaster made his statement and I pointed out that not only do I agree 100% with what the Prime Minister said at Prime Minister’s questions on all those relevant matters, wishing him well for this evening, but that what the Chancellor of the Duchy of Lancaster announced yesterday, in principle, and then reaffirmed today must not be allowed to undermine the unfettered sovereignty of the United Kingdom Parliament. That sovereignty is based on the referendum, the votes, the Acts of Parliament that everybody in this House on the Government Benches and the House of Lords agreed to, and, for that matter, section 38 of the European Union (Withdrawal Agreement) Act 2020, which was passed by a majority of 120 in this House—not a word of dissent from the House of Lords and not a word of dissent from any Member of this House In conclusion, I intend to table these amendments to examine the question when we get to the Report stage next week.
Will the hon. Gentleman give way?
It is always a pleasure to give way to the right hon. Gentleman, with whom I have been jousting on these questions for the best part of 20 years.
I hate to think it is the best part, but certainly it has been almost 20 years. The hon. Gentleman gives an interesting list of topics that his Committee has considered. The actual, practical application of these matters will be very different if the ratio decidendi in the Factortame case continues to have application in Northern Ireland post 31 December. Is that a matter he has considered, and what impact does he think it has on these things?
As somebody who has taken a great interest in Irish matters since I came into this House, I can only say the answer to that is yes. However, I also know that there is an enormous amount of malicious rubbish talked about the implications for the hard border. We are not going to impose a hard border. If anybody does, it will be the EU. If the EU gets its way on these matters, believe me, we are going to end up with difficulties that will have been created by the EU, not by us. I remember Martin Selmayr saying that the price the United Kingdom would have to pay would be the loss of Northern Ireland. I mean, it is as bad as that. I therefore say that I do take a great interest in it, because I want the Union to survive and to prosper. I believe it can, but it will not be able to if we end up with provisions that undermine the sovereignty of the United Kingdom Parliament On the specific question of state aid, that is a matter within the scope of the Bill. I therefore expect our amendment to be able to be called. Precisely what I do about it at that time will depend on the outcome of the negotiations, but I am not going to buy a pig in a poke and accept the idea that it is all over and done with because somebody who happens to be a Government Minister made a statement yesterday from Brussels and then came to the House to put forward his case today. We have not seen the details, so I want to reserve my position until I know exactly what the outcome of the negotiations is. I would warrant that the 70% of the British people would agree with me.
The way this Bill has been brought to the House today, less than 24 hours since it was published yesterday, really shows the disrespect the Government have for Parliament and for all of us here today. It is unacceptable that the UK Government are coming so late in the day with these proposals and are blatantly using them as a form of leverage in their negotiations The proposals before us today will impact on the daily lives of residents in Northern Ireland and of businesses more widely. I have concerns, not least from what the hon. Member for Stone (Sir William Cash) has just said, that the clauses being taken out could easily be put back in again—if not by him, then by the Government themselves. We have no certainty over that because of the way they have conducted these negotiations As MPs, we do not have adequate time to scrutinise what is in front of us this afternoon. Businesses and stakeholders have also been excluded from the process and they are, of course, those who will feel the impact the most. It is typical of the slapdash, chaotic way the UK Government do things, but I would like very much to put on record my dismay and regret at this shambles. I would also like to say that, while I have huge sympathy for those who have worked on the drafting on the Bill, it would not be the first Bill that has come back with errors and drafting issues because it has been prepared in haste. We have also seen that with some of the financial services statutory instruments that have gone through. I am very concerned that this has been done so hastily that we will not find out what the errors are until the UK Government come back to fix them later The Northern Ireland provisions have huge complexity and give significant powers to the Treasury to define in regulations the goods that are “at risk” of being moved into the EU. The Minister confirmed yesterday that we do not know exactly what those at-risk goods are, which causes huge uncertainty for those moving goods in and out of Northern Ireland. As the hon. Member for Oxford East (Anneliese Dodds) said, that has a chilling effect on businesses that want to transact their business as normal, but just do not know what it is that they are being expected to prepare for The letter that we received earlier from the Financial Secretary to the Treasury confirms that changes to the regulations will be made under the negative procedure, so this House will have no ability to further scrutinise them. The same is true of Stormont and it is crucial that we hear Stormont’s views on these regulations and the effect of them “Take back control,” this Government said. Well, it seems that most of the control is either going to the Treasury or to officers in HMRC. All these regulations are being put forward in such a way as to remove scrutiny and to remove control. Throughout the letter that we received earlier from the Financial Secretary to the Treasury, references were made to the use of the negative procedure and, curiously, to powers that there are no plans for the Government to use. It may not be the plan now to use them, but even the best laid plans gang aft agley, as happens so often and so wildly with this Government. How will the scrutiny work should the Government decide to make these changes? Lots of powers are being hived off, as we can well see. The amendment tabled in my name and the names of my colleagues attempts to redress some of the democratic deficit in the way that the Government are conducting themselves The affirmative procedure, as with many procedures in this place, is not perfect by any means, but at the very least this would make the UK Government come to this House to explain the reasons for their actions and to be scrutinised on their thinking, rather than just making changes that will make a real difference to the lives and livelihoods of people across these islands and more widely. Changes should not just go through on the nod The withdrawal agreement has the consent mechanism for Stormont, which will kick in only at the end of 2024. The UK Government must explain how their engagement will operate on all the mechanisms between then and now. This matter is horribly complicated and my sympathies are with all those who have to operate under these very difficult circumstances. So much of the uncertainty is also swathed in huge amounts of red tape. The red tape that the Brexiteers claimed they were going to remove will now be wrapped around Northern Ireland I received very little by way of reassurance from the Chancellor of the Duchy of Lancaster in his statement and his responses to Members earlier today. Too much is uncertain, and a lot of it is mince. The derogation in chilled meat, sausages, mince and unfrozen prepared meals is one such aspect. [Laughter.] Keep up, keep up! RTÉ’s Tony Connelly notes that when the as-yet-to-be-determined derogation period expires, supermarkets in Northern Ireland will need to source products locally or from the Republic of Ireland. That may well be good for those producers and good luck to them, but a clear competitive disadvantage is being placed on food exporters in Scotland, Wales and England and that cannot be justified by the Government The trusted trader scheme itself is subject to review three and a half years after the Northern Ireland protocol begins, but what mechanisms exist to hold it to account in the meantime to ensure that it is effective and that it does not have a distorting effect, which we suspect that it may do? What is in place now to ensure that there is not a further panic in a couple of months’ time due to a lack of qualified staff to carry out checks for export health certificates? Given the propensity of this Government to hand in their homework late if the dog has not already eaten it, what concrete assurances can they give I turn now to enforcement. The Prime Minister could not answer the question earlier from the Leader of the Opposition on the existence, or otherwise, of 50,000 customs agents, and the Minister today could not answer the same question from the hon. Member for Oxford East. I want to know a bit more about these customs agents. Where are they? How many of them are there? Will they be prioritised for the big ports in the UK, or will the Government run the risk of leaving the door open to smuggling and tax-dodging via the short straits? As the hon. Member for North Down (Stephen Farry) mentioned earlier, there is a risk of criminality as well as just of error What assessment have the Government made of the competitiveness of our export businesses with reference to schedule 3 of the Bill? If customs charges now apply, surely it will make it more difficult for people to export as well as to import? This is a general concern that has been raised by my hon. Friend the Member for Aberdeen North (Kirsty Blackman) on multiple occasions. It presents an extra hassle for small businesses as well as an extra unanticipated expense for consumers. I give the House a small example. I ordered a necklace some time ago from the United States and when it arrived a huge customs charge was slapped on it. Had I known about it before I had ordered it, I might not have ordered it, given the scale of the charge. Consumers do not know what they will end up with if they order something online. When we see something online, we see what the price of it is and what the postage is, but we do not see that customs charge, which is really not transparent. The earrings that I am wearing today are from a small business based in Slovenia, which was able to send them with no additional charges because we were a member of the European Union. Some 70% of Irish online purchases come from the UK. I want to know from the Minister what the impact of the changes will be on our own businesses that wish to export to the Irish Republic.
The hon. Lady makes an almost persuasive case about the difficulty of fragmenting a customs union that has been in place for only 40 years or so. How much more difficult would it be to fragment the United Kingdom, a customs union that has been in place for centuries?
The hon. Gentleman makes a good attempt there, but the issue is really the UK Government and their incompetence in dealing with all these issues, which could well have been anticipated, as well as in taking us out of the large trading bloc on our doorstep from which we have benefited for 40 years and from which our businesses have been able to export their goods. We in Scotland have been able to export our food and drink very easily, very simply and without any barriers. These are barriers that the UK Government wish to put in place—and if they wish to put them in place with an independent Scotland, that is their choice, not ours.
Will the hon. Lady give way?
I have almost finished, so I want to make a little progress, but I will try to bring the hon. Lady in later I am curious about what assessment the Government have made of the chilling effect of these changes. It is also very interesting that the customs duties will benefit the Irish Exchequer and be to the detriment of our people who wish to export. I note that paragraph 12 of schedule 1 will amend the Isle of Man Act 1979, and that part 6 of new schedule 9ZB to the Value Added Tax Act 1994, which is inserted by schedule 2, also relates to the Isle of Man, so I would be grateful if the Government told us what communication they have had with the Manx authorities on the proposals. Obviously those proposals have come out overnight, so I do not know what discussions have been had, but it would be very interesting to find out Scotland has not been offered the deal that Northern Ireland has been offered. The Financial Secretary to the Treasury spoke about the benefits of the EU single market that people in Northern Ireland will enjoy. Lucky them. Scotland is the only part of this supposed Union of equals not to get any of what we asked for, and we will see our own industries disadvantaged. To add insult to our very evident injury, Baroness Davidson and the then Scottish Secretary, the right hon. Member for Dumfriesshire, Clydesdale and Tweeddale (David Mundell), threatened to resign if Northern Ireland was given different treatment. Just a couple of years ago, they said: “Having fought just four years ago to keep our country together, the integrity of our United Kingdom remains the single most important issue for us in these negotiations Any deal that delivers a differentiated settlement for Northern Ireland beyond the differences that already exist on an all Ireland basis (eg agriculture), or can be brought under the provisions of the Belfast Agreement, would undermine the integrity of our UK internal market and this United Kingdom…We could not support any deal that…leads to Northern Ireland having a different relationship with the EU than the rest of the UK, beyond what currently exists.” Well, that is exactly what we have. It is exactly what the Bill is and what it does, yet those two Members are still about. The Scottish Conservatives really do have more faces than the town clock To move on to the Chancellor of the Duchy of Lancaster, he has an absolute brass neck to describe the situation in Northern Ireland as the “best of both worlds”. He said on ITV that Northern Ireland would have “access to the European single market, because there is no infrastructure on the island of Ireland, and at the same time unfettered access to the rest of the UK market.” “The best of both worlds”—in Scotland, we have heard that before. The Better Together campaign told us that the only risk of losing our place in the EU was if Scotland voted for independence. Where are we now The United Kingdom Internal Market Bill farce undermines yet further the integrity of this crumbling Union, and today’s Bill takes another sledgehammer to the support structures that this Government believe are stronger than they are. The people of Scotland—those who voted no as well as those who voted yes, and those who were unable to vote six years ago—have been watching what has been going on. They do not want a UK Government who drag Scotland out of the EU—they voted very clearly, by 62%, to remain—they do not want a UK Government who threaten to break international law and spoil our standing in the world, and they do not want a UK Government to force Scotland into an insular and poorer future. People want their chance to have their say. The 15 polls in a row that now back independence show clearly to me and everybody else that the people of Scotland believe that things have changed. As Winnie Ewing said: “Stop the world, Scotland wants to get on.”
Members should be aiming to speak for not much longer than four minutes, if we are to get everybody in. I call Sir John Redwood.
I have declared my business interests in the Register of Members’ Financial Interests The origins of this legislation lie in the negotiations under the previous Prime Minister that introduced the whole idea of a Northern Ireland protocol. I regretted those negotiations very much. I opposed them at the time and did not vote for the deals that my right hon. Friend the Member for Maidenhead (Mrs May) came forward with, because I thought they were designed by the EU as a lever to try to delay, dilute or damage Brexit. When the current Government asked me to support their version of the withdrawal agreement, I still had considerable reservations about the Northern Ireland protocol. I put those to Ministers, who reassured me and said, “This is only an outline operation in the withdrawal agreement as currently drafted. None of the detail has been done. We will negotiate very strongly. We will get rid of the offensive features that you don’t like.” They said that they shared some of my concerns and that they would come back with something much better. I am always trusting of colleagues, so I said that that was very good to know but that I did not have the same confidence in the EU I thought it was unlikely that the EU would want to facilitate that in the way that I and the Government would like. so with some friends, I backed my hon. Friend the Member for Stone (Sir William Cash) in saying that the way through this was to put clause 38 into the European Union (Withdrawal Agreement) Bill. Under that clause, were the EU to act in bad faith and not come up with a workable solution for Northern Ireland and the other problems, we would have asserted UK sovereignty in our version of the treaty, and so in good law we could use clause 38 to legislate in Britain for what we intend to do, overriding the agreement It was quite clear from the drafting of that Bill that we wanted that override, and I would not have dreamt of voting for the thing without the override. The Government were saying that they did not think we would need to use it, but we could use if we had to, which is why I was pleased to support them earlier this week in a very modest override. It is entirely legal; it is the assertion of British sovereignty. We need to keep that in reserve, because without seeing all the detail from the Chancellor of the Duchy of Lancaster, I am not satisfied yet that we have a working operation for the Northern Ireland border and the matters that we are discussing today—more precisely, who controls the taxation What I do not like about these proposals is that it is extremely difficult for individuals and businesses to have to respond to two legal jurisdictions on tax in the same place, yet we seem to have both an EU VAT system and a UK VAT system. I hope that the UK VAT system will deviate rather more from the EU one and be friendlier, lower and apply to different things, but the more that that happens, the more difficult it will be if we are trying to enforce two different VAT systems in one part of the United Kingdom I am also concerned about the enforcement mechanisms. We are led to believe that it will be handled by HMRC, but we are also told that the ultimate authority on the EU part of VAT and excise will be the European Court, and therefore there are likely to be inspectors and invigilators—electronic or in person—interfering in the process within what should be sovereign United Kingdom territory. I hope the Government will think again and push back again We need more of the detail that the Chancellor of the Duchy of Lancaster has so far withheld from the House. It may be that he does not yet know it all or that his agreement is high level, in principle, but there are details that we need to know—indeed, details that it would be better to know before we legislate today. For example, the Chancellor of the Duchy of Lancaster says that delay periods for adjustment will be necessary for supermarkets and some meat products and so forth. Does that not require some kind of recognition in this legislation? Does it not mean that these jurisdictions do not kick in during the period of grace that we are told will be available We need to have more detail from the Government on what exactly happens at the border. I have always explained to the House and others who are not very interested that VAT and excise take place electronically across the borders at the moment, so we are talking largely about an electronic border. We need to know how this electronic border will be programmed to deal with the competing jurisdictions and competing incidences of taxation, and how the product codes and shipment codes will correctly identify the products by category that will be suborned by the EU jurisdiction as well as, properly, by the UK jurisdiction, which ideally would be handling the whole thing We do not have nearly enough time to discuss the fundamentally big issues of principle that the Bill brings before us and we have had precious little time to go into the detail. It is all very sad that this rush job is being done like this, but I hope before the Government finish the debate today they will have done a better job of explaining to someone like me why we need to have this dual jurisdiction; how the EU control is going to be limited; how it is going to operate; how, in the early days, the “transitional arrangements”, which we are told about, are going to apply; and why they are not reflected in the current text of this rather unfortunate piece of legislation.
It is a great pleasure to follow the right hon. Member for Wokingham (John Redwood). Unusually, I found myself agreeing with much of what he said about the time we have to debate this Bill. The points made by my right hon. Friend the Member for Wolverhampton South East (Mr McFadden) in the previous debate were absolutely on the mark As someone who voted in the referendum to remain but who represents a seat that voted leave, I have to say that when I hear speeches such as the right hon. Gentleman’s, and many others that we are going to hear, I fear that much of what I have long feared about the whole Brexit process is coming to pass, which is that Brexit will be an orphan child and when we have left the EU and come to our final arrangement, it will be impossible to find anyone, perhaps with the exception of the Prime Minister, who says, “This is the Brexit I was campaigning for.” Brexit operated in so many different people’s minds as a different entity. Even now, with a Brexit-backing Prime Minister, an overwhelming Tory majority, any Tories who showed a whiff of regard for our future relationship with Europe banished from the party and all rebellion quashed, the fundamental contradictions of Brexit remain unresolved. I have no way of knowing whether there will be a deal, but I can be certain that when that deal is signed many who argued earnestly that we should leave the EU will claim, “This was not the Brexit I was campaigning for.” Let me turn to the measures in the Bill. I confess that during the referendum our campaign to back remain in Chesterfield hardly touched on the position of Northern Ireland. We did speak a bit about the Union in the context of Scotland, but Northern Ireland was barely mentioned, yet much of the Bill relates to the provisions relating to Northern Ireland that have become central to the issues that remain. The Labour party is, as I am, resolutely behind the Union and entirely committed to the Belfast agreement, and we recognise the many contradictions that persist I have to say to colleagues from the Democratic Unionist party and others that they should not think that these Northern Ireland issues concern very many of my constituents in Chesterfield. I know from many conversations that took place during the general elections on doorsteps in Chesterfield in 2019, when I was trying to raise the issues associated with Northern Ireland, that if the cost of getting a Brexit deal that enables our country to trade freely and regain control of immigration happened to be a united Ireland, many of my Brexit-voting constituents would accept that in a heartbeat. The people of Northern Ireland, whom, we should remember, in totality voted to remain, have been badly let down by many of the people they elected to represent them, either by those who sold their support to prop up the disastrous May Government and were then shocked to be sold down the river by the right hon. Member for Uxbridge and South Ruislip (Boris Johnson), or by those who, through their absence from this place, allowed the Brexit view to be heard as the dominant opinion of Northern Ireland The businesses of Northern Ireland are now starting to understand what that failure means for them. Right now it means that just weeks away from a change that will impact them more than any other on these islands, the promise that they will be able to enjoy frictionless trade has been exposed as wrong. It is irresponsible that when the Government themselves acknowledge that the administrative impacts on businesses affected by these changes will be significant, those businesses have so little time to plan, and no serious economic or fiscal impact assessments are contained within The last-minute nature of the Bill once again exposes the fact that the businesses of Great Britain, and particularly Northern Ireland, are left vulnerable by this incompetent Government’s pursuit of a promise that they cannot keep and should never have made. Although I wish the Prime Minister well tonight, the whole country needs him to remove the spectre of no deal from the nightmares we face as we look towards 2021. Once again, the Government are leaving businesses in the dark, jobs at risk and industries on the brink.
The next two speeches will be timed at four minutes, and then everyone else will have three minutes.
I am going to break with tradition in this debate and actually talk about the Bill. A Bill that is described, in large sections, as primarily technical, administrative and procedural will not always excite the juices in Parliament, among the public or in the press but, although dry in sections, this Bill contains important measures, and I rise to support them. Let me ground my comments in the experience of many people in the UK today. As someone who ran her own business prior to the election, I know that it is often the technical, administrative and procedural that can really shift the dial—for example, on the number of sales an individual can make or on market price points for a certain type of product—never mind the administrative and procedural processes that take too much valuable time from often hard-pressed smaller traders. Clarity is essential, welcome and timely. Once passed, the Bill will ensure that whatever happens in the ongoing trade negotiations with the EU, in an important subset of regulations there is clarity and fairness for businesses in the UK Measures in the Bill will change and improve our tax system and have been brought forward in separate legislation in advance of the proposed Finance Bill. They will ensure that the UK is prepared, whatever the outcome of the Prime Minister’s trip to Brussels later today. We are, and will continue to be, a proud sovereign trading nation. We are ensuring, and will continue to ensure, a smooth transition and continuity for trading businesses What do I mean? Let me be specific and turn to schedule 3, on amendments to the Value Added Tax Act 1994—essential bedtime reading for all, I am certain. In my previous business, I sold volumes of lower-value goods in online marketplaces and online channels to customers in the UK, the EU and many other locations overseas. For too long prior to the election I saw lower-value goods advertised by overseas sellers—my competitors— that were imported from abroad and undercut UK manufacturers and suppliers Currently, overseas sellers can avoid VAT, not charging it at the point of sale and not handing the revenue back to our Exchequer. That means that our country is losing twice: our fabulous businesses are losing sales to cheaper products from overseas sellers who do not have to charge VAT, which is unacceptable, while our Exchequer is also losing the revenue that such measures raise, which I remind the House funds the provision of the public services, such as the NHS and schools, that we rightly value so highly on the Government Benches. The Bill will remove that overseas-seller anomaly Specifically, the measures will mean that low-value consignment relief—LVCR—is removed from all non-UK sellers. All imported goods worth under £135, including under those worth under £15, will be subject to VAT at UK rates. Although currently legal, the existing situation amounts to tax avoidance by overseas sellers and has created distortions in UK marketplaces. It is this Conservative Government who are clamping down on it. To level the playing field, online marketplaces must now account for their VAT. This Government support our fabulous businessmen and women who trade from shops or—like me—online and will continue to do so Earlier, the hon. Member for Glasgow Central (Alison Thewliss) mentioned extra exporting barriers. As someone who has sat and put the labels on to goods going to EU, Ireland and international destinations, I know that for lower-value goods, any individual consignment worth under £270 gets a CN23 sticker with all the declarations on it, and then off it pops and there are no additional barriers between the EU and the US. No change that we will make today will put in place extra paperwork: what was done for the EU was always what happened anyway—it automatically comes off the printer. I am sure there are great British jewellers who can sell us wonderful earrings—
Sorry Katherine —that is four minutes.
Yesterday in the debate on the Ways and Means resolutions, I said that I would be supporting the Bill because our country needs it. It needs it for the core purposes of the Bill, which are the smooth continuity of business after the transition period, being ready, and creating a more level playing field for UK businesses I recognise that leaving the EU is a field full of tough issues, but the most problematic element is the nature of our land border with it. Seeking to deliver Brexit while protecting the Good Friday agreement was the major stumbling block in our endless debates and struggles last year, so I am pleased to see progress made on that issue. We had a statement on it earlier; I will not go over trodden ground There are businesses in Harrogate and Knaresborough that do significant trade selling to and buying from Northern Ireland. The Bill will be welcome news for them. More people in Harrogate and Knaresborough are affected by internet shopping, either buying from or selling via online platforms. Even if people do not buy online, they are affected by the struggles on the high street. It is a tough time for retailers and, of course, high streets provide countless thousands of jobs. They are economic hubs. Our high streets and town centres also have a social function beyond an economic one. They provide a community focal point Before coming here, I worked in retail and for brands that sell through retail. When I talk to retailers, they say that they just want a level playing field. They are talking widely when they use that phrase, but they are talking about taxation, particularly business rates and VAT. The Bill helps to create more of a level playing field with a new model for the treatment of VAT on goods arriving in the UK from overseas. The collection moves to the overseas seller or the online marketplace where that transaction occurs. As a result, it will be easier to collect VAT and harder to avoid it. The last thing that a business having a tough time needs is for competitors to have a 20% price advantage. High street businesses and online players based here pay VAT, so if overseas businesses are allowed to make VAT-free sales, they are unfairly undercut I do not think the measure is controversial; it is entirely reasonable. Indeed, as I mentioned yesterday, there are moves across the world in this policy direction. I commented on the other measures in the Bill yesterday, so I will not detain the House with repetition The past year has obviously been one of the toughest on record in peacetime. The economic impact will be felt for many years. We also have the consequences of Brexit. The need for the continuity of business operation is profound. Our whole United Kingdom must focus on growth as we seek to protect livelihoods as we have sought to protect lives. The Bill is part of the measures being taken to secure our business future, and that is why I will support it.
The existence and contents of the Bill encapsulate the opportunities and complexities that we, the United Kingdom of Great Britain and Northern Ireland, face as we reach the end of the transition period. As we regain control of our money, borders and laws, we have the opportunity to innovate and, in relation to taxation, to remould our regulations around the values and requirements of our modern UK economy For example, the Bill introduces some administrative and procedural VAT changes that not only are legally necessary, but allow us to tackle non-compliance and to support our high streets to compete with online sales. That is important in the current economic climate where, for nearly nine months, our high streets have faced unprecedented restrictions and sales have plummeted, while online retailers have traded unhindered and made record profits. I therefore support the measures in the Bill that stipulate that VAT is due from online sales by companies that import goods into the UK. That will ensure a more level playing field for our bricks-and-mortar retailers Another opportunity presented by our departure from the EU and the end of the transition period is our potential ability to crack down on tax evasion. The Bill also makes technical provisions on that issue. As well as realising the administrative opportunities that we can embrace as we leave the EU, the Bill reflects some of the complexities that have inevitably arisen as we, an historic Union of four distinct nations, seek to disentangle ourselves from 40 years of economic and increasingly political union with our European neighbours During the referendum campaign in 2016, I was not actively involved in politics and I was not a member of a political party, but I agonised over my vote. I was torn between the moral conviction that our UK Parliament should be sovereign and the practical acknowledgement that any divorce after 40 years of union will be complicated and messy—of course, both are true. Following 17 million votes to leave the EU, it is right and democratic to leave, but is also a complex and challenging process that has tested our determination and resolve for three and a half years. That is why the Bill must also make provision for all the circumstances that we may face following the outcome of ongoing trade negotiations. We cannot gloss over or underestimate these complexities or pretend that they should not exist. The history of the relationship between each of our four nations is unique, and it is based on cultural and relational settlements as much as law and statute. Whatever the outcome of the trade negotiations, we must ensure that we have a VAT and customs framework in place to allow trade across the UK to continue as seamlessly as possible. That is what this Bill will achieve, and it is why I support it as a sensible, responsible and necessary piece of legislation.
Somehow or other, I always thought that taking back control would look rather different for this place than this: to have just 24 hours to consider 112 pages of highly technical and detailed taxation legislation is an affront and insult to this House, and an abuse of the process by which we are supposed to govern ourselves. Those on the Treasury Bench who have brought forward this legislation in this way should hang their heads in shame. But, as the hon. Member for Oxford East (Anneliese Dodds) indicated in her contribution, it is, unfortunately, necessary. It is remarkable that amongst these 112 pages there are so many enabling provisions; so we know that in fact the detail is still to come and there will require to be secondary legislation to implement the detail of what our businesses will actually need The kindest comment I can make about the Bill at this stage, given the time available to me, is that it is just a foretaste of things to come. Essentially, most of what we have here pertains to the relationship with Northern Ireland, and even at this stage the Government are still tying themselves in knots because they promised three things of which they could only ever at best deliver two. They said we could come out of the customs union or we would have no border north and south or have no border east or west. In fact, if we were going to come out of the customs union, eventually we had to have a border north or south, or east or west; we could not have all three. I listened to the right hon. Member for Wokingham (John Redwood) talking about electronic borders, but the clue is in the title: it is a border. Once sovereignty trumps economics, that inevitably leads to having borders—something that should be heard in all parts of this House I was struck by the hon. Member for Glasgow Central (Alison Thewliss) quoting Robert Burns, saying: “The best laid schemes o’ Mice an’ Men Gang aft agley,” I was disappointed and a little surprised that she did not then deliver the next line of that stanza: “The best laid schemes o’ Mice an’ Men Gang aft agley, An’ lea’e us nought but grief an’ pain, For promis’d joy!” If ever I heard the perfect way of describing Brexit, that has got to be it: “An’ lea’e us nought but grief an’ pain, For promis’d joy!” The House will remember, of course, that Robert Burns was an exciseman, so he would know quite a lot about customs and the matters in this Bill; Lord alone knows what he would make of it if he were alive today.
This time yesterday we, frankly, would all have celebrated seeing what is in this Bill; today, I want to celebrate what is not in it. It is great that we do not have to consider the inclusion of additional measures to take account of the failure of the Joint Committee to come to an agreement on the proper interpretation of the Northern Irish protocol; I am delighted to learn that we have now come to the pragmatic and proportionate way found by the Joint Committee for the interpretation and enforcement of its provisions. Just a few days ago the European Union asserted that all goods travelling from GB to Northern Ireland were to be considered as being “at risk” of onward transport to the EU, a patently absurd and obstructionist position, so I heartily welcome this last-minute change of heart. TD Simon Coveney, the Fine Gael Minister for Foreign Affairs, has said that “Practical cooperation and flexibility has been agreed to make it as manageable as possible for people and businesses.” Amen to that, and may the same spirit suffuse the continuing negotiations elsewhere in Europe Clauses 2, 3 and 4 put in place the practical requirements to allow for the charging of customs duties and VAT away from the geographical border with the Republic of Ireland while continuing to protect the ability of Northern Irish products to travel without restrictions to the rest of the United Kingdom. This respects the Government’s commitment that goods from Northern Ireland will continue to have unfettered access to the rest of the United Kingdom Clause 7 proposes that VAT collection for goods sold in the UK by overseas sellers will move away from the border either directly to the overseas seller or, importantly, where the sale has been facilitated by an online marketplace, to that marketplace. This is a very important step that marks, I hope, the beginning of a much wider reassessment of the role of online marketplaces and the responsibility that they should properly have for the goods of international origin that they sell. All goods sold on our high streets pay the appropriate level of VAT, yet high street shops are being unfairly undercut by online international competitors that have avoided VAT. This clause allows the first step to be taken in recognising that the online marketplace has come of age, and with that coming of age it needs to accept the responsibilities of its powerful market-making position I hope that the link between the facilitation of sale and wider responsibilities will be a theme that the Government expand on in the coming months. As I mentioned in the debate yesterday, the same argument can be applied to areas of environmental legislation, such as the extended producer responsibility, as well as the collection of electronic waste for recycling I welcome Her Majesty’s Government’s approach. It is no longer credible for the hugely powerful and commercially dominant online marketplaces to wash their hands of what actually passes through their platforms.
It is a pleasure to follow the hon. Member for Broadland (Jerome Mayhew), particularly given the fact that he highlighted that just yesterday, we were all wondering what was going to be in this Bill What a complete and utter boorach the last 24 hours have been. The right hon. Member for Orkney and Shetland (Mr Carmichael) rightly highlighted the shambolic scenes that we have all seen. I heard yesterday from those on the Government Benches that the reason for this is that we are currently in a fast-paced environment. This has been going on for four and a half years, with three Prime Ministers and two general elections. How many resignations? How many U-turns? And the Government leave it until three weeks before the end of the transition before they bring forward something, and they do so with less than 24 hours’ notice of what it will actually entail. What a complete and utter embarrassment. Government Members are the ones who tell us that this is the place where power should lie, yet they are the ones who treat it with more contempt than anyone else. If I was not so disappointed, I would laugh at their sheer hypocrisy To turn to the Bill—I am very mindful of time—the hon. Member for South Ribble (Katherine Fletcher) was right to highlight one of the good elements of the Bill, in relation to online VAT. We should all support that, particularly at this moment in time, given the challenges that we are all seeing on our high street. We need to see a level playing field, and if we can bring that level playing field about, we should be willing to do it. I hope, however, that the Government will continue to go further and revisit the issue of the digital services tax, where they have the powers to make further inroads into levelling that playing field You will be unsurprised to learn, Mr Deputy Speaker, with just 60 seconds to go, that my agreement with the Government ends there, for four simple reasons that I will cover quickly. The first one is this: England voted to leave and England will leave. Wales voted to leave and Wales will leave. Northern Ireland voted to remain and Northern Ireland is going to get the best of both worlds; it is going to get access to the EU market while simultaneously remaining in the United Kingdom. And what of Scotland? What do we get? Scotland was told that we should stay in the United Kingdom in order to lead the United Kingdom—lead, don’t leave. We wanted the same access as Northern Ireland. We put forward numerous proposals, yet time after time, this UK Government completely ignored our views and desires in that respect. That all adds up, and it adds up in the minds of the very people this UK Government are going to have to rely upon the next time we go to the polls on our independence.
At least I and the hon. Member for Aberdeen South (Stephen Flynn) agree on a level playing field for business, and I want to concentrate my comments on that area. There is no question, for the best deal for consumers on prices and service, but that we need a fair and level playing field for businesses. That makes the market more competitive, which drives down prices and drives up service. It is absolutely where this Government should focus, and I am pleased to see that they are doing so in this legislation I am a big fan of VAT’s part in the collection of taxation. It is much more difficult to avoid than other taxes and much easier to collect. It is not a regressive tax, and I think we should try to focus on indirect taxes as we reform taxes in the future and simplify the tax system. As this closes a loophole, there is actually another area where we lose such a fair and level playing field, and that is the threshold for VAT registration. Some businesses are slightly below that and gain an advantage over others that are slightly above it. That is perhaps a conversation we should have another day On part 1 of schedule 3 to the Bill, I very much welcome the changed emphasis on online marketplaces in the collection of VAT duty. I understand from reports that when the changes were made in 2016, we collected about £500 million, although I am not sure what period that accounted for. I would be interested to hear from the Exchequer Secretary how much she thinks these changes will actually bring in for the Exchequer. I am pleased to see that we are closing another loophole in this way, after things like the digital services tax and the diverted profits tax. I do not think any Government in history have done more to clamp down on tax avoidance than this Government, quite rightly I would like to ask a couple of questions about these provisions. As I asked in my intervention, why is the figure £135? I realise this is to do with the changes in Northern Ireland to do with our leaving the European Union and the provisions in EU law for this, but why is it £135? Many products sold on the internet are also sold by UK domestic sellers who have to charge VAT, but above £135 overseas sellers may not have to, so this is another loophole that needs closing. I am not sure why, for example, someone could buy a watch from abroad that might be £500 or £1,000 and the same loophole would apply Similarly, this applies only to goods, not services. Many services are now sold online from abroad, such as legal services, accountancy services, IT developer services—for example, people can recruit developers from abroad through platforms such as Elance—and UK providers would have to charge VAT, but overseas providers potentially would not, so I wonder whether we can look at that. However, in the round, I am very supportive of these changes. I welcome them, and I certainly will be voting for them, if it comes to that, later today.
I am pleased to be a Northern Ireland voice in this very important debate. Obviously, this is a different type of speech from the one I was envisaging making earlier this week, and I do welcome that progress—not least that we are, I hope, moving beyond part 5 of the United Kingdom Internal Market Bill and the potential notwithstanding clause in this legislation, although of course we do remain vigilant in that regard I would welcome confirmation from the Minister, not least given that we have had very little time to scrutinise the detail, that the current version of this Bill is entirely consistent with the Northern Ireland protocol. It is worth recalling why we have to do that and why there is such a protocol. It arises from the decision of the UK not to have a fresh customs union with the EU post Brexit. That prompts the question of where the line is going to be drawn on the map between the UK’s customs union and the EU. The protocol essentially sees a situation whereby Northern Ireland remains part of the single market for goods, but remains part of the UK’s customs territory. Crucially, however, the EU customs code is to be applied down the Irish sea; hence the nature of this Bill Just to correct something that was said earlier, the withdrawal agreement and the protocol, which were signed up to by this Prime Minister, had the starting point that all goods moving into Northern Ireland were potentially at risk. That was what was said in the protocol, and I do welcome the progress that has been made in trying to find a way through this and that that is not going to be the case in practice Some people may say that it was only the EU that was threatening a border in Ireland. Of course, the EU does have the right to protect the integrity of its single market and customs union, but I think we are being too complacent about the UK’s own obligations in that regard. If, in the event of no deal, the back gate was left open, so to speak, there would be a requirement under WTO rules for the UK to adopt the exact same posture that it has on the island of Ireland with the rest of the world. I am not sure that is a line that it would want to go down, particularly given the whole range of threats that are out there There are a range of issues still to be addressed regarding the wider context of the Bill—in particular, the achievement of a zero-tariff, zero-quota deal. Even with that, rules of origin will still be an issue. But if there is no free trade agreement, we are back to the issue of goods at risk. Although we have the prospect of the authorised economic operator model—we await more details of that—it is not going to cover everyone. For example, it is not going to cover small retailers and it may not cover the online issue. There is also the question of what happens if that measure is not renewed in a few years’ time, as well as the issue around necessary resources Looking the other way, I have already raised in my intervention on the Minister the issue of qualifying goods and how we can tackle avoidance.
I call Shaun Bailey; please resume your seat no later than 5 pm.
It is a pleasure to contribute to this debate. It has certainly been a wide-ranging and interesting one, on both sides of the House Trade is among the most efficient ways to ensure that peace can be maintained between the communities in Northern Ireland as a whole, and to maintain the prosperity of Northern Ireland and the rest of the United Kingdom. I believe that this Bill secures that. In creating the legal framework for customs, VAT and excise charges, the Bill will make a real and positive impact on trade in both Northern Ireland and the rest of the United Kingdom, including in my communities in Wednesbury, Oldbury and Tipton. It will have a sizeable effect, given that 10% of England’s exports are to other parts of the United Kingdom, and particularly to Northern Ireland, with Northern Ireland external purchases from Great Britain coming in at around £14 billion. In specifying that customs charges will apply to certain goods only if they are at risk of moving into the EU, the Bill provides greater certainty and will ensure that our businesses can have the brighter future that they are looking for. Equally, the Bill will ensure that businesses across the United Kingdom can benefit from a continual flow of goods between the United Kingdom and Northern Ireland, and that Northern Ireland exports and imports do not have to suffer from barriers to trade It is quite right that our red line in this Bill has been the ability to set our own customs laws and excise duties. We are going to see the benefit of that in January, with the streamlining of some 6,000 tariff lines and the removal of tariffs on some £30 billion of imports entering supply chains, particularly within manufacturing, which is a key industry for areas like mine in the Black Country. We are going to do that while ensuring that there is no hard border on the island of Ireland, that we maintain the peace that has been built there over generations, and that we maintain the integrity of the communities within Northern Ireland Let me turn to the technicalities of the Bill. My hon. Friends the Members for South Ribble (Katherine Fletcher) and for Harrogate and Knaresborough (Andrew Jones) touched on the tax element, particularly VAT. As we have heard, schedule 3 finally ensures that our high street retailers can have the level playing field that they desperately need. As I touched on in my contribution yesterday, this has been a horrendous year for our high street retailers, with all the uncertainty and difficulties that they have come through, so ensuring that they are on a level playing field with online retailers and are able to obtain those benefits—and, equally, ensuring that the tax revenue that we have lost out on so far can be put into our vital public services, which have stepped up to protect us and our constituents during this time—is absolutely crucial. I welcome that part of the Bill I am extremely conscious of time, so I will round off my comments. Ministers have been given quite a degree of discretion under the words in the Bill, both in some of the definitions, and in some of the abilities that they will have. My right hon. Friend the Member for Wokingham (John Redwood) touched yesterday on the point that Ministers have to realise the potential of what they can do through this Bill. I implore my hon. Friends on the Treasury Bench to realise the potential in some of the abilities and powers that they have in this Bill, and to ensure that they get this right as we move forward—because we will move forward into 2021, and we have to ensure that, as we implement these measures, we do the best by all traders and all businesses operating within our United Kingdom.
I thank everybody who has contributed to this short debate. To pick out a few, the hon. Member for Stone (Sir William Cash) told us that he was reserving his judgment on some of these measures, particularly the Government’s decision not to proceed with the “notwithstanding” clauses. The hon. Member for Glasgow Central (Alison Thewliss) talked about hidden customs charges and described parts of the Government’s approach as “absolute mince”. The right hon. Member for Wokingham (John Redwood) spoke about the dual taxation regime, which we will return to in the Committee stage shortly to follow. My hon. Friend the Member for Chesterfield (Mr Perkins) spoke about the phenomenon of people saying that it is never a proper Brexit, no matter what kind of Brexit it is. The hon. Member for North Down (Stephen Farry) gave us a very welcome Northern Ireland voice on these issues What this Bill does, first and foremost, is to put in place a framework for the monitoring, taxation and movement of goods that was not there in the past. However much the Government try to duck that issue—to pretend that everything is going to carry on as normal—the new regime is there for everybody to see in the clauses of the Bill and the regulations to follow. Business to and from Northern Ireland will be conducted on a more monitored, differently taxed and significantly more bureaucratic basis than before. There is simply no escaping that and no hiding from it, and it would be better if the Government acknowledged this as what they have agreed. My first question to the Minister is: do the Government really expect to implement everything in this Bill and to secure compliance from businesses both in Northern Ireland and in the rest of the UK on all these measures by 1 January? Is that the Government’s realistic goal The Bill, of course, could have been very different. It could have contained clauses setting aside parts of the Northern Ireland protocol. The Government did look ready to double down on the course of action that they had embarked on in the UK Internal Market Bill, but thanks to yesterday’s statement by the Chancellor of the Duchy of Lancaster and his counterpart, Mr Šefčovič, the Government have announced that they will not proceed with such clauses. We can now look forward to the Government moving amendments in the other place to delete that which they insisted was necessary in this House on Monday evening. It is one thing to play ping-pong with the House of Lords, but quite another to play ping-pong with yourself. Once again, the Government’s MPs who valiantly defended the line on Monday now have a very different line to advance before Thursday. This is not the first time this has happened, and I should guess it will not be the last. If I was a Government Back Bencher, I would be becoming a little bit more wary of following the line from No. 10 on a number of issues In all the twists and turns that got us here, Ministers might think that they have acted tough, but threatening to legislate to set aside parts of an international agreement that the Government signed only a year ago has only done damage to the country’s reputation. The Government have not communicated toughness; all they have communicated is that they cannot be trusted. As we embark on a process of trying to negotiate new free trade deals around the world, what a signal to send and what a starting point: do a deal with the Government who threatened to ditch parts of the last one that we signed. That was not clever negotiating tactics and it was not toughness—it was reckless, and, I am afraid, it was revealing about the character of the Government The Bill sets out the new customs regime for so-called at-risk goods moving to and from Northern Ireland and the rest of the UK. Although it empowers Ministers to levy the necessary duties, there is still much that, as clause 1 says, will have to be clarified in new regulations from the Treasury. We only have 22 days to go. When will we see these new regulations? When will businesses in Northern Ireland, or those anywhere else in the country that send goods to Northern Ireland, know exactly what the new regime will be? Does the Minister really think that this is a proper way to do this, more than four years after the referendum and just three weeks before the end of the transition period Similar phrasing is used in clause 2 in relation to goods moving from Northern Ireland to the rest of the UK, and the same point applies: when will businesses know what is happening? On the VAT regime in clause 3, will the Minister set out how the EU’s VAT regime, as it applies to Northern Ireland, will interplay with the UK’s VAT regime—the question raised by the right hon. Member for Wokingham (John Redwood)? Similarly, on excise duties, how will the measures in clause 4, which apply to everything from spirits and beer to tobacco products, differ from current arrangements? Are the insurance premium tax changes thought necessary in the event of no mutual assistance provisions between the UK and the EU? If they are, are such provisions likely to be part of any deal which, if agreed, would then mean that the clause was not needed These measures are likely to pass the House quite quickly tonight, but the real action at the moment is of course not here, but elsewhere. As we debate this Bill, we still do not know whether there will be a free trade agreement reached. After four years, the public, companies and their staff do not know what they will be facing in January, and the root of that decision remains what it has always been: this choice between sovereignty and market access The story of the past four years has been the Government moving more and more towards the sovereignty side of that choice. They may say that is the remorseless logic of Brexit, but no one should doubt the significance, because what it means is that, for the first time in history, we have a Government and a process where questions of investment, of people’s prosperity and of their living standards have been progressively relegated to a more and more distant second place. We will see the results of that choice over the coming months. Perhaps after tonight’s dinner in Brussels, we might even be a bit clearer about the results in the days to come, but in the end what has been described as a negotiation is, in fact, a choice. The Government have made their choice, and we will see the effect in the months to come.
It is a privilege to close this debate on behalf of the Government, and I thank Members from all parts of the House for their thoughtful and varied contributions At the end of this month, the transition period will end. As my right hon. Friend the Financial Secretary pointed out at the beginning of today’s debate, we have a great responsibility to be ready for this event. The measures contained in the Taxation (Post-transition Period) Bill will play an important part in the preparations Let me take this opportunity to thank Opposition Members for their constructive and collegiate approach throughout the passage of this Bill, despite their evident reservations, and in that same spirit I will address some of the points raised in today’s debate The Bill is an essential part of our preparations for the end of the transition period. It takes forward important changes to our tax system to support the smooth continuation of business across the UK. It contains six measures. Three relate to the implementation of the Northern Ireland protocol and three implement wider changes to the tax system, which are needed before 1 January. Most importantly, it will ensure that we meet our commitments to Northern Ireland, including on unfettered access and those commitments as set out in the Northern Ireland protocol. Taken together, the measures form an important part of our preparations as we resume our place as a fully sovereign trading nation Now that we have further clarity on the outcome of the Joint Committee negotiations, it is vital that the provisions are in place before the end of the transition period to provide that certainty. The Bill’s passage is necessarily rapid, but it will allow for these important changes to be implemented on time. The right hon. Member for Wolverhampton South East (Mr McFadden) asked if we believed it can be done, and my answer is yes, of course. The UK Government will take forward a pragmatic approach that draws upon available flexibilities to implement the protocol without causing undue disruption to lives and livelihoods The Government are committed to supporting business. At the centre of the package is the free-to-use trader support service, which will support business when moving goods into Northern Ireland, educating traders on what the protocol means for them and completing customs safety and security declarations on their behalf. That is working. Since the launch of the registration portal in September, more than 18,000 businesses have signed up for support from the trader support service Turning to Members’ comments, the hon. Member for North Down (Stephen Farry) requested confirmation that the UK meets its obligations. The powers in the Bill allow us to implement the Northern Ireland protocol in a way that is consistent with our obligations, and I appreciate his broader supportive statements. My hon. Friends the Members for South Ribble (Katherine Fletcher) and for Harrogate and Knaresborough (Andrew Jones), among others, rightly referred to our closing of the VAT loophole in clause 7 and schedule 3. Low-value consignment relief is subject to widespread abuse and contributes to trade distortion. It disadvantages UK high street businesses that are required to charge VAT where overseas businesses are not, either for legitimate reasons or through abuse, and removing the relief will bring overseas sellers on to an equal footing with UK businesses My hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) asked why the clause applied just to low-value goods and whether there was an opportunity for it to apply to high-value goods as well. The reason is that the £135 threshold aligns with the threshold for customs duty liability. Imports of goods greater than £135 in value are subject to enhanced customs requirements, which would negate the benefit of moving VAT away from the border. Therefore, imports of goods greater than that amount will remain subject to the current model for goods arriving from non-EU countries, where VAT is collected at the point of importation My hon. Friend also asked what revenue we expected from this change. The Office for Budget Responsibility has forecast that these changes will raise over £300 million a year over the next five years, and £1.6 billion over the scorecard period. Approximately two thirds of that will come from improving collection and tackling non-compliance through the new VAT treatment of cross-border goods, and the final third of the revenue will come from the removal of low-value consignment relief, which will end widespread abuse of this relief My right hon. Friend the Member for Wokingham (John Redwood) asked whether the ECJ would be the ultimate arbiter for VAT and excise. The ECJ will continue to have a role where EU directives apply in Northern Ireland—for example, where there are disputes on how the EU rules should be interpreted. However, the rules will continue to be policed by HMRC, which will continue to be the tax authority for the whole of the UK. He also mentioned Northern Ireland being subject to two regulatory systems. Northern Ireland is and will remain part of the UK and its VAT system. It is correct that the Northern Ireland protocol means that NI will continue to align with the EU VAT rules in respect of goods, but not services. That is to ensure that trade is not disrupted on the island of Ireland, and to allow us to meet our commitments under the Belfast/Good Friday agreement. But, as I said, HMRC will continue to be the tax authority for the whole of the UK. Businesses will continue to have a single UK VAT number, issued by HMRC, and they will submit only one UK VAT return to account for VAT on all supplies of goods and services My hon. Friend the Member for Stone (Sir William Cash) asked about the current negotiations. Just to remind him and reiterate to the House, the UK Government set out on 17 September that Parliament would be asked to support the use of provisions such as clause 45 of the United Kingdom Internal Market Bill and any similar subsequent provisions in a Finance Bill. These clauses were introduced as reasonable steps to create a safety net, so that the Government would always be able to deliver on their commitments to the people of Northern Ireland in the event that a negotiated outcome could not be reached in the Joint Committee. However, as we all now know, following intensive and constructive work over the past weeks by the UK and EU, we now have an agreement in principle on all issues in relation to the protocol on Ireland and Northern Ireland. As we have mutually agreed solutions, the UK can now withdraw clauses 44, 45 and 47 of the UKIM Bill and not introduce any similar provisions in this taxation Bill.
On that point about the “notwithstanding” clauses, can the Minister guarantee, given that neither the United Kingdom Internal Market Bill nor this Bill has finished its passage in the House, that the Government will not reintroduce them at any further stage?
As I have just said, I am not in a position to be talking about what is happening in the future. We have been negotiating in good faith and we have an agreement in principle. I do not believe that those clauses will be coming back, but as the right hon. Gentleman knows very well, the negotiations are still ongoing and we need to wait and see what the outcomes of those negotiations are. It would be quite wrong for me or him to pre-empt anything else that will be taking place, and we must not bind the hands of our negotiators. It is absolutely right that we all speak with one voice in this House The hon. Member for Glasgow Central (Alison Thewliss) mentioned GB and NI parcels and asked how consumers would know whether there was a customs charge. The movement of parcels into Northern Ireland is another important part of how the protocol will work in practice for people in Northern Ireland. That is why the UK Government will take forward a pragmatic approach, just as we have elsewhere, that draws on available flexibilities to implement the protocol without causing undue disruption. In terms of schedule 3, she gave the example of the earrings from Slovenia that she had ordered. It is worth stressing that schedule 3 deals with imports to the UK and not exports. It will ensure that UK customers see the amount of VAT that needs to be paid at the point of sale on goods below £135. For goods between Northern Ireland and GB, VAT is already charged on supplies sold by a GB business to an NI customer. When the Northern Ireland protocol comes into effect, Northern Ireland businesses or consumers purchasing goods from VAT-registered businesses will see no significant difference in costs from a VAT perspective. Let me conclude by saying that tonight, this House has the opportunity to give businesses in Northern Ireland and throughout the rest of the UK certainty about the arrangements that will apply from 1 January next year, to strengthen the precious bonds of union that tie this country together, and to prepare this country for an even brighter future as an independent sovereign trading nation. For all those reasons, I urge all Members to support the Bill Question put and agreed to. Bill accordingly read a Second time; to stand committed to a Committee of the whole House (Order, this day).
I will now suspend the sitting for a brief period in order for both Dispatch Boxes to be sanitised.
Before I ask the Clerk to read the title of the Bill, I should explain that in these exceptional circumstances, although the Chair of the Committee would normally sit in the Clerk’s chair during Committee, I will remain in the Speaker’s Chair in order to comply with social distancing requirements, although I will be carrying out the role not of Deputy Speaker but of Chairman of the Committee. Chairs of the Committee should be addressed as such, rather than as Deputy Speakers I must also modify the call list slightly in the light of the selection and grouping of amendments by the Chairman of Ways and Means. I will call the right hon. Member for Wolverhampton South East (Mr McFadden) to open the debate by moving amendment 2; we will then follow the rest of the call list as published, starting with the hon. Member for Stone (Sir William Cash). I will call the Minister at the end to respond to the debate Clause 1 Duty on goods removed to Northern Ireland
I beg to move amendment 2, page 2, line 43, at end insert— “(4A) The Treasury must publish guidance setting out its proposed approach to the reliefs, repayments and remissions referred to in subsection (3)(b) within four working days of this section coming into force.”
With this it will be convenient to discuss the following: Clause stand part Amendment 3, in clause 2, page 4, line 24, at end insert— “(5) The Treasury must publish guidance setting out its proposed approach to the reliefs, repayments and remissions referred to in subsection (4)(a) within four working days of this section coming into force.” Clause 2 stand part Clauses 3 to 4 stand part Amendment 1, in clause 5, page 7, line 44, leave out subsection (3) This amendment is connected with NC1, which would make all substantive regulations under the Bill subject to the affirmative procedure. Clause 5 stand part Clauses 6 to 12 stand part New clause 1—Regulations— “Notwithstanding any other enactment, a statutory instrument containing regulations made under this Act, other than regulations made under section 11, may not be made unless a draft of the instrument has been laid before and approved by a resolution of the House of Commons.” This new clause would make regulations made under the Bill (other than the commencement regulations in clause 11) subject to House of Commons affirmative procedure. New clause 2—Treasury use of powers— “(1) The Treasury must, within four working days of the day on which this Act is passed, publish a report setting out the timeframe within which it will use the powers to make regulations conferred by— (a) section 40A(2) of TCTA 2018; (b) section 40B(1) and (2) of TCTA 2018; (c) section 30A(4) of TCTA 2018; (d) section 30B(1) and (3) of TCTA 2018; (e) section 30C(5) of TCTA 2018, and (f) section 5(2) of this Act (2) The Treasury must publish an annual report setting out how it has made use of the powers referred to in subsection (1) (3) Each report under subsection (2) must include an assessment of— (a) what considerations the Treasury made when deciding to use its powers, and (b) the impact of the regulations on individuals and businesses throughout the UK, and specifically in Northern Ireland.” That schedule 1 be the First schedule to the Bill That schedule 2 be the Second schedule to the Bill That schedule 3 be the Third schedule to the Bill That schedule 4 be the Fourth schedule to the Bill.
As well as speaking to amendment 2, I will speak to amendment 3, which makes the same points, and say a word about new clause 2. All three have been tabled in the name of the Leader of the Opposition and those of my right hon. and hon. Friends Clause 1 sets out the new customs regime that will apply to goods moving between Great Britain and Northern Ireland—specifically those that are deemed to be at risk of entering the EU single market. The Northern Ireland protocol that the Government have signed up to requires such a regime as a result of their decision to leave the single market and the customs union. It will mean a system of paying customs duties for those who move such goods As yet, none of us knows whether a deal will be agreed, although we know that an important dinner is taking place in Brussels tonight. However, we welcome the announcement of a trusted trader scheme today, although it comes very late in the day. That scheme will remove some of the possible tariffs on goods that move from Great Britain to Northern Ireland in the event of a no-deal Brexit, but for other goods we are clear that we do not want to see additional costs for businesses and communities in Northern Ireland The House should note that Northern Ireland consumers have, on average, about half the discretionary income of consumers in the rest of the United Kingdom; the long and the short of it is that they simply cannot afford such additional trade tariffs on goods. There therefore needs to be a system for at-risk goods that do not leave Northern Ireland, in line with the agreement that Northern Ireland remains part of the UK’s customs territory and that customs duties should not apply to goods that travel between Great Britain and Northern Ireland if Northern Ireland is their end destination The protocol and the arrangements agreed yesterday by the Chancellor of the Duchy of Lancaster and his counterpart create new requirements for businesses to be set out in regulations. Clause 1 is specific about that, for example in new section 40B of the Taxation (Cross-border Trade) Act 2018, which states that the Treasury “may by regulations provide” for which goods the new duties will apply to, and make “provision about reliefs, repayment and remission…checks, controls or administrative processes” and other matters My broad point is that that is obviously a description of new arrangements that are not in place right now; that is why they are being introduced in the Bill. As I said on Second Reading, it would be better for the Government to acknowledge that this is a new regime with new requirements, instead of the pretence that everything will carry on exactly as it is As I also said on Second Reading, we only have three weeks to go. Businesses in Northern Ireland and those that do a lot of trade with Northern Ireland will be asking, “What does this mean for me? What processes do I have to go through? What do I have to pay? If the goods remain in Northern Ireland, will I be entitled to a rebate if I have paid? How will I claim that rebate? How will this system work?” Those are all legitimate questions about the new regime being introduced by the Bill and the regulations enabled by it. Amendment 2 asks the Treasury to reach conclusions and to publish answers on these matters in the coming days. Frankly, it is already too late to expect businesses to absorb more than 100 pages of legislation within a few weeks. But even if it is too late, we cannot afford more delay, which is why our amendment calls for the publication of guidance on this within a few days of the Bill coming into force I should stress that nothing in this amendment alters the regime that the Government are trying to bring in. Everything in the amendment is fully in line with the Northern Ireland protocol and with the commitments that the Government have made as part of that. We want to provide clarity for businesses as soon as possible, rather than leaving open-ended the time for these regulations to be published In response to my question at the end of the Second Reading debate, the Exchequer Secretary to the Treasury said with confidence that she was sure this could all be done by 1 January. I hope she is right and that any scepticism that all these arrangements will be completed in the three weeks between now and 1 January is unfounded. Let us hope that she is right. The amendment asks for the Government to outline precisely how these duties and tariffs, if they are necessary, will be rebated. Businesses will be asking that question and, quite reasonably, they will want an answer Will businesses be required to pay up front and then be reimbursed by HMRC, as envisaged in the Northern Ireland protocol? Is that what the Government have in mind? If so, the Minister should know that there are fears that such a rebate system could be hugely complex. Indeed, some fear that it is not fully built, but we are told that it will all be ready for 1 January. These are vital questions. As it stands, the Bill does not fully answer them, nor does it set out a timeframe in which they will be answered, which is why we have tabled amendments 2 and 3 to the Bill Finally, new clause 2 is an attempt to give both Parliament and the public some timetable—some road map—for the blizzard of regulations that are enabled by the Bill and to secure a report on their impact in the future. As I said, this is a new regime. The Bill legislates for something that we have not had to do before in the United Kingdom, and we should at least have the courtesy of reporting on how it is operating in the future. New clause 2 asks for both a timetable of the regulations and a report on how the new regime has operated. These are completely reasonable amendments. I hope that, in a spirit of generosity, the Government will find it within themselves to accept them, and I look forward to hearing the Financial Secretary to the Treasury wind up the debate.
Sir William Cash is not here, so we go to Alison Thewliss.
I am very sorry to hear that the hon. Member for Stone (Sir William Cash) is not here, because I am sure that there is so much more that he could have added to this debate that he has not already said.
He may have withdrawn but I have not been told, so that may explain it.
That is absolutely fine. I wish to speak to the amendments in my name and the names of my hon. Friends As I outlined on Second Reading, I have real concerns about the scrutiny aspects of the Bill. It is a thick and substantial Bill that gives substantial powers to the UK Government to move things through this House under the negative procedure, which gives very little opportunity for us or anybody else to scrutinise their proposals. We wish to see the proposals come under the affirmative procedure wherever possible, to allow extra scrutiny of the Government As I said, I am very concerned about the letter that the Minister sent to Members. It talks about a huge range of duties that the Government are creating but that, at this moment, they do not intend to use. I question why they are creating such duties if they do not intend to use them. At some stage perhaps they will use them, so we need a mechanism to scrutinise them. It is unfortunate, but perhaps not surprising, that the Government see taking back control as bringing it back from bureaucrats in Brussels to give it to bureaucrats in Whitehall, bypassing this place altogether. It should have been an opportunity for this place to get more powers to scrutinise such duties, but no; it all goes to Her Majesty’s Revenue and Customs or to the Treasury, and very little comes here or indeed to the Committees of this House. There should have been an opportunity to look at the new taxation structures that we are bringing in here and that we have responsibility for in this House, but the Committees of this House will not get the opportunity to scrutinise these measures either. I know that some have suggested that an additional Committee would allow that scrutiny to be made I very much support what the right hon. Member for Wolverhampton South East (Mr McFadden) said and the questions he asked. We are dealing with complex supply chains when we talk about the movement of food, chemicals and manufactured goods. In my constituency and in the constituencies of some of my colleagues, for example, we have manufacturers of leather, who move raw hides from Ireland to the west of Scotland. They need to know how they will be able to move these goods through different territories, as they really should not be left hanging about for any length of time; they need to be moved quickly to where they are processed. We do not know whether they would fall under what the Government have termed “at risk goods”. It is not surprising that businesses are tearing their hair out with this shambles of a Government, because they do not know whether they will be able to continue with their business come the turn of the year There is also the cost and the red tape, whether it is the 265 million customs forms that will need to be filled out compared with the 54 million now, or whether it is the issue of rebates and the processing of fees and money. This is the end of the transition period, but we do not know what we are transitioning to. We certainly know what we had and what we will not have any more: free and unfettered access to a huge market in Europe. We do know that we are losing that, but we do not yet know what the Government’s plans are Despite the Government’s attempts to reassure us, concerns remain. Aodhán Connolly of the Northern Ireland Retail Consortium, while acknowledging the progress that has been made, said of the delays: “We are just 22 days out and retailers are still unsure about the exact processes needed to move food to Northern Ireland. Therefore, the Government needs to assure them how this will be done without additional bureaucracy.” There are real concerns about the cost and the choice of food that people of Northern Ireland will have if we do not get this right The point that I made earlier about customs charges and duties was reflected in an item on RTÉ at about 2.30 this afternoon. It said that customers in Ireland will be faced with VAT and customs duty from 1 January if buying goods from the UK worth over €22. That is significantly lower than the levels that were spoken about earlier. It was said that the Irish Revenue has no way of knowing whether consumers will continue to buy from the UK when additional charges apply. I ask the Minister to consider this and to do some studies on whether these additional charges will have an impact on people in this country who make good-quality goods and export them to Ireland. A total of 70% goes to Ireland, and we need to have some certainty from the Government about the long-term impact The scrutiny mechanisms that we suggest give us ample opportunity to do that at every stage of this process, not just today while we are considering this Bill, and then putting it in a box and leaving it, but on an ongoing basis. This Government definitely need to be held to account The First Deputy Chairman of Ways and Means (Dame Rosie Winterton): I believe that the Members who were numbers five to 11 on the call list spoke in the earlier debate and have withdrawn from this one, which means that we go straight to Andrew Griffith.
It is a pleasure to speak under your chairmanship, Dame Rosie I welcome this set of pragmatic measures. The Bill is a building block on the way to regaining our national self-determination in this very important area. I will oppose the amendment, although not on the principle— greater scrutiny and giving business greater certainty are things that I hope that those on both sides of the House can support. However, we should recognise that we are in a fast-moving environment. The Treasury team have been working incredibly intensively in the context of the pandemic and I think it is unfair to impose on them a specific timeframe when I know they will—perhaps the Minister will address this point—use their very best endeavours to give the very greatest amount of certainty as quickly as possible I follow the hon. Member for Glasgow Central (Alison Thewliss), who I have to say takes something of an 18th-century approach to customs, borders, forms and tariffs. The reality is that, as my right hon. Friend the Member for Wokingham (John Redwood) said earlier, we are in an age of online forms and digital electronic surveillance. Any good that passes across any internal or external border is tracked through a multiplicity of different technologies. I made the observation to the hon. Lady that of course when one introduces any customs border—this is one reason why Government Members are so keen to keep our United Kingdom together—there is an added level of complexity, but we should not overstate the complexity or understate the ability of business to innovate and deal with that.
I thank the hon. Gentleman for allowing an intervention. Is he aware that we were told in the Treasury Committee that the UK could have adopted the French customs system, which was up and running before ours? Ours is not ready, as the Business, Energy and Industrial Strategy Committee heard yesterday. Technological solutions exist, but they do not exist in the UK, and we do not have them up and running to get this moving by the turn of the year.
I beg to differ with the hon. Lady. There will be different systems for different territories, but on the business side of things there is already sophisticated tracking of stock, sales and data, which can be used to feed into accounting systems What I really want to do is to celebrate—I hope that those on both sides of the House can do that—the absolute game-changer that is contained within clause 7 to crack down on the leakage of the important tax revenues that fund our valued public services, and, most importantly, to create a level playing field for the nation’s small and online retailers. That has needed to be addressed for far too long. I welcome the Minister to his place and what clause 7 will do for the enterprising small businesses of our nation.
Dame Rosie, what a delight it is to see you in the Chair, metaphorically if not actually It is a measure of the wide gulf between the House’s professed intentions and its actual activities that we are about to wind up within a very few minutes, and nothing like to time, the scrutiny of the Bill in Committee. I thank those who have spoken. Let me do service on my part by keeping my remarks brief, although I will say that nothing could have surprised me more than that my hon. Friend the Member for Stone (Sir William Cash) will not be taking the opportunity to make a trivial two-hour speech. The right hon. Member for Wolverhampton South East (Mr McFadden) said that somehow the Government were pretending there was no change. Of course, he then went on to say that nothing has changed. We are not pretending anything. We acknowledge that there is change and that is specifically why we have used the language we have of making the changes as easy and as frictionless as possible for all parties concerned The right hon. Gentleman raises concerns and questions about Northern Ireland. I remind him that the Trader Support Service, which was launched on 28 September, has 18,000 subscribers already. He asks us to publish guidance. I can tell him that guidance has been published already, on 26 October The hon. Member for Glasgow Central (Alison Thewliss) saw Brexit—rather helpfully—as an opportunity to return powers to Parliament. How right she was. That is why I am a supporter of the United Kingdom of Great Britain and Northern Ireland, and of the Parliament that stands at its centre. My hon. Friend the Member for Arundel and South Downs (Andrew Griffith) rightly said that it should be for the Bill to make matters as easy as possible. I agree with that. He pointed to the absolute game-changer in clause 7. I agree with that too.
I believe the right hon. Member for Wolverhampton South East may wish to withdraw his amendment.
I point out to the Minister that he said guidance was published in October; he cannot be referring to the guidance referred to in clauses 1 and 2, which talks about the regulations under the Bill. However, on the basis of the whole debate, we will not press the amendment to a vote tonight, so I beg to ask leave to withdraw the amendment Amendment, by leave, withdrawn. Clause 1 ordered to stand part of the Bill. Clauses 2 to 4 ordered to stand part of the Bill. Amendment proposed: 1, in clause 5, page 7, line 44, leave out subsection (3).—(Alison Thewliss.) This amendment is connected with NC1, which would make all substantive regulations under the Bill subject to the affirmative procedure. Question put, That the amendment be made.
With the leave of the House, we shall take motions 4 to 9 together Motion made, and Question put forthwith (Standing Order No. 118(6)), Exiting the European Union (Environmental Protection) That the draft Control of Mercury (Amendment) (EU Exit) Regulations 2020, which were laid before this House on 19 October, be approved Exiting the European Union (Consumer Protection) That the draft REACH etc. (Amendment etc.) (EU Exit) Regulations 2020, which were laid before this House on 19 October, be approved That the draft Detergents (Amendment) (EU Exit) Regulations 2020, which were laid before this House on 19 October, be approved Transport That the draft Renewable Transport Fuel Obligations (Amendment) Order 2020, which was laid before this House on 15 October, be approved Exiting the European Union (Customs) That the draft Export Control (Amendment) (EU Exit) Regulations 2020, which were laid before this House on 15 October, be approved Exiting the European Union That the draft Conflict Minerals (Compliance) (Northern Ireland) (EU Exit) Regulations 2020, which were laid before this House on 15 October, be approved.—(Jesse Norman.) Question agreed to. Motion made, and Question put forthwith (Standing Order No. 118(6)), Exiting the European Union (Immigration and Asylum) That the Immigration and Social Security Co-ordination (EU Withdrawal) Act 2020 (Consequential, Saving, Transitional and Transitory Provisions) (EU Exit) Regulations 2020 (S.I., 2020, No. 1309), dated 17 November 2020, a copy of which was laid before this House on 18 November, be approved.—(Mike Freer.)
I rise to present a petition to the House of Commons from the residents of Gillingham and Rainham The petition states: The petition of residents of the constituency of Gillingham and Rainham, Declares that the proposal in Maidstone Borough Council’s Local Plan Review for up to 2,000 homes at Lidsing, which borders Hempstead in the constituency of Gillingham and Rainham, would negatively impact local infrastructure and green spaces; and further that the building of this proposal would be detrimental to road capacity, school place availability and local GP services for the local residents of Hempstead and the surrounding areas The petitioners therefore request that the House of Commons urge the Government to take into account the concerns of the petitioners and take action to ensure that the 2,000 home Lidsing proposal in Maidstone Borough Council’s Plan does not go ahead And the petitioners remain, etc [P002638]
The section 114 legal notice that halted all non-statutory expenditure in the London borough of Croydon was the first in the capital in 20 years. The previous two were in Hillingdon, where I serve, to this day, as a councillor—I draw the attention of the House to my entry in the Register of Members’ Financial Interests—and in Hackney. The circumstances today could not be more different, although they may have the eventual similarity of the need for a new Conservative administration to take office in Croydon to sort out the mess—a challenge that I know Councillor Jason Cummings and his opposition colleagues will rise to, and a challenge that was very familiar to us in Hillingdon A section 114 notice starts off as a sign of cash flow distress in a council. Income is insufficient for planned expenditure, so services have to be cut and expenditure halted until the budget is balanced again. We know that it has no direct private sector equivalent, but it has the effect of requiring the organisation’s management to demonstrate that it is a going concern. Today, with councillors and residents across the city seeing what is happening in Croydon with worry, it is important that we address here in Parliament the issues that have led to the situation. Given the unfortunate silence of some of the Labour Members representing them, this debate has the purpose of airing the financial challenges facing our London boroughs and providing some assurance to my constituents and others across our capital that the situation in Croydon will not be replicated elsewhere Local government financial management is a complex, some would say dull and, in many respects, unique process. It is unique in the public sector, in that councils have to balance their budgets every year. Clearly, constituents across the capital will want to know that there is effective governance and effective oversight of decision making. The consequences can be very serious. In Hillingdon, we faced a 14.8% council tax rise, tens of millions of pounds of unspecified cuts and a budget that had only been legal for the duration of the meeting at which it was agreed, as the legacy of a previous administration. Residents in Croydon and across the capital will want assurance that that is not the fate that awaits them Context, of course, is all-important here. Our councillors and constituents want to see evidence that what has happened in Croydon is unique. Further work is under way in the Ministry of Housing, Communities and Local Government and the wider local government sector to establish the detail of what has happened. Certain things are strikingly different about the situation facing Croydon, which should give some assurance to residents in my constituency and elsewhere First, looking at the picture across London, the House may wish to note that the finance report to the London Councils leaders committee of 8 December referenced an overall rise of 4.5% in local authority resources available to London as a result of the spending review. The House may also wish to note that the report highlights the additional resources from the Government to ameliorate the financial impact that covid has had on London’s councils. While that leaves an estimated funding gap in the next financial year, the broad picture from across London and the feedback from my local authorities is that the measures provided by the Ministry have met the costs of covid in terms of service delivery. We all recognise that councils in the capital have done an amazing job of rising to that challenge This adds up to a picture in which the serious impact of covid on the capital’s finances has been substantially mitigated, to the extent that councils’ financial resilience should not be compromised. Given that background, it is clear that the situation in Croydon is not a consequence of covid, so is it a consequence of austerity? Council budgets consist of a number of elements, some of which are ring-fenced, such as the dedicated schools grant, housing revenue account, parking revenue account and public health grant. The main part of the budget that is visible to residents—the general fund—is largely spent on the authority’s day-to-day statutory services, with the bulk of that on social care, but also on resident-visible services such as parks, libraries, waste collection and clearing up litter. The general fund also services any debt finance costs relating to general fund capital expenditure. Good practice and the expectation of auditors is that councils will retain a reserve—known in local authority accounting terms as “balances”—sufficient to cover likely risks in that budget. This is where we begin to see a divergence from the practices of other London councils Financial risk is a part of life for councils, and planning for it is a characteristic of all soundly financially managed authorities. Hillingdon, for example, faced the covid crisis with around £54 million in balances and reserves, sufficient to cover pretty much any financial challenge that the authority might face and ensuring the stable delivery of services to residents—ensuring that libraries, litter clearing, waste collection and potholes being filled would all carry on come what may. Harrow Council, which also serves my constituents, is more financially challenged, but from my regular briefings by its chief executive and finance team, it is clear that it remains on course for a stable and balanced budget. So we need to ask where we see a variance Councils’ involvement in housing development is an essential part of housing delivery in the capital, and it is welcome that council tax payers, rather than developers, will see the upside of the gain where developments take place. However, it is noteworthy in the case of Croydon that, unusually, the local authority has loaned a housing subsidiary of around £220 million of capital—borrowed money—of which a total of zero has been returned against a reported business plan to return £110 million by today Clearly, that knocks a very significant hole in its budgetary position. As it went into the covid crisis with a capital debt of £1.5 billion, by far the highest in London, it is clear that, although capital borrowing to invest in assets and services is no bad thing, it does impose borrowing costs on council tax payers—in this case, about £43 million each year. That is compounded if those business plans go wrong. Using those resources to fund what it appears since 2007 has essentially been a burst of speculative property investments, it is clear that diversion of resources into servicing debts that are not generating their planned returns on such a scale was a significant part of the problem and created a very weak financial position going into the covid outbreak.
The financial situation in Croydon is worrying to residents in Carshalton and Wallington, as the London Borough of Sutton sits directly next to the London Borough of Croydon. My hon. Friend mentioned the council’s housing development arm. Does he share my concern that the huge amount of money that has been wasted does not seem to be accepted by the council administration itself, and that the first step to recovery for Croydon will have to be the administration acknowledging the mistakes that were made in getting it to this point?
My hon. Friend is absolutely right to draw attention to that. Part of the reason for this debate is the frustration expressed by many that everyone—from the auditors, to local residents, to councillors in the opposition group, to Members of Parliament—was raising these concerns, but they seem to have fallen on deaf ears. There is an absolutely critical need for the assurance in other local authorities—not just Hillingdon and Harrow but Sutton and elsewhere—that a closer degree of attention is being paid to the finances The point that my hon. Friend draws attention to was compounded in the case of Croydon, where—as Grant Thornton, the auditor, has highlighted—there was a growing and unaddressed funding gap in the delivery of day-to-day services. These are the basics for a local authority, as opposed to extraordinary speculative business activity that is out of the norm. That prompted Grant Thornton to issue—an extraordinary step—a report in the public interest, given the scale of its concerns, highlighting a shortfall of about £60 million between the resources available and the budgeted expenditure. That is a cash-flow problem on a massive scale, distinctly out of proportion with anything that we have seen in any other London borough I should declare that I enjoyed a positive working relationship with the former Croydon leader, Councillor Tony Newman, in my local government days, and always found him a very passionate advocate for Croydon—somewhere that was clearly his place that he felt determined to improve. There is no suggestion that he or his colleagues have acted in anything other than good faith. However, with such a perilous financial position facing residents, and others across London asking what it means for them, it is important that the Department, the Government, the wider local government family and Croydon itself are clear about what has gone wrong and about the fact that this combination of failed commercial property speculation and, more importantly, the failure to address the fundamental management issues is out of step with what we see in other London boroughs. I want all residents in the capital to enjoy the stability, the residents-first attitude and sound financial management that is consistently highlighted by my constituents, because it is critical to the delivery of services on which our community depends It is clear that Hillingdon and Harrow, Barking and Bexley and Havering and Redbridge have all faced the financial challenges of austerity and of covid, and they have emerged with budgets that are robust. It is what some have described as disastrous failed commercial property speculation and a fundamental lack of grip on the finances that have unusually brought Croydon to this position. The local government sector is stepping in to help. I know that Ministers will be aware of the particular value of the Local Government Association-led and sector-led improvement teams, who are already beginning to help out. After all, why pay expensive consultancy firms when peers who have been through it are able to rally round and use their experience to help sort the situation out Although Labour representatives have sadly remained silent on these concerns—and, in the case of Mayor Khan, heaped praise on the administration for “perfect examples” of projects that even then were millions of pounds over budget—I am determined, and we should be determined, to provide other residents across London with an assurance that such failings are not common across London’s councils. I know that Ministers are equally determined that the success of our councils is not undermined by the reputational damage and what has happened in Croydon.
I am grateful to my hon. Friend the Member for Ruislip, Northwood and Pinner (David Simmonds) for securing this debate on such an important topic. I am pleased to respond on behalf of the Government. I thank my hon. Friend for highlighting his experience as a serving councillor in London, and agree that the mismanagement by the Labour-run Croydon Council, leading to the section 114 notices, damages the reputation of the excellent work that is carried out by local authorities up and down the country. He may know that I also served as a councillor and as a cabinet member on the Conservative-run Medway Council prior to being elected as an MP. It was well known then that Labour spent all the money when it was in control, and it was only when the Conservatives took control that fiscal prudence and oversight returned I will begin by talking about local government in general, and the steps that central Government have taken to support local councils nationwide, before looking at the issues in Croydon in isolation. The very first thing that I should say is how grateful the Government are to those who work for local councils up and down the country who have been tireless in helping our residents to meet the challenges of the pandemic. I am sure that Members on both sides of the House agree that the crucial role that local government plays in delivering the vital services on which we all depend will never be more evident than during this pandemic, and I thank everyone involved for their work As hon. Members will know, supporting councils to maintain critical services is a key priority for the Government. That is why, at last month’s spending review, my right hon. Friend the Chancellor of the Exchequer announced the key measures of income for local authorities’ core spending power to rise by 4.5% in cash terms next year. That equates to an additional £2.2 billion of funding for local government services. The Chancellor also announced estimated funding of around £3 billion in additional support for covid-19 pressures next year. This comes on top of the unprecedented support that the Government have committed this financial year, with over £7.2 billion for local authorities even before the extension of the contain outbreak management fund for local authorities under the highest level of restrictions that was announced as part of the covid-19 winter plan. This takes the total support committed to councils in England to tackling the impact of covid-19 to over £10 billion. Councils also have access to the co-payment scheme, which has been extended to June 2021. Under this scheme, the Government will cover local councils for 75% of losses beyond the first 5% of previously planned income from sales, fees and charges. We recognise that, even with the considerable support already provided to local government, there may be individual authorities with unique circumstances. That is why we are encouraging them to approach my Department to discuss any concerns that they have about their future financial position. We remain committed to working closely with local authorities as they support their communities through the pandemic Let me turn to Croydon specifically. Since the start of the pandemic, the council has been allocated over £49.2 million in funding, including £33 million in un-ringfenced grants, £8.1 million through the infection control fund and £5.1 million through the contain outbreak management fund. That is on top of the £20.8 million increase in Croydon Council’s core spending power for 2021 that was announced on 6 February this year I turn to the current financial challenges in the London Borough of Croydon. As hon. Members are aware, the council’s financial director has now issued two section 114 notices: the first on Wednesday 11 November, and the second on Wednesday 2 December. Local authorities have a legal duty to balance their budgets, and section 114 notices are an important part of an accountability framework that guards against irresponsible or ineffective financial management. If a council judges that it is unable to set or maintain a balanced budget, the finance officer has a statutory responsibility to issue a notice. The council then has 21 days to consider what action it intends to take in response to that notice. Local government is independent of central Government, and the decision to issue a section 114 notice rests with the council at the local level. The Government have no role in the decision to issue a notice That said, the Government are well aware of the wider concerns around Croydon’s overall finances and governance. During the pandemic, my Department met with the council on multiple occasions to discuss its budgetary pressures. Croydon had publicly reported that there has been significant uncertainty around the council’s estimation of its budget gap throughout this period. On 23 October, the council’s auditors published a public interest report, which my hon. Friend alluded to, under the Local Audit and Accountability Act 2014. That report detailed serious concerns relating to governance, financial management and commercial investments. The report highlighted that the council had failed to recognise both the seriousness of the financial position and the urgency with which action needed to be taken Grant Thornton’s report suggested that there was little evidence of councillors holding officers to account or taking action to address the overspend reported in 2017-18, 2018-19 and 2019-20. The Labour-run council failed to address significant overspending, despite warnings before the covid pandemic. Sadly, the report lays bare the fact that Labour recklessly gambled hundreds of thousands, even millions, of pounds of taxpayers’ moneys on disastrous commercial property ventures. For example, it bought a hotel for £30 million—20% more than the asking price; this hotel has gone bankrupt—and a £50 million shopping centre, the value of which has crashed. Most damningly, it provided a loan of over £200 million to a developer, brick by brick, which is yet to make any payments, as my hon. Friend outlined. That has resulted in a staggering pre-covid £1.5 billion debt—larger than that of any other London borough Local authorities are independent of national Government and directly accountable through their elected councillors to local residents. Where powers in the Local Government Act 1999 are used, that involves the passing of functions in those democratically elected members to people appointed by the Secretary of State. Intervention in a local authority by central Government is therefore not to be undertaken lightly. We have been clearing the path such that the powers will be used only when there is evidence of systematic and significant failure at a local authority. Our firm preference when a local authority runs into difficulties is that it will tackle those challenges itself, possibly with sector-led support, as my hon. Friend mentioned. That continues to be the case However, it is worrying that the interim chief executive officer said in November, when she wrote to councillors: “Colleagues across the council are still putting forward requests to spend money and for growth next year that we simply cannot afford.” That is why, on 29 October, my right hon. Friend the Secretary of State for Housing, Communities and Local Government announced a rapid, non-statutory review of the council to be conducted by an independent review team. Announcing the review, my right hon. Friend was clear that the situation described in the public interest report is “deeply concerning and unacceptable” and that residents of Croydon “deserve… better… from their local council.” I am pleased to confirm that the independent review team has reported its findings to the Secretary of State. He is considering the report and will respond in due course. I can reassure Members that the Secretary of State will take a keen interest in the steps the council will need to take to address the governance and financial management issues that have been identified through the independent review, ensuring that the residents of Croydon receive the services they have every right to expect I can, of course, understand that the current situation and the ongoing existence of a section 114 notice might be a matter of concern for Croydon residents. Once a notice has been issued, the council is required to operate controls on spending for 21 days. During this period the council may not enter into any new agreement that involves expenditure unless a finance director has specifically authorised the spend. However, we would expect existing expenditure to continue, such as salaries, pension costs and expenditure required to honour existing contracts and legal requirements. Officials from the Ministry of Housing, Communities and Local Government have been in discussion with the council, which has confirmed that services linked to safeguarding vulnerable people and statutory responsibilities will continue to be delivered. We have also been clear that the council should notify us if it anticipates that spending controls during the 21-day section 114 period will prevent it from delivering any services that are required to safeguard the residents of Croydon during the pandemic, and we will continue to monitor. At the end of the 21-day period, the council must meet to discuss a plan to bring the budget back into balance. The council held a meeting in response to the first section 114 notice on 1 December, where it was agreed that it was not possible to deliver a balanced budget, leading to the issue of a second notice the following day. It is for the council to decide what steps it needs to take to balance its budget. The council made it clear in its section 114 notices and accompanying reports that it will submit a request later in December to the Government for financial support to help it bring the budget back into balance. That request will be considered as and when it is received I thank my hon. Friend for calling this debate on a very important matter, and it is a shame that Labour Members who represent the area are not here. As I have outlined, the Secretary of State will be responding in due course to the independent report of the non-statutory review team, alongside any request that Croydon Council may submit to Government for financial support. The Government will continue to take a keen interest in the steps that Croydon Council is proposing to resolve the matters that have been outlined so eloquently by my hon. Friend. It is imperative that the council moves forward towards a financially sustainable footing to ensure that it continues to deliver for the communities it serves Finally, I repeat that, although these are exceptional circumstances and many councils up and down the country face challenges due to the pandemic and demands on their purse, they are still able to provide that robust oversight challenge and deliver balanced budgets. I assure residents that many local authorities up and down the country operate in a very good way, which we happily support going forward Question put and agreed to.