Jonathan Djanogly questions the Secretary of State.
Oral evidence: The European Union (Withdrawal) Bill, HC 373
Wednesday 25 October 2017
Questions to the Department for Exiting the EU Secretary of State, Rt Hon David Davis MP
Q87 Mr Djanogly: Good morning, Secretary of State.
Mr Davis: Good morning, Mr Djanogly.
Q88 Mr Djanogly: Having heard previous questions, Chairman, can I just clarify for my understanding that during the implementation period we will remain in the single market and the customs union but we will no longer have a place on the EU’s decision-making bodies that affect both the single market and the customs union?
Mr Davis: We will remain in, have access to it or it will look alike, yes. We will get back to the legal basis, Mr Djanogly, if we are not careful. I am sorry. What was the last part of the question? It was about whether we will have a say on decisions.
Mr Djanogly: It was about whether we will have a say about how those are moulded.
Mr Davis: Yes, how they are changed, yes.
Q89 Mr Djanogly: During that period, will the UK have to accept new EU laws made during that period?
Mr Davis: One of the practical points of this, which anybody who has dealt with the European Union knows—as you will have done, I guess—is that it takes two to five years from inception to outcome for laws to make it through the process. Anything that would have impact during those two years we are talking about will already have been agreed with us in advance. Anything that happens during it will be something for subsequent discussion as to whether we propose to follow it or not. That is where the international arbitration procedure might become important.
Q90 Mr Djanogly: If I could also just have a say on the sequencing—everyone else seems to want to—most businesses I speak to seem to have been thinking, until yesterday probably, that we were just going to have a two-year implementation period. They thought it had been negotiated and agreed, but of course that is not the case either from the European Union’s point of view, who have been saying that they have only agreed to consider it, or from our perspective. Yesterday, the Prime Minister made it quite clear that we firstly need a trade deal to implement. Given how little time there is, can I just go a stage before the stage Mr Bone was talking about? Will there come a point in time when your department and you take the decision, “Actually, we are running out of time here. There is no time to do a deal before March 2019”? In that situation, would you consider a two-year standstill from March 2019, giving business time to sort itself out and you time to finalise an FTA?
Mr Davis: The first thing is that trying to finalise an FTA under those circumstances would be very disadvantageous from a negotiating leverage point of view. You might get into the circumstance Ms Cherry raised of putting it off and putting it off and putting it off, which we do not want to do. Secondly, it is no secret that the way the Union makes its decisions tends to be at the 59th minute of the 11th hour of the 11th day and so on. That is precisely what I would expect to happen here. In technical terms, there is no reason why we cannot do this in the time available. That is the point Karel De Gucht made, the previous Trade Commissioner, an antagonist of Brexit. Even he accepted that, given the political will. But we do have to maintain a degree of determination to achieve it, but I am quite sure in my mind that we can do that. My jibe or joke—if it was a joke—to the Chairman about the clock being stopped at midnight is precisely what happens. If there is a time limit on a negotiation, the Union stops the clock. It assumes it is still at 11.59 or whatever it may be until it is concluded—sometimes over the course of 24, 36 or 72 hours thereafter. That is what I imagine it would be here, and there would be a lot of pressure. It would be very high-stress and very exciting for everybody watching, but that is what would happen.
Q91 Mr Djanogly: These will be the very final points. What if, six months before or a year before, you are very far apart? You can only be so far apart to take that strategy.
Mr Davis: If the experience to date is anything to go by, we will have a pretty good idea of where their end game is from what is published. What people do not often ask me about at this Committee but is the unseen element of this is the huge amount of diplomatic activity, personally by me, by Olly Robbins, by UKRep and by our diplomatic corps as well, across the whole of Europe, across the 27 members, to know what they are after, what they are accepting from this and what they want out of that final Council meeting. We have a pretty good idea of the economic interests of every single member state. They are not always focused on them, all the time. They have other issues. We have Germany, Austria, Holland—I have forgotten somebody—and the Czech Republici all without new Governments in place at the moment, so this is not at the top of their tree. There are other reasons, Catalonia in Spain, people’s eyes are being taken away from it. Nevertheless, we have a pretty good idea of where they will end up as the end game, even if there are delays along the way.