Prime Minister – Statement to Parliament 09 July 2018

Theresa May – Statement to the House of Commons on 09 July 2018

The Prime Minister (Mrs Theresa May)

I am sure the House will join me in sending our deepest condolences to the family and friends of Dawn Sturgess, who passed away last night. The police and security services are working urgently to establish the full facts, in what is now a murder investigation. I want to pay tribute to the dedication of staff at Salisbury District Hospital for their tireless work in responding to this appalling crime. Our thoughts are also with the people of Salisbury and Amesbury. My right hon. Friend the Home Secretary will make a statement shortly, including on the support we will continue to provide to the local community throughout this difficult time.

Turning to Brexit, I want to pay tribute to my right hon. Friends the Members for Haltemprice and Howden (Mr Davis) and for Uxbridge and South Ruislip (Boris Johnson) for their work over the last two years. We do not agree about the best way of delivering our shared commitment to honour the result of the referendum, but I want to recognise the former Secretary of State for Exiting the European Union for the work he did to establish a new Department and steer through Parliament some of the most important legislation for generations, and similarly to recognise the passion that the former Foreign Secretary demonstrated in promoting a global Britain to the world as we leave the European Union. I am also pleased to welcome my hon. Friend the Member for Esher and Walton (Dominic Raab) as the new Secretary of State for Exiting the European Union.

On Friday at Chequers, the Cabinet agreed a comprehensive and ambitious proposal that provides a responsible and credible basis for progressing negotiations with the EU towards a new relationship after we leave on 29 March next year. It is a proposal that will take back control of our borders, our money and our laws, but do so in a way that protects jobs, allows us to strike new trade deals through an independent trade policy and keeps our people safe and our Union together.

Before I set out the details of this proposal, I want to start by explaining why we are putting it forward. The negotiations so far have settled virtually all of the withdrawal agreement, and we have agreed an implementation period that will provide businesses and Governments with the time to prepare for our future relationship with the EU. But on the nature of that future relationship, the two models that are on offer from the EU are simply not acceptable.

First, there is what is provided for in the European Council’s guidelines from March this year. This amounts to a standard free trade agreement for Great Britain, with Northern Ireland carved off in the EU’s customs union and parts of the single market, separated through a border in the Irish sea from the UK’s own internal market. No Prime Minister of our United Kingdom could ever accept this; it would be a profound betrayal of our precious Union. And while I know some might propose instead a free trade agreement for the UK as a whole, that is not on the table, because it would not allow us to meet our commitment under the Belfast agreement that there should be no hard border between Northern Ireland and Ireland.

Secondly, there is what some people say is on offer from the EU: a model that is effectively membership of the European economic area, but going further in some places, and the whole of the UK remaining in the customs union. This would mean continued free movement, continued payment of vast sums every year to the EU for market access, a continued obligation to follow the vast bulk of EU law, and no independent trade policy, with no ability to strike our own trade deals around the world. I firmly believe this would not honour the referendum result, so if the EU continues on that course, there is a serious risk it could lead to no deal. This would most likely be a disorderly no deal, for without an agreement on our future relationship, I cannot see that this Parliament would approve the withdrawal agreement with a Northern Ireland protocol and financial commitments, and without those commitments, the EU would not sign a withdrawal agreement.

A responsible Government must prepare for a range of potential outcomes, including the possibility of no deal, and given the short period remaining before the conclusion of negotiations, the Cabinet agreed on Friday that these preparations should be stepped up. But at the same, we should recognise that such a disorderly no deal would have profound consequences for both the UK and the EU, and I believe that the UK deserves better.

The Cabinet agreed that we need to present the EU with a new model, evolving the position that I had set out in my Mansion House speech, so that we can accelerate negotiations over the summer, secure a new relationship in the autumn, pass the withdrawal and implementation Bill and leave the European Union on 29 March 2019.

The friction-free movement of goods is the only way to avoid a hard border between Northern Ireland and Ireland and between Northern Ireland and Great Britain, and it is the only way to protect the uniquely integrated supply chains and just-in-time processes on which millions of jobs and livelihoods depend. So at the heart of our proposal is a UK-EU free trade area that will avoid the need for customs and regulatory checks at the border and protect those supply chains. Achieving this requires four steps. The first is a commitment to maintaining a common rulebook for industrial goods and agricultural products. To deliver this, the UK would make an up-front sovereign choice to commit to ongoing harmonisation with EU rules on goods, covering only those necessary to provide for frictionless trade at the border. This would not cover services, because that is not necessary to ensure free flow at the border, and it would not include the common agricultural and fisheries policies, which the UK will leave when we leave the EU.

The regulations covered are relatively stable and supported by a large share of our manufacturing businesses. We would continue to play a strong role in shaping the European and international standards that underpin them, and there would be a parliamentary lock on all new rules and regulations, because when we leave the EU we will end the direct effect of EU law in the UK. All laws in the UK will be passed in Westminster, Edinburgh, Cardiff and Belfast. Our Parliament would have the sovereign ability to reject any proposals if it so chose, recognising that there would be consequences, including for market access, if we chose a different approach from the EU.

Secondly, we will ensure a fair trading environment. Under our proposal, the UK and the EU would incorporate strong reciprocal commitments relating to state aid. We would establish co-operative arrangements between regulators on competition and commit to maintaining high regulatory standards for the environment, climate change, social and employment, and consumer protection.

Thirdly, we would need a joint institutional framework to provide for the consistent interpretation and application of UK-EU agreements by both parties. This would be done in the UK by UK courts and in the EU by EU courts, with due regard paid to EU case law in areas where the UK continued to apply a common rulebook. This framework would also provide a robust and appropriate means for the resolution of disputes, including through the establishment of a joint committee of representatives from the UK and the EU. It would respect the autonomy of the UK’s and the EU’s legal orders and be based on the fundamental principle that the court of one party cannot resolve disputes between the two.

Fourthly, the Cabinet also agreed to put forward a new business-friendly customs model—a facilitated customs arrangement—that would remove the need for customs checks and controls between the UK and the EU because we would operate as if a combined customs territory. Crucially, it would also allow the UK to pursue an independent trade policy. The UK would apply the UK’s tariffs and trade policy for goods intended for the UK and the EU’s tariffs and trade policy for goods intended for the EU. Some 96% of businesses would be able to pay the correct tariff or no tariff at the UK border, so there would be no additional burdens for them compared with the status quo and they would be able to benefit from the new trade deals that we will strike. In addition, we will bring forward new technology to make our customs systems as smooth as possible for businesses that trade with the rest of the world.

Some have suggested that under this arrangement the UK would not be able to do trade deals. They are wrong. When we have left the EU, the UK will have its own independent trade policy, with its own seat at the World Trade Organisation and the ability to set tariffs for its trade with the rest of the world. We will be able to pursue trade agreements with key partners, and on Friday the Cabinet agreed that we would consider seeking accession to the comprehensive and progressive agreement for trans-Pacific partnership.

Our Brexit plan for Britain respects what we have heard from businesses about how they want to trade with the EU after we leave and will ensure we are best placed to capitalise on the industries of the future in line with our modern industrial strategy. Finally, as I have set out in this House before, our proposal includes a far-reaching security partnership that will ensure continued close co-operation with our allies across Europe while enabling us to operate an independent foreign and defence policy. So this is a plan that is not just good for British jobs but good for the safety and security of our people at home and in Europe too.

Some have asked whether this proposal is consistent with the commitments made in the Conservative manifesto. It is. The manifesto said:

“As we leave the European Union, we will no longer be members of the single market or customs union but we will seek a deep and special partnership including a comprehensive free trade and customs agreement.”

What we are proposing is challenging for the European Union. It requires the EU to think again, to look beyond the positions that it has taken so far, and to agree a new and fair balance of rights and obligations. That is the only way in which to meet our commitments to avoid a hard border between Northern Ireland and Ireland without damaging the constitutional integrity of the UK and while respecting the result of the referendum. It is a balance that reflects the links that we have established over the last 40 years as some of the world’s largest economies and security partners. It is a bold proposal, which we will set out more fully in a White Paper on Thursday. We now expect the EU to engage seriously with the detail, and to intensify negotiations over the summer so that we can get the future relationship that I firmly believe is in all our interests.

In the two years since the referendum we have had a spirited national debate, with robust views echoing around the Cabinet table, as they have around breakfast tables up and down the country. Over that time I have listened to every possible idea and every possible version of Brexit. This is the right Brexit. It means leaving the European Union on 29 March 2019; a complete end to free movement, and taking back control of our borders; an end to the jurisdiction of the Court of Justice of the European Union in the UK, restoring the supremacy of British courts; no more sending vast sums of money each year to the EU, but instead a Brexit dividend to spend on domestic priorities such as our long-term plan for the NHS; flexibility on services, in which the UK is world-leading; no hard border between Northern Ireland and Ireland, or between Northern Ireland and Great Britain; a parliamentary lock on all new rules and regulations; leaving the common agricultural policy and the common fisheries policy; the freedom to strike new trade deals around the world; an independent foreign and defence policy—but not the most distant relationship possible with our neighbours and friends; instead, a new deep and special partnership. It means frictionless trade in goods; shared commitments to high standards, so that together we continue to promote open and fair trade; and continued security co-operation to keep our people safe.

This is the Brexit that is in our national interest. It is the Brexit that will deliver on the democratic decision of the British people, and it is the right Brexit deal for Britain.

I commend this statement to the House.

Jeremy Corbyn

I thank the Prime Minister for advance copy of her statement, and share her condolences to the friends and family of Dawn Sturgess.

We are more than two years on from the referendum: two years of soundbites, indecision and Cabinet infighting, culminating in a series of wasted opportunities, with more and more people losing faith that this Government are capable of delivering a good Brexit deal – and that is just within the Prime Minister’s own Cabinet. It is two years since the referendum and 16 months since article 50 was triggered, and it was only this weekend that the members of the Cabinet managed to agree a negotiating position among themselves – and that illusion lasted 48 hours.

There are now only a few months left until the negotiations are supposed to conclude. We have a crisis in the Government; two Secretaries of State have resigned; and we are still no clearer about what our future relationship with our nearest neighbours and biggest trading partners will look like. Workers and businesses deserve better than this. It is clear that the Government are not capable of securing a deal to protect the economy, jobs and living standards. It is clear that the Government cannot secure a good deal for Britain.

On Friday the Prime Minister was so proud of her Brexit deal that she wrote to her MPs to declare that collective Cabinet responsibility “is now fully restored”, while the Environment Secretary added his own words, saying that

“one of the things about this compromise is that it unites the Cabinet.”

The Chequers compromise took two years to reach and just two days to unravel. How can anyone have faith in the Prime Minister getting a good deal with 27 European Union Governments when she cannot even broker a deal within her own Cabinet?

To be fair – I want to be fair to the former Brexit Secretary and the former Foreign Secretary – I think they would have resigned on the spot on Friday, but they were faced with a very long walk, no phone and, due to Government cuts, no bus service either. So I think they were probably wise to hang on for a couple of days so they could get a lift home in a Government car.

I also want to congratulate the hon. Member for Esher and Walton (Dominic Raab) on his appointment as the Secretary of State. He now becomes our chief negotiator on an issue that could not be more important or more urgent. But this new Secretary of State is on record as wanting to tear up people’s rights. He has said: “I don’t support the Human Rights Act…leaving the European Union would present enormous opportunities to ease the regulatory burden on employers.” And he is the one negotiating, apparently, on behalf of this Government in Europe.

This mess is all of the Prime Minister’s own making. For too long she has spent more time negotiating the divisions in her party than she has in putting any focus on the needs of our economy. The Prime Minister postured with red line after red line, and now, as reality bites, she is backsliding on every one of them. We were also given commitments that this Government would achieve “the exact same benefits” and “free and frictionless trade” with the EU. Now those red lines are fading, and the team the Prime Minister appointed to secure this deal for our country has jumped the sinking ship; far from “strong and stable”, there are Ministers overboard and the ship is listing, all at the worst possible time.

If we look at the Prime Minister’s proposals for the long delayed White Paper, we see that this is not the comprehensive plan for jobs in Britain and the economy that the people of this country deserve. These proposals stop well short of a comprehensive customs union, something trade unions and manufacturers have all been demanding; instead, they float a complex plan that had already been derided by her own Cabinet members as “bureaucratic” and “unwieldy”.

The agreement contains no plan to protect our service industry and no plan to prevent a hard border in Northern Ireland, and also puts forward the idea of “regulatory flexibility”, which we all know is code for deregulation of our economy. The Government’s proposals would lead to British workplace rights, consumer rights, food safety standards and environmental protections falling behind EU standards over time, and none of this has even been tested in negotiations.

The Chequers agreement now stands as a shattered truce, a sticking plaster over the cavernous cracks in this Government. The future of jobs and investment is now at stake, and those jobs and that investment are not a sub-plot in the Tory party’s civil war. At such a crucial time for our country in these vital negotiations, we need a Government who are capable of governing and negotiating for Britain. For the good of this country and its people, the Government need to get their act together and do it quickly, and if they cannot, make way for those who can.

The Prime Minister

The right hon. Gentleman has been in this House for quite a long time, and I know that he will have heard many statements. The normal response to a statement is to ask some questions. I do not think that there were any questions anywhere in that; nevertheless I will comment on a few of the points that the right hon. Gentleman has made. He talks about removing or lowering standards in a number of areas, including employment. As I said in my statement, we will

“commit to maintaining high regulatory standards for the environment, climate change and social and employment and consumer protection.”

He says that there is no plan in what I had said to ensure that there would be no hard border between Northern Ireland and Ireland, but in fact the very opposite is the case. The plan delivers the commitment for no hard border between Northern Ireland and Ireland. At the beginning of his response, he thanked me for giving him early sight of my statement. It is just a pity that he obviously did not bother to read it.

The right hon. Gentleman says that we are two years on. This is the right hon. Gentleman who, immediately after the referendum decision in 2016, said we should have triggered article 50 immediately with no preparation whatsoever. He talks about delivery. Well, I remind him that we delivered the joint report in December, we delivered the implementation plan in March, and now we stand ready to deliver on Brexit for the British people with the negotiations that we are about to enter ?into. He talks about resignations, but I remind him that he has had, I think, 103 resignations from his Front Bench, so I will take no lectures from him on that.

When it comes to delivering a strong economy and jobs for the future, the one party that would never deliver a strong economy is the Labour party, whose economic policies would lead to a run on the pound, capital flight and the loss of jobs for working people up and down this country.

Further debate continues from