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EU: Future Trade Agreement

Volume 805: debated on Wednesday 29 July 2020

Private Notice Question

Asked by

To ask Her Majesty’s Government, following the last round of negotiations between the United Kingdom and the European Union, whether a future trade agreement will be secured by September.

The fifth negotiation round took place in London last week and intensified talks are ongoing. There is convergence in many areas and we will keep working to bridge the gaps. We believe that an agreement can be reached in September and we look forward to the full negotiating round beginning on 17 August.

I am sorry that we have a Minister with no involvement in the talks answering. Given that the Prime Minister and EU top politicians accelerated the talks so as to reach an agreement in September, can the Minister inform the House whether we will now drop our hostility to a level playing field so that we can get that much-needed trade deal in place in time for business certainty; remove any risk of no deal, with its security risk of organised crime and terrorism; and allow for ratification here, as well as in the European Parliament, and by member states?

I thank the noble Baroness for her question. No, we are not going to forget the importance of the level playing field. The political declaration sets out our commitment to discuss open and fair competition as part of negotiations on an ambitious future relationship. We already start from a place of exceptionally high standards. We have said that we have absolutely no intention of lowering these standards, including on social and employment law, such as maternity leave and shared parental leave, and environmental regulation, such as greenhouse gas targets. We do not agree that an open trading relationship based on an FTA requires extensive level playing field commitments. We are looking for commitments in these areas, like those of a normal FTA.

My Lords, the Government’s damaging and reckless version of Brexit has already imposed a red-tape burden on those trading between Great Britain and Northern Ireland, through their insistence on quitting the EU single market and customs union. Now the Government admit, in their internal market White Paper, that

“the absence of EU rules could make it easier for new barriers to arise”—

that is, within the UK as a whole. They are struggling to substitute the glue of what they call

“the wider EU ecosystem of institutions and treaty rights”

in holding the UK internal market together. Therefore, why are the Government threatening to make this challenge even harder, and the prospect of an EU deal less secure, by refusing to agree with the EU a level playing field on standards, including an independent regulator on state aid and subsidies?

International trade partners will be seeking full access to the UK market. The UK internal market system will provide a stable and consistent regulatory framework that will support UK exporting and inward investment ambitions.

Does my noble friend agree that, while we earnestly want this trade deal, it cannot be at any cost, to the detriment of the interests of the UK or indeed our overseas territories?

I totally agree with my noble friend. That is what the Government are working on at this moment and will continue to work on until we get that agreement.

My Lords, if, as seems increasingly likely, the UK leaves the EU under WTO terms, are the Government confident, given the unprecedented pressure of economic uncertainty and the degree of disarray in the organisation itself, that the WTO will be able to monitor adequately its own trade rules?

We are not going to leave with no deal. We left the EU with a deal—the withdrawal agreement—on 31 January 2010, and we are now in a transition period. The end of that period does not signify no deal and leaving on WTO terms. Preparations by government, businesses and citizens should be based on the guaranteed changes that are to come. The Government’s delivery programme ensures that the UK will be prepared for the end of the transition period at the end of December in all trading scenarios.

My Lords, Ministers have expressed hostility to a level playing field, but in that case why did the Government sign up to one so firmly in the political declaration last year?

I thank the noble Baroness. I think that I have answered her question on the level playing field. It is important that, like the EU, we have a level playing field with other countries, including Canada, and we are looking to have an agreement based on these existing precedents.

My Lords, the political declaration of last October also committed us to pursuing a continuing dialogue and close relationship on foreign and security policies. The new Russia report follows that in calling for a “common international approach” to handling Russia with our allies, most of whom are of course members of the European Union. Will the Minister confirm that this has now been abandoned in the negotiations and is not intended to be part of the deal?

I am very sorry, my Lords, I cannot answer that but I will write to the noble Lord. As far as security issues are concerned, we have made it clear to the EU negotiators that we are open to co-operation on all security measures.

My Lords, we still hear little mention of services from the Government, even though trade in services was on the agenda in the latest round of negotiations. What progress has been made on a deal for services that is advantageous to UK workers?

The deal on services is tied up with the deal on trade, and negotiating those deals will continue throughout the summer.

I congratulate my noble friend on responding to her first Private Notice Question. Can she make unequivocally clear that the declaration of last October still stands and will be honoured?

I thank my noble friend. I have no reason to believe that there are any changes to that declaration and that it will not be honoured.

My Lords, perhaps I may take the Minister back to the more familiar territory of transport policy. Given that it now appears that the two most likely outcomes are either a WTO no deal or a sort of bare-bones deal with no tariffs or quotas or other border controls in place, can the Minister update the House on either outcome? What are the likely bilateral arrangements and estimated additional costs for UK-based road haulage, and, likewise, for air freight and cross-channel shipping? Have the Government abandoned the bizarre position of a previous Secretary of State for Transport—namely, that in the event of no deal we would let in incoming traffic without delays but accept that our exporters might face problems across the channel?

I thank the noble Lord for that question. We are working with all businesses at the moment through the Let’s Get Going campaign, launched earlier this month, so that businesses are ready for any changes. Particularly regarding the borders, because of the impact of coronavirus on transport and haulage businesses, as well as others, the UK has taken a decision to introduce some new border controls in three stages. Those three stages go up to 1 July 2021. We will work very closely with all sectors, particularly the sector that has to deal with the borders, on how that work is going. We will talk to them about how we deal with the issues that they think may arise.

My Lords, this agreement must be a win-win deal, otherwise trouble will lie ahead. However, some observers are still suggesting that talks are at an impasse, so it would be helpful to have more clarity on what stumbling blocks remain or what has already been rejected by either side.

The EU has listened to the UK on some of the issues most important to us, notably the role of the Court of Justice, and we welcome this more pragmatic approach. Similarly, we have heard the EU’s concerns about the complex Switzerland-style set of agreements; we are ready to consider simpler structures, provided that satisfactory terms can be found for dispute settlement and governance. We have also had constructive discussions on trade in goods and services and on some sectoral agreements—notably on transport, social security co-operation and participation in European programmes. We have also continued to deepen our understanding of each other’s constraints on law enforcement. But, yes, there are still considerable gaps in some difficult areas, so we continue to work on the so-called level playing field and on fisheries.

I call the next speaker, Lord Lea of Crondall. I am not sure that he is there, so I will move on to call Lord Adonis.

Will the Minister comment on the stories in today’s papers that a trade agreement is close with Japan and tell the House whether the Prime Minister has met the current head of Nissan, our largest Japanese trading partner? If she cannot give me that information now, will she write to tell me whether he has met the head of Nissan?

My Lords, this shows that I am the government Whip taking this on from the Minister today. I am sorry that I cannot answer that. I have not had a brief on that question, but I will certainly get the noble Lord a written answer on it as soon as possible.

My Lords, with just five months to go to the end of the Brexit transition period, Northern Ireland remains in the dark about how its new trading arrangements will work. Will the Minister provide your Lordships’ House with a firm date for publication of the details on the border operating model, originally scheduled for release on Monday? Will she also confirm a firm date for work to begin on Northern Ireland’s ports infrastructure?

I thank the noble Baroness and had expected her to speak, as always, on Northern Ireland issues. I cannot give her any further information, but it will come out. What I can say is that as part of the campaign of communications, we will provide specific audiences with tailored guidance. This will include further guidance for businesses and citizens, particularly in relation to Northern Ireland, in the coming weeks. We are already engaging intensively with businesses in Northern Ireland to ensure that they benefit from unfettered access to the whole of the UK market and are prepared for changes as a result of the transition period.