Urgent question (Commons) on Leaving the EU: Implementation - Jan 29

Paul Blomfield (Sheffield Central) (Lab) 

There is a majority in this House that wants a sensible approach to Brexit, so does the Minister agree that it would be right to reach out to that majority instead of letting the European Research Group call the shots? Will he also confirm, as the Chancellor, Business Secretary and Brexit Secretary said in a letter on Friday, that during the transition period, our relations will “continue on current terms”? Will he also confirm, as the Secretary of State told the Brexit Committee on Wednesday, that he does not see the Court of Justice as a red line and that, indeed, any red lines in the negotiations would be “idiotic”? In that vein, do the Government now recognise that it was wrong to rule out a customs union and close relationship with the single market, and does the Minister agree with the Chancellor that our economies should move only “very modestly apart”?

The Government are too distracted by negotiating with their own Back Benchers to focus on the negotiations that matter with the European Union. They are incapable of setting out a clear negotiating position, as Angela Merkel apparently said in Davos at the weekend. Is it not the case that the extraordinary infighting that we have seen again this weekend is the single biggest threat to a Brexit deal that works for Britain?

Mr Walker 

I agree with one thing that the hon. Gentleman said: there is a majority in this House that wants a sensible approach to Brexit. We saw that with the passage through this House of the European Union (Withdrawal) Bill, despite the votes of Labour Front Benchers, who voted against a stable and sensible approach with continuity and certainty as we take this process forward.

Of course we need to make sure that we deliver stability and continuity for our businesses, which was why the Government set out from the start, in the Prime Minister’s Lancaster House speech, the approach of having an implementation period. I am happy to update the House on the beginning of talks on that implementation period today, but we will take no lectures from the Opposition’s Front-Bench team, which has a different position on these issues every day of the week.

John Redwood (Wokingham) (Con) 

Will the Minister confirm that the Government are making good progress on the failsafe option of leaving under World Trade Organisation terms, in case there is not a good agreement on offer? Does he also agree that we are more likely to get a better offer from the EU if it realises that we have the perfectly good option of just leaving?

Mr Walker 

My right hon. Friend is right to say that the Government have to prepare for all eventualities, and I am working closely with the Under-Secretary of State for Exiting the European Union, my hon. Friend the Member for Wycombe (Mr Baker) to ensure that we do just that. However, I am also very clear, as is the Government’s policy, that it is in the interests of the UK and the EU that we secure a partnership between us, and the implementation period is a bridge to that future.

Stephen Gethins (North East Fife) (SNP) 

We are just over a year away from leaving the EU, yet the only thing we can rely on from this Government is chaos. It has been said in the past that the Scottish National party is the real opposition to this failing Government, but I have to say that we are being given a good run for our money by Tory Back Benchers at the moment. The Scottish Government have published their analysis of what leaving the European Union will mean, and they have done so publicly. When will this Government publish their analysis?

Mr Walker 

I would say to the hon. Gentleman that if he is seeking to provide the real opposition, he might want a few more of his colleagues to turn up for debates in this House. Of course the Government will continue to carry out all the analysis and work that are needed to prepare for this process, but we are going to stick to what this House has repeatedly voted for, which is not to publish anything that would be prejudicial to our negotiating position.

Anna Soubry (Broxtowe) (Con) 

The CBI, which represents thousands of businesses of all sizes and from all sectors across the United Kingdom, called on the Government just over a week ago to put the interests of the economy over and above ideology. Does the Minister agree with that, and if he does, when are the Government going to stand up against the hard Brexiteers, who mainly inhabit these Benches—there are only about 35 of them—and see them off to ensure that we get a sensible Brexit? If we do not do that, we will be sleepwalking into a disastrous Brexit for generations to come.

Mr Walker 

I can assure my right hon. Friend that the Government have always put the interests of the economy at the heart of their approach to Brexit. We are seeking a successful negotiation that delivers for the UK economy and our neighbours in the EU, but of course we need to ensure that we are prepared for all eventualities. The implementation period has strong support from a wide range of business groups and we are therefore seeking to deliver that as swiftly as possible by the end of this quarter.

Yvette Cooper (Normanton, Pontefract and Castleford) (Lab) 

Does the Minister agree that the flurry of confusion at the weekend reflects the fact that there are genuinely different views about how Britain should leave the EU that were not resolved during the referendum, especially on issues such as the customs union? Given the significance of the customs union for the future of Northern Ireland, for the issues raised by the CBI, and for the future of northern and midlands manufacturers, does he agree that the Government should bring forward a proper vote in this Parliament on the customs union, and not just for the transition period but for the long term?

Mr Walker 

The right hon. Lady raises some important points, but her party, like mine, stood on a manifesto that said we would have our own independent trade policy and that we would therefore be leaving the customs union and the common external tariff. I know that Labour Front Benchers have already voted to uphold that, so this issue has been decided by the House, and the Prime Minister has shown real leadership in setting out the way forward.

Sir Desmond Swayne (New Forest West) (Con) 

What negotiations, if any, will continue into the implementation period?

Mr Walker 

We have always been very clear that the benefit of the implementation period will be there when both sides have agreed the shape of the future partnership and we can therefore implement that. We will be seeking to establish agreement on the future partnership before March 2019.

Mr Ben Bradshaw (Exeter) (Lab) 

Given the damage that the chaos in government is already doing to our economy, if the Minister will not accept the way out that has just been offered by my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper), the Chair of the Home Affairs Committee—incidentally, the vote she proposed should be a free vote—why will he not do as the hon. Member for North East Somerset (Mr Rees-Mogg) suggests and extend article 50?

Mr Walker 

I do not recall hearing that suggestion from my hon. Friend the Member for North East Somerset (Mr Rees-Mogg). The Prime Minister has set out a clear approach, saying that the UK can benefit from its independent trade policy and pursue global trade in the future. That is what we are seeking to deliver.

Several hon. Members rose— 

Mr Speaker 

Order. Let us hear from the voice of North East Somerset. I call Mr Jacob Rees-Mogg.

Mr Jacob Rees-Mogg (North East Somerset) (Con) 

How does my hon. Friend square paragraph 4 of the European Union’s guidelines, which requires the phase 1 agreement to be respected in full and implemented in legal terms, with the idea that nothing is agreed until everything is agreed?

Mr Walker 

We have already set out our desire to reach that legal agreement with the EU on the withdrawal agreement, but it is of course clear from the terms of article 50 that the withdrawal agreement must have regard to the framework for the future relationship, which we are seeking to establish through the negotiations.

Mr Chris Leslie (Nottingham East) (Lab/Co-op) 

The Minister will have heard some of the anxieties about Britain during a transition becoming a rule taker rather than a rule maker. May I make a constructive suggestion, because there might be consensus around this point? If we want to get a final trade deal done properly, why does he not explore the option of extending the article 50 timeframe so that we can negotiate while we are still around the table?

Mr Walker 

The Prime Minister has been clear that we do not want to be in some form of indefinite purgatory throughout the process. We need to take the opportunities for the UK that come from having an independent trade policy, and we have set out to provide continuity and certainty for our businesses through the implementation period. That continuity and certainty will be all the greater if we are clear about the future framework by the time we enter the implementation period.

Mr Bernard Jenkin (Harwich and North Essex) (Con) 

I commend my hon. Friend and, indeed, the Government for refusing to break faith with the British people by insisting that we shall leave on 29 March 2019 and that, at the end of any implementation period, as the Prime Minister told the House on 11 December, the United Kingdom will have full regulatory autonomy and be free to do our own trade deals with third countries.

Mr Walker 

I am grateful to my hon. Friend. It is very important that we respect the referendum, which of course Members of this House voted for in huge numbers and then voted to respect. The challenge for the Opposition Front-Bench team is to reconcile its ever-changing positions with that decision.

Kate Hoey (Vauxhall) (Lab) 

Every Minister and Secretary of State, and even the Prime Minister, when asked, has said that we will leave the common fisheries policy at the end of March 2019. Whatever else is happening in this so-called implementation period, will the Minister please confirm now that we will be leaving the common fisheries policy at the end of March 2019 and that we can then discuss which other countries we want to work with in our waters?

Mr Walker 

It is clear that the UK will be leaving the common fisheries policy, but we now need to negotiate the terms of the implementation period. The EU has already set out some of its approaches and argues that we will not be playing a continuing role in some institutions. The logic of that is absolutely there. We will be leaving the common fisheries policy and taking control of our waters.

Antoinette Sandbach (Eddisbury) (Con) 

In planning for all eventualities, will the Minister confirm that he is looking at the potential benefits and advantages that the European Free Trade Association might provide us with?

Mr Walker 

The Government have of course considered that, but the Prime Minister has set out that she does not believe that a Norway option is the right approach for the UK. It is important that we have control of our future trade policy, which is one of the objectives of our EU negotiation process.

Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op) 

We can argue all we like about the transition period, but it is fundamentally just a plank off a cliff, and we will have no idea where we are going when we walk off the end of it. Does the Minister agree that it is unlikely that a trade agreement would be agreed before we leave and very unlikely that we would have one by the end of the transition period? The real issue is that the Cabinet needs to sort out where on earth it wants this country to go.

Mr Walker 

I do not agree with the hon. Gentleman and do not share his pessimism. We start the trade negotiations from the unique position of our having a high degree of convergence with countries and territories that have followed the same rules for a long time. We can therefore be very ambitious about the future trade agreement that we can reach with the EU.

Sir Edward Leigh (Gainsborough) (Con) 

Until recently, I had thought that The Beano was a rather silly boys’ magazine; I now understand that it refers to “Brexit in name only”. Will the Minister confirm that abiding by Brexit in name only is not Government policy, that we will not move modestly apart from Europe, that we are leaving the customs union, the single market and the European Union, and that we will have control of our borders?

Mr Walker 

I am happy to reiterate to my hon. Friend that the Government’s policy is that the UK will be leaving the EU, and that does mean leaving both the single market and the customs union.

Angela Smith (Penistone and Stocksbridge) (Lab) 

The Minister stated that the Prime Minister does not want us to stay within EFTA and has ruled that option out, but that position is supported by only a few Back Benchers—the 35-plus—on the other side of the House. Will the Government commit to ensuring that the wishes of the majority of this House, which wants to put the national interest first, are listened to so that we get to the right place in 2019?

Mr Walker 

Of course the Government’s aim throughout this process is to put the national interest first. We have been clear, as was the hon. Lady’s own party in its manifesto at the last general election, that the UK will be leaving the European Union, which includes leaving the customs union.

Crispin Blunt (Reigate) (Con) 

Our partners have made what seems to be an extremely sensible suggestion that the implementation period should end with the budget period, at the end of December 2020. That is about two years—a year and three quarters, to be precise—so why have we been unable to sign up to it so far?

Mr Walker 

My hon. Friend raises an interesting point. The negotiations on that issue are about to begin, and there are reasons why we are confident that we will be able to reach agreement by the end of March. We believe that the implementation period should be, as he says, about two years. We look forward to engaging in those negotiations to reach agreement with our EU counterparts.

Tom Brake (Carshalton and Wallington) (LD) 

Is it not time that the Minister put the Brexit ultras on the Conservative Benches, and indeed some on the Labour Benches, back in their box and pointed out that every single business sector he has met has asked to stay in the customs union, to stay in the single market and to be subject to the European Court of Justice for at least two years? Otherwise those sectors face chaos, with a huge impact on British jobs and British families.

Mr Walker 

I do not agree with the right hon. Gentleman’s characterisation. He is right that many business sectors have spoken out for an implementation period, and they share the Prime Minister’s vision of an implementation period that is a bridge to our future relationship, but those businesses also regularly speak about the opportunities they see in the UK having its own independent trade policy.

Mr David Jones (Clwyd West) (Con) 

My hon. Friend has now indicated twice that he anticipates the implementation period will be in the region of two years. Given that uncertainty is the greatest enemy of business confidence, does he not think it would improve business confidence, and indeed assist in the negotiations, if he were to make it absolutely clear that the implementation period will not exceed two years?

Mr Walker 

My right hon. Friend speaks with great expertise on these matters. It will be in the interests of the UK and the EU to reach agreement on the exact period of this implementation period as soon as possible, but it is important that we enter this negotiation by trying to give ourselves sufficient flexibility to achieve success.

Stephen Kinnock (Aberavon) (Lab) 

Paragraph 17 of the directives for the negotiating team states clearly that

“any time-limited prolongation of the Union acquis requires existing Union regulatory, budgetary, supervisory, judiciary and enforcement instruments and structures to apply, including the competence of the Court of Justice of the European Union.”

Will the Minister please explain what exactly will be implemented during the implementation period?

Mr Walker 

Very clearly, as the Prime Minister set out, the aim of the implementation period is to implement the future relationship between the UK and the EU, and to allow us to put those structures in place for that future relationship. As the hon. Gentleman so often does, he speaks eloquently in this House on behalf of the EU, but we need to make sure that we are negotiating on behalf of the UK.

Jeremy Lefroy (Stafford) (Con) 

I thank my hon. Friend for his and this Government’s reasonable approach. I stress again that the European Free Trade Association does not require membership of either the customs union or the single market, but it does provide an administrative and legal framework that might be useful at least for the implementation period, if not further forward.

Mr Walker 

I am grateful for my hon. Friend’s point, and I know he takes a great interest in these areas. We believe that both the UK and the EU have set out a different basis for the implementation period, and it is one that can deliver such continuity and certainty, as we have seen in the negotiations.

Paul Flynn (Newport West) (Lab) 

If the majority of Members of this House vote against the final deal, what will the Government do then?

Mr Walker 

It is very clear that this House has already voted for article 50, which means that we are leaving the European Union. What we want to ensure is that we have a good deal that this House will support.

Stephen Hammond (Wimbledon) (Con) 

The welcome news on Friday that the UK economy grew more strongly in the fourth quarter highlights the importance of the services and financial services sectors to this economy. In response to a question on a previous occasion, the Secretary of State for Exiting the European Union said he accepts that the future of financial services relies on a closely aligned regime of regulatory equivalence and mutual recognition. Does the Minister agree that that is still the policy of the Government?

Mr Walker 

I thank my hon. Friend for his question. Of course it is the policy of the Government to achieve a comprehensive free trade agreement with the European Union, building on the strong relationship we have had over the years to ensure we maintain strong market access for our services industry, including financial services. As he will know, the financial services sector is one of the many that has spoken up for this implementation period we are talking about delivering.

Emma Reynolds (Wolverhampton North East) (Lab) 

The Select Committee on Exiting the European Union visited Dublin last week, and every Minister and indeed politician we met stressed the need to avoid a hard border on the island of Ireland. Last Wednesday, the Secretary of State told our Committee that regulatory alignment, as agreed last year, applies to only six areas. On Thursday, the Irish Government told us that it would apply to 142 areas, as proposed by the British Government. Which is it, six or 142?

Mr Walker 

The hon. Lady makes an important point. It has of course been this Government’s position from the start of this process that we will not allow a hard border on the island of Ireland; we want to secure that through the future relationship between the UK and the EU. She refers to commitments in the joint report, and of course we want to protect north-south co-operation, wherever it exists, between Northern Ireland and the Republic of Ireland.

Robert Neill (Bromley and Chislehurst) (Con) 

As well as on the importance of financial services, does the Minister agree that the Government’s objective of maintaining and, if possible, maximising and increasing continuing judicial and security co-operation will also require a continuing very close alignment on regulatory matters, not least in relation to data protection and exchange? Will he confirm that that will remain a priority for the Government, more than artificial or ideological considerations?

Mr Walker 

My hon. Friend raises an important point. We set out in our data paper the intention to reach a comprehensive deal between the UK and the EU on data, which I believe will be in the interests of both parties. He rightly points to what the Prime Minister has said, which is that our commitment to European security is non-negotiable.

Kate Green (Stretford and Urmston) (Lab) 

The Minister rightly says that a priority for the Government should be to serve the best interests of this country. So if progress has been made towards negotiating a deal but that negotiation has not been concluded by late this year, will the Government consider, in the interests of this country, extending the process of negotiation to secure the ideal deal?

Mr Walker 

The hon. Lady raises an important point, but we want to make sure that businesses have certainty both about the implementation period and about where they are headed through it. The benefits to businesses of an implementation period will be much greater if they know the shape of the future relationship to which we are headed, so I do not believe that prolonging this discussion will be in the interests of either the UK or the EU.

Mr Peter Bone (Wellingborough) (Con) 

Will the excellent Minister confirm that in 424 days’ time, when we leave the EU and start the implementation period, we will know what our future relationship with the EU will be after the implementation period?

Mr Walker 

I am happy to reiterate to my hon. Friend that that is absolutely our objective.

Stephen Timms (East Ham) (Lab) 

The jurisdiction of the European Court of Justice in the UK will be ended from March 2019 under the European Union (Withdrawal) Bill, but the Prime Minister has made it clear that the ECJ’s jurisdiction will continue into the two-year implementation period to follow. Can the Minister therefore confirm that the implementation and withdrawal Bill, which will come forward in due course, will re-impose the jurisdiction of the ECJ on the UK?

Mr Walker 

There is a crucial distinction and difference here, in that the action of the ECJ in the UK currently takes place because we are a member state of the EU, and the withdrawal agreement and implementation Bill will implement the agreement between the UK and the EU. That will recognise that the UK is therefore an independent country, adhering to that agreement, which the Prime Minister said should be under the same rules and regulations that we follow now.

Neil O’Brien (Harborough) (Con) 

Like my constituents, I support Brexit, but does the Minister agree that, given that we have been in the EU for 40 years, it is essential to have an implementation period so that we can deliver the huge prize of a smooth and orderly Brexit?

Mr Walker 

My hon. Friend makes an excellent point, one that has been made by people on all sides of the referendum debate. We respect the decision made by the British people, including his constituents, and we want to make the greatest success of it. A smooth and orderly exit is the best way to achieve that.

Jonathan Edwards (Carmarthen East and Dinefwr) (PC) 

Earlier this month, the National Assembly for Wales unanimously—this included Tory and UK Independence party Assembly Members—supported a motion from my colleague, Steffan Lewis, calling for a continuity Bill to protect the Welsh constitution from the power grab inherent in the British Government’s legislative proposals for implementing the European Union (Withdrawal) Bill. Now that Wales has spoken, will the British Government listen, or are they intent on forcing a constitutional crisis?