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Customs Union

Volume 635: debated on Thursday 1 February 2018

2. What recent assessment he has made of the effect of the UK leaving the EU customs union on the economy. (903662)

The Government conduct an extremely broad range of work on EU exit issues and will continue to do so, which means that all decisions, including those on the EU customs union, are supported by many analyses. Leaving the customs union liberates the UK to establish new and fruitful trade deals with the rest of the world, as well as pursuing a new trading relationship with the EU that retains as frictionless a trade as possible in goods.

From that answer, it is clear that no assessment has been made. We have had it confirmed again this week that the north-east retail and manufacturing sector will be hardest hit in all scenarios. It is clear—is it not?—that nearly 200,000 workers in my region who work in these sectors are facing grim futures because of this Government’s inability to get their act together.

One advantage—although there are many—of leaving the customs union is that Britain can be a champion for global free trade again for the first time in 40 years. Free trade through mutually beneficial partnerships has historically ushered in productivity, innovation, consumer choice, growth and prosperity—something I hope that the hon. Lady will encourage.

I very warmly welcome my hon. Friend to her place. It is great to see a ray of sunshine, optimism and positivity from the Front Bench. What a shame that we do not see the same from the Opposition Benches. Is she surprised, as I am, that we are still discussing the customs union? The EU has ruled it out. The Prime Minister has ruled it out. The Leader of the Opposition—if not quite the shadow Secretary of State—has ruled it out. Why are we still talking about it?

My hon. Friend raises a very prescient point. The British people voted to leave the EU in their historic decision in 2016. In doing so, they instructed this Parliament to take us out of the EU customs union. That is exactly what the Prime Minister and this Government are doing.

Blaenau Gwent has just been boosted by the arrival of the car company, TVR. Does the Minister agree that we need a customs union with the European Union for such ventures to survive and thrive?

The UK is the second largest market for cars in Europe, so it is clearly in both our interests to continue this partnership between our industries. Is it not encouraging that companies such as Jaguar Land Rover, Nissan, Toyota and McLaren have made significant investment decisions in the UK since the referendum? I am committed, with this Government, to ensuring as frictionless trade as possible, so that we can continue this fruitful arrangement and support this vital sector of our economy.

It may be that the Minister is not aware that, in fact, car production went down for the first time since 2009 and that investment in the industry has also gone down by £500 million. When will the Government confirm exactly what their plans are in relation to the customs union, so that companies that manufacture here know that their components can get safely into the United Kingdom and not get stuck in a traffic jam at Calais?

We are seeing a rise in manufacturing and in exports, and UK foreign direct investment is at a record high. The economy is doing very well, and there have been encouraging signs and votes of confidence in the UK economy since Brexit. As we enter the next phase of the negotiations, we want to ensure that the automotive sector benefits from any arrangement. That will be a priority for the Government.

We now know—no thanks to the Government—that all the analysis that the Government have done to date shows that Brexit is bad news. We know that the Prime Minister was shown that analysis a few days ago, and we know that the first thing she did was to jump on a plane to China. Will the Minister confirm the accuracy of the reports yesterday that the Government’s analysis also shows that their obsession with cutting EU migration will be seriously bad for the British economy?

We are in the middle of the negotiations, but when it comes to migration, it is clear that the UK will be committed to designing its own immigration policy, which is determined by skills, talent and brains. That is what will drive our economy forward, and that is what will create jobs and growth.

My question was whether yesterday’s report was correct. I take it from the Minister’s attempt to dodge the question that that report, like the previous ones, was entirely accurate. Given that the Government’s own analysis shows that leaving the European Union is bad news, leaving the customs union is bad news and leaving the single market is bad news—and now that we know that cutting immigration from the European Union is bad news—do the Government have any plans, at any time before Brexit day, to adopt a strategy that is based on facts and evidence, rather than on blind ideology?

The document to which the hon. Gentleman refers is not Government policy. It comes with significant caveats and is limited in nature. It is clear that there are significant benefits from our departure from the EU and the customs union. First, we have the chance to pursue our independent global trade policy and foster growing economic ties with fast-growing economies for the first time in 40 years. Secondly, we will be free from the common external tariff, which could lead to a drop in consumer prices for British citizens. Lastly, we have the golden opportunity to build a new customs arrangement with the EU that is world-leading and enables prosperity, jobs and growth.