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European Union: Future Relationship

Volume 672: debated on Thursday 27 February 2020

With your permission, Mr Speaker, I would like to make a statement on the Government’s approach to our future relationship with the European Union.

Now that Britain has left the EU, we are entering a new chapter in the history of these islands. This Government have honoured the clearly expressed wish of the British people. Their instruction to us, their servants, to secure our departure from the EU has been followed. The votes of 17.4 million people—more than have ever voted for any democratic proposition in our history—were implemented on 31 January and we are now on a new journey. As a sovereign, self-governing, independent nation, we will have the freedom to frame our own laws, control our own borders, lower all our taxes, set our own tariffs, determine our own trade relationships, and ensure that we follow the people’s priorities on security, the economy, and democratic accountability. Over the next nine months, we will negotiate a new relationship with our friends and partners in the EU based on free trade and friendly co-operation. We have today published the approach for these negotiations, and copies of the document, “The Future Relationship with the EU”, were made available to Members in the Vote Office from 9.30 am.

Talks with the EU on our future relationship begin next week. It is our aim to secure a comprehensive free trade agreement as well as agreement on questions such as fisheries, internal security and aviation. We are confident that those negotiations will lead to outcomes that work for both the UK and the EU, but this House, our European partners, and, above all, the British people should be in no doubt: at the end of the transition period on 31 December, the United Kingdom will fully recover its economic and political independence. We want the best possible trading relationship with the EU, but in pursuit of a deal, we will not trade away our sovereignty.

The Government’s vision for the UK’s future relationship with the EU was outlined with crystal clarity by the Prime Minister during the general election campaign, and the election result comprehensively confirmed public support for our direction of travel. In his speech in the Painted Hall in Greenwich on 3 February, the Prime Minister laid out in detail how we will reach our destination. The first principle of our approach is that we wish to secure a relationship based on friendly co-operation between sovereign equals. We respect the EU’s sovereignty, autonomy and distinctive legal order, and we expect it to respect ours. We will not accept or agree to any obligations where our laws are aligned with the EU or the EU’s institutions, including the Court of Justice. Instead, each party will respect the other’s independence and the right to manage its own borders, immigration policy and taxes.

The second and allied principle of our approach is that we will seek to emulate and build on the types of relationship that the EU already has with other independent sovereign states. We will use precedents already well established and well understood to ensure that both sides’ sovereignty is respected. By using already existing precedents, we should be able to expedite agreement. We will seek functional arrangements that the EU will recognise from its many other relationships. Our proposal draws on existing EU agreements such as the comprehensive economic and trade agreement with Canada, the EU-Japan economic partnership agreement and the EU-South Korea free trade agreement. That approach should enable us to move swiftly towards the goal envisaged in the political declaration agreed last October, in which both sides set the aim of concluding a zero-tariff, zero-quota free trade agreement.

As well as concluding a full FTA, we will require a wholly separate agreement on fisheries. We will take back control of our waters as an independent coastal state, and we will not link access to our waters to access to EU markets. Our fishing waters are our sovereign resource, and we will determine other countries’ access to our resources on our terms. We also hope to conclude an agreement on law enforcement and judicial co-operation in criminal matters, so that we can work with the EU to protect their citizens and ours from shared threats, but we will not allow our own legal order to be compromised. By taking back full control of our borders, we can implement measures to make the British people even safer, and we can tackle terrorism and organised crime even more effectively. We also wish to conclude a number of technical agreements covering aviation and civil nuclear co-operation, which will help to ensure continuity for the UK on its new footing as an independent sovereign nation.

Securing agreement on all those questions should not, in principle, be difficult. We are, after all, only seeking relationships with the EU that it has with other nations—relationships that respect the interests and the sovereignty of both partners. It is in that light that we should view discussions about what has been termed the “level playing field”. It has been argued that EU demands in this area will make full agreement difficult, yet there is no intrinsic reason why requirements that both parties uphold desirable standards should prejudice any deal.

The United Kingdom has a proud record when it comes to environmental enhancement, workers’ rights and social protection. In a number of key areas, we either exceed EU standards or have led the way to improve standards. On workers’ rights, for example, the UK offers a year of maternity leave, with the option to convert it to parental leave, so that both parents can share care. The EU minimum is just 14 weeks. On environmental standards, we were the first country in the world to introduce legally binding greenhouse gas emission reduction targets through the Climate Change Act 2008. We were also the first major global economy to set a legally binding target to achieve net-zero greenhouse gas emissions across the economy by 2050.

We will not dilute any existing protections. Indeed, as the Environment Bill debated yesterday demonstrates, we wish to go further and faster than the EU in improving the natural environment. We do not need the EU’s permission to be a liberal nation leading the world in the fight against climate change and for social progress. That is why the UK Government seek an FTA with robust protections for the environment and labour standards, but we do not see why the test of suitability in those areas should be adherence to EU law and submission to EU models of governance. The EU does not apply those principles to free trade agreements with other sovereign nations, and they should not apply to a sovereign United Kingdom.

Some argue that we must accept EU procedures as the benchmark because of the scale of UK trade with the EU, but the volume of UK trade with the EU is no greater than the volume of US trade with the EU, and the EU was more than willing to offer zero-tariff access to the US without the application of EU procedures to US standard setting. The EU has also argued that the UK is a unique case, owing to its geographical location, but proximity is not a determining factor in any other FTA between neighbouring states with large economies. It is not a reason for us to accept EU rules and regulations. We need only look at the United States-Mexico-Canada agreement for an example of a trade agreement that does not require regulatory alignment to one side’s rules or demand a role for one side’s court. Geography is no reason to undermine democracy.

To be clear, we will not be seeking to align dynamically with EU rules on EU terms governed by EU laws and EU institutions. The British people voted to take back control, to bring power home and to have the rules governing this country made by those who are directly accountable to the people of this country, and that is what we are delivering.

The negotiations are due to begin next week, led by the Prime Minister’s sherpa, David Frost, and I would like to end by looking ahead optimistically to the coming months. There is ample time during the transition period to strike the right deal for the UK. We hope to reach a broad agreement ahead of the EU Council’s high-level summit in June, whereupon we will take stock.

We know that our proposals are measured and our approach is fair. We know what we want to achieve. We are ready to go, and this Government are committed to establishing a future relationship in ways that benefit the whole UK and strengthen the Union. We are committed to working with the devolved Administrations to deliver a future relationship with the EU that works for the whole UK, and I take this opportunity to reassure colleagues that our negotiation that will be undertaken without prejudice and with full respect to the Northern Ireland protocol.

This Government will act in these negotiations on behalf of all of the territories for whose international relations the UK is responsible. In negotiating the future relationship between these territories and the EU, the UK Government will seek outcomes that support the territories’ security and economic interests, and reflect their unique characteristics. As the Prime Minister committed to do on Second Reading of the European Union (Withdrawal Agreement) Act 2020, we will keep Parliament fully informed about the negotiations, and colleagues will be able to scrutinise our progress.

This Government are delivering on our manifesto commitments with energy and determination. This Government got Brexit done, and we will use our recovered sovereignty to be a force for good in the world and a fairer nation at home. We want and we will always seek the best possible relationship with our friends and allies in Europe, but we will always put the welfare of the British people first. That means ensuring the British people exercise the democratic control over our destiny for which they voted so decisively. That compact with the people is the most important deal of all, and in that spirit, I commend this statement to the House.

I thank the Minister for the Cabinet Office for prior sight of his statement. He talks about having got Brexit done, but he knows that is not the case. We have taken the first step in leaving the European Union, but Brexit, as he knows, is far from done. The Government’s ambition for our new relationship with our most important trading partner is, frankly, underwhelming. They started with a commitment to securing the exact same benefits; then scaled it back to frictionless trade to protect our vital supply chains; then it was Canada-plus-plus-plus; and now it is Canada so long as that does not get in the way of ending our alignment with the standards that we have previously enjoyed.

The Minister talked about the Government’s mandate in the general election, which was based on a withdrawal agreement and a political declaration that says the free trade agreement will be

“underpinned by provisions ensuring a level playing field”.

They now apparently reject that. The Minister spoke of higher UK standards than are required within the EU, and he is right—there are some examples; there are also contrary examples—but EU standards are a floor, not a ceiling. May I ask the Minister: if the Government have no intention of falling below those standards, why are they unwilling to make that commitment?

I spent Monday evening with manufacturing companies from across the north of England, and they are not worried by alignment; indeed, they want it. They are concerned about the barriers to trade undermining their position in the crucial European market. I know that the Prime Minister has made his contempt for the views of business well known, but will the Government not think again at this crucial moment, because they are taking serious risks with our economy, people’s jobs and their livelihoods?

The Treasury analysis from November 2018 predicted that a Canada-style FTA would shrink the economy by up to 6.4%. I know the Government have rubbished their own analysis already, but what new analysis have they done? May I ask the Minister: will the Government publish a full economic impact assessment of the deal that they are seeking? Will they also publish the assessment of the other trade deals that he mentioned? A recent freedom of information request revealed that the Department for International Trade has commissioned and received, but not yet published, assessments of the impact on the UK economy of the FTA with the US, of that with Japan and of the Trans-Pacific Partnership. Will he commit to publishing those impact assessments immediately?

The Prime Minister has told us time and again that his Brexit deal

“represents stability and certainty for business.”—[Official Report, 19 October 2019; Vol. 666, c. 594.]

But in ruling out extending the transition period, the Government are taking business from one set of uncertainties to a new set. They are expecting to complete enormously complex negotiations in just 10 months, with a cavalier disregard for the consequences of failing to do so. The Minister’s warning to business that customs checks are “inevitable” and that “almost everybody” will face extra barriers at the border is deeply concerning. Indeed, the one place where the Government claim that there will not be checks—for GB trade with Northern Ireland—is the only place where they have actually so far committed to having them: down the Irish sea. In light of the conflicting statements from so many of his colleagues, will the Minister clarify the extent of checks along the border that the Government have created down the Irish sea?

Labour wants the best deal for Britain in trade, security and all the other areas mentioned by the Minister. That means maintaining the closest possible relationship with our most important trading partner, and it is on that that we will hold the Government to account.

I am grateful to the hon. Gentleman for his questions and for the constructive way in which he approaches these matters. This Government are wholly committed to implementing the withdrawal agreement, to respecting and enacting the Northern Ireland protocol, and to giving effect to the political declaration and its aim of securing a comprehensive free trade agreement without tariffs, quotas or quantitative restrictions. He asked specifically about the maintenance of standards, and the requirement that we follow EU law and ECJ judgments in order to secure workers’ rights and environmental protections. We do not believe that is necessary, and the EU does not require submission to its legal order from any other sovereign independent state. Ultimately, the best guarantor of environmental protections and workers’ rights is a sovereign UK Parliament that is determined to lead in the world, just as this Government are doing in those areas.

It is vital to ensure that our manufacturing sector, like all sectors of our economy, is equipped to take advantage of new economic opportunities. That is what the Government are doing, and my right hon. Friend the Chancellor of the Exchequer will say more about how we can supercharge every part of our economy when he delivers the Budget statement on 11 March. The free trade agreement that we seek should ensure tariff-free access to markets, and provisions on rules of origin that will allow the manufacturing sector to flourish in the future.

The hon. Gentleman pointed out that the need to ensure that negotiations are concluded by the end of the transition period on 31 December necessarily means that they will have to proceed at pace. They will, but as I pointed out, and as he acknowledges, because we are seeking relationships for which there is already a precedent between the EU and other countries—precedents such as those between the EU and Canada, Japan, South Korea and others—it should be possible to make rapid progress. I note that my good friend, Dr Martin Selmayr—he is now the EU’s permanent representative to Austria, and he previously worked for the President of the Commission—has said that it would be entirely possible to conclude those negotiations in a timely fashion, and not for the last time, Dr Selmayr and I are in complete agreement on that.

The hon. Gentleman made a point about customs checks and a border down the Irish sea. There will be no border down the Irish sea, and we will ensure that there is unfettered access for Northern Ireland businesses to the rest of the United Kingdom.

I acknowledge the hon. Gentleman’s sincere beliefs and his commitment to appropriate scrutiny, but the problem for the Labour party more broadly is that its approach to Europe would mean that we would have no control over our fishing borders, no effective control over our borders, and no way of charting our own independent economic destiny. Looking at that proposal, I am afraid all I can say, as someone once said, is, “No, no, no.”

I congratulate my right hon. Friend on his clear statement, and on his view that since the standards we set are higher than those in the EU, he will therefore not be demanding that the EU aligns with our standards as we go forward. That is refreshing. The settlement on Northern Ireland in the withdrawal agreement included provision on state aid, and since then, the EU has interpreted that as bringing the whole UK under state aid provisions. Will he confirm that in any future agreement with the EU, we will not accept that the UK leaves itself under the jurisdiction of the European Court of Justice when it comes to state aid provision?

My right hon. Friend makes an important point. Of course we must respect the integrity of that protocol, but it is not the case that the CJEU should be governing the application of state aid in the way that some have envisaged, which would be quite wrong.

What a load of bunkum, baloney and codswallop! This is nothing other than a route map to the cherished no deal, which is the real ambition of the Brexit zealots on the Conservative Benches. They are, even now, prepared to break international law to achieve that outcome.

Let us dispense with the unicornism and see if we can start to make sense of the real world and what we are actually dealing with. The EU expects nothing other than the political declaration to be implemented in full. It expects that level playing field to be realised and it will not accept anything else. How many times do the Government need to be told that the UK will not leave with a better deal and arrangement than that which is currently enjoyed? It does not matter if it is Canada-plus. It does not matter if it is Australia. It does not even matter if it is outer space-minus-minus-minus. The Government will have an inferior product at the end of the day when we finally get an agreement with the EU. Look at who we are up against: it is the clown-shoe UK up against the efficient, effective EU, with its negotiating experience—[Laughter.] Conservative Members are laughing, sitting there with their proposals which mean absolutely nothing. They will be trounced by the EU in the negotiating process. Their hard Brexit will do nothing but hurt my nation. Even with one of these free trade agreements, our GDP will be hit by 6.1%. If they get their cherished no deal, the consequences will be absolutely catastrophic for my nation of Scotland.

Scotland wanted nothing whatever to do with this ruinous Brexit and we will not accept it. I am sure the hon. Gentlemen who have been laughing and scoffing have seen the opinion polls in Scotland. There is now sustained majority support for independence for Scotland. One of the things driving that is all of them saying no to Scotland and pursuing their hard Brexit. Scotland is not going to be a part of this, Secretary of State. We will not accept it. When will you allow us to have a referendum, so we can get out of this mad Brexit?

I am very grateful to the hon. Gentleman for his remarks. First, may I use this opportunity to place on the record my thanks to Mike Russell MSP from the Scottish Government for the work he has done, along with leaders from other devolved Administrations, in helping to shape our approach?

Of course, the Scottish Government and the Welsh Assembly Government will in some areas take a different view from the UK Government, but it is undoubtedly the case that our negotiating position is enhanced as a result of the conversations we have with our colleagues in the Scottish National party and the Scottish Government. Indeed, a number of changes have been made to our approach and to this document, following conversations I have had with the Scottish Government over the course of the past week.

It is also the case, however, that Scotland, like every part of the United Kingdom, will benefit hugely not just from our departure from the European Union but from the new trading relationships we will develop with other countries. It is the case, for example, that when we conclude a new free trade agreement with the United States, Scotland will be one of the sectors that benefits most from the new trading opportunities. It will also be the case, as the Scottish Government have themselves pointed out, that tens of thousands of new jobs will be created in north-east Scotland in the fishing sector as a direct result of our departure from the European Union—jobs that would not be created if we followed the SNP approach of staying in the common fisheries policy.

Ultimately, the greatest threat to the prosperity and security of the people of Scotland is the reckless approach the Scottish Government take towards the 2014 referendum and their determination to overturn the settled will of the Scottish people to stay in the United Kingdom. Their approach, I am afraid, would mean that we would have border posts at Berwick and they would not be able to use the pound sterling in Stirling. We must give that madness a miss.

I very much welcome my right hon. Friend’s statement. Does he agree that those who continue to peddle the line that we somehow need to tether ourselves to the EU’s rules and standards are in fact making a case to hold Britain back?

Is the Secretary of State aware that 60% of international exports from Wales go to the European Union? The Welsh Government have said that there must be a level playing field and frictionless trade with the EU in the interests of the Welsh economy. Is he aware of that?

I am very well aware of the views of the Welsh Assembly Government, thanks to the excellent work done by Jeremy Miles AM, the Brexit Minister and Counsel General. I enjoy the conversations I have with Jeremy, Mark Drakeford and others to ensure we can work together.

I appreciate that negotiating a comprehensive free trade agreement with the EU is a priority, but will the Minister confirm that we will also look to reach free trade agreements with other countries, that such negotiations are either under way or will be shortly, and that we have the civil service capacity to reach them?

My hon. Friend makes a very good point. Yes, we do—the Department for International Trade has a team of trade negotiators, lawyers and other policy experts. There have already been a number of informal and formal contacts with the United States, Australia, New Zealand and other participants in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, and we will proceed at pace with negotiations with partners across the globe to forge free trade agreements in the interests of every part of the United Kingdom.

Brexit is clearly far from done. It had cost us £130 billion by January and the average UK household is £900 worse off. Will the Minister tell us what he estimates the price tag will be at the end of this year, and, given the gendered impact of trade, where is the equality impact assessment that the Government have a statutory duty to provide?

Looking at most of the indices of economic performance, such as the measures of increased investment and increased capital expenditure recently, it is the case that the United Kingdom economy, following the Conservative victory in the general election on 12 December, is powering ahead—indeed, powering ahead by comparison with EU nations. I would like to make sure that we get a comprehensive free trade agreement so that other EU nations can benefit from the dynamism of the UK economy and that men and women across Europe can benefit from the right economic relationship.

Financial services are critical to this country’s economy, contributing 11% of our total tax take. Will my right hon. Friend assure my constituents who work in financial services that their interests will be protected during free trade negotiations?

Absolutely—financial services matter not just in the City of London, but in Edinburgh, Perth, Leeds and across the United Kingdom. It is a dynamic and growing sector and it is important that we make sure we have the right arrangements for them. We hope that the EU will report by June on the prospects for equivalency in financial services. That commitment was made in the political declaration. It did not subsequently appear in the EU’s negotiating mandate, but I am confident that by June the EU will have completed those equivalency assessments.

In our future relationship, it is important that musicians, performers and so on can move freely and continue to go to Europe, and that European performers can come here on a reciprocal basis. What is the Minister’s understanding of the Government’s position on that?

The hon. Member makes an important point. He will see that in this document there are details on how we can ensure that those who provide professional services, including artists and musicians, can continue to do so at the end of the transition period. It is critically important that the cultural excellence that so many UK musicians are responsible for continues to be available to European nations. Whether it is the Bayreuth festival or pop concerts in Belgium, we need to make sure that British talent has a chance to shine.

Does my right hon. Friend agree that an agreement on a future relationship by the end of the year is perfectly feasible, and that the EU and its negotiators need to recognise the reality of a sovereign, independent United Kingdom with a strong, dynamic economy?

Yes, that is absolutely right. As I mentioned, a number of EU leaders have said that a deal is doable because we are operating on the basis of precedent, and it should then be possible to conclude all the necessary agreements. Having concluded these agreements by the end of this year, we can then move on to deepening the many bilateral and multilateral relationships that we have with our friends and partners in Europe to the benefit of all.

The right hon. Gentleman referred to other deals that he is hoping to emulate. He will be aware that the EU’s deal with South Korea took eight years from the start of negotiations to implementation and that the Canada deal took seven. Given that the Government are seeking a much more comprehensive arrangement than either of those, his optimism that it can be done and ratified in 10 months remains to be proven, but will he confirm that if it is not possible to conclude a deal, we will exit the transition period on 31 December with no agreement whatsoever?

We already have an agreement—a withdrawal agreement that safeguards the rights of UK and EU citizens, settles our financial obligations and makes provision through the protocol for Northern Ireland’s position. As for the free trade agreements to which the right hon. Gentleman refers, it is more difficult to begin when one is designing a prototype; now that the prototypes exist and have become precedents, it is much easier to replicate their provisions.

Further to the previous question, some two years ago I attended a presentation, complete with slides, given by Mr Michel Barnier, at which he indicated that, as things then stood, the only post-Brexit trading arrangements available to the UK were those enjoyed by South Korea and Canada, which is precisely the arrangement that the Government are seeking. Since then, the EU seems to have resiled from that position. Does my right hon. Friend know why the EU is apparently showing such bad faith?

As my right hon. Friend knows, having served with distinction in government, there is a range of views across the European Union, but the EU mandate has now been concluded, with unanimity, and we are confident that we can negotiate using our approach and that mandate to reach an appropriate deal, similar to the one that he has outlined.

I have often referred in this place to the concerns of the highland tourism industry, in particular hotels, about the continuing employment of EU nationals, many of whom are heading homeward, and the concerns of fish processors about getting their fresh produce to European markets in good time. Will the Secretary of State, who is a good Scot, consider coming to the highlands to meet representatives of those industries? He would be most welcome.

I would be delighted so to do. Any opportunity to visit the hon. Gentleman’s constituency is a welcome one. He is absolutely right that the hospitality industry is integral to the success of the highlands economy. We want to make sure that in the future those who provide such a high standard of hospitality have access to the skilled labour they need.

I thank my right hon. Friend for his statement and his clear message on fisheries. He will know that memories run deep in our fishing communities, and that great concern continues to be felt because of the way the fishing industry was treated previously. Will he make it absolutely clear to fishermen in Cornwall and around the country that access to our fishing waters will not be used as a bargaining chip to be traded off against other priorities?

My hon. Friend is absolutely right: memories of what happened in the 1970s certainly do run deep, and for very good reason. That is why I sought to stress that we, as an independent sovereign state, regard control of our own resources as something we cannot barter away. Of course we want to co-operate in the management of stocks with our neighbours, but the approach we take will be similar to that of other sovereign states or regimes such as Norway, Iceland and the Faroes. As an independent coastal state, we will regulate access to our own waters on our terms.

I welcome the right hon. Gentleman’s commitment to trying to secure a comprehensive free trade agreement, but does he accept that many of my constituents who work in the automotive industry are seriously worried about the impact of a potential 10% tariff on motor vehicles? Will he give a firm commitment to making sure that their interests are as protected as possible?

I am grateful to the right hon. Gentleman for making that point. Throughout his time in the House, he has been a strong, consistent and powerful voice for the rights of workers. He is absolutely right that those who work in our automotive sector deserve the best possible future, and it is for that reason that we will seek to avoid any tariffs on cars or automotive products.

British farmers are proud to produce food to the highest standards, and the British consumer benefits from that. Will my right hon. Friend reassure the farmers and consumers of my constituency that those high standards will be maintained in any free trade agreement?

Absolutely. The Agriculture Bill, which was introduced by my right hon. Friend the Member for Chipping Barnet (Theresa Villiers) during her outstanding tenure as Environment Secretary and which is being carried forward by her successor, will ensure that farmers have a firm foundation on which to plan for the future. In all our trading relationships, we will make sure that there are appropriate protections for the environment and for animal welfare, to ensure that the peerless standards set by our farmers are used as a badge of excellence to enable them to do even better in the future.

Can the Secretary of State confirm that fishing fleets and fish processors in Portavogie in my constituency, Ardglass, Kilkeel and elsewhere will have the same rights as their fellow fleets and processors in Scotland, Wales and England, and that Northern Ireland will not be disadvantaged by the border down the Irish sea?

There will be no border down the Irish sea, and the fishing fleets of Northern Ireland will enjoy all the rights that they deserve, similar—indeed, identical—to those of other fishermen, and fishers, throughout the United Kingdom.

Striking a deal is far easier and far more likely from a position of strength. Does my right hon. Friend agree that, in contrast to what happened in 2017, going into these negotiations with clarity and unity, backed up by a strong electoral mandate, should give us all reasons for optimism, not pessimism?

My right hon. Friend is absolutely right. As I have said before from this Dispatch Box, given a 52-48 referendum result and 650 different views in the House, not everyone will be satisfied with every aspect of our negotiating approach; but with a united Government, a clear approach and a general election mandate, and given that this document is underpinned by clear work by lawyers, trade negotiators and others, I believe that we can secure a deal, and I am sure Members throughout the House recognise that we should not make our own personal perfect the enemy of the common good.

The Minister’s statement and the document published today show that the Government have made a fundamental choice, which is to prioritise sovereignty over any economic argument or consequence for either goods or services. Is there not a danger, however, that having made that choice, the Government will impose long-term economic consequences on the country in pursuit of the prize of a sovereignty that they will end up not using very much, because at the end of the day good standards in the environmental, labour market and consumer sectors actually make sense?

The right hon. Gentleman always makes thoughtful contributions to our debates, and I take his point. It will be for this Parliament and future Parliaments to decide how our sovereignty is exercised in accordance with the wish of the British people, but the experience of history tells us that the countries with the maximum amount of control over their own destinies are the best equipped to succeed economically and, indeed, to secure a greater degree of equity for all their citizens.

Does my right hon. Friend recognise the distinction between EU regulations and European technical standards? The latter are set outside the EU, and without a loss of sovereignty, by expert bodies of which the British Standards Institution is one of the most respected and admired in the world. Does my right hon. Friend share my hope that British standards expertise will continue to be able to influence European and international standards?

My right hon. Friend has made an excellent point, which reflects the brilliant work that he did as Business Secretary. It is absolutely the case that there are common technical standards in which British experts play a distinguished part. We will want to ensure—and I know that others will want to ensure—that those common standards can help to underpin successful commerce and trade.

The Minister began by saying that the Government were not asking for anything that was not already in an existing agreement between the EU and another country, but then gave an answer on financial services which the document backs up, saying that the Government were seeking an enhanced, comprehensive equivalence regime for our major sector. I must respectfully say to him that those statements cannot both be true. There is no single equivalence regime—it is a patchwork of regulations—and there are major bits of legislation that contain no equivalence provisions at all, such as cross-border payments regulation, the motor insurance distribution directive and the single euro payments area. So, with respect, we are asking for something additional, and one of the answers that the Minister has given is not really correct.

I am grateful to the hon. Gentleman for his thoughtful intervention, but all that we are seeking is straightforward equivalence in financial services. The European Union has said that it will review that, and we will know the conclusions of its review by June.

What an excellent statement the Minister made, outlining our principles, but can he assure me that the principles will not change when the EU says no to something? Over the last few years I have listened to excellent speeches from that Dispatch Box, only to find that our principles change when the EU says no.

I am a restless seeker after consensus wherever it can be found, but, more important than that, I am a democrat. The British people made it clear in the referendum and again in the general election that they wanted us to leave the European Union, and the Prime Minister made it clear in the general election, as he did during the referendum campaign, that that meant leaving the single market, leaving the customs union and leaving the jurisdiction of the European Court of Justice. We will not move from those principles.

Regrettably, the British Government, through this statement, have decided to take a belligerent approach to the second phase of Brexit negotiations. Their opening move is to try to reopen the agreement reached after the first phase of Brexit, and to set further arbitrary deadlines for the infinitely more complicated second phase of Brexit dealing with trade. Rather than playing Russian roulette with people’s jobs and economic wellbeing, would it not be better for the Government to take a grown-up approach to these negotiations and remove any arbitrary deadlines for the conclusions of the negotiations?

There are no arbitrary deadlines. The deadline of 31 December for agreement is in the political declaration. If we were to take that out, we would be altering the political declaration. However, we are honouring the political declaration, and far from being belligerent, all we are doing is simply setting a deadline. When I was an editor in the world of newspapers, setting a deadline for correspondents was not an exercise in belligerence; it was a way of making sure that we could serve the people.

Does my right hon. Friend agree that we have higher standards than the EU in a number of areas, particularly in maternity, and that it might be useful for the EU to recognise that in some of its discourse?

My hon. Friend is absolutely bang on. Across the nations and countries of the continent of Europe, there are different approaches to some of these questions. There are also countries outside the European Union, such as Norway, that have exemplary standards in environmental protection, as well as in maternity and social rights. The UK, like Norway, is a progressive, liberal, modern country, and that is something that we should celebrate across the House. Outside the European Union, we can aim even higher.

The Minister knows that Canada, South Korea and Japan are not in the single market or the customs union, so we are starting from a different position. Will he therefore accept that if we diverge from EU environmental standards and workers’ rights, there will inevitably be restrictions? Is it not really his plan to lose British jobs and simply blame the EU? Would it not be better to keep up the standards and keep up the trade, because people did not vote to lose their jobs when they voted to leave the EU?

I completely understand where the hon. Gentleman is coming from, but we have had a referendum and a general election, and in both it was very clear that we were going to leave the single market and the customs union and take back control in the interests of the British people.

I very much welcome the statement, and the document to which my right hon. Friend refers. I particularly welcome the clarification and increased detail on the subject of fisheries, and not least the point that, as he said in his statement, “we will require a wholly separate agreement on fisheries. We will take back control of our waters as an independent coastal state, and we will not link access to our waters to access to EU markets.” Will he confirm to the House and to the constituents of Banff and Buchan, particularly those in the seafood sector—the catchers and those on the processing side—that we will retain sovereignty and get the best deal for our fishermen across the United Kingdom, despite the assertions from the EU and the seemingly wishful thinking of Scottish National party Members?

My hon. Friend is absolutely right. For folk in Banff and Buchan, Moray and across the United Kingdom, a sea of opportunity beckons when we leave the European Union, and it is a great pity that the SNP and the Scottish Government, despite the many talented Members that they enjoy, still want us to remain in the EU and the common fisheries policy. This is one of a number of ways in which they would sell Scotland short, and it breaks my heart.

This Government have today ignored the voice of Scotland in the referendum and ignored the compromise proposals from the Scottish Government. They are showing that they are willing to ride roughshod over a Sewel convention. Now the right hon. Gentleman has reneged on his offer as chair of Vote Leave for Scotland to have its own immigration policy. Which one of these aspects will strengthen his so-called precious Union?

We are respecting the referendum result. In 2014, the people of Scotland voted to remain in the United Kingdom. This is a settled decision that, sadly, the Scottish Government seek to unpick to the detriment of all. After Scotland voted to be in the United Kingdom, the United Kingdom, whole and entire, voted to leave the European Union, and we are working to ensure that that democratic decision works in the interests of all.

I welcome my right hon. Friend’s statement. The UK’s economy is primarily service based, and while I hear that taking back our borders means a separate treaty for fishing, which many people in coastal communities will welcome, many of my constituents are in financial services and probably represent more people than are employed by fishing in the entire UK. We have talked about taking back control of our money, so why not have a separate treaty for financial services? If not—I have heard his comments on equivalence—will he set out the Government’s position on equivalence when it comes to the derivation period?

As my hon. Friend makes clear, financial services matter not just in Wimbledon, but across the United Kingdom, which is why, as stated in the document published today, we wish to conclude an agreement that will make provision for financial stability, market integrity and investor and consumer protection for financial services. We also want to secure mutual recognition of professional qualifications to ensure that everyone in our service sector can continue to have access to opportunities in every market in which they currently work.

May I ask the Minister for further information to the chapter on digital in the report, which refers to an

“open, secure and trustworthy online environment”

and encouraging regulatory co-operation? With the Government moving to tackle online harms on various platforms, will he set out in more detail what he means by ensuring that there is co-operation on regulation in any future trading agreement?

Yes. As the hon. Gentleman knows, we are compliant with the general data protection regulation that the EU introduced, and we want to ensure that we get an equivalency judgment from the EU on data adequacy, so that we can continue to ensure that data flows, which are so integral to business and others, can continue in an appropriate way.

I welcome my right hon. Friend’s statement for its clarity and optimism, which people of Montgomeryshire and, indeed, the majority of people in Wales will welcome. To tackle some of the scaremongering, will he meet the Welsh farming unions to outline again that we will not seek to lower food standards? Indeed, if my hon. Friend wants a Welsh farmhouse breakfast, we can certainly do that in Montgomeryshire.

I am grateful to my hon. Friend for making that point. Whether it is from the Farmers’ Union of Wales, NFU Cymru or my hon. Friend, farmers in Wales have brilliant representation. There is nothing nicer than a Welsh farmhouse breakfast, apart from possibly an Ulster fry, or a bacon sandwich in Peterhead harbour.

The Minister states that the negotiation will take place without prejudice to the Northern Irish protocol. However, there is confusion in Northern Ireland. We hear from the EU that there will be no derogation from the rules, but reports over the weekend suggested that the Government seek to find ways around the protocol, yet the Minister and his colleagues say that there will still be unfettered access and no border in the Irish sea. Will the Minister please describe in detail, with the crystal clarity he referred to, how those irreconcilable aims will be married up, and how people in Northern Ireland will finally get certainty after three and a half years of bluster and stalled investment? Will he also clarify what form the negotiation with the devolved Administration will take?

Far from there being confusion, I hope that there is clarity that we will implement the withdrawal agreement, respect the Northern Ireland protocol, and then conclude a comprehensive free trade agreement with the European Union that will work in the interests of the people of Northern Ireland and people across the United Kingdom. I have had profitable conversations with both the First Minister and the Deputy First Minister in the preparation of our approach today. We will not always agree with every party in Northern Ireland, but all parties in Northern Ireland, including the hon. Lady’s, have an important role to play in ensuring that we deliver for all the people of the United Kingdom.

I am grateful to my right hon. Friend for his reassurances to our fisheries. Those reassurances are particularly relevant to the fisheries in my beautiful constituency. Does he agree that the point of leaving the EU is to enable us to make our own laws in our own way through politicians whom we elect, and who are accountable to the British people?

My hon. Friend gets to the heart of the matter. Democratic accountability, as outlined brilliantly and eloquently by the father of the right hon. Member for Leeds Central (Hilary Benn) in this House and elsewhere, is something that all of us should celebrate, and that leaving the European Union allows us to enhance.

The document rightly acknowledges the importance of the second-generation Schengen information system—SIS II —database, which holds millions of pieces of data on wanted or missing persons, including vulnerable children. The document also says that if by June insufficient progress has been made on ensuring the basis of an agreement by September, the Government will begin to make their own preparations for domestic priorities. Will the Chancellor of the Duchy of Lancaster explain how he will protect this country properly if we have to sacrifice our access to millions of pieces of vital data and rely on an Interpol database that contains only a few hundred thousand records?

The hon. Lady makes an important point. We would like to continue having access not just to the Schengen information system II database, but to Prüm, ECRIS and a number of other law enforcement and criminal justice tools. Of course, we will have to see what approach the European Union takes. I am hopeful it will take a pragmatic approach, because it benefits just as much as we do, if not more, from our participation in these databases. Leaving the European Union allows us, through our controlling our own borders and laws, to improve homeland security in a number of ways, and we will always act in the interests of the British people.

Can my right hon. Friend confirm that the UK and the EU will trade together under an Australian-style agreement if an agreement cannot be reached by the end of the year?

My hon. Friend is absolutely right. We want to have a comprehensive free trade agreement on the model I outlined in my statement, but if we do not, there are other great countries, including Australia, New Zealand and, of course, the United States, that have a huge volume of trade with the EU without having an agreement of that kind.

We cannot level up by damaging the foundations, but that is exactly what would happen to the economy if we walked away in June, as the Government have this morning been briefing that we will. As my hon. Friend the Member for Stretford and Urmston (Kate Green) said, it would also do damage to our security. The document clearly says there should be no

“role for the CJEU in resolving UK-EU disputes”.

Does that mean that the Government are happy potentially to lose access to not only databases that are crucial to our security, but the European arrest warrant?

That is ultimately a question for the EU. We are clear that we want a relationship of sovereign equals. If the EU attaches to that relationship a requirement that we follow the jurisdiction of its courts, it is not a relationship of sovereign equals. The security of the EU would be impinged as well, and I am sure that no European politician would want to sacrifice the security of their people by taking anything other than a constructive approach.

Before I came to this place I had a job, in the wake of the Brexit referendum, representing the banking industry in negotiations with the EU, the European Parliament, the Commission and the European Council, and in discussions with the Bank of England and the Treasury on what sort of relationship we want with the EU after Brexit. We came to realise quite quickly, as did the Bank of England—Mark Carney has spoken on this point—that, as a global financial centre, being a rule taker and having no say on our financial regulation would be a threat to the UK’s financial stability. Does my right hon. Friend agree that we have to be very careful, as becoming a rule taker would be a real threat to our financial services?

Yesterday, as a member of the Select Committee on Defence, I heard from Professor Malcolm Chalmers of the Royal United Services Institute that

“the risks to the UK’s essential alliance relationships are greater now than they have been for many decades.”

Can the Chancellor of the Duchy of Lancaster advise the House on why the statement on our future relationship with the European Union says absolutely nothing about maintaining and improving defence?

When it comes to maintaining and improving defence, we have a network of relationships, including, of course, our membership of NATO—the strongest and most durable alliance for freedom the world has ever known. When it comes to defending this country, one of most perilous things we could do would be to follow the Scottish Government’s approach of breaking up the United Kingdom and of unilateral nuclear disarmament. I am afraid that the SNP’s position on defence, like its position on so many other issues, would mean the Scottish people were less safe. That is the direct result of its ideological attachment to separation.

In the light of the Minister’s remarks on a level playing field, can I ask him about competition policy and governance arrangements? Would the Government accept commitments on workers’ rights, environmental protections and consumer and social standards being subject to any dispute resolution mechanism agreed to as part of the wider agreement?

The hon. Gentleman has given a list, and I will come back to each of them in correspondence. Some will be covered by dispute resolution mechanisms, and others may not.

Scotland cast its biggest ever vote on a proposition when it voted by 62% to remain in the EU. More people in Scotland voted to remain in the EU than voted to remain in the United Kingdom—and that was using the UK Government’s franchise; had the Government trusted 16 and 17-year-olds in the way we trust them in Scotland, a bigger proportion of voters would have voted to remain in the EU. Does the right hon. Gentleman truly believe that withholding the sovereign right of the Scottish people is a sustainable position? While protecting the sovereignty of the UK, is he prepared to deny the sovereignty of Scotland?

It is the case that the Scottish nationalist party—[Hon. Members: “National!”] I am sorry, but as Robert Burns said,

“facts are chiels that winna ding”.

I am afraid that the representatives on that Bench are nationalists. They put separation—the smashing up of the United Kingdom—ahead of anything else. Some of them are decent and kind people, but they are nationalists. The reason they object so much is that when the mask comes off and we recognise the ideological heart of the SNP, they dinnae like it up ’em.

It is estimated that if agreement is reached, there will be a need for about 50,000 new customs officers. Is it feasible to recruit and train that many people in less than six months, and who is going to foot the bill for it?

Does the Minister recognise that even the most far-reaching and comprehensive free trade agreement will sadly still mean regulatory and rules of origin checks down the Irish sea. As such, beyond simply giving a rhetorical commitment on the implementation of the protocol, will he assure not just the House, but his negotiating partners in the EU, that the Government are preparing to implement that protocol?

We will ensure that the protocol is appropriately implemented, and we will also ensure unfettered access for businesses in Northern Ireland to the rest of the UK market.

Brexit will be extremely damaging for Scotland in a range of ways. The difference between me and the Minister is that he is a British nationalist, whereas I am a Scottish nationalist. Does he think that Brexit imposed on Scotland will increase or decrease constitutional tensions across the UK?

Britain leaving the EU will mean that there is a greater degree of harmony between every part of the United Kingdom. I recognise that that will be a disappointment to the SNP in its restless search for grievance, dissension and division, but one thing I cannot help saying is that even though I profoundly disagree with the SNP, it is so lovely to have so many SNP Members here in the Westminster Parliament. I know that for many, many years to come, there will be representation for Scotland here in Westminster, and that is a lovely thing.