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Leaving the EU: Cabotage

Volume 624: debated on Thursday 30 March 2017

The Government are carefully considering the potential impacts on cabotage as part of our preparations for negotiating our departure from the EU. The Department for Transport is engaging with industry on the matter. It is too soon to say what arrangements will be in place, but we are very conscious of the interest of the transport industry in future arrangements.

The open skies agreement has provided great opportunities for EU-registered airlines, including UK companies such as easyJet that fly largely unrestricted between and within member states, as well as from the EU to the US, but Brexit could change all that. Can the Secretary of State reassure industry and passengers that the UK will remain part of open skies arrangements?

As I said a moment ago, we will reach that agreement in due course. It is our intention across the sectors, whether haulage or aviation, to secure the best possible agreement for the future that will benefit those from elsewhere in the European Union who seek to do business in the UK and those from the UK who seek to do business elsewhere in the European Union.

How important is it to make arrangements for the worst-case scenario, just to show how serious our negotiating intent is?

My right hon. Friend will not be surprised to learn that the Government of course take steps to prepare for all eventualities, but we enter the negotiations with good faith and the intention to secure a deal, because we believe very strongly that that is in everybody’s interests, both here in the United Kingdom and across the European Union.

Will the Secretary of State confirm that the worst-case scenario is no arrangement at all, that airlines have to schedule 12 to 18 months in advance, and that he therefore has to resolve the issue within the next six months?

I never speculate on these things, but I have had detailed discussions with the aviation industry over the past few weeks. I am well aware of the challenges it faces with regard to its business models. Of course the Government listen very carefully to it about how best to approach that important sector in the context of the negotiations.

Like the aviation sector, the maritime industry relies heavily on the EU with regard to cabotage. The shipping sector warned that Brexit may well cost UK-flagged and owned shipping companies the right to trade in EU coastal waters, which would entail a heavy financial price. What assurances will the Secretary of State give today that he will maintain the same access, and what discussions has he had with the Scottish Government about the implications?

As I said a moment ago, the Government are focused on ensuring that we have the best possible arrangements across the transport sector. We have regular discussions with the Scottish Government on a wide variety of issues. What I will say—I think this is good news for all us—is that the UK flag is increasing in size again, which we all welcome.

The Prime Minister told the House yesterday that she will “deliver certainty” to UK businesses about their position post-Brexit, but without agreement on the principles behind cabotage, trucking companies are already warning that new customer checks will gridlock roads leading to the channel ports. UK-based airlines are already warning that they may need to relocate their bases across the channel if the UK falls out of the common aviation area. Just how and when are Ministers going to deliver the certainty that those companies need now, rather than a ministerial aspiration that everything is going to be all right on the night?

Of course, this is not simply about UK companies, because the vast majority of haulage-based cabotage that takes place in the United Kingdom is undertaken by international hauliers operating in the UK, so they themselves have a vested interested in ensuring that their politicians work with us to make sure that we have the best possible arrangements for the future. That is what we will do, and I am confident that other European Governments will want to do the same.