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UK-EU Trade and Co-operation Agreement

Volume 702: debated on Wednesday 3 November 2021

1. What recent assessment he has made of the effect of the UK-EU trade and co-operation agreement on Scotland. (903918)

This is an incredibly significant week for the whole planet, as countries from around the world gather in Glasgow to negotiate on climate action. We are facing a climate emergency, with no time to lose; we must keep 1.5° alive. I am sure that the whole House will join me in urging all countries at COP to make a real commitment to change. I know that we will all want to take this opportunity to thank Police Scotland for working so hard to ensure a safe and secure COP26. It is supported in that by 7,000 police officers from other UK forces. I am very pleased that the UK Government have brought COP26 to Glasgow, and I am sure the city will receive a long-term boost from being in the world spotlight.

The UK Government have agreed a deal with the EU that fully delivers for Scotland and the rest of the UK. Our deal provides Scottish businesses with exceptional access to EU markets. It is the first time the EU has ever agreed a zero-tariff, zero-quota deal. I regret that the SNP refused to support that deal.

Brexit-induced labour shortages are having a real impact on several sectors of the Scottish economy, with social care, hospitality, and food and drink among the worst hit. For some, the impact has been catastrophic, with up to a third of Scotland’s harvest of some crops left to rot in the fields. Those are the direct consequences of this UK Government’s hard Brexit deal and their ideological decision to abruptly end freedom of movement. The Secretary of State knows that, and he knows that the EU provided over €1 billion in Brexit support to Ireland, so will he back Scotland’s employers and support a compensation fund to mitigate the Brexit damage inflicted on Scotland against our will?

The hon. Lady will know that I backed the increase in the seasonal agricultural workers scheme from 2,500 to 30,000. The National Farmers Union of Scotland is well aware of that; I led on those negotiations. She will know that the EU settled status scheme has been successful. We were told that fewer than 3 million people would apply but in fact over 6 million have applied. Some of those workers have remained in their countries; they can come to the UK freely, as she knows, but they remained in their countries during the pandemic, and the pandemic has been a factor. We also have the shortage occupations list, which creates lower salary requirements for skilled workers. This Government are doing everything they can, but we have to recognise that there is a pandemic effect on labour shortages at the moment.

The Secretary of State will be aware that the principal export market for most businesses in my constituency is in England. Does he share my frustration that the Scottish Government, rather than supporting those businesses with exports to other parts of the United Kingdom, continue to pursue an independence agenda, which could only mean more barriers for those businesses?

My right hon. Friend is spot on. Scotland’s trade with the rest of the UK is three times more than her trade with Europe. It is worth over £50 billion, it is worth over half a million jobs, and it is critical that we keep the border open.

The Secretary of State will remember that Scotland voted to remain part of the European Union, and that despite every compromise offered, this Government ploughed ahead with Brexit, knowing full well the damage that it would do to Scotland and that it was against the wishes of the people in Scotland. Now, the Office for Budget Responsibility has projected that the UK’s economy will be 4% smaller because of Brexit, and Her Majesty’s Revenue and Customs found that Scottish exports were actually higher last year, during the height of the pandemic, than they are this year, after Brexit.

I know that the Secretary of State mentioned the pandemic, but that means that Brexit is having a worse impact on Scottish exports than the pandemic. Although he could have fooled me with his lack of mask, Mr Speaker, I am going to presume that the Secretary of State is not in favour of the pandemic and its effects. Given that the effects of Brexit are worse, why does he support it?

The hon. Lady quotes the OBR. Actually, the OBR prediction was for economic growth to be 4% in March. The reality is that it has corrected that, and its prediction is now for economic growth to be 6.5% in 2021 and 6% in 2022. Actually, our economy is recovering strongly, and it is the fastest-growing economy in the G7.

This alternative reality is an international embarrassment. As my hon. Friend the Member for East Renfrewshire (Kirsten Oswald) already mentioned, the EU provided over €1 billion to Ireland as a Brexit compensation fund to combat its effects. Since we know that Brexit is damaging Scotland’s economy and since this place clearly thinks itself so superior to the EU, without mentioning existing funds can the Secretary of State tell us when Scotland will receive its Brexit compensation fund and how much will be in it?

We have just had a Budget where the Chancellor has given £41 billion in the block grant, up £4.6 billion and the largest ever block grant received by the Scottish Government since devolution began in 1998. On top of that, this week there was almost £200 million in structural funds support through the levelling up fund, the community renewal fund and the community ownership fund. More money is going into Scotland than ever before to support Scotland as we go through the pandemic. It is a matter of enormous regret that last night, when the Budget vote took place, the SNP did not support all that extra funding for Scotland.

The EU announced earlier this week that it would be removing the tariffs on American whisky, in a further de-escalation of the trade dispute between the US and the EU. Clearly, there has already been positive news for the Scotch whisky industry with the five-year suspension, but will the Secretary of State work with me to encourage the UK Government to remove all tariffs on American whisky, which would further support the distillers in Moray and the industry across Scotland?

My hon. Friend makes a very good point. I know that there are over 40 distilleries in his constituency, so I understand why he feels very strongly about this issue. I agree with him. We were successful in taking the 25% tariff away, but it needs to be removed completely and not just suspended for a number of years. The way to do that is for us to also remove our tariffs on bourbon. I would be very happy to meet him to discuss that.

Brexit has been nothing other than an unmitigated disaster for Scotland. We now have food shortages, labour shortages, businesses unable to export their products and food rotting in the fields. Is it not about time, instead of all this mealy-mouthed nonsense, that the Secretary of State got to his feet and apologised to the people of Scotland for dragging our nation out of the European Union against its national collective will?

I simply do not recognise what the hon. Gentleman says. We have been through the pandemic and it is far too early to say what any impacts are to make predictions, but what we do know is that our economy is growing. We are doing fantastic trade deals around the world, which will benefit the Scottish economy, and Scottish food and drink. He just needs to get positive about that: stop talking down Scotland’s businesses, stop talking down Scotland, and start to get optimistic about the opportunities we face.

May I just gently say to Ministers that they are meant to speak through the Chair? That was becoming a very personal battle and I am trying to not allow that.