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No Deal EU Exit: Job Losses

Volume 655: debated on Tuesday 5 March 2019

5. What discussions he has had with the Secretary of State for Business, Energy and Industrial Strategy on potential job losses as a result of the UK leaving the EU without a deal. (909576)

The Government’s analysis indicates that leaving the EU without a deal would not be good for the UK economy, which is why we are so determined as a Government to secure an appropriate deal with the European Union that can pass through this House.

There are 4,000 jobs in the manufacturing sector in Merthyr Tydfil and Rhymney. This Government have had two years to negotiate a good deal for that sector, but they have so far failed to do so. Does the Minister share my concern that Nissan’s decision to build its X-Trail in Japan, and similar decisions by Honda, are a sign of things to come as a result of this Government’s chaotic negotiations?

The chief executive of Honda has made it perfectly clear that the company’s recent decisions were not a consequence of Brexit. Other factors across the world are affecting car sales, including the switch away from diesel and, in the case of Honda, the agreement on tariffs that has been entered into between the European Union and Japan, which will mean that, after the move to Japan, exports into Japan will attract no tariffs.

Does not this underline the importance of fine-tuning the deal so that we can jettison the backstop and use existing technology and EU law to take forward the innovative Malthouse proposals, which will ensure that we can move forward and build the new Britain?

The House has made clear the basis on which it would be prepared to accept the deal negotiated with the European Union, and that will necessitate some changes to the backstop arrangements. That is what is being negotiated at the moment and it will come back to the House in due course.

17. This country’s public sector institutions spend £1 billion a year on food, and there have been many warnings that food price inflation in the event of a no-deal Brexit will make that unaffordable. What is the Minister doing to protect not just jobs in the food sector, but the people who depend on those meals? (909588)

The hon. Lady is right to raise an issue that relates to our tariff policy in the event of a no-deal Brexit. We have made it clear that we will carefully balance this, protecting consumers from unwanted price rises at the same time as using our tariff policy to provide appropriate protection to vital elements of the economy.

Cheshire-based company ABB has stated that investment in automation could result in radical improvements in cost efficiency, allowing work to move back to the UK. Will my right hon. Friend consider incentivising investment in automation through the tax system?

We have already brought in some important measures to do just that, not least by increasing the annual investment allowance from £200,000 to £1 million, as announced at the previous Budget. We keep all taxes under review and I will certainly bear my hon. Friend’s important point in mind.

In a recent survey by the Fraser of Allander Institute, 62% of Scottish businesses said that they did not feel ready for Brexit. Will the Chancellor bring forward an emergency Budget to provide support for small and medium-sized enterprises so that they can cope with the Brexit that he proposes?

My right hon. Friend the Chancellor has made it clear that, in the event of a no-deal Brexit, we will take stock of the situation and take whatever measures are necessary to ensure that we protect and support businesses throughout the United Kingdom.

I was specifically talking about the Brexit that the Chancellor is proposing, which is presumably not a no-deal Brexit, although it looks like 100,000 jobs could be lost in Scotland as a direct result of no deal. However, in relation to the deal Brexit, the Bank of England has said that unemployment could be up to 4% higher by 2023 if the Prime Minister’s deal is approved. Does the Chancellor believe that keeping his job is worth costing thousands of others?

I do not believe that the figure to which the hon. Lady refers is accurate. This Government have seen employment at a record high and unemployment at the lowest level since 1975, and youth employment is half what it was in 2010—unlike the Labour Government, who saw youth unemployment increase by almost 50%.