Where we are now
In the Birmingham Mail in December, I set out my thoughts on the issues facing the country. I tried to address the real possibility that if Parliament remained unable to agree a way forward – there may be little alternative but to put the choices facing the UK back to the people for a final decision. So what has happened since then? The Brexit deal that Theresa May recommended was, of course, rejected by Parliament earlier this month by 432 votes to 202 – the biggest defeat in history for a sitting Prime Minister. It was a deal that was neither acceptable to the majority of MPs who had backed Brexit in the referendum nor to those who had voted to Remain at that time.
This week, Parliament again debated the issue. Two proposals were passed. The first was a decision in principle to rule out leaving the EU without any kind of deal – which you may have seen referred to in the press as the ‘Spelman-Dromey Amendment’. The second decision was to ask Theresa May to try to persuade the EU to agree alternative arrangements to the Northern Ireland backstop that is a key part of the Brexit deal she had urged Parliament to accept just a fortnight before (called the ‘Brady Amendment’). In a somersault from what she had said before, however, Theresa May backed the proposal to try to reopen negotiations on the backstop. Unfortunately, she has been far from clear about what alternative arrangements she now thinks could replace the backstop and initial responses from the EU have indicated no appetite from that direction to reopen negotiations on things they have already agreed with the UK Government.
How did things get to this stage?
Of course, two and a half years on from the referendum, it is ridiculous that there is still such uncertainty over Brexit. My own view is that the way Theresa May has handled the issue from the start bears a great deal of responsibility for where we have ended up. For most of the past two years she has failed to reach beyond her own inner circle when deciding her approach to negotiations with the EU. Indeed, Parliament even had to fight to get her to concede that MPs should be given a meaningful vote on the outcome of negotiations. If we hadn’t, she would have just had free rein to force on the country whatever deal she wanted. By declaring at the start a series “red lines” around issues which she refused to even talk about, moreover, the Prime Minister made a successful outcome to negotiations with the EU even more unlikely.
Looking back, the Prime Minister also took the wrong course in early 2017 when she decided to trigger Article 50 before her Government had even agreed what kind of Brexit deal they wanted, thereby setting a two-year clock ticking to Brexit day on 29th March this year. It made little sense to set a deadline for negotiations to be concluded before talks had even started. I thought she had got the order of doing things wrong at the time she asked Parliament to agree to trigger Article 50 back in early 2017. Despite my reservations, though, I still voted to trigger Article 50 when the Prime Minister put her proposal to us. Along with the majority of other MPs, I did so to respect the referendum result. I take responsibility for my decision, but looking back Parliament probably should have told the Prime Minister to approach things differently back then.
Had things been done differently and without Theresa May’s “red lines”, could the future be clearer and the country less divided than we are now? We will never know for certain but I believe so.
Alternatives to Theresa May’s “Red Lines”
We are, however, where we are. Despite her record, the Prime Minister is now at least claiming that she wants to listen to a wider range of opinions on the way forward than she has done so far. For Labour, that means urging her to change course in three key areas. The first is to drop two of her “red lines” which have ruled out maintaining a customs union with the EU and a close relationship with its Single Market after Brexit.
The name “customs union” is often misunderstood. In essence it means an arrangement through which states agree to tariff-free trade with each other and to collectively agree the trade deals they have with countries outside the customs union. You do not have to be in the EU to be in a European customs union but it has come automatically with our membership of the EU until now. That customs union membership currently gives us access to preferential trade deals with around 50 other countries around the world. Companies throughout the UK have also emphasized how important Britain’s customs union membership has been to their competitiveness and to jobs in the UK in recent decades. Labour’s policy – which I support – is that Britain should remain in a customs union with the EU after Brexit.
As a member of the EU, Britain is also part of the European Single Market, allowing firms across the EU to know that the rules on which they trade with each other are the same for all of them. In the motor industry for example, that means that the standards to which cars are built in the UK are also certified as safe for sale in the EU and vice versa. Once again, countries do not have to be part of the EU to be part of the Single Market. Norway, for example has access to the Single Market but it is not a member of the EU. It is true that countries that are not part of the EU have less say in the rules of the Single Market than EU member states themselves – including in relation to rules governing the ability of people to move between different member states to work. This can raise complex and difficult issues, particularly as arguments over migration between EU states featured so prominently during the referendum. Even here, though, proposals have been made that could at least be considered as a way forward, including a cross-party initiative called Common Market 2.0.
The point about all this is that we should not allow Theresa May’s “red lines” to stop us even talking about these things with the EU and at least trying to find a way forward in the interests of the UK. Remember too, that if we were able to agree a customs union arrangement with the EU and a strong relationship to the Single Market after Brexit, there would be no need at all for any change to the current frictionless border between Northern Ireland and the Republic. At a stroke, that would remove any need for the “backstop” in the Withdrawal Agreement which the Prime Minister agreed with the EU and which has provoked so much argument ever since.
Protecting the environment and rights at work
The second area in which Labour is calling for the Government to change is to ensure that any Brexit deal does not allow the watering down of workers’ rights, and that it protects the environmental standards that we currently have as part of the EU.
Having originally failed to even acknowledge these as legitimate concerns, the Government now claim they will listen to what Labour MPs have been saying on workers’ rights and protection of the environment. However, Ministers still need to demonstrate that they will follow though these promises by practical action.
No to No Deal
For any of the above suggestions, or indeed any other proposals to be possible, however, the UK must not be allowed to crash out of the EU by accident without a deal of any kind, simply because the clock that Theresa May set ticking when Article 50 was triggered runs out on 29th March. This is the third area in which Labour is urging the Government to change course. It is also the most immediate priority.
Until recently, very few people seriously talked about a No Deal Brexit. Indeed, as the commentator Daniel Finkelstein noted in the Times this week, during the Referendum even the Leave campaign cautioned against talk of a no deal Brexit:
“Take the document called Our Case which Leave campaigners were encouraged to download and distribute to voters, and which is still available on their campaign website.” says Finkelstein, “Here it says, as plain as anything: “Taking back control is a careful change, not a sudden stop — we will negotiate the terms of a new deal before we start any legal process to leave”
It is not surprising that the Leave campaign took this view in 2016, even if some hardline Brexiteers can be heard arguing the opposite today. The fact is that, as each day passes, there are more and more warnings of the damage that would be done to the UK if Britain leaves the EU without a deal.
As Chair of Parliament’s All Party Motor Group I work closely with the automotive industry and the message from them has been clear. The uncertainty over Brexit and the looming prospect of no deal are now really starting to bite and key investment decisions are being jeopardized.
The industry needs to be placing orders now for parts which will be shipped in and out of the UK in April. The days of stocks of parts being stored in large warehouses are long gone and the industry relies on “just in time” deliveries to keep production lines going. As things stand, though, they don’t know what tariffs will add to the cost of those orders or whether deliveries will be held up in queues at the ports in the event of Brexit taking place without a deal on 29th March. Millions could be added to costs and production lines could be stopped – with employees being put onto short time working or worse.
In the medium term it could be even worse. Automotive companies make investment decisions about where and how they will produce new models years in advance and Britain’s Brexit uncertainty is already leading a number of firms to question whether they should move more of their operations overseas. Jaguar Land Rover is a company which has already invested millions in the Midlands economy and it retains a forward programme that promises to bring in millions more in the development of new generations of electric, connected and autonomous vehicles. Even JLR, however, has announced that it is cutting 4,500 jobs. Brexit is not the only cause of the challenges now facing JLR and other automotive manufacturers. A downturn in the Chinese market and a dramatic drop in sales of new diesels are also key factors. But Brexit uncertainties are part of the picture too and they must be addressed. These issues were in the forefront of my mind when I spoke in the Commons a fortnight ago about the importance to the motor industry of ruling out a no deal Brexit.
The consequences of a No Deal Brexit would, of course, be felt far beyond the motor industry. Supermarkets have warned that delays and customs bureaucracy will also hit food imports, driving up the price of the weekly shop for people already struggling to make ends meet. In the Heath Service too, millions of pounds that should be going to patient care is being spent buying up thousands of fridges to stockpile medicines that could end up running short because of border delays. Even with those precautions, the Chief Executive of Birmingham’s University Hospitals Trust, has warned that a no deal Brexit could lead to non-urgent operations being cancelled.
For all these reasons and more, MPs voted on Tuesday to rule out a No Deal Brexit. Although clear in its purpose, this decision is technically not binding on the Government. As Theresa May has pointedly refused to rule out No Deal until now therefore, I also voted for additional amendments that would have given Parliament’s decision more teeth (sometimes referred to in the media as the ‘Cooper’, ‘Grieve’ and ‘Reeves’ amendments). Unfortunately, those stronger amendments did not secure a majority in Parliament. Even so, the decision in principle to rule out No Deal remains on the record. It is something on which the will of Parliament is clear and – in the interests of democracy – it is a decision the Prime Minister should respect.
What happens over Brexit will affect the UK for years to come. Over the coming weeks, the challenge for MPs of all parties remains one of finding a way forward that can command majority support. If Parliament remains unable to agree, other options will have to be explored to enable decisions to be reached and putting the issue back to the people for a final say has to be one of the options to be considered in those circumstances.
Things should not have gone on as long as they have but, as I said earlier, we are where we are. The priority for now must be to rule out No Deal and, if we need a bit more time to reach the decisions on such vital issues for our country, so be it. It is more important to find solutions that bring our divided country together and get things right than to stick rigidly to arbitrary deadlines set nearly two years ago.
I apologise for the length of this update but I hope it gives you a sense of how I see things.
