Category: Brexit

  • Michael Gove – 2020 Statement on End of EU Transition Period

    Michael Gove – 2020 Statement on End of EU Transition Period

    The text of the statement made by Michael Gove, the Chancellor of the Duchy of Lancaster, in the House of Commons on 13 July 2020.

    With permission, Mr Speaker, I would like to make a statement on our preparations for the end of the transition period.

    Before I do, may I place on record my thanks—and, I am sure, those of the whole House—for the 20 years of service that Dave Prentis, the general secretary of Unison, has given? Mr Prentis announced today that he will be standing down at the end of this year. He has been an exemplary trade union leader. We have all been reminded during the covid pandemic of how much we depend on the public sector workers he speaks up for. I would like to extend my best wishes to him on his retirement.

    On 31 January this year, the United Kingdom left the European Union, and last month we confirmed to our European Union partners that there would be no extension of the transition period beyond 31 December. My counterpart as co-chair of the Joint Committee confirmed that this marked “a definite conclusion” to the matter, and the deadline for extension has now passed. As a consequence, from 1 January 2021 we will embark on the next chapter in our history as a fully independent United Kingdom. With control of our economy, we can continue to put in place the right measures for covid recovery. With control over the money that we send to Brussels, we can spend it on our priorities—investing in the NHS, spreading opportunity more equally across the UK, and strengthening our Union. We are also able to build a trading relationship with our neighbours in Europe that serves all our interests, while also developing new economic partnerships across the world, including opportunities for new and better trade deals with the US, Japan, New Zealand, Australia and many other nations.

    The deal the Prime Minister struck last year, which the country backed in the general election, means that we can look forward with confidence to the end of the transition period on 31 December, but of course there is still work to do to prepare. Regardless of the outcome of negotiations with the EU over our future relationship, whether or not we have a Canada-style deal or an Australian model, we will be leaving the single market and the customs union. This will herald changes, and significant opportunities, for which we all need to prepare—Government, business and individual citizens.

    So I am announcing today two significant new initiatives that will bring financial support, further clarity, and reassurance for business and citizens. We are launching a major new public information campaign to make sure that everyone has the facts they need about the actions that we all need to take in order to be ready. We are also releasing for the first time an operating model for the border that will benefit importers and exporters, and provide information to hauliers, shippers, freight companies and our customs intermediaries. This comprehensive guidance covers every processing system used across all Government Departments and has been developed after extensive consultation with industry partners, operators and, of course, the devolved Administrations. Together with the additional £705 million package of funding for border infrastructure, extra jobs and better technology, this will help to ensure that our new borders will be ready when the UK takes back control on January. It will assist the smooth movement of goods, and it will also help us to lay the foundations for the world’s most effective border by 2025, making our country more secure and our citizens safer.

    Turning to the detail of these initiatives, the public information campaign—“The UK’s new start: let’s get going”—will run in the four home nations and internationally, encouraging us all to play our part in preparing for change. The campaign will be supplemented by the deployment of experts in the field, giving one-to-one support to businesses and their supply chains to ensure that they have made arrangements that will help to keep their operations running efficiently.

    From January 2021, in order to fulfil the import process, traders will need to have a GB economic operators registration and identification, or EORI, number before moving their goods. They will need to have the commodity codes of their goods, which will be needed to make a customs declaration and, of course, to calculate duties on an import. They will need to know the customs values of their goods, the rules of which are based on the World Trade Organisation valuation agreement. They will also need to have considered whether they are able to use, and would benefit from using, any of the available simplifications or facilitations, including deferring customs declarations for standard goods. Traders who choose not to defer their customs declarations will also need to ensure that they have considered how they will make those declarations to Her Majesty’s Revenue and Customs systems, and, of course, whether or not they will use an intermediary. From January 2021, traders who are exporting goods to the EU will need to make export declarations and ensure that they have the right certificates and licences required for entry. While there is still work to do, substantial progress has been made to ensure that we all fulfil our promise to the British people and take back control.

    The freedom to control our own borders brings many benefits. Our plans mean that we can introduce a migration policy that ensures that we are open to the world’s best talent, and my right hon. Friend the Home Secretary has set out further details of that today. A new, points-based immigration system will ensure that we can attract the scientists, innovators and entrepreneurs who can power future economic growth. It will also help us to ensure that our NHS attracts the very best professionals from around the world to our hospitals. The new technology that we are introducing will allow us to monitor with far greater precision exactly who and what is coming into and out of our country, enabling us to deal more effectively with organised crime and other threats.

    Control of our borders also means that we can choose the right trade and commercial policies for this country. The border operating model that we have published today provides clarity about the end-to-end journey of goods on the move between Great Britain and the EU, including information about controlled goods and the new Government systems that will support future trade. I place on record the Government’s gratitude to the border sector for the practical knowledge, enthusiasm and expertise it has brought to the development of the operating model, which is the result of extensive consultation and collaboration.

    It is important to note that, as the document makes clear, the border operating model does not cover matters relating specifically to the Northern Ireland protocol. I reassure the House that guidance specific to Northern Ireland will be published in the coming weeks and on an ongoing basis throughout the transition period.

    With autonomy comes the freedom to be practical and pragmatic in implementation, which is why, in the light of coronavirus and to give business and industry more time to adjust, we announced last month that border controls would be introduced in three stages up to 1 July 2021. In the first phase, from January 2021, traders importing standard goods will need to prepare for basic customs requirements. Full customs declarations will be needed for controlled and excise goods—such as alcohol and tobacco products—but people importing standard goods will have up to six months to make their declaration and to pay tariffs. Traders moving goods using the common transit convention will need to follow all the transit procedures.

    In the second phase, from April 2021, we will require all products of animal origin, regulated plants and plant products to have pre-notification and the relevant health documentation. Any physical checks will continue to be conducted at the point of destination.

    In the third and final phase, from July 2021, traders moving all goods will have to make full customs declarations at the point of importation and, of course, pay relevant tariffs. Checks for animals, plants and their products will take place at border control posts in Great Britain.

    When we announced our approach to controls last month, we also confirmed that we would be building new border facilities in Great Britain to carry out the required checks, as well as providing targeted support to ports to build new infrastructure. The £705 million funding injection that we announced yesterday is on top of an already announced £84 million grant to ensure sufficient capacity in the customs intermediary sector. That money will be used to do just that: to prepare our border infrastructure for all the changes by improving and developing IT systems, recruiting more personnel and building new border posts.

    The actions that we are taking today are an important step towards readiness for the new opportunities that Brexit can bring. It is time for our new start—time for us to embrace a new global destiny—and therefore I commend the statement to the House.

  • Michael Gove – 2020 Comments on £705 Million Cost of Securing UK/EU Border

    Michael Gove – 2020 Comments on £705 Million Cost of Securing UK/EU Border

    The comments made by Michael Gove, the Chancellor of the Duchy of Lancaster, on 12 July 2020.

    We are taking back control of our borders, and leaving the single market and the customs union at the end of this year bringing both changes and significant opportunities for which we all need to prepare. That is why we are announcing this major package of investment today.

    With or without further agreement with the EU, this £705 million will ensure that the necessary infrastructure, tech and border personnel are in place so that our traders and the border industry are able to manage the changes and seize the opportunities as we lay the foundations for the world’s most effective and secure border.

  • Michael Gove – 2020 Article on the UK’s Future Outside of the EU

    Michael Gove – 2020 Article on the UK’s Future Outside of the EU

    The text of the article written by Michael Gove, the Chancellor of the Duchy of Lancaster and Minister for the Cabinet Office, on 12 July 2020.

    Leaving the European Union is, I’ve often argued, a bit like moving house. Instead of being lodgers under someone else’s roof we are choosing a new place in the world where we’re in control. Four years after we made the decision to leave the EU, the reasons for moving are stronger than ever. Taking back control of our economy means we can put in place the right measures for our Covid recovery.

    Taking back control of the money we send to Brussels means we can spend it on our priorities: investing in the NHS, spreading opportunity more equally across the UK and strengthening our Union. We can build a trading relationship with our European neighbours that serves all our interests and develop new economic partnerships across the world.

    The deal the Prime Minister struck last year, and which the country backed in the general election, ensured we left the EU in January and means we can look forward with confidence to the end of the transition period on December 31. But, just like a house move, we need to make sure all the practical arrangements for our new future are in place.

    Everyone has their part to play, starting with the government.

    That’s why on Sunday we’re investing £705 million to make sure our borders are ready for full independence. We’re investing in new infrastructure, more jobs and better technology to help goods move smoothly, make our country more secure and our citizens safer. The money will ensure that Great Britain’s new borders will be ready when the UK takes back control on January 1 2021, and will also lay the foundations for us to build the world’s most effective border by 2025.

    Modernising our border means we can introduce a migration policy that ensures we’re open to the world’s best talent. A new points-based immigration system will ensure we can attract the scientists, innovators and entrepreneurs who can power future economic growth. It will also help us ensure our NHS has the very best professionals from across the world working in our hospitals. And the new technology we’re introducing will allow us to monitor with far greater precision exactly who, and what, is coming in and out of the country, enabling us to deal more effectively with organised crime and other security threats.

    Alongside the investment we are making in infrastructure we’re also launching a major new public information campaign, “The UK’s new start: let’s get going” to give everyone the facts we need to be ready for January 1 2021. Whether you’re the managing director of a multinational conglomerate or a family business; a UK citizen resident in the EU or planning to work abroad, the new campaign will clearly set out the steps that will help this big change go as smoothly as possible.

    A straightforward checker tool at gov.uk/transition will quickly identify the specific steps any business or individual needs to take to be ready, and will allow companies and citizens to sign up for bespoke updates. Taking these steps will equip everyone for this new chapter in our country’s story.

    Helping businesses adjust to life outside the EU Customs Union will enable them to more easily access the new opportunities being an independent trading nation will bring, such as those presented by trade deals with the Japan, Australia, New Zealand and other growing Pacific economies as well as deeper ties with North America and the developing world.

    We’re negotiating hard, of course, to get the best possible trading relationship with our neighbours in the EU but we won’t back down on the essential principles the country voted for when we chose to leave. We won’t accept control of our laws by the EU or allow our new-found independence to be compromised. Whatever the nature of our trading relationship with the EU we’ll be outside the single market and the customs union – and that means the preparations for new export arrangements and new border processes will be needed whatever the negotiations bring.

    These have been challenging times for our country, but, as the Chancellor reminded us this week, government can help lay the foundations for recovery and future growth. That’s what we’re doing this week as we prepare for our new life fully outside the EU. We’re building the border that allows us to take back control. Let’s get going.

  • Rachel Reeves – 2020 Comments on Leaked Liz Truss Letter

    Rachel Reeves – 2020 Comments on Leaked Liz Truss Letter

    Below is the text of the comments made by Rachel Reeves, the Shadow Chancellor of the Duchy of Lancaster and Shadow Cabinet Office Minister, on 11 July 2020.

    This leaked letter lifts the lid on a growing sense of chaos and confusion between Cabinet Ministers at the Government’s complacent approach to vital preparations ahead of 31 December.

    There is growing alarm from the business communities in Northern Ireland and increasingly in Britain that Ministers aren’t being entirely open about the state of preparations.

    These issues will affect countless businesses and jobs and are simply far too important to be left to written correspondence like this. This extraordinary letter deserves answers, not just given to the House of Commons, but to the industries and people who stand to be affected if the Government gets this badly wrong.

  • Michael Gove – 2020 Statement on UK-EU Future Relationship Negotiations

    Michael Gove – 2020 Statement on UK-EU Future Relationship Negotiations

    Below is the text of the statement made by Michael Gove, the Chancellor of the Duchy of Lancaster, in the House of Commons on 7 July 2020.

    The Government have made a commitment to update Parliament on the progress of our future relationship negotiations with the EU. This statement provides an update on the intensified talks process as agreed at the high level meeting between the Prime Minister and the three presidents on the EU side on 15 June. The timetable for this process was published on 12 June as an addendum to the terms of reference on the UK-EU future relationship negotiations.

    Intensified talks took place in Brussels between 29 June and 2 July in a restricted format and led by the UK chief negotiator David Frost. The talks covered: trade in goods; trade in services and investment and other issues; fisheries; horizontal arrangements and governance; level playing field for open and fair competition; criminal law and judicial co-operation; mobility, social security, thematic co-operation; energy and transport; and participation in Union programmes.

    These talks were comprehensive and useful. However, they have underlined the significant differences that still remain between us on a number of important issues. Further discussions will take place later this week in London. The UK remains committed to working hard to find an early understanding on the principles underlying an agreement out of the intensified talks process during July, as agreed at the high level meeting on 15 June.

  • Pat McFadden – 2020 Speech on Financial Markets after Exiting the European Union

    Pat McFadden – 2020 Speech on Financial Markets after Exiting the European Union

    Below is the text of the speech made by Pat McFadden, the Labour MP for Wolverhampton South East, in the House of Commons on 16 June 2020.

    Like many who have spoken in the Chamber today, on the fourth anniversary of her death, my thoughts are very much with our former colleague Jo Cox and her family.

    As we heard from the Minister’s opening statement, these statutory instruments are quite technical in nature. I would like to thank him for his welcome, and to thank him and his officials for providing some briefing on their meaning and effect. Overall, these instruments seek to replicate at national level the regulatory regime for financial services to which we currently subscribe—and which in many cases the UK designed—at EU level. Until the end of the transition period, we will of course continue to follow the EU’s regulatory rulebook. This is about what will happen in January if, as the Government confirmed last week, the end of this year marks the end of the transition period.​

    As the Minister outlined, the regulations cover areas such as money laundering, supervision, central counterparties, the cross-border distribution of funds and the desire to maintain the pre-Brexit relationship between the UK and Gibraltar on financial services. In most of these cases, they are taking the supervision of the rules governing these areas from EU bodies and transferring them to either the Treasury, the Bank of England or the Financial Conduct Authority.

    On the detail, I have a few questions I would like to put to the Minister. On the money laundering provisions, why is the current duty to co-operate with supervisors in other countries being removed and replaced with the weaker power to co-operate if we so choose? In what circumstances would we not want to co-operate to tackle money laundering, which can fund everything from international terrorism to the drugs trade? On cross-border distribution of funds, can the Minister confirm that these statutory instruments enshrine the loss of passporting rights for our financial services that will result from the Government’s decision to withdraw from the single market as well as from the EU itself? On equivalence determinations, can he confirm that, although these SIs create a regime for the UK to make decisions on the regulatory regime in other countries, as yet we have no guarantee that our own regulatory regime will be regarded as equivalent by the rest of the EU?

    We can only hope that this exercise in taking back control is a little more convincing than last week’s decision on border checks from the Cabinet Office. After having four years to prepare, the Government dropped their plans for border checks on goods because we simply could not implement them, even though our own goods will be subject to border checks when we export them overseas.

    Paragraph 36 of the political declaration, on which the current negotiation is based, states that the UK should have concluded its equivalence assessments by the end of this month. If we are only now legislating to take the powers to do that, can that exercise possibly be completed in just two weeks’ time?

    Taken together, these changes and others in similar statutory instruments represent a significant increase in the functions and power of the Treasury, the Bank of England and the Financial Conduct Authority. What accountability arrangements will there be for those bodies in the exercise of their new powers? Alongside the transfer of functions, accountability must surely be enhanced if claims of restoring parliamentary sovereignty are to mean anything in reality.

    More broadly, there is an obvious contradiction at the heart of all this. These regulations are intended to ensure continuity for UK financial services at the end of the transition period, yet the Government’s stated intention for withdrawal is to erect new trade barriers between our financial services and the rest of the EU, so even as we replicate at UK level the EU regulations that we played such a big part in designing, we are pursuing a course that will be incapable of replicating the market access that we have at the moment.

    That is not my judgment; it is the stated aim of Government policy. It is the equivalent of one of the shops reopening this week and putting lots of new stock in its window but telling a substantial proportion of its ​previous customers that they are no longer welcome to shop in the store. For all the debate there has been about Brexit, its impact on services has not been debated nearly as much as it should have been.

    We are not dealing here with just-in-time supply chains and trucks on ferries; we are dealing with regulations and rules. We are taking the area that makes up 80% of our economy and, in the case of financial services, a sector in which we trade at a substantial surplus with other countries, and inserting new barriers between us and our nearest customers. The fact that the sector is resigned to that and has established alternative bases in Dublin, Luxembourg or wherever does not change the reality of it.

    We do not intend to divide the House on these measures, because regulatory continuity is better than not having a regime in place at all, but no amount of duplication can avoid the basic fact that although we can replicate the rules, we cannot replicate the market access to which these rules apply at the moment and for which they were designed in the first place.

  • John Glen – 2020 Statement on Financial Markets after Exiting the European Union

    John Glen – 2020 Statement on Financial Markets after Exiting the European Union

    Below is the text of the statement made by John Glen, the Economic Secretary to the Treasury, in the House of Commons on 16 June 2020.

    I welcome my opposite number, the right hon. Member for Wolverhampton South East (Mr McFadden), to his place. He has a distinguished history of public service and I look forward to a constructive dialogue with him today and on future occasions.

    As the House will be aware, the Treasury has been undertaking a significant programme of financial services legislation since 2018, introducing almost 60 statutory instruments under the European Union (Withdrawal) Act 2018. It has been an enormous privilege for me to do the vast majority of those measures. These SIs were made prior to exit day—31 January 2020—and covered all essential legislative changes needed to ensure a coherent and functioning financial services regime at the point of exit, had the UK not entered a transition period.

    The European Union (Withdrawal Agreement) Act 2020 received Royal Assent in January this year. The 2020 Act contains a general rule that delays those parts of the SIs that would have come into force immediately before, on or after exit day, so that they instead come into force by reference to the end of the transition period, which we leave at the end of this year. Over the course of this year the Treasury will therefore, where necessary, continue to use powers under the European Union (Withdrawal) Act 2018, as amended by the 2020 Act, to prepare for 1 January 2021. This will involve the Treasury bringing forward a small number of SIs that, in particular, will ensure that recently applicable EU legislation will operate effectively in the UK at the end of the transition period. The SIs before the House today are two such instruments. The approach taken in these SIs is aligned with the general approach established by the EU (Withdrawal) Act 2018, providing continuity by retaining existing legislation at the end of the transition period but amending where necessary to ensure effectiveness in the UK-only context.

    I turn to the draft Over the Counter Derivatives, Central Counterparties and Trade Repositories (Amendment, etc., and Transitional Provision) (EU Exit) Regulations 2020. From now on, I will refer to this instrument as the OTC SI. In preparation for the UK’s withdrawal from the EU on 31 January 2020, Parliament approved several ​EU exit instruments to ensure that the European market infrastructure regulation would continue to operate effectively in the UK at the point of exit. EMIR was updated on 1 January this year by a regulation known as EMIR 2.2, which now applies in the UK. The OTC SI that we are discussing today address deficiencies in the UK’s post-transition framework arising as a result of that update.

    EMIR is Europe’s response to the G20 Pittsburgh commitment in 2009 to regulate over-the-counter derivative markets in the aftermath of the last financial crisis. EMIR mandates the use of central counterparties, known as CCPs, to manage risk between users of derivative products. EMIR has been effective in increasing the safety and transparency of derivative markets, thereby reducing the associated risks that users may face, and UK CCPs play an essential role in reducing systemic risk and ensuring the efficient functioning of global financial markets.

    EMIR 2.2 introduced an updated third country or non-EU CCP supervision framework, including an updated recognition regime. This means that EU authorities can have greater oversight over third country CCPs that are systemically important to the EU. Perhaps the most substantial update in EMIR 2.2 is the ability for the European Securities and Markets Authority to tier third country CCPs according to their systemic importance to the EU as part of the recognition process. ESMA will now take on certain supervisory responsibilities for systemic third country CCPs known as tier 2 CCPs.

    This OTC SI updates the UK’s recognition framework in line with EMIR 2.2 by transferring ESMA’s new powers to the Bank of England after we leave the transition period. That includes the ability to tier non-UK CCPs as part of the recognition process, and to supervise non-UK CCPs that are systemically important to the UK. The Bank of England has already been given the power to recognise non-UK CCPs wishing to operate in the UK in an earlier SI under the EU (Withdrawal) Act. EMIR 2.2 also empowers the Commission to adopt delegated Acts setting out the details of how the framework will function in practice. This includes how tiering and deference to the rules of home authorities referred to as “comparable compliance” will function. This instrument transfers the power to establish these frameworks to the Bank of England.

    Since the Bank already has responsibility for safeguarding financial stability in general, and managing systemic risk in CCPs in particular, this is an appropriate conferral of functions as it allows the Bank to manage the systemic risk posed by some non-UK CCPs in a way that is appropriate for the UK. The statutory instrument therefore transfers the remaining Commission functions—including the power to deploy the so-called location policy—to Her Majesty’s Treasury.

    Under EMIR 2.2, ESMA can recommend to the Commission that a third-country CCP that is felt to be substantially systemically important should lose permission to offer some services to EU clearing members, unless those services are offered from inside the EU. This is referred to as the location policy, the inclusion of which in EMIR 2.2 the UK did not support because of concerns that it could lead to market fragmentation and reduce the benefits provided by the global nature of clearing. However, the powers in the European Union (Withdrawal) Act 2018 under which we introduced the SI extend only ​to the addressing of deficiencies arising from withdrawal. During the passage of that legislation, commitments were made that the powers would not be used to make significant policy changes, so I am not going to deviate from that.

    The OTC SI transfers the powers to use the location policy to the Treasury, subject to advice from the Bank of England and appropriate procedural safeguards and transitional provisions. I assure the House that because of the very different nature of the UK’s clearing markets, it is hard to foresee circumstances in which the Bank would appropriate the use of that tool in practice. EMIR 2.2 also makes changes to internally used supervisory and co-operation mechanisms but, as the UK is no longer part of the EU, those provisions are removed by the SI.

    Finally, the OTC SI updates the recognition powers set out in the temporary recognition regime, which was established by a previous SI to enable non-UK CCPs to continue their activities in the UK after exit day, while their recognition applications are assessed. This SI updates the recognition requirements in line with the new EMIR 2.2 provisions. The Treasury has worked closely with the Bank of England to prepare the instrument and has also engaged with the financial services industry, as we have done throughout. The draft legislation has been publicly available on the legislation.gov.uk website since 24 February, and the instrument was laid before Parliament on 25 March.

    In summary, the OTC SI is necessary to ensure that existing EMIR legislation will continue to function effectively in the UK from the end of the transition period, following the updates made in EMIR 2.2. In particular, it will ensure that the UK has the tools necessary to manage the financial stability risks posed by some of the largest non-UK CCPs.

    Let me turn my attention towards the second of tonight’s SIs, the Financial Services (Miscellaneous Amendments) (EU Exit) Regulations 2020. Although this SI makes amendments to approximately 20 pieces of legislation, the number and nature of the amendments are modest and minor. They act to preserve the effect of recent changes to EU legislation in the UK, and in doing so limit any impact on business that would otherwise arise at the end of the transition period.

    Primarily, this SI fixes deficiencies in recently applicable EU legislation, which is congruous with the Treasury’s approach to previous financial services EU exit instruments and the approach required by the European Union (Withdrawal) Act 2018. It also revokes pieces of retained EU law and UK domestic law that it would not be appropriate to keep on the statute book at the end of the transition period.

    This SI contains a small number of minor clarifications and corrections to previous financial services EU exit instruments. The House will be aware of the unprecedented scale of the legislative programme that the Treasury has undertaken, which has been carried out with rigorous checking procedures. However, errors are unfortunately made on occasion, and when they arise it is important that they are corrected as soon as possible. This has happened previously, and I will continue to be completely transparent when such shortcomings become apparent.​

    I note that this SI also includes provisions initially included in the Cross-Border Distribution of Funds, Proxy Advisors, Prospectus and Gibraltar (Amendment) (EU Exit) Regulations 2019, which were laid using the made affirmative procedure in October 2019, when at the time it was necessary to ensure that the SI was in place prior to the previous exit date of 31 October. That SI subsequently ceased to have effect, but it is important that those provisions, which include amendments to the UK’s prospectus regime to ensure it remains operational in a wholly domestic context, are in force before the end of the transition period. Those provisions have therefore been included in this IS.

    I would like to say a few words on the amendments that this SI makes to a previous EU exit instrument, the Equivalence Determinations for Financial Services and Miscellaneous Provisions (Amendment etc) (EU Exit) Regulations 2019, which I shall now refer to as the equivalence SI. The equivalence SI allows the Treasury to make equivalence directions for EEA states during the transition period for specified provisions. Today’s SI adds additional equivalence regimes to the scope of the power for the Treasury to make equivalence directions for EEA states during the transition period. This is through the inclusion of provisions relating to central securities depositories, which are entities that hold financial instruments and trade repositories that collect and maintain records of derivative trades.

    This SI also amends the existing drafting on the length of the direction power to tie it to the end of the transition period. This will enable Ministers to make directions during the transition period to come into force at the end of the transition period, granting equivalence to the EEA for those regimes. Finally, this SI clarifies that the Treasury can impose limitations on the application of state-level equivalence decisions in granting equivalence to the EEA—for example, in response to EU conditions placed on the UK. As with the OTC SI, the Treasury has been working closely with the financial services regulators in the drafting of this instrument and has engaged with the financial services industry.

    In conclusion, the Government believe that these instruments are necessary to ensure that the UK has a coherent and functioning financial services regulatory regime at the end of this year when we leave the transition period, and I hope that the House will join me in supporting them. I commend the regulations the House.

  • Rachel Reeves – 2020 Speech on the UK-EU Negotiations

    Rachel Reeves – 2020 Speech on the UK-EU Negotiations

    Below is the text of the speech made by Rachel Reeves, the Labour MP for Leeds West, in the House of Commons on 16 June 2020.

    Four years ago today, I was at Leeds General Infirmary with Jo Cox’s parents and her sister. I will never forget that day and all that we lost. Today we remember Jo and remind ourselves of her values and all that she stood for.

    I thank the Minister for an advance copy of his statement today. Following the meeting on Friday, both the UK and the EU confirmed that there is not going to ​be an extension of negotiations beyond the end of this year, which puts the focus firmly on both sides to secure the deal that they describe in the political declaration. The right hon. Gentleman knows full well what a calamity leaving only on World Trade Organisation terms would be for our country. Last year, the Minister told the Oxford farming conference that small farms would be hardest hit by the barriers and tariffs of trading on WTO terms. That is on top of what many farmers fear from a lack of safeguards from cheap imports with lower environmental and animal welfare standards.

    This is not an isolated incident of uncertainty. In the automotive industry, Nissan says:

    “We’ve modelled every possible ramification of Brexit and the fact remains that our entire business…is not sustainable in the event of WTO tariffs”.

    Similar warnings have been issued by Vauxhall’s owners about their future presence in Ellesmere Port. The Minister has made clear in the past why it is important to secure a deal, so will he explain again today why a deal is better than leaving on WTO terms?

    The Prime Minister has staked his own authority on having an “oven-ready” deal, but in his statement the Minister said that we wanted to intensify talks in July and find, if possible, an early understanding of principles underlying any agreement. That does not sound like an oven-ready deal to me, and is a cause of great concern for all of us. The ingredients of such a deal were published, and the country expects them to be delivered.

    The Minister has referred today to his manifesto pledges to end the transition period at the end of this year, so may I remind him of some other pledges in that manifesto? First,

    “no tariffs, fees, charges or quantitative restrictions”

    across all sectors. Will the Government give UK industries and workforces peace of mind and prevent their business models from rupturing in the coming months? Late on Thursday, the Government published a written statement indicating a U-turn on border controls, perhaps recognising that they simply have not done enough to prepare for new rules that they wanted to introduce. That does nothing, however, to help British businesses that export to the UK. The Minister said in his statement that the Government would manage the commitments required, but he cannot make that pledge unilaterally. How will the Government help exporters, who will face those rules from day one?

    Secondly, the Conservative manifesto told voters that the Brexit deal would safeguard workers’ rights, consumer and environmental protections. Does the Minister agree that it is essential that the UK defends those standards in all trade negotiations with other countries? People want to see the UK win a race to the top, not be forced into a race to the bottom, overseen by an overseas president.

    Thirdly, we were promised a

    “broad, comprehensive and balanced security partnership.”

    There is no greater priority than keeping the British people safe and secure. On 3 June, with regard to European criminal records data, the right hon. Member for Maidenhead (Mrs May) asked for

    “reassurance that as from 1 January 2021, the UK will have access to the quantity and quality of data that it currently has”. —[Official Report, 3 June 2020; Vol. 676, c. 846.]

    Will the Minister provide an answer? Two weeks ago, the Prime Minister was unable to do so.​
    Fourthly, we were told that whatever happens, the UK will respect the Good Friday agreement. Many Northern Irish businesses, including manufacturing firms, have integrated supply chains across the United Kingdom. Unite and GMB members working at Bombardier in Belfast are reeling from the prospect of more redundancies following the covid-19 crisis. We need to stem the tide of job losses, not exacerbate them. Firms in Northern Ireland need to know the real-world detail of the business environment in which they will be operating, the precise checks and controls that they need to implement, and the operational readiness of the systems that they will be using in just 29 weeks’ time. It is far from reassuring that according to paragraph 28 of the UK Command Paper, the Government have so far committed to

    “produce full guidance to business…before the end of the transition period.”

    That could be December. That simply is not good enough for British businesses.

    Finally, on the same day that the Prime Minister claimed that the impasse can be resolved and a deal achieved in July, the Government signed up to two further negotiating rounds, concluding on 21 August. Is July a serious proposal, or is it one of those over-promises to which we have become accustomed from the Prime Minister, agreed in haste to win a headline only to fall by the wayside when reality bites?

    With that in mind, and thinking firmly about what is best for the United Kingdom, Labour wants the Government to succeed in achieving the deal that they promised and to avoid the perils of the alternative. The Government must fulfil their pledges to the British people in order to protect jobs, secure our food and medical supplies, and protect our citizens’ safety and security. We urge both sides to show the flexibility required to achieve a deal in our national interest.

  • Michael Gove – 2020 Statement on the UK-EU Negotiations

    Michael Gove – 2020 Statement on the UK-EU Negotiations

    Below is the text of the statement made by Michael Gove, the Chancellor of the Duchy of Lancaster and Minister for the Cabinet Office, in the House of Commons on 16 June 2020.

    With permission, Madam Deputy Speaker, I would like to make a statement on the Government’s negotiations on our future relationship with the European Union.

    Yesterday the Prime Minister met the President of the European Council, Charles Michel, the President of the European Commission, Ursula von der Leyen, and the President of the European Parliament, David Sassoli, via video conference. The purpose of this high-level meeting, as the political declaration puts it, was to take stock of progress on the negotiations and to agree actions to move forward. All parties agreed that now was the moment to accelerate the pace of these negotiations—in the Prime Minister’s words, to

    “put a tiger in the tank”.

    The three Presidents welcomed the Prime Minister’s call for greater pace, focus and flexibility in the negotiations, and the tempo of the talks process has now been escalated.

    I am pleased to say that both sides pledged yesterday, in a joint statement that was made public immediately afterwards, that they would intensify the talks in July and, if possible, seek to find an early understanding on the principles underlying any agreement. Our respective chief negotiators and their teams will therefore intensify talks from the end of this month, starting on 29 June. I also welcome the Commission President’s statement yesterday that the EU is available 24/7, and we will be too. Meetings will take place every week in July, with a keen focus on finding an early understanding on the principles that will underpin a broad agreement. As the Prime Minister said yesterday, the faster we can do this, the better. We are looking to get things done in July. We do not want to see this process going on into the autumn and then the winter. We all need certainty, and that is what we are aiming to provide.

    Yesterday’s high-level meeting followed the second meeting of the withdrawal agreement Joint Committee, which took place on Friday 12 June, again via video conference. I am grateful to the Vice-President of the European Commission, Maroš Šefčovič, for the very constructive way in which progress was made under his chairmanship. In that meeting, I set out our plans to implement the protocol on Ireland and Northern Ireland, and updated the EU on our ongoing work to protect the rights of EU citizens in the UK. This is a priority for the UK Government. I also sought assurance, for our part, that the EU intended to meet its obligations under the withdrawal agreement around the protection of the rights of our nationals currently living in the EU. We have concerns in this area, and we will continue to press the EU to ensure that our citizens’ rights are properly protected.

    If we are to make the progress that we all want to see in our negotiations on the future relationship, we all need to be both clear-eyed and constructive. Our EU partners agreed yesterday that during the four full negotiating rounds completed to date, we have all gained greater clarity and understanding of our respective positions. Discussions have been productive and legal texts have been exchanged, even as both sides have had to deal with uniquely difficult challenges posed by the coronavirus pandemic.​

    But as my right hon. Friend the Paymaster General advised the House last week, following the fourth round of negotiations it is still the case that there has been insufficient movement on the most difficult areas where differences of principle remain. We are committed, in line with the political declaration, to securing a comprehensive free trade agreement with the EU built on the precedents of the agreements that the EU has reached with other sovereign states such as Canada, Japan and South Korea—and we are ready to be flexible about how we secure an FTA that works for both sides. The UK, however, has been clear throughout that the new relationship we seek with the EU must fully reflect our regained sovereignty, independence and autonomy. We did not vote in June 2016 to leave the EU but still to be run by the EU. We cannot agree to a deal that gives the EU Court of Justice a role in our future relationship, we cannot accept restrictions on our legislative and economic freedom—unprecedented in any other free trade agreement—and we cannot agree to the EU’s demand that we stick to the status quo on its access to British fishing waters.

    There must be movement, and the clock is ticking. The transition period ends on 31 December. That was a manifesto pledge on which the Government were elected, and it was the instruction from the electorate in the 2016 referendum: to leave the single market and the customs union and to grant the opportunities of full and economic and political independence. Four years on from the referendum result, no one can argue that this is a rushed or precipitate step. It is delivering at last on democracy. We will manage the adjustment required at the end of the transition period in a flexible and pragmatic way to minimise any challenges and to maximise all opportunities, but the call from Opposition politicians to extend the transition period is not in the national interest.

    Staying under the EU’s control after this December would mean paying money into EU budgets that we could spend on our NHS, accepting new laws over which we would have no say—laws shaped in the interests of others—and being prevented from taking the actions that we need to supercharge our economic recovery. That would clearly not be in our national interest. There is no intrinsic reason why a deal cannot be concluded in good time. As Roberto Azevêdo, the director general of the World Trade Organisation, confirmed at the weekend, a deal between the UK and the EU can be reached in a timely way if the political will is there.

    The UK’s political will is there. Our position is reasonable, based on precedent, and we still have the time to bring a deal home. That is why the Prime Minister has led the drive to accelerate these talks, to reach agreement, and to ensure that next January, we leave the regulatory reach of the EU and embrace the new opportunities that our independence will bring. I commend the statement to the House.

  • Michael Gove – 2020 Statement on the Withdrawal Agreement

    Michael Gove – 2020 Statement on the Withdrawal Agreement

    Below is the text of the statement made by Michael Gove, the Chancellor of the Duchy of Lancaster and Minister for the Cabinet Office, in the House of Commons on 15 June 2020.

    The second meeting of the withdrawal agreement Joint Committee took place by video conference on 12 June 2020. It was co-chaired by the Chancellor of the Duchy of Lancaster and Minister for the Cabinet Office, the right hon. Member for Surrey Heath (Michael Gove), and Vice President of the European Commission, Maroš Šefčovič.

    The Committee was updated on progress of the specialised committees and withdrawal agreement implementation. The Committee adopted one decision on correcting errors and omissions in the withdrawal agreement relating to financial provisions and citizens’ rights.

    The UK emphasised its decision not to extend the transition period.

    The UK also announced that it would introduce new border controls on imports coming into Great Britain from the EU in three stages up until 1 July 2021. The UK stated that it was taking a flexible and pragmatic approach that will give industry extra time to be ready for the new procedures, recognising the impact of covid-19 on businesses’ ability to prepare.