John Redwood's Diary
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The UK should lead freer trade worldwide

I have made two consistent requests of the UK government whilst I have watched the negotiators reach an Agreement Parliament could not possibly accept. I have asked that the UK tables a comprehensive free trade agreement with the EU and says we should negotiate it once we have left, allowing both sides to avoid any new barriers or tariffs whilst we negotiate it. I have also asked that the UK tables its own schedule of tariffs for April 2019 assuming the EU refuses all co-operation. These tariffs should be lower than those imposed by the EU on the rest of the world, thereby cutting our tariffs on the bulk of our trade whilst imposing them on EU trade for the first time as we have to under WTO rules.

There are two advantages of tabling a draft Free Trade Agreement. The first is the EU has indicated that would be easier to agree with the UK than a half in half out arrangement of the kind the present UK negotiators seem to want. The EU has free trade agreements with various smaller countries already and has just managed one with Japan. Our draft should be based on the best of the EU/ Canada and Japan agreements, so we can say to them we are only asking for what they have already granted to others. They and we might then want to add some more to that.  The second is we could then under Article 24 of Gatt/WTO  agree to no new barriers  pending agreement. This would be especially advantageous to the rest of the EU given their huge surplus with us in food and cars, where tariffs would otherwise be imposed.

The ERG is working with experts to produce a full legal text draft. I look forward to its early publication, as then the government could just table that one if they still have not drafted one of their own.  The government could itself produce a scissors and paste version of the EU/Canada or EU/Japan treaties to get the conversation started. I hear there will be a launch of a comprehensive FTA text on Wednesday.

I have also repeatedly asked for publication of our own tariff schedule.I think EU tariffs are in some cases too high. I would want us to remove all tariffs from imported components so we can say to industrialists based here it will be cheaper to make things once we have left. I would like us to remove tariffs on food we cannot grow for ourselves. I would suggest lowering other food tariffs a bit. It is an important judgement to balance consumer interests in no tariffs with farmers interest in some tariff protection, which would for the first time extend to protection against EU as well as non EU produce.

The publication is essential for two reasons. The first is we may well leave with no Withdrawal and future partnership agreement in March, so farmers and traders need to know what the tariff regime will look like when they decide what to grow and what to buy from world markets.  It would also be a timely reminder to the big food exporting industries of the rest of the EU that they will face tariiff barriers in default of a Free Trade Agreement, which might make them keener on a Free Trade Agreement.

The government should also tell us how it will spend all the extra tariff revenue it could collect. A mixture of spending increases and tax cuts would provide a welcome boost to the economy, jobs and wages.

 

Another round of Project fear

It is strange to read stories coming from people in or close to the government telling us leaving without a deal will be bad, saying the government has  not done all it needs to do to leave on March 29, and playing up any bad economic or business news that comes along. Normally governments are guilty of putting too optimistic a spin on events. Not this one, who often seem to prefer the EU spin line against us.

Most of it is Project Fear re heated. It was that very Project Fear  replete with precise and wildly wrong forecasts for jobs, house prices, growth and business for 2016-17 that did much to lose the vote for Remain. Most of us want sensible optimism not remorseless and inaccurate pessimism.

The Prime  Minister and government has had 2 years 7 months to get everything ready to leave on March 29. They have  told us officially they can do that, though there are plenty of leaks, hints, statements of individual off message Ministerial opinion saying the opposite. The PM has always  been consistent in saying we will leave on 29 March with or without a deal. She has always said you cannot take no deal off the table as it is important to the negotiation, and has always said we can just leave  if necessary. She of course would much prefer a deal, but has difficulty persuading MPs her  Withdrawal Agreement is acceptable. It is of an expensive invitation to another 21 months of talks about a future relationship. This prolongs the uncertainty for business and delays an economic boost from spending our former EU contributions on our priorities.

It is clear the planes will fly, the trucks will pass through Calais and Dover  in good time and there will be no food or drug shortages. I am not going to stockpile anything.  It looks as if the  pressure for a second referendum has abated, which anyway cannot be held before 29 March now. The Remain forces in Parliament  now want delay. They have failed to say what we could agree after March that we have been unable to agree in the 2 years 9 months since the vote, and failed to spell out why the EU  would let  us have a delay to renegotiate and on what terms. The UK has no plans to offer candidates for the European parliament so will not be part of the full governance arrangements of the EU from that date. We need to get on with leaving.  I am still pressing the UK government to offer a free trade agreement and use of Article 24 of the GATT to avoid tariffs and other new barriers when we leave in March

 

Working throughout February

I had no plans to take a holiday and was intending  to work as normal when Parliament planned a February recess. I am very willing to attend Parliament to do anything to ensure a smooth exit from the EU on 29 March on any dates between now and then.

An unhappy Euro area and a squeezed car industry

The news that hundreds or even 2000 people have now been injured in the French protests is worrying. There have been at least 10 deaths, according to press reports. There is also a controversy raging in France over the use of police weapons.

It seems to be true that the police themselves have suffered in these protests and have experienced injuries. They are allowed to use  guns that fire large rubber bullets, and to release grenade type crowd control devices that contain explosives and scatter more rubber bullets on detonation. There have been cases of people losing part of their hand from these explosions, and reports of blinded and injured eyes from the bullets.

The gilet jaune protests began against high and rising fuel taxes. The symbol and uniform of the protesters is the gilet jaune that all car drivers have to carry in their vehicle to wear in case of emergency. It is an irony that a protest which is part a protest about the attacks on motorists should use as its symbol an item of clothing demanded by a  regulatory requirement . It makes it impossible for the authorities to ban carrying such items or using  them by displaying them prominently in a car as a symbol of support for the movement.

Meanwhile Italy is in recession and Germany had a fall in output in the third quarter, with a weak fourth quarter as well. Economies are crying out for some stimulus. The motor industry has been particularly hard hit by restrictive credit policies and by tax attacks on the purchase , owning and use of vehicles. EU emission rules changes disrupted production and sales, and Chinese demand for German cars fell away quickly.

Even the UK industry has suffered from all this, which isn’t anything to do with Brexit and has happened before we have been allowed to leave the EU. In the UK high VED increases, a squeeze on car loans and threats of more bans and taxes on diesel vehicles has as predicted here cut output and sales and slashed investment. The UK government should put together a better tax and regulatory package to stabilise and improve sales and output before more damage is done.

Better healthcare

I am taking an interest in how the extra money for the NHS will  be spent. It is most important that NHS England comes up with a proper plan of what they are trying to achieve by way of expansion and service improvements, so they can then test out how many extra staff they may need and what new contracts they should sign to deliver the  better healthcare.

I understand that the Health Secretary is engaged on just such an exercise. I would be interested to hear from people, especially constituents, on what would be sensible requests for spending this additional cash. My priorities include wanting a well staffed GP service locally so that patients can get appointments that are timely and GPs feel they have manageable workloads so they can provide the best possible service. I think we do need some more hospital capacity for the most common procedures to reduce waiting times and provide some  choice and flexibility for patients over when and where they receive treatment.

Local services need to  be expanded to reflect the additional homes and increase in population. I share the government’s wish to see better mental health provision where there are proven protocols and treatments that can make a difference to people in need of help.

The government is considering the role of technology in future medical services and care. How far do patients want to go with digital booking, or even  remote consultations? I am keen that this should  be based on patient preference rather than a mandatory conversion, as healthcare is a private and individual matter where  the patient needs to feel happy with the system. Patients need to  trust the doctor and the way he or she works for it stand most chance of being a success.

The Commons votes

Yesterday the Commons voted down the Grieve and Cooper amendments to the government’s neutral motion. The Grieve amendment would have given Parliamentary time for a series of debates and votes on indicative approaches to Brexit, seeking to pre-empt  or direct the role of government to propose, amend or pass legislation and pursue policies of its design.  The Cooper amendment would have given Parliamentary time to enact a delay in Brexit, amending the EU Withdrawal Act, against the government’s wishes.  These amendments were rejected by  20 and 23 votes respectively, more than the government’s majority.

The Commons also passed the Spelman amendment by 8 votes. This amendment to the motion expresses the opinion that we should not leave without an agreement, but it does not overturn the legislation already passed for us to leave on 29 March. The government opposed it, in part because any suggestion we will not leave without a deal undermines the UK bargaining position.

The Brady amendment also passed requiring the government to go back to Brussels to seek to remove the Irish backstop from the draft Withdrawal Agreement. The government to win over more Conservatives to this measure promised that they will seek a rewrite of the legal text of the agreement on the backstop, when they had previously indicated they would just be seeking a protocol which would have been too weak. The PM also promised she  will strengthen the official negotiating team and will take seriously the Malthouse  compromise about the future negotiations and possible settlement.  As someone who objects to more than just the backstop in the draft Agreement I was unable to support a motion which said I would support the Withdrawal Agreement after changes to the backstop.  I do support the part of the Malthouse approach which seeks a managed no deal Brexit with talks about a comprehensive free trade agreement and use of the Article 24 of the GATT whilst in talks about such a proposal. I do not agree with more delay or payments to the EU after March. It is difficult to see what we might be able to agree after March that we have been. unable to agree over the previous 33 months. If the EU agreed this removes the need for any tariffs or new barriers to UK/EU trade.

New migration policy causes stress for Labour

The New Immigration Bill before the Commons yesterday carries out one of the promises of the government over Brexit. It takes powers to repeal freedom of movement from the EU into the UK , establishing a migration system for EU countries which will be the same as the system for the rest of the world. This could come into effect shortly after March 29 if we leave then,  but would be delayed for a couple of years were the UK to enter into a Withdrawal Agreement and so called Transition.

The government has not provided many of the details about how the powers will be used. It has stated that it wants to base its common worldwide migration policy on allowing the recruitment of talent from anywhere around the globe. It is likely talent will be defined by a minimum salary or wage for a job the person is coming to accept, but clearly it could be qualification based as well or additionally. Students will be allowed then as now to come to recognised UK institutions to study an approved course, and faculty members allowed to reflect the international nature of much modern scholarship.

Labour decided they could not oppose this measure. After all they had promised to end freedom of movement, and seemed to understand the views of many of their voters on this issue. Some in the Union movement did feel that allowing too many people into low -aid jobs from abroad undercut British workers and tended to help keep pay down. Late in the day Labour under pressure on social media and from some of its own backbench MPs decided to switch course and ask them to vote against it. Apparently Labour changed its mind and felt that the policy would be too restrictive on migration after all.

What criteria would you want the government to use when deciding who can gain entry to work here? This legislation takes back control, but leaves many questions unanswered about how exactly we should use the new powers we gain once we have left the EU.

The Brady amendment does not allow Brexit

The Brady amendment says MPs should vote for the Withdrawal Agreement if the backstop is amended or withdrawn. It is vague over how to fix the backstop and fails to mention the other many failings of the Withdrawal Agreement. I will not be supporting it. The Conservative Manifesto made clear that the government needed to keep negotiation over the Withdrawal Agreement in line with negotiation of the future partnership to have any bargaining power. The Withdrawal Agreement would lock us in for 21 to 45 more months of talks , placing us back under EU laws and taxes for that period, with no guarantee of a good exit.

Parliament and the people

Tomorrow Parliament has to decide whether it wishes to serve the people or defy them.

Parliament promised the electorate a referendum. It enacted one. It promised to enact the decision of the UK people. After much huffing and puffing it sent the Article 50 letter to leave the EU. After even more regrets and Parliamentary objections it passed the EU Withdrawal Act to confirm in UK law our departure on the 29 March 2019. If it wishes to serve the people it will now concentrate on making a success of our departure and do everything it can to use the new freedoms, money and controls we gain by exit.

Instead there are determined factions within Parliament who want to stop Brexit altogether, or who seek to delay or undermine it in the name of a having a so called  soft Brexit, partial Brexit, late Brexit or half in half out Brexit.  They have tried before to persuade the Parliament that we should stay in the Customs Union we voted to leave, and lost the votes. They have tried before to say we should stay in the single market or closely aligned to it though we voted to leave it, and again lost the votes.  Both Remain and Leave made crystal clear in the referendum leaving the EU meant leaving both single market and customs union. The UK government sent a leaflet to every household telling us just that. The EU has always said that. The EU says you cannot cherry pick, you can’t stay in the bits some like about the EU without accepting lots of rules, costs and laws you may not like.

The forces of Remain in the Commons now dare to say they are the defenders of Parliamentary democracy, by wanting further debate and more votes. The irony is crushing, as they only want more debates and more votes to stop us regaining control of our laws, our borders and and our money. They refuse to accept that their view has been given more than three years of air time in the referendum and in the endless repetitious debates they have required us to hold. It dominates the airwaves of the conventional media, where the Just Leave cause is given little time, always interrupted, and always bookended by “experts”  saying we are wrong. A group of Remain MPs who spent our years in the EU telling us no one was interested in details of EU policy and did their best to stop Parliament talking about it now want to talk about nothing  else. MPs who told us the EU had no significant powers over us now tell us what the EU does is wide ranging and crucial.

 

The public think it is time Parliament got on with it. The majority do not want Parliament to reverse its Brexit legislation and keep us in. The public have spoken. Parliament promised. Parliament must now let us leave. To do otherwise is to go to war with the people.

Questions for Remain

I am bored to tears with much of the conventional media, which simply recycle endless old Project Fear stories as if they were true, parades so called experts who always back Remain, and fail to ask any of these people the questions pro Leave would ask. The media interrupts and cross examines Leave supporters aggressively but rarely asks a difficult question of a Remain “expert” or supporter. So here’s the sort of questions they should be asked, in the interests of balance.

 

  1. Why do you want to give £39bn away to rich countries on the continent in return for 21 more months of talks with the EU?
  2. Why do you think the EU will give us a good deal on a future relationship in 21 months of talks after March, when they have failed to offer anything in the 2 years 9 months before March?
  3. Why will it be easier to get a good deal once we have given away the money than it is before we do so?
  4. Why did Remain tell us that leaving the EU meant leaving the single market and customs union if you now say we could negotiate our way back in?
  5. If you want to stay in either the single market or customs union what do you expect the EU to demand on freedom of movement, budget contributions and adherence to EU laws?
  6. Why should there be any delays at UK ports where we import food and drugs, when the UK will be controlling the borders there and when Customs and Excise have already said they can ensure a smooth incoming border?
  7. Why didn’t the UK economy collapse into recession and massive job losses as Remain and the government predicted for the first year after a Leave vote?
  8. How would you afford the tax cuts and spending increases which Brexiteers plan from the big savings on the EU budget? Do you accept a Brexit bonus budget will boost the economy?
  9. Would you like to see lower tariffs or no tariffs on tropical produce from emerging market poorer countries, as the UK can do that once out? Wouldn’t removing all tariffs on imported comp0nents for manufacture be a great idea as well?
  10. Wouldn’t another 21 to 45 months of talks prolong the very  business uncertainty you dislike and worry about?
  11. What would you have said if Leave had refused to accept the 1975 referendum result and demanded a second referendum on the basis that Remain then lied by saying there would be  no loss of sovereignty by joining the EEC/EU?
  12. Why do you have such a low view of our country that you think we cannot govern ourselves?
  13. Is there anything the EU has done that you think is wrong or damaging? If so  why didnt you oppose or try to change it?