Asked by Baroness McIntosh of Pickering To ask Her
Majesty’s Government what assessment they have made of the
comparative advantages, disadvantages and costs to the United
Kingdom economy of (1) free trade agreements, (2) membership of the
European Union Single Market, and (3) participation in the
European...Request free trial
Asked by
-
To ask Her Majesty’s Government what assessment they have
made of the comparative advantages, disadvantages and
costs to the United Kingdom economy of (1) free trade
agreements, (2) membership of the European Union Single
Market, and (3) participation in the European Union
Customs Union.
-
My Lords, we want the UK to have the greatest possible
barrier-free trade with the European Union, delivered
through a bold and ambitious free trade agreement. We
continue to undertake a wide range of macroeconomic and
sectoral analyses although, as agreed by Parliament, we
will not publish anything that might harm our negotiating
position.
-
While I am grateful to my noble friend for his Answer,
will he address the Question and the information that I
seek in it? The Government are asking this House and the
other place to take an awful lot on trust. Given that our
main exports are in services, how confident is he that we
will reach agreement on financial services, for example,
within two years of our having left the European Union?
-
On the first point, I have little further to add. The
Government have clearly said—I answered on it a moment
ago—that, as the negotiations continue, we will continue
to provide to this House and the other place what
information we can without undermining our negotiating
position. That is not only the right thing to do, but the
right thing if we are to build the national consensus
that I said at the start we wished to build as we go
forward. On my noble friend’s point about financial
services, which is a very valid one, I would like to
think that we are moving into a slightly new era as
regards the understanding of the challenges and issues we
face. There is a greater understanding of the mutual
benefit that will be achieved if we come to an
understanding with our European partners on financial
services—not only to avoid a cliff edge in these
negotiations, but to ensure that European companies and
European Governments continue to have access to the
global capital markets and the wonderful services
provided in the City.
-
My Lords, the Government will be very aware that in the
Korn Ferry survey of FTSE 100 chairmen, 88% are convinced
that, as it has been decided to leave the single market
and the customs union, no trade agreement could possibly
provide the current level of access. Does the Minister
accept that consensus is now growing that, under the best
terms we can get, we will see a drop in exports to the EU
of something like 22%—nearly a quarter—and that no deal
with the United States, no matter how favourable, could
do more than claw back a very small portion of that loss?
-
I hope the noble Baroness will forgive me, but she is
approaching this from a somewhat pessimistic point of
view. I approach it from a more optimistic and ambitious
point of view. I believe that the United Kingdom has a
very strong economic record on which we can build. I
believe that we already have fantastic networks, right
across the world, on which we can also build. Therefore,
while I understand the challenges that lie ahead, I
believe that when we put our mind to it and approach it
in the way that my right honourable friend the Prime
Minister has set out, there is no reason to take the
somewhat pessimistic approach that the noble Baroness has
outlined.
-
My Lords, what do the Government think of the latest
Civitas research, which can find no discernible benefit
from our membership of the EU single market and customs
union since we joined it? Is it not also true that the EU
needs our free trade very much more than we need its? Is
it not also the single market that inflicts Brussels
overregulation on the 90% of our economy which does not
cede into it, and which has stopped us doing free trade
deals with the markets of the future? Is not the single
market a pretty good disaster?
-
There are a number of questions wrapped up in that. From
what my right honourable friend the Prime Minister set
out in her thoughtful speech at Lancaster House, I shall
pick up one point. There are aspects of the customs union
that we do not wish to be part of, which restrict our
ability to strike free trade agreements with non-EU
countries. However, there are aspects of the customs
arrangements that exist which we wish to preserve. We
wish to try to ensure that there remains frictionless
trade across the EU, as far as possible.
-
My Lords, when it comes to assessing the single market,
as suggested in this Question, has my noble friend
noticed that the Visegrad four countries—and, indeed,
several other east and central European countries—are in
a state of considerable dissent and questioning about the
structure, character and future of the single market? Are
we in touch with those Governments and those countries?
-
My noble friend makes a very good point, as always. Yes,
we are in touch with those countries. We are well aware
of the issues bubbling around throughout Europe about the
future of the single market. All I say is that the
British people decided on 23 June to leave the European
Union and therefore the course is the one that the Prime
Minister has set out.
-
Can the Minister tell us how much of a fist-fight the
Government are preparing for to protect their position on
the customs union?
-
I am sorry to say that I will not start commenting on
language such as “fist-fight”. It does not necessarily
augur well for creating the best tone for the
negotiations that lie ahead. I will say only that we are
determined to protect and strengthen the competitiveness
of the United Kingdom economy.
-
My Lords, will my noble friend reinforce what he just
said in reply to the Opposition Front Bench? Would it not
be a good thing, in the conduct of these debates, if it
was recognised that we are preparing not for a battle but
for a negotiation?
-
I absolutely agree with my noble friend, and I will go
somewhat further. It is absolutely in our mutual
interest—both that of our country and of the countries of
the European Union—that we not only come to an agreement
on the issues before us but do so mindful of the fact
that for generations to come, just as for generations
past, this country has faced similar challenges to those
faced by countries right across Europe. We therefore need
to be in a position to continue to co-operate and
collaborate with our European partners in the years and
decades ahead.
-
My Lords, has the Minister read the House of Lords report
on EU financial services, which fears that New York may
predominate in the future as the global financial
services centre—including, of course, those services
which will gravitate to Frankfurt and Paris?
-
I have seen it, and it is clear that although some
thought that it was a zero-sum game between London and
the capitals of Europe, that is not strictly true.
However, I point to what I said at this Dispatch Box last
week—that there is a growing recognition, not just in
this country but in others, that London will remain a
very important financial centre, no matter what happens.
|
