The Brexit Select Committee flexes its muscles for the first time

The Brexit Select Committee flexes its muscles for the first time

Today the Exiting the European Union Select Committee (otherwise known as the Brexit Select Committee) publishes its first report.

Chaired by Labour’s Hilary Benn, it is worth remembering that the cross-party committee – including MPs from all four nations of the UK – does nevertheless have a majority of former Remain supporters among its membership.

Today’s report, The process for exiting the European Union and the Government’s negotiating objectives, calls on the Government to publish its Brexit negotiation plan as a White Paper by the middle of February, including clarity over whether it is aiming to remain in the single market and customs union.

The report also seeks an outline framework of the UK’s future trading relationship with the EU as part of the Article 50 negotiations, and calls for transitional arrangements if it is not possible to reach a final agreement by the time the UK leaves the EU. The MPs also want the Government to commit to Parliament having a vote on the final Treaty.

One Leave-supporting committee member – Lincoln’s MP, Karl McCartney – has already sounded concerns about some of the recommendations. He said the report was “flawed” in its call for transitional arrangements on trade and tariffs, which he said would “merely prolong the uncertainty for businesses and everyone else”, while he railed at the “emotive and negative language from the Remain side” which had seeped into the report.

The committee should have taken a more “collegiate” approach, he said, expressing his fear that Remain supporters on the committee are “seeking to thwart the democratic will of the 17.5 million people who voted to leave the European Union by taking part in the largest democratic vote our country has had.”

You can read the report for yourself at the committee’s website, but here are excerpts of its key recommendations:

What the Government needs to do before triggering Article 50

  • The additional burden of delivering Brexit and the new functions that the public service will need to take on may well require, at least in the short to medium term, an increase in numbers of civil servants.
  • The Government should also identify where the gaps in the knowledge and experience of the civil service lie and consider bringing in people from a range of backgrounds to ensure that it is up to the task at hand.
  • We welcome the Prime Minister’s commitment to set out more detail on the UK’s objectives in January and we look forward to publication of the Government’s plan… We welcome the Prime Minister’s assurance that Parliament will have the opportunity to scrutinise the Government’s negotiating plan, but in order to do that the plan must be published in sufficient time before the triggering of Article 50.
  • We therefore expect to see the plan by the middle of February 2017 at the very latest. It should be published in the form of a White Paper given its huge significance.
  • When the Government does produce its plan, it should declare its position in relation to membership of the Single Market and Customs Union.

The Article 50 negotiation: what will it cover?

  • The UK’s future relationship with the EU should be negotiated in parallel with the Article 50 negotiation so that there is clarity about both the divorce settlement and the new relationship at the moment we formally leave the EU.
  • The key differences between an agreement made under the procedure laid down by Article 50 and one using the procedure set out in Article 218 TFEU (which would apply to a separate agreement on future arrangements between the UK and the EU) are that, as EU law and practice currently stands, the latter requires each Member State’s agreement (rather than a Qualified Majority) and also the possible agreement of up to 34 national and regional parliaments. However, if the Article 50 agreement were to be a “mixed agreement” its procedure would, in practical terms, be the same as for Article 218 TFEU agreement. As these procedural considerations may well affect the outcome of the negotiations, we consider it important for the Government to provide early clarification of its expectations on whether or not the Article 50 agreement is likely to be mixed, the respective scope of an Article 50 agreement and a future arrangements agreement made under Article 218, and the room for flexibility in the choice between the two and, if the expectation is that it is a mixed agreement, the Government should put plans in place at that time to engage with other regional and national bodies throughout the EU in order to ensure safe passage of the agreement.
  • The Great Repeal Bill will introduce the legislation that ought to provide legal certainty in the UK on the day after Brexit day. EU legislation will be incorporated into UK law and can then be either retained or repealed… The Secretary of State must publish this Bill in draft to enable the fullest scrutiny to take place.
  • It will be essential to provide clarity as soon as possible, and certainly by the time the UK leaves the EU, about the Government’s preferred option for the UK’s future participation in EU regulatory bodies. If it is decided, however, not to seek to maintain membership of these bodies then the Government must set out the new arrangements it proposes to put in place to ensure that these functions are carried out in future.
  • It is clearly in everyone’s interests to resolve the position of EU nationals currently in the UK and of UK nationals in other EU member states as quickly as possible so as to provide certainty and reassurance to the individuals, their families and the businesses and services that rely on them… This must be an early priority for the negotiations.
  • It will be essential to maintain cooperation with the other 27 member states on defence, foreign policy, security and the fight against terrorism after the UK has left the EU. This is clearly in the UK’s and EU-27’s mutual interests to do so and the negotiations should ensure that it happens.
  • The Government has stated that it will be looking for the best deal that it can secure in respect of continued access to European markets without tariffs or other obstacles. The Government should look to secure a mutually beneficial relationship in other areas where the UK currently cooperates with other Member States. The UK should also seek a future relationship with the EU based on continuing close cooperation in Justice and Home Affairs, Security, Foreign Affairs and Defence Policy.
  • By the time that the UK exits the EU, it is essential that clarity has been provided around:
    • The institutional and financial consequences of leaving the EU including resolving all budget, pension and other liabilities and the status of EU agencies currently based in the UK
    • Border arrangements between Northern Ireland and the Republic of Ireland and a recognition of Northern Ireland’s unique status with regard to the EU and confirmation of the institutional arrangements for north-south cooperation and east-west cooperation underpinning the Good Friday Agreement
    • the status of UK citizens living in the EU
    • the status of EU citizens living in the UK
    • the UK’s ongoing relationship with EU regulatory bodies and agencies
    • the status of ongoing police and judicial cooperation
    • the status of UK participation in ongoing Common Foreign and Security Policy missions
    • a clear framework for UK–EU trade
    • clarity on location of former EU powers between UK and devolved governments

Negotiating the future relationship

  • The Government will undoubtedly be undertaking economic assessments of the different options for market access and trade looking both at risks and opportunities. In the interests of transparency, these should be published alongside the Government’s plan in so far as it does not compromise the Government’s negotiating hand. The UK Government’s negotiating plan should outline its position in relation to membership of the Single Market and the Customs Union.
  • A return to tariffs and other regulatory and bureaucratic impediments to trade would not be in the interests of UK businesses and therefore the Government should strive to ensure that this does not happen.
  • It will also be important for the Government to set out clearly its policy on membership of the Customs Union as part of its plan for the negotiations.
  • Given the importance of the financial services industry to the UK economy in terms of jobs and tax revenues, the Government should seek to ensure continued access to EU markets in financial services for UK providers whether by way of a continuation of passporting or mutual recognition of regulatory equivalence or some other means.
  • In deciding on a new system for controlling EU migration, the Government will need to take full account of the importance of workers from the EU, including the highly skilled, and the ability to undertake intra-company transfers to a large number of sectors of the UK economy.
  • The Secretary of State has said that he wants to secure the best possible access for goods and services to the European market. The Prime Minister has made it clear that she places a top priority on controlling the UK’s borders and extricating the UK from the jurisdiction of the European Court of Justice. The pronouncements of the EU’s chief negotiators on the indivisibility of the four freedoms seem to indicate that achieving all these objectives will be difficult.
  • A “cliff edge” change in circumstances could be extremely disruptive in some sectors to businesses both in the UK and in the EU 27, whether it be the need to adjust to new provisions for regulatory approval, new customs requirements, or the need to adjust to new costs or restrictions in employing EU workers… The Government must make clear from the outset that a period of adjustment to any change in trading arrangements or access to EU markets for UK service industries will be sought as part of the negotiations.
  • If final agreement is not possible by the time that the UK leaves the EU, it would be in the interests of both sides of the negotiations for an outline framework, with appropriate transitional arrangements, for the UK’s future relationship with the EU to be agreed in respect of access to the Single Market for goods and services and future trade policy.
  • In addition to the economic aspects of the relationship, it is essential that cooperation in defence, foreign policy, security and the fight against terrorism, which is of benefit to both the UK and the EU-27, is not lost when the UK exits the EU. If it is not possible to conclude an agreement on all areas of cooperation in Justice and Home Affairs and Common Foreign and Security Policy before the UK leaves the EU, transitional arrangements to ensure that mutually beneficial cooperation is not brought to an abrupt end by Brexit will be needed.
  • Although the Constitutional Reform and Governance Act 2010 provides the House of Commons with powers to withhold ratification of Treaties, this is not a satisfactory way of dealing with such an important Treaty. We therefore call on the Government to make it clear now that Parliament will have a vote on the Treaty and that the timetable for this vote will allow for proper consideration of any deal that is negotiated.