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Brexit: Negotiations

Volume 794: debated on Thursday 22 November 2018


My Lords, with the leave of the House, I will now repeat a Statement made by my right honourable friend the Prime Minister in another place. The Statement is as follows:

“With permission, Mr Speaker, I would like to update the House on our negotiations to leave the European Union. Last week I set out the details of the draft withdrawal agreement, which will ensure our smooth and orderly departure when we leave the EU on 29 March next year. I also updated the House on the outline political declaration that set out a framework for the future relationship we want between the UK and the EU.

Last night I met with President Juncker in Brussels to work through the details of the full political declaration on this future relationship. We had good discussions in which I was clear about what we need in order to ensure the best possible deal for the United Kingdom. We then tasked our negotiating teams to work through the remaining issues. As a result, the text of the political declaration has now been agreed between the UK and the European Commission. I updated the Cabinet on this progress this morning.

The draft text that we have agreed with the Commission is a good deal for our country and for our partners in the EU. It honours the vote of the British people by taking back control of our borders, our laws and our money, while protecting jobs, security and the integrity of our precious United Kingdom. It ends free movement once and for all. Instead, we will introduce a new skills-based immigration system based not on the country people come from but on what they can contribute to the UK. It ends the jurisdiction of the European Court of Justice in the UK. We will make our own laws in our own Parliaments, here in Westminster and in Edinburgh, Cardiff and Belfast, and they will be adjudicated on by UK courts. And it means an end to sending vast sums of money to the EU, so we can take full control of our money to spend on priorities, including our long-term plan for the NHS, to which we have committed to spending over £394 million more per week by 2023-24. Just this morning I was able to announce a major new investment in primary and community care worth £3.5 billion a year in real terms by 2023-24.

The text we have now agreed would create a new free trade area with the EU, with no tariffs, fees, charges or quantitative restrictions. This would be the first such agreement between the EU and any advanced economy in the world, which will be good for jobs. The EU said that the choice was binary—Norway or Canada. The political declaration recognises that there is a spectrum, with the extent of our commitments taken into account in deciding the level of checks and controls.

Crucially, the text we have agreed also has an explicit reference to development of an independent trade policy by the UK beyond the partnership with the European Union, so we would have the ability to sign new trade deals with other countries and capitalise on the opportunities in the fastest-growing economies around the world—and we would be able to get on with this, negotiating deals during the implementation period and putting them in place immediately afterwards. The deal would mean we leave the common agricultural policy and the common fisheries policy.

Let me be absolutely clear about what this would mean for fishing. We would become an independent coastal state, with control over our waters so our fishermen get a fairer share of the fish in our waters. We have firmly rejected a link between access to our waters and access to markets. The fisheries agreement is not something we will be trading off against any other priorities. We are clear that we will negotiate access and quotas on an annual basis—as, for example, do other independent coastal states such as Norway and Iceland.

The trade agreement with the EU would also cover services and investment that will go further than any other recent EU agreements, and it would secure new arrangements for our financial services sector, ensuring that market access cannot be withdrawn on a whim and providing stability and certainty for our world-leading industry. We would also have a cutting-edge agreement on digital, helping to facilitate e-commerce and reduce unjustified barriers to trade by electronic means. And there would be strong rules in place to keep trade fair and ensure that neither side can unfairly subsidise its industries against the other.

The text we have agreed with the European Commission also includes a new security partnership, with a close relationship on defence and tackling crime and terrorism to keep all our people safe. There would be a surrender agreement to bring criminals to justice, no matter where in Europe they break the law, and there would be arrangements for sharing data, including on DNA, passenger name records and fingerprints. The new security partnership would also ensure close co-operation between our police forces and other law enforcement bodies. And we would continue to work together on sanctions against those who violate international rules or commit atrocities, and there would be joint working on meeting cybersecurity threats and supporting international efforts to prevent money laundering and the financing of terrorists.

Finally, as I set out for the House last week, the draft withdrawal agreement will ensure that we transition to this new and ambitious future relationship in a smooth and orderly way. It will deliver a 20-month implementation period so that we have time to put our new future relationship in place and so that businesses have time to prepare for it. It will protect the rights of EU citizens living in the UK and UK citizens living in the EU, so they can carry on living their lives as before. It will ensure a fair settlement of our financial obligations—less than half what some originally expected—and it will meet our commitment to ensure that there is no hard border between Northern Ireland and Ireland and no customs border in the Irish Sea.

The text we have agreed is explicit about the determination of both sides to avoid the backstop altogether by getting the future relationship in place on 1 January 2021 and, in the unlikely event that we ever did need the backstop, to ensure that it is quickly superseded by either the future relationship or alternative arrangements. As part of this, there is an explicit commitment to consider facilitative arrangements and technologies which could avoid a hard border on the island of Ireland. I am grateful to my right honourable friends the Members for Chingford and Woodford Green and for North Shropshire for their ideas on this. Preparatory work on alternative arrangements to avoid the backstop would begin before we leave, enabling rapid progress after our withdrawal.

I want to be very clear about the stage we have reached in these negotiations and the scale of what is now at stake. We have an agreed text between the UK and the European Commission. This text is today being shared with the leaders of the other 27 member states ahead of the special EU Council on Sunday. The negotiations are now at a critical moment and all our efforts must be focused on working with our European partners to bring this process to a final conclusion in the interests of all our people. Last night I spoke to Prime Minister Sánchez of Spain. We have been working constructively with the Governments of Spain and Gibraltar in the negotiations on the withdrawal agreement and we want this work to continue in the future relationship, but I was absolutely clear that Gibraltar’s British sovereignty will be protected and that the future relationship we agree must work for the whole UK family. Today I met Chancellor Kurz of Austria, which currently holds the EU’s presidency. Later today and tomorrow I will be speaking to other European leaders ahead of returning to Brussels on Saturday.

The British people want Brexit to be settled. They want a good deal that sets us on a course for a brighter future and they want us to come together as a country and to move on to focus on the big issues at home, such as our NHS. The deal that will enable us to do this is now within our grasp. In these crucial 72 hours ahead, I will do everything possible to deliver it for the British people. I commend this Statement to the House”.

My Lords, that concludes the Statement.

My Lords, I thank the noble Baroness for repeating the Statement: I suspect we will see her again on Monday with a further Statement.

The last week has been full of highs and lows, not least for our embattled Prime Minister. Even when the proverbial white smoke appeared last Wednesday evening, two departing Cabinet Ministers and their friends in the ERG quickly snuffed it out. Now, with today’s unexpected Statement from the Prime Minister, the Government are repeating what they do best—they are living in the moment. The Prime Minister has often talked about the JAMs, those “just about managing”. Truth be told, this Statement is just about managing to get through another week.

What have the 19 extra pages today offered us? If we are honest and forensic about it, very little. I will acknowledge some progress in a couple of extremely important areas. Many noble Lords will remember the passionate speech of my noble friend Lady Sherlock during the Second Reading of the EU withdrawal Bill. In a few short minutes, she highlighted the significant challenges facing families as a result of our withdrawal from the EU. I welcome the inclusion of paragraphs 57 and 58; at last, the Government have recognised the importance of this. But it still is not agreed and, after two years, all that the Government can offer is:

“The Parties will explore options for judicial cooperation in matrimonial, parental responsibility and other related matters”.

That is still work in progress.

Similarly, my noble friend Lord Hunt of Kings Heath led a cross-party effort to amend the Nuclear Safeguards Bill to ensure continued UK co-operation on medical radioisotopes. We therefore recognise progress in the inclusion of paragraph 71, with co-operation,

“through the exchange of information on the supply of medical radioisotopes”.

However, this is so far from the detailed, precise and substantive document previously promised by the Government. It somehow manages to list dozens of aspirations for the future UK-EU relationship without any feeling of aspiration or optimism. Far from providing citizens and businesses with certainty, it kicks the can down the road. It neither delivers the deal promised by the Government nor the one that Parliament would have mandated, had Ministers accept the Monks amendment to the withdrawal Bill. My noble friend Lord Monks brought forward his amendment to assist the Government; had they gained a mandate from and genuinely engaged with Parliament for the negotiations, the Prime Minister would not now be scrabbling around, desperately trying to get Parliament to support her deal.

Today’s extended declaration continues to point to a blind Brexit, which is likely to leave our country less prosperous, less secure and less influential around the globe. Being generous to the Prime Minister, it should at least buy her extra time to try to bring together a divided Conservative Party, which is really what this Statement is about. Just think: at the last election, it was those voting for my party who were told that it would be a coalition of chaos.

According to the document, which is not even certain to get approval from the EU 27 on Sunday, we will be outside the customs union and the single market after the transition period. But despite their importance to UK businesses, we have absolutely no idea about the nature of our future relationship with those entities. I have come straight from a meeting with Northern Ireland businesses and farmers. It is clear, in talking to them, how it has been hugely damaging for the Government and the Prime Minister to talk up the prospects of no deal. They are facing the impacts already. We may eliminate tariffs on goods but, however unprecedented, provisions on services will be subject to “exceptions and limitations”.

The security section alarmingly confirms that we will be outside the European arrest warrant after the transition, as well as a number of other vital EU schemes and databases. Yet we have no idea which aspects of them we will be able to replicate or to what degree this will keep UK citizens safe. I would have thought that, as a former Home Secretary, surely the Prime Minister would know the importance of these systems. There are so many questions left unanswered; we are addressing just a few here today.

For example, while paragraph 9 confirms that work will start on a data-adequacy decision as soon as possible after exit, this is not consistent with the Government’s stated desire for an agreement with the EU that goes beyond the adequacy framework. Can the Leader of the House confirm whether this ambition has been dropped or if it remains?

Paragraph 24 refers to three of the agencies—the European Medicines Agency, the European Chemicals Agency and the European Aviation Safety Agency—that the Government recognise are of value of the UK. But all the declaration offers is that we will consider regulatory alignment and that we,

“will explore the possibility of cooperation”.

What does that actually mean? Are we seeking to somehow gain membership, or do the Government intend to set up parallel agencies, with the costs and bureaucracy involved in that, and will that be by primary legislation?

I am also disappointed that the document does not appear to include anything on the onward movement of UK citizens living in the EU—the Leader of the House is talking to her Ministers again, but I shall press this point, which I have raised with her a number of times before. I hope she caught the first part of what I was saying about the onward movement of UK citizens living in the EU. Your Lordships’ House was assured by the noble Baroness that this would be a key part of the second phase of negotiations. Can she confirm whether the Prime Minister or the UK negotiating team formally requested the inclusion of onward movement rights in this document? If so, where are they, and if not, why not?

The Leader of the House will understand the concerns of Gibraltar. She referred to that in her comments today. Can she update the House about the conversations the Prime Minister has had with the Prime Minister of Spain? I wonder whether the Prime Minister of Spain is more encouraging in private telephone calls than he is in his public declarations ahead of upcoming elections.

Standing on the steps of Downing Street, or at the Dispatch Box in the other place, the Prime Minister talks of a deal that upholds the national interest. Even if this political declaration were to be delivered in full, there is no way that these arrangements can serve the best interests of this country. I have no idea whether the talented negotiators on both sides of this debate will approach future talks with a positive spirit and will use the best endeavours which are so frequently referred to in the declaration document, but if the Brexit process has highlighted anything, it is the incompetence and efficiency of a divided Government.

I have one final question for the Leader of the House. Paragraph 145 notes that, based on the preparatory work, the UK and the EU will agree a programme for the next set of negotiations. I think we all hope that the Government will take a little more care in those arrangements and that preparation than they did before the referendum. Will the noble Baroness share with the House the lessons learned by the Government as a result of the Article 50 process and perhaps give an indication of how past mistakes, including David Davis’s capitulation on sequencing, will be avoided?

My Lords, I, too, thank the Leader of the House for repeating the Statement. There was a hope that an expansion of the political declaration would deliver enlightenment, but going from seven pages to 26 has illustrated even better how thin and inadequate our prospective future relationship is as impotent rule takers. The claim that we will make our own laws in our own Parliament is one of the deceptions that I mentioned the other day. We will in fact obey EU laws if we want decent access. This political declaration shows how there is no better deal than remaining in the European Union with a full voice and a great deal of influence. That is why we definitely need a people’s vote to give the opportunity to choose to remain in the EU.

It is notable how many uses there are in this document of considering options or exploring options with a view to identifying opportunities where something is in mutual interest to the extent possible. How long is a piece of string? This document does not answer that question. It is simply aspirational, not operational, and there are many gaps.

We are supposed to expect that the combination of at least a single customs territory—the political declaration talks about building on a single customs territory—and the alignment of rules can coexist with an independent trade policy, an end to free movement and an end to the jurisdiction of the ECJ. I shall come back to that latter point. This is an unstable and dishonest pretence that the package can deliver all those things.

Paragraph 28 of the draft states that,

“the extent of the United Kingdom’s commitments on customs and regulatory cooperation … would be taken into account in the application of related checks and controls”,

and that there can be,

“a spectrum of different outcomes for administrative processes as well as checks and controls”.

That is not what the Chequers White Paper promised. It promised to,

“avoid the need for customs and regulatory checks at the border”—

that is, all checks—and said it would,

“enable products to only undergo one set of approvals and authorisations in either market, before being sold in both”.

You do not need checks at the borders if that is the case. It promised to,

“protect the uniquely integrated supply chains and ‘just-in-time’ processes that have developed”,

over the last 40-odd years. I heard the Prime Minister claim in the other place that this political declaration represented frictionless trade. It does not; that is a completely groundless assertion. There will be border checks.

As the noble Baroness, Lady Smith, mentioned, paragraph 24 talks about exploring,

“the possibility of cooperation of United Kingdom authorities with Union agencies such as the European Medicines Agency … the… European Chemicals Agency … and the European Aviation Safety Agency”.

This is a very long way from the Chequers White Paper, which claimed that we would get participation in key agencies. That is not what the political declaration says. The same is true for Europol and Eurojust, where again there was a claim that we would get participation in those security agencies. Perhaps the Minister could explain the gap between the Chequers White Paper and what is in the political declaration. Working together to identify the extent of co-operation is not participation.

Perhaps the Minister could also explain how she envisages the financial services markets, as the noble Baroness, Lady Smith, mentioned. Currently there is a huge gap; one of the reasons Jo Johnson resigned is that 80% of our economy is not covered, while one of the reasons lots of City people oppose the deal is that equivalence in financial services is very weak indeed.

We also have a very thin promise on judicial co-operation, matrimonial and parental responsibility and related matters. I sit on a sub-committee of the EU Select Committee that has spent a great deal of time on this matter. I am afraid that the thin nature of the two and a half lines in the political declaration on this issue is testament to the lack of attention the Government are paying to this.

In the section on intellectual property, I see no reference to the Unified Patent Court. The Government put a lot of effort into securing the life sciences section of the UPC to be in the UK, which obviously plays to our strengths in that sector. Can they give us an assurance that Britain will be able to stay in the unified patent regulation and in the court even if we are outside the EU?

On the European Convention on Human Rights, there is an interesting contradiction in the declaration. Paragraph 7 refers only to the UK’s,

“continued commitment to respect the framework of the European Convention on Human Rights”.

What does that mean, as opposed to a commitment to the convention? Later, though, in paragraph 83, there is a reference to,

“continued adherence and giving effect to the ECHR”,

so I hope that paragraph 7 is just a slip of the pen. Perhaps the Minister could reassure us that there is a full commitment by the Government to stay a member of the ECHR.

Lastly, on ending the jurisdiction of the European court, the declaration says that the arbitration panel must refer any question of the interpretation of union law to the ECJ for a binding ruling. Then, it says:

“The arbitration panel should decide the dispute in accordance with the ruling given by the CJEU”—

that is, the binding ruling. If a party fails to comply, the other can seek financial compensation or suspend the rights and obligations under the agreement. How is that ending the jurisdiction of the European Court of Justice?

I thank the noble Baronesses for their comments and shall try to cover the points they made. They both mentioned new arrangements in judicial co-operation in certain areas, particularly in relation to matrimonial matters and parental responsibility. I can also say that the UK intends to accede to the Lugano convention and looks forward to discussing its application with the EU and other contracting states in due course.

The noble Baroness, Lady Ludford, asked about financial services, and the political declaration indeed contains important detail about co-operation. In particular, we have agreed to consultation mechanisms relating to the adoption, suspension and withdrawal of equivalence decisions. It also notes that both parties will keep their respective frameworks under review to ensure that they can continue to function effectively for both sides. We have agreed to negotiate new arrangements for financial services that provide for greater co-operation and consultation than is possible under existing third-country frameworks.

The noble Baroness, Lady Smith, talked about a blind Brexit, but in fact the political declaration sets out a clear vision for the UK’s future relationship with the EU and provides instructions for negotiators that will deliver a legal agreement by the end of 2020 covering an economic partnership, a security partnership and specific agreements on cross-cutting co-operation.

Both noble Baronesses talked about our security partnership, and the political declaration provides for UK co-operation through PNR, Prüm, Europol and Eurojust in future, but also ensures that the UK and EU’s future relationship will deliver capabilities approximate to those currently enabled by relevant EU mechanisms. The noble Baroness, Lady Smith, asked in particular about the European arrest warrant. Again, the declaration is clear that effective and streamlined surrender arrangements will be established, akin to the European arrest warrant and the EU’s arrangements with Norway and Iceland.

The noble Baroness, Lady Smith, also asked about the adequacy framework, and we have always said that we believe that the EU’s adequacy framework provided the right starting point for the arrangements that the UK and EU should agree on data protection, but that, reflecting the strength of the relationship, we wanted to go beyond an adequacy arrangement. We will therefore continue to consider additional arrangements, including co-operation between regulators, so our ambition remains.

The noble Baroness, Lady Ludford, asked about the ECHR, and I can say once again that we are committed to the framework of the ECHR.

Both noble Baronesses asked about agencies. Where we want to continue co-operation with EU agencies—I think that the EMA and ECA were mentioned—we will certainly work with our European partners to explore it. If we have such a relationship, we have also made it clear that we will make an appropriate financial contribution.

I assure the noble Baroness, Lady Smith, that we continue to push for onward movement for EU nationals. Unfortunately, the EU did not want to include that in the political declaration, but we intend to return to it during the detailed talks on the future arrangements. In terms of next steps, once the political declaration has been endorsed by the Prime Minister and leaders of the EU member states, we will move from negotiating under Article 50 to negotiating under Article 218 of the TFEU. That can legally begin only once the UK has left the EU.

The noble Baroness, Lady Ludford, asked about building on the single customs territory. What we mean by that is that in designing our long-term arrangements, we will make use, where appropriate, of what we have included in the withdrawal agreement. For example, we want to ensure that no tariffs, quotas, or checks on rules of origin are maintained for what is provided for under that agreement, but the text is also clear that whatever is agreed in our future partnership must recognise the development of an independent UK trade policy.

The political declaration also recognises that the UK may choose to align with the EU’s rules in relevant areas and that the application of checks and controls will depend on the UK’s commitment, including on the level of alignment. It recognises that both sides wish to be as ambitious as possible, but obviously we need to agree the balance of that as part of the forward negotiations. Once again, I must say to my Liberal Democrat colleagues that we will not be having a second vote. We have already had a people’s vote, and they voted to leave the EU.

Would my noble friend accept that when it comes to the ambitious new trade agreement which this document outlines—which is a very welcome and promising prospect—after 46 years of our two systems growing together and becoming entangled, the process of disentanglement, unwinding and building the new opportunities is bound to take considerable time? Would she accept that some of the impatient demands for more rapid solutions are quite inadequate in dealing with that situation? It has been said that the withdrawal agreement is a halfway house. Would she agree that if we can be allowed to get to that halfway house, this does indeed show the path that opens to the completion of our situation, which will be very much stronger than we have today? Could she explain why, when it comes to the international trade negotiations, this document just has a mention that this can be developed, whereas the withdrawal agreement is much more specific and talks about negotiating, signing and ratifying agreements which will come into force as soon the transition is over? Would she just reassure us that that, too, is part of the prospect in the future, which on the whole is greatly to be welcomed?

I thank my noble friend. I can certainly reassure him that the withdrawal agreement includes a legally binding commitment that ensures that both sides will use best endeavours to negotiate the detailed agreements he was talking about that will give effect to the future relationship, so that they can come into force by the end of 2020. We are obviously extremely pleased that the political document makes it very clear that whatever is agreed in relation to our future partnership with the EU must recognise the development of an independent UK trade policy, and of course during the implementation period we will be able to sign, negotiate and ratify our own trade agreements.

I thank the noble Baroness for the Statement. I agree with those who say that this is a highly aspirational document. I lighted upon a sentence which says that,

“a fair and appropriate financial contribution”,

will be made. Perhaps the noble Baroness could say something about how long she thinks it would take to flesh that out. It took Baroness Thatcher five years to get to a fair and appropriate financial contribution. How many years does the noble Baroness think it will take this negotiation?

Secondly, could the noble Baroness be very kind and now reply to the point made by the noble Baroness, Lady Ludford, about paragraph 134, on dispute settlement? It really is an important point and I am afraid that on Tuesday the noble and learned Lord, Lord Keen, did not get it quite right. It makes it quite clear that the European Court of Justice, which is described in this document that we are going to sign as,

“the sole arbiter of Union law”,

will in fact have an absolute grip on any disputes. That is the only reading of paragraph 134 that you can possibly make. And of course all these agreements will be European Union law, or they will be worthless. So could she comment on paragraph 134, please? It is a pretty important point.

On the noble Lord’s first question, I answered it in my reply to my noble friend’s question when I said that we intend to have the future relationship come into force by the end of 2020. On the noble Lord’s second point, only the CJEU can bind the EU on the interpretation of EU law, so we have agreed that where a dispute raises a question of interpretation of EU law, the arbitration panel can refer this question to the CJEU for interpretation. What it cannot do is ask the CJEU to resolve the dispute. That will always be done by the independent arbitration panel. An ability for the CJEU to provide an interpretation of EU law is not the same as resolving disputes. The EU has been clear that that must fall to an independent arbitration panel. This respects the principle that the court of one party cannot resolve disputes between the two.

My Lords, first of all, I find this a comprehensive and interesting list of subjects for future discussion—but that is all it is. I caution the Minister against overselling it as something else. That—the misrepresentations—was part of the problem with the original referendum. For instance, the noble Baroness says:

“It ends the jurisdiction of the European Court of Justice in the UK”,

but this declaration does no such thing. It is not a deal, even leaving aside the fact that the 27 others have not agreed it yet. Even when they have agreed it, it will not be a deal; it will not be an agreement—or rather, it will be an agreement to look for an agreement at some future stage. So will the Minister please not oversell it?

On the European Court of Justice, I am not a lawyer—as I have said, that is neither a boast nor a complaint—but I agree with the noble Lord, Lord Hannay. What the Minister says is just not true. She is inadvertently misreading this. Not only does paragraph 132 say:

“The Parties will base arrangements for dispute settlement and enforcement on those provided for the Withdrawal Agreement”,

but paragraph 134 says:

“Should a dispute raise a question of interpretation of Union law, which may also be indicated by either Party, the arbitration panel should refer the question to the CJEU as the sole arbiter of Union law, for a binding ruling”.

Crucially, it then goes on to say:

“The arbitration panel should decide the dispute in accordance with the ruling given by the CJEU”.

So it does not give just a ruling, it gives a binding ruling, which the arbitration panel must decide in accordance with the ruling given by the European Court of Justice.

I am not asking for a legal answer at present. All I ask is that Ministers be very careful that they do not try to oversell this as somehow a deal that has been done and agreed. It is a framework for future discussion, kicking the can down the road; that may be necessary but it is no more than that, so I ask the Minister not to misrepresent it.

I think I was clear; I hope I was. I said that it sets out a clear vision and is a framework for the future relationship between the UK and the EU, and that it provides the negotiating instructions that will aim to deliver the full legal agreement by the end of 2020. We are on both sides committed to turning this into a legally binding treaty as soon as possible. In relation to the noble Lord’s points about the CJEU, I gave the answer to the noble Lord and I can only say again that an ability for the CJEU to provide an interpretation of EU law is not the same as resolving disputes.

My Lords, I hope we can accept that this is a reasonable framework. I hope the Prime Minister will feel that Mrs Pike has satisfactorily pricked Captain Mainwaring’s ego. However, I ask my noble friend to say to the Prime Minister that it would probably be very helpful indeed if, at some stage in the next two or three weeks, she would speak to the nation on television to explain exactly what we are proposing to do and that this is, indeed, the only realistic Brexit that is in prospect.

I am not sure whether my noble friend was watching the television at the weekend, but the Prime Minister was on television quite a lot. She will most certainly be continuing to sell this deal, as indeed will all members of the Government. I am sure she will be interested in his views on how she can best do this.

My Lords, in paragraph 38 there is a reference to the financial services sector, going back to the issue of equivalence which is mentioned in the withdrawal agreement. Since the referendum, the financial services sector has said again and again that equivalence is not good enough to maintain an industry with the international reputation that we have here in Britain. At the very least, the Governor of the Bank of England has said that enhanced equivalence is needed. Tens of thousands of jobs rest on this, not just in the City but in Edinburgh, Glasgow, Leeds, Bristol and throughout the United Kingdom. Will the Minister please go behind some of the waffle that is in this to give reassurance? Businesses not four miles away from here are making plans to relocate. That has to be stopped.

I hope I can reassure the noble Baroness when I say that we have agreed to negotiate new arrangements on financial services that provide greater co-operation and consultation than is possible under existing third-country frameworks. For existing regimes, the EU and UK have agreed to move quickly to progress equivalent assessments during the implementation period and, crucially, both sides will endeavour to conclude decisions on granting equivalence by the end of June 2020—which is a major step forward in providing clarity for the industry about a smooth transition to our new relationship.

My Lords, I have been able to read this in some detail since this morning. Apart from the general waffle and aspirations—which one would have hoped would have been finalised after two and a half years—the overwhelming factor is the underlined need to rejoin organisations that we are leaving, including agencies dealing with medicines, chemicals and aviation safety, and to get ongoing co-operation on science, youth, culture, education, civil protection and space. We are reinventing things that we are leaving. Why do we not just stay there and get the benefit? The cost of applying to all these will mount up and take away most of the savings we get. We seem to be going around in a full circle to end up where we started.

The noble Lord may recall that the British people voted to leave the European Union, and we are delivering that. In response to the noble Baronesses, I said we want to maintain co-operation with certain EU agencies. We will work with our EU partners over the coming months to explore the most effective ways to do that. If we do so and, depending on the level of the relationship, we have also said we will make a relevant contribution.

My Lords, I echo the wise words of the noble Lord, Lord Reid of Cardowan. I ask the Minister please not to oversell. This is not the load-bearing framework that the treaty authors had in mind. This is an aspirational text, neither prescriptive nor proscriptive. The negotiation will take place under Article 218, which means that, on the other side of the table, if one member state objects to something we want, that thing does not happen. Remember too that its scope is far wider than the Ukrainian or Canadian arrangement. The idea, as the Minister just said at the Dispatch Box, that we intend this treaty to come into force by the end of 2020 is absurd. That is unthinkable. It takes on average four years to negotiate these things. Then there is the problem of ratification and, if one country does not ratify, it does not happen. Please do not oversell. The only certain thing is that we face five, six or seven years of uncertainty.

Before our withdrawal in March, both sides will undertake preparatory work to enable negotiations to begin as soon as possible. There will be a clear programme to deliver the ambitious timetable, which will be set out in the withdrawal agreement, to ensure that both sides will use their best endeavours to bring into force a detailed future relationship. Because of the possibility that the noble Lord raises, we also have the backstop, the extension to the implementation period. There are best endeavours from both sides to achieve this ambitious relationship, which is in both our interests.

My Lords, the noble Lord, Lord Reid, missed his calling. He may not be a lawyer, but he made a pretty good imitation of one. I do not really think that the noble Baroness was able to respond. I will not repeat the points he made, other than to point out that this document says we will take back control of our laws and end the jurisdiction of the European Court of Justice. These assertions are made without any qualification. If you look carefully, you will see that paragraph 134 says circumstances may arise where the United Kingdom chooses to invoke the jurisdiction of the European Court of Justice. That is wholly contrary to the impression this document seeks to give.

I have already responded to these points and have nothing further to add. The ability of the CJEU to provide an interpretation of EU law is not the same as resolving disputes.

My Lords, there is a certain Alice in Wonderland aspect to the exchanges we have heard. A lot of the questions from ardent remainers—I am not criticising people; I am an ardent leaver—have complained about the extent to which there will still be some jurisdiction from the European Court of Justice over what we can and cannot do in this country. That seems a bizarre position for someone who is in favour of us remaining in the European Union to adopt.

Does the noble Baroness also share my dismay that, whenever in this unelected House a reference has been made to the 17.4 million people who voted to leave, there has been an audible groan? That is the first time that there has not been. It is not a good position for an unelected House to groan about a referendum of this unprecedented scale.

Finally, my noble friend Lord Reid is absolutely right—I agree with him, as I have done on most things throughout our pretty long political life—that this is a framework and it should not be oversold. However, after March next year we will be entering negotiations not as a member state of the European Union, subject to all the restrictions involved in being one of 28, but as an independent sovereign country able to make within this precious Parliament—the other part rather more precious than this one, I have to acknowledge—the laws that the people in our country are obliged to obey, and if they do not like the people making the laws, they will be able to throw them out, unlike the system under which we are living at present.

The Statement says that there will be,

“a fair settlement on our financial obligations—less than half what some originally expected”.

The amount of that fair settlement is already well known but I hope that the House will forgive me if I ask how much it will be and when we will hand it over. Will it be after the many pious hopes in this Statement have been fulfilled? I very much hope that we will not hand anything over until that happens.

As the noble Lord said, the financial settlement will represent a fair settlement of our obligations as a departing member, and it has been agreed in the context of the implementation period and our future relationship. I believe that it is within the range of £34 billion to £38 billion.

My Lords, the tone of the declaration and the tone of the Prime Minister’s Statement are remarkably different. The political declaration talks about,

“the values and interests that the Union and the United Kingdom share”,

arising from,

“their geography, history and ideals anchored in their common European heritage”.

The Prime Minister’s Statement is about how we bash them on this and reassert control on that, and absolutely nothing positive is said about the need to co-operate, the fact that, as these are our neighbours, we are fated to co-operate closely with them, and that that we cannot have the sort of absolute sovereignty that the noble Lord, Lord Forsyth, talked about two days ago in which we tell them what we want and they have to give it to us. Is there anything positive in the noble Baroness’s notes about the future relationship with the European Union and how important it is to the future of this kingdom?

I am afraid that I completely disagree with the noble Lord. We have been very clear in saying that we want a positive, strong and deep partnership with the European Union in the future, and I am afraid that I do not recognise his characterisation of the approach we are taking.

My Lords, I am glad to see progress in the latest documents in a number of places: for example, on fisheries, on electronic trade facilities, on digital, on medicinal radioisotopes and on future governance. But, assuming that the withdrawal agreement and the political declaration are agreed, what leverage will the Government have in getting timely agreement on the free trade partnership and the associated treaty, thus avoiding the backstop, which seems to suit other member states more than us? We will have paid a lot of money, given up our ability to charge tariffs, accepted the regulatory level playing field and made generous provisions on things such as security—all of which are good—but how will we ensure that we can get the negotiations to end in the timely way that my noble friend described?

As I said in response to a number of questions, the withdrawal agreement includes a legally binding commitment that ensures that both sides will use best endeavours to negotiate the detailed agreements that will give effect to the future relationship so that they can come into force by 2020. In the unlikely event that a party considers that the other has not negotiated in good faith, the complaining party could bring a complaint under the process established by the withdrawal agreement.

My Lords, can I put it to my noble friend that, while not overselling the political declaration, neither should she undersell it? It was not given to the Prime Minister to satisfy either remainers or leavers in full. The point was to deliver the Brexit for which people voted while minimising the economic and other harms to this country. In that context, does she agree that this framework gives us a basis on which to achieve that to a significant extent?

House adjourned at 5.20 pm.