Brexit: Options for Trade (EUC Report) — House of Lords, 2017-03-02
Topic: International Affairs
David Edward Lea (Labour, Centre-left): My Lords, I very much welcome the report and the debate that we are having. Indeed, I very much welcome the thrust of the remarks just made by the noble Lord, Lord Green of Hurstpierpoint. When we are compared with the Germans, the area of training, educational standards and so on is one excellent feature of the closer European integration. The concept of benchmarking best practice in Europe, our nearest neighbours, is a huge factor in what has been the relative success story—let us say it—of our membership of the European Union since 1973, when we joined the EEC My noble friend Lord Whitty said at the start that he was a little sorry that the report had not been debated before the two days of Committee this week. The plus side is that we who sat through most of those two days—Monday and yesterday—can add some reflections arising from that debate, which are germane to where we are today. I moved the first amendment on Monday, to do with retaining our membership of the European Economic Area, at least to get it on to the map so that everyone understands we are a member of the European Economic Area by virtue of our membership of the EU, and that membership would be retained if we were a member of the other pillar of the EEA—EFTA—despite leaving the EU, as was required by the result of the referendum last June One thing I am looking for—perhaps in vain—in the next few months is for the public debate to become much more ruthlessly realistic about the options. I hope my noble friend Lord Whitty does not mind me describing him as ruthlessly realistic in chairing the committee but it is what we need. We still have too much "have your cake and eat it", Alice in Wonderland stuff. When we go back to the referendum question, what people voted for was totally obscure. As all we all know, there was a melange of things in people’s minds. But the idea came up yesterday: "We voted for maximum access to the European single market, not membership of it". "Oh, so that was on the ballot paper, was it?"—et cetera. This ruthless realism is absolutely vital to avoid what Field Marshal Montgomery would have called a dog’s breakfast at the end of it. I do not know whether breakfast rhymes with Brexit but it will have to do for the moment It is also rather irresponsible to have an imbalance in the debate, which the Government somehow have to answer for. On the one hand, things are ruled out in this speech or that: you see a bridge and you blow it up; it is ruled out. But nothing is ruled in. The number of things that are still there to be looked at seem to get less and less until you are left with only one. That one will be the same as all the others: it will have down sides as well as up sides. In the spirit of ruthless realism, let us acknowledge that all the options have down sides as well as up sides. We have to evaluate them all against the background of that recognition Let us take account, for example, of some excellent points made by my noble friend Lord Mandelson. We shall hear from my noble friend Lord Mendelsohn in a minute; I always pause to make sure I have not got the two pronunciations mixed up. My noble friend Lord Mandelson made an interesting speech on Monday, saying that the sort of agreement the Government now think they can get would give us far less economic bang for our buck than the arrangements we have at the moment. Let us reduce all this to one slogan. We are in the business of maximising our world market share. The central question is: what, in the short, medium and long term, maximises our world market share? That is certainly how the Germans and Japanese see it. One cannot quite summarise how the Americans see it at the moment because it is very hard to make the thing add up. There is, in the way the debate is becoming rather abstract, a denial of what my noble friend also said in an interesting phrase: in Europe, we are talking about not just a vast trading area but a vast factory floor. As a former trade union official, in designing the framework of agreements for multinational companies on a whole string of things, which is the way much of the world now operates—there are not as many strong trade union agreements as we would like—conceptually it is clear that you do not want a race to the bottom. You want some minimum standards and even long-term training investment. You cannot just have people poaching each other’s labour. This is what happens if you do not have any rules Talking about rules, I mention the metaphor of a level playing field. There seems to be a belief that we want a level playing field, while at the same time we do not want a referee. I thought the metaphor of a level playing field referred to football, where the levelness of the playing field was so that, even though you have half-time and you move from one end to another, generally speaking you are kicking the ball along an even, horizontal patch, and you have a referee. As we know, there are offside rules and some disputed decisions, but you do not normally shoot the referee—much as Everton supporters think you ought to be able to. We have decided that there is a world where we can have free trade and it will all be hunky-dory, but no referee—unless the implication is that we are happy to have a referee as long as he or she is not a foreigner, certainly as long as he is not a European foreigner, or as long as he is not specifically called the European Court of Justice. EFTA has a European court of arbitration, so is it just about the name, or are people still irrational when it comes to how you have rules about trade and investment in Europe? I would be very glad if the Government could give a lead in making sure that their succession of Green Papers, White Papers or whatever are ruthlessly realistic in having a totally objective view and transparently evaluate and publish how the national interest, in terms of trade and investment and our world market share, would be met by the different options on the table In yesterday’s debate on all the Brits living in Spain and all the Spanish et cetera living here, we heard a very interesting vignette about reciprocity which bears on all of this. It began with an acknowledgment that this was inherently a relationship of reciprocity, but that we could give a lead by saying that we would make the first move ourselves. But that notion assumes that we can have everything that suits us and ignores the fact that there are 27 member states over there against our interests. All of them simply want to recognise that the Brits want this interest to be reflected. But there has to be reciprocity; we of course need reciprocal rules. I do not think you can simply say that this was not what people voted for. Retrospectively, we can deliver only something which is deliverable, whatever people thought they were voting for, and I repeat that I do not believe that they were voting, in any conscious sense, to say, for example, "We would like to have access to the single market but not be members of it" I hope the committee will go on and do further work, ruthlessly identifying the options and holding the Government’s feet to the fire to make sure they give us a running commentary. I do not buy this idea that there should be "no running commentary". We are parliamentarians, and it is our job not only to have a running commentary ourselves but to demand that the Government engage with us in so doing.