Meeting of the Parliament

Meeting date: Tuesday, December 5, 2017

Official Report 880KB pdf

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Urgent Question

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European Union (Regulatory Alignment)

To ask the Scottish Government whether discussions have taken place with the United Kingdom Government regarding Scotland retaining regulatory alignment with the European Union and effectively remaining in the single market.

The Scottish Government put forward proposals in December 2016 in its publication “Scotland’s Place in Europe”, which set out our view that, if Brexit was unavoidable, the UK as a whole should remain within the European single market and customs union. We set out a mechanism through which, in the event that the remainder of the UK chose not to do that, Scotland could continue to benefit from membership of the single market and the customs union.

However, subsequently, in her Lancaster house speech, the Prime Minister, without any consultation or forewarning, ruled out single market and customs union membership. Much of the damage and chaos that have been caused over the past year are a direct result of the red lines that the Prime Minister set out then. After our proposals for Scottish membership were tabled at the joint ministerial committee on European Union negotiations in January 2016, there were limited further discussions between officials in the UK and Scottish Governments. Two months later, the UK dismissed the proposals as unworkable, without giving any convincing reasons.

We fully support the Good Friday agreement, in all aspects, and we welcome the proposals of yesterday that sought to ensure that there would be no return to a hard border in Northern Ireland, and which demonstrated that the principle of a differentiated approach, which we set out in December last year, was viable within the scope of the UK’s future relationship with the EU. Although the detail remains unclear, the Irish Government has been clear that it would facilitate free movement of people, goods and services across the border to Northern Ireland. On that basis, we understand that the deal provides for a dynamic regulatory compliance between Northern Ireland and the EU acquis, now and in future, and provides for an agreed form of dispute resolution, which could include the European Court of Justice. We will press for further clarity on those and other issues as a matter of urgency.

Of course, Scotland did not vote to leave the EU. The best solution would be to stay. However, in the case of a continued move towards Brexit, there is overwhelming support in this Parliament and across the country for retaining Scotland and the UK’s place in the single market and customs union. Therefore, it is time for all of us, here in Scotland and across the UK, to speak out at this crucial time for what is in everybody’s interests and reject a hard Brexit. It is time for Scotland to speak with one voice, and I encourage all who realise that single market and customs union membership is vital to say so and to work to achieve that.

Given the discussion and debate over the past few days, I do not think that it is fair that there can be one rule for one constituent part of the UK and another rule for everyone else. Last year, the UK Government committed to

“full engagement with the Scottish Government, the Welsh Government and Northern Ireland Executive on the UK’s exit from the European Union”,

and the four Governments agreed to work together towards an agreed UK approach to the Brexit negotiations, through the joint ministerial committee. Does the minister think that there has been full engagement with the Scottish Government on the latest developments, or that we have an agreed UK approach?

I stress at the outset that the situation in Northern Ireland stands on its own, with its own history and its own need for a solution that respects, for example, the Good Friday agreement and the great benefits that that has brought. However, that stands alongside membership of the single market, which has allowed the border to be completely porous with, I think, 275 crossing points.

We are endeavouring to work on solutions that have been made more difficult by the European Union (Withdrawal) Bill, and we have been making progress on those. What yesterday’s chaos actually means is a moot point and will have to be factored into the discussions that we are having. There is due to be a meeting of the joint ministerial committee next Tuesday, and we hope that at that meeting we will be able to explore the issues, get some clarity about what the situation is and find a way to move forward.

It is very difficult to negotiate with people who seem to change their position all the time and who do not inform others of their position. What we saw yesterday was a chronic failure to keep everybody informed about what the situation was. We ourselves have, over a period, suffered from not having the information that we required. Maybe this will be an object lesson for the UK Government; maybe it will change.

What will be the consequences for jobs and living standards in Scotland if the UK leaves the single market and the customs union? In particular, what will that mean for rural constituencies such as mine, Angus North and Mearns?

I, too, represent a rural constituency, Argyll and Bute—indeed, some people might call it an extreme rural constituency—and I am very worried, as all members of the Scottish Parliament should be about the effects on their constituencies, rural and urban, of our leaving the single market and the customs union.

We published material last year in “Scotland’s Place in Europe” and we have published analysis and other information over the past 12 months. Just recently, we published our evidence to the Migration Advisory Committee, which paints a stark picture of the difficulties that we will have if there are restrictions on migration.

In the circumstances, the best solution would of course be to stay in the EU, but the compromise solution, which we put forward 12 months ago and which seems ever more relevant, is to remain within the single market and the customs union. Such an approach has been widely supported across the Parliament—I am very grateful for that; it is extremely important. Indeed, although I do not anticipate questions from Conservative members today, I am mindful that, just days after the vote, Ruth Davidson said:

“Retaining our place in the single market should be the overriding priority.”

I do not think that that has changed. If this Parliament were to speak with one voice on membership of the single market and the customs union, I think that that would be very effective indeed.

We will have to move to the topical question at 2.25, so I ask those members who wish to ask questions to be succinct, so that we can get everyone in.

Somewhat unexpectedly, I agree with Mairi Gougeon’s opening remarks. The Scottish Conservatives believe that if regulatory alignment in a number of specific areas is a requirement for a frictionless border, the Prime Minister should conclude that that must happen on a United Kingdom-wide basis.

Yesterday, the First Minister hastily took to Twitter to once again demand a separate Brexit deal for Scotland. We know how that would benefit the Scottish National Party’s political objectives, but can the minister explain how separate arrangements for Scotland and England would be beneficial to the rest of us, given that trade with Britain is worth four times more to Scotland than trade with the whole of the European Union combined?

I am going to be very constructive in my answer, no matter how much Jackson Carlaw tempts me not to be.

The reality of the situation is that the position that the First Minister has laid out yesterday and today is exactly the same as the position in “Scotland’s Place in Europe”, which we have had for the past year and which I am sure that Mr Carlaw has read, marked and inwardly digested. The position is that our preference is to stay in the EU. If that is not what is to happen—I think that the evidence for doing so grows stronger and stronger—a whole-UK approach to staying in the single market and the customs union is what is required. Whether we call it regulatory convergence, lack of regulatory divergence or continued observance of the acquis, that would be the best solution.

In the circumstances that we are in today, that is also the best solution to resolve the difficulty that has arisen in Ireland and Northern Ireland, because it squares the circle—the impossibility of making one offer to Ireland and another to Northern Ireland. The only way out of that is to make sure that the whole of these islands is in the single market and the customs union. If the Scottish Conservatives would support that—as they have in the past—that would be a considerable step forward. That would resolve the issue.

We also know that there can be no cherry picking of the single market. The idea that appears to be being floated at the moment in Downing Street—there are so many ideas being floated in Downing Street that I am surprised that it is not under water—involves the cherry picking of agriculture, elements of trade and elements of energy regulation, but the reality is that that will not be possible. [Interruption.] Adam Tomkins says from a sedentary position that those elements are in the Good Friday agreement. Yes, they are, but the Good Friday agreement goes alongside membership of the single market. Not everything is in the Good Friday agreement, and that is a difficulty.

The solution is single market membership for the whole of the UK. The position that the First Minister has articulated is also in “Scotland’s Place in Europe”. If that is not available, it is axiomatic that those places that can have a different arrangement should be allowed to have that, and that is the position that we find ourselves in. Single market membership for the whole of the UK would be the way out of the incredible mess that has been created by Theresa May, and I urge it on every member of the Parliament.

What matters here, of course, is to draw the right conclusions from current events, and I hope that the minister will agree that it would be a mistake to use the chaos of Theresa May’s failed deal on Northern Ireland yesterday simply to push for a differential deal here, too. Is the right conclusion not to say, “If it’s good enough for Northern Ireland, it’s good enough for the whole of the UK”? If the proposals that were floated by Mrs May yesterday were indeed designed to protect jobs and business in Northern Ireland, surely we should seek to do the same in Scotland, England and Wales. Should achieving that not be the focus of all the efforts of the Scottish Government?

I am in the curious position of hearing my own words echoed back in that question. I have just said that a differentiated deal is at the end of the road. We are forcing the pace by saying, “Let’s have a deal for the whole of the UK.” We should do that, but it is also wise to be prepared—as the member has in the past urged me to be—for any circumstance. “Be prepared” is the motto of the boy scouts; I was never a boy scout, but I recognise the motto. We are preparing ourselves, but we must be realistic and recognise that if the solution of a deal for the whole of the UK is not possible, another solution must be found.

We wish to have a UK-wide solution—in that regard, I commend to members paragraphs 169 to 171 of “Scotland’s Place in Europe”. We have said that membership of the single market and the customs union would be the best thing for Northern Ireland and the rest of us.

If, however, that is ruled out, it would be wrong to have entirely differentiated solutions in one place and not in another—not least because it would be very damaging to Scotland. The effect of having a differentiated solution in one part of the UK and not in another could be deleterious to the country, and I am sure that Lewis Macdonald would not urge upon the chamber actions that would be damaging to Scotland. However, I agree that the whole of these islands should be in the single market and the customs union. We urge that upon all, but particularly upon the Labour Party. I have to say that if the Labour Party were to adopt that approach—to carry that standard in the campaign—it would move things on very considerably indeed. The First Minister made that point this morning, in a tweet to Jeremy Corbyn, and I repeat it to Richard Leonard.

It seems that those who angrily assert the difference between differentiated models among parts of the UK and full single market membership for the UK are missing the central point: that those are now the only two credible options. Last week, the cabinet secretary spoke at a meeting of the Finance and Constitution Committee, in positive terms, about the re-energised process in the joint ministerial committee (European Union negotiations). Did the JMC meeting specifically address the question of the extent to which differentiated options are technically achievable? If it did not, will the cabinet secretary ensure that next week’s meeting of the JMC does not end without a clear answer to the question of whether such options—or the UK’s single market membership—are still on the table?

There has not been a meeting of the JMC since I gave evidence to the Finance and Constitution Committee, but, of course, John Swinney and I have had a meeting with Damian Green and David Mundell. We were looking at ways in which we could progress discussions on the European Union (Withdrawal) Bill and on frameworks. An hour is a long time in Brexit, and that meeting took place well before we had the current situation with Ireland. In evidence to the committee last week, I said that I thought that it was a pending difficulty that was coming towards us very fast—and so it has happened.

I cannot imagine going to the JMC meeting next week and not making it crystal clear—as I am sure that my colleague in Wales, Mark Drakeford, will—that what has happened in the past 24 hours has changed things yet again and will require to be addressed very seriously indeed. There must be a resolution of that. However, I agree with Patrick Harvie that there are only two possible solutions: one is to have a differentiated solution, but the better one is to have a solution for the whole of the UK. Anything else will not resolve the issue. Again, I am grateful for the support that Patrick Harvie has given, and I urge others to give theirs. Together, we can make a substantial difference on the matter.

We do not really know what the Conservatives and their Democratic Unionist Party allies are doing, and neither, it seems, do they. We have a mounting set of broken promises on Europe: first, on the £350 million for the national health service and now the apparent dismissal of any scaremongering about the Irish border. In that context, does the minister not think that there is a third option, which is that the British people should have the final say on whether it is appropriate to accept this guddle—or should it be left to the Conservatives and their DUP allies?

As Willie Rennie knows, I have certainly not ruled out supporting that third option. There is a need for people to reflect very seriously on the changed circumstances in which we now are. As he will know, an opinion poll yesterday showed that, in Scotland, there is now a substantially greater majority against Brexit than there was even on 23 June last year. There is some indication that that is also happening elsewhere. On the radio this morning, I quoted the case of Grimsby, which is a town in which 70 per cent voted to leave the EU, but whose fishing industry now says that it does not wish to have the disadvantages of doing so. People are genuinely seeing what the difficulties are. I have been very struck by the number of people who have commented to me on the difficulties that will be caused by the way in which the competition to be named European capital of culture has come to an end. People are seeing the effect of what is taking place. They will wish to reflect on that, and there may be a number of ways in which they can do so.

Willie Rennie is also right that the chaos of the situation is a major factor that affects people’s confidence in politics, which is something on which Theresa May needs to reflect very seriously indeed. There is a weekly—sometimes daily—crisis of confidence in the UK Government, which cannot be good for the generality of politics. I say again that it would be an example if the chamber could come together on the issue of the single market and the customs union and be able to say that that is what it wants to be delivered and that that is what it will try to do.

I am still meeting representatives of the other political parties and I am glad to do so. When we meet again—this week, I hope—I hope that we will reflect on that. That stance, which was taken right across the chamber, before and after the referendum, could unite us in a clear view of what should happen now. People are looking for a clear view of what should happen now, because all that they are getting is chaos and confusion from elsewhere.

On a number of occasions this afternoon, the minister has stated his position that a differentiated settlement is one option further down the line, but what assessment has the Scottish Government made of the economic impact of Scotland ceasing to have regulatory alignment with the rest the UK?

It is quite obvious that we have assessed the difficulties of ceasing to have regulatory alignment with the EU. We are in a position where our own paper and future papers have reflected on all of the issues. However, I ask the member to think about this. I have made it absolutely clear that the best solution is to have regulatory alignment across these islands. That is the work that we have been trying to achieve—it is the position that we have laid out. We are grateful for the support of the Labour Party, frequently, in this chamber, on the issue of the single market. If we focus on what might unite us to achieve that, we would probably achieve more than if we focus on what divides us. Here is an opportunity for the chamber to achieve something and I hope that we can do it together.

Does the minister accept that there is a credible alternative to the Tory Brexit shambles that, first, respects the result of the referendum; secondly, resolves the issue of the border between Northern Ireland and the Republic of Ireland; thirdly, challenges the economic deficit that will come from Brexit; and, finally, stops further austerity? That alternative is to support permanent membership of the single market and the customs union for the entire UK. There is a natural majority across the UK for permanent membership of the single market and the customs union.

We could find ways to disagree but I will not disagree with Mr Sarwar. That is absolutely what should take place. I have described a single market solution as not transition but destination. That would be another way of putting what the member has just described. That is available to us. Contrary to the completely erroneous information given by David Jones on a television programme on which I appeared with him this morning, it is perfectly possible for the UK to say, “We now see that the best result would be for us to stay in the single market and the customs union.” There is a mechanism so to do, through European Free Trade Association and European Economic Area membership. I am absolutely sure that a way could be found to do that, which would solve the issue.

It would also create the circumstances in which negotiations become much clearer and easier, because the negotiations would then be about a single market solution; a single market minus solution perhaps, but a single market solution. That is a completely clear path out. Almost uniquely, I am not going to disagree with Anas Sarwar. I am not going to disagree with Daniel Johnson or Lewis Macdonald either. We are as one on that and I am very glad that we could unite on the issue of single market membership.