Live Foreign Affairs Committee

:00:00. > :00:00.with David Davis. Collins coverage continues live on our website. We

:00:00. > :01:07.will return to the Commons once the committee has finished.

:01:08. > :01:19.Welcome to this afternoon session of the Foreign Affairs Committee on the

:01:20. > :01:25.ongoing enquiry into Brexit process. The Secretary of State, you are very

:01:26. > :01:33.welcome. I note this is your second meeting in two days and you told the

:01:34. > :01:38.house of Lords EU scrutiny committee yesterday impeding in front of them

:01:39. > :01:42.was a particular pleasure. -- appearing in front of them. Digital

:01:43. > :01:47.Economy Bill I hope to be back today. Is that what you schedule a

:01:48. > :01:58.meeting at that site of the building. It was not me who don't be

:01:59. > :02:03.scheduling. The scheduling was theirs. You presumably make the

:02:04. > :02:08.decision to go there first and that is the gentle book I want to take

:02:09. > :02:13.into my question, to examine your assessment of the legal and

:02:14. > :02:18.parliamentary implications of the Brexit process. Can you confirm

:02:19. > :02:21.there is going to have to be an act of Parliament in order to leave the

:02:22. > :02:26.EU? You there will have to be some

:02:27. > :02:31.legislation, no doubt about it. There are various stages. Firstly,

:02:32. > :02:34.legislation to deal with the European communities act 1972 and

:02:35. > :02:46.the consequential legislation from back. -- on from that. There may

:02:47. > :02:55.have to be parliamentary ratification under the relevant 2010

:02:56. > :03:02.legislation. The so-called USO legislation. That is the absolute

:03:03. > :03:09.minimum that I can see. -- Cragg legislation. So we cannot leave the

:03:10. > :03:15.EU if that is not in place? Well, we can leave but what the legislation

:03:16. > :03:21.does is put in place directives and various other pieces of law which

:03:22. > :03:30.will still have effect if we did not. Whilst we require a treaty

:03:31. > :03:34.change, we were in that sense still be reporting back to the European

:03:35. > :03:38.Court in some respects. Digital Economy Bill what I am

:03:39. > :03:47.seeking to establish if there are acts of parliament to be put in

:03:48. > :03:52.place or repealed. So, that is perhaps why you were at

:03:53. > :03:55.the other side of the building, my assessment is that there is a

:03:56. > :04:00.majority in the House of Commons to support the Prime Minister in Brexit

:04:01. > :04:03.means Brexit and despite the fact the number of conservatives were

:04:04. > :04:10.campaigning to remain in the EU they have accepted the decision of the

:04:11. > :04:15.electorate and will now support the Government in the process of leaving

:04:16. > :04:20.the EU. However, it is my assessment you could not be as confident that

:04:21. > :04:26.is the position down the other end of the building in the house of

:04:27. > :04:30.Lords, would you agree? Well, you are wrong about the

:04:31. > :04:35.calculation in that there was no calculation in terms of who I saw

:04:36. > :04:39.first and second, I have not made an assessment of what the balance of

:04:40. > :04:45.power or balance of interest or voting with the end of each house.

:04:46. > :04:55.It is a bit early to do so for a start. Any legislative change would

:04:56. > :05:01.be based at least in part where the negotiation had got to buy them and

:05:02. > :05:06.whether or not individual members of each house approved. I do not know

:05:07. > :05:09.where we will be. My hope and intention is we will have a majority

:05:10. > :05:15.in both houses. Can I gently suggest the Government

:05:16. > :05:18.could be reasonably confident that of a majority in the Commons in

:05:19. > :05:23.order to carry out the decision of the British people, that is a rather

:05:24. > :05:28.more open question about the attitudes of the house of Lords,

:05:29. > :05:35.where the Government has a significant minority and there are a

:05:36. > :05:39.number of conservatives who are appear to be determined to obstruct

:05:40. > :05:46.the country's wrote to Brexit. If you were in that place, then

:05:47. > :05:53.obstructing the Acts of Parliament that are required to enable Brexit

:05:54. > :05:57.is something that will have to be overcome by the House of Commons

:05:58. > :06:03.using the Parliament act. What I would suggest to you whether you

:06:04. > :06:07.would agree if it was a sensible idea for the legislative process to

:06:08. > :06:11.be commenced in sufficient time for it to be on the statute book having

:06:12. > :06:17.overcome opposition in the house of Lords by the use of the Parliament

:06:18. > :06:21.act so we can leave the EU by the early part of 2019.

:06:22. > :06:27.The other Mac again, I will challenge the basis on which you

:06:28. > :06:31.make your argument. The simple truth is what the Government is doing is

:06:32. > :06:35.carving out the biggest ever mandate giving to the Government by the

:06:36. > :06:43.British people -- carrying out. Nearly 17.5 million people. Had it

:06:44. > :06:49.been in general election between two parties called Leave and Remain,

:06:50. > :06:55.majority for Leave would be better than Tony Blair's majority 1997. --

:06:56. > :06:59.the majority for leave would be bigger. It is a clear mandate and

:07:00. > :07:07.the house of Lords would be unwise not to take that seriously. They

:07:08. > :07:11.have a perfectly reasonable possession and challenging elements

:07:12. > :07:16.of the negotiation but I would be very surprised if they were unwise

:07:17. > :07:18.enough to go down the route or blocking it.

:07:19. > :07:24.. It has been a review of this committee the Government was guilty

:07:25. > :07:30.of gross negligence for not preparing for Brexit in advance. It

:07:31. > :07:33.might -- it is also the view that it may amount to gross negligence if

:07:34. > :07:38.you proceeded on the assumption all would-be hunky-dory and you would

:07:39. > :07:43.get you legislation in good order because the house of Lords were

:07:44. > :07:49.minded to upgrade instruction of the British people. Wouldn't it be

:07:50. > :07:51.prudent to make sure your legislation was then placed

:07:52. > :07:59.insufficient time to allow us to leave the EU? On a date of the

:08:00. > :08:03.Government's choosing or at the conclusion of negotiations two years

:08:04. > :08:06.after giving notice under article 50.

:08:07. > :08:12.You are jumping to the conclusion of the committee report on a decision I

:08:13. > :08:15.have yet to take. I suspect it is getting the committee ahead of

:08:16. > :08:20.itself. I am clearly intending to get us to

:08:21. > :08:25.a position of leaving the EU within the normal article 50 timetable. I

:08:26. > :08:30.will make the legislative arrangements that are necessary to

:08:31. > :08:36.get there. That is the simple case of the matter. I will not, I am

:08:37. > :08:40.afraid, hypothesised with this committee or any other about the way

:08:41. > :08:45.I got house will vote. That is buggy whips and the usual channels to do

:08:46. > :08:51.and I will make decisions based on the advice. -- that is for the whips

:08:52. > :09:01.to do. I will not air this any more public than outwards jeopardise

:09:02. > :09:06.them. -- van with the jeopardise. I am grateful for Europe reply this

:09:07. > :09:13.morning on my letter to the Attorney General of legal issues on leaving

:09:14. > :09:18.the EU. I wrote to him and invited him to reply by the 13th of July and

:09:19. > :09:27.I am delighted he finally replied on the 13th of September. Albeit from

:09:28. > :09:32.me. I am very grateful. What I am less satisfied by is the terms of

:09:33. > :09:37.your answers. I want to explore why you are unable to give answers to

:09:38. > :09:42.some rather basic questions. The first question I put to the attorney

:09:43. > :09:46.was can all be directly applicable regulations currently applied to the

:09:47. > :09:51.UK be transposed into UK law in a single act of Parliament. That

:09:52. > :09:58.struck me as a rather straightforward question and your

:09:59. > :10:01.reply said you would appreciate the questions raised in your letter

:10:02. > :10:06.touched on issues currently the subject of legal proceedings, to

:10:07. > :10:09.which the Government is party. Areas raised by them watch it would

:10:10. > :10:16.therefore not be appropriate for me to comment on. Please do explain how

:10:17. > :10:21.this simple technical question about whether or not it is possible to use

:10:22. > :10:25.the single act of Parliament impinges on at action being taken

:10:26. > :10:29.against the Government about the operation of article 50. I can talk

:10:30. > :10:36.about the issues relating to the act of Parliament. Let me do that here

:10:37. > :10:40.and now. There are a number of ways you can put into effect such an act

:10:41. > :10:50.of Parliament. One of them is to have a poor... Puts everything in

:10:51. > :10:57.place at once. It would be huge and to come back to you earlier position

:10:58. > :11:00.about timing on this, it would have to wait until very late on in the

:11:01. > :11:10.process because we would need to know what we were doing with each

:11:11. > :11:17.components of the exit from the EU. Even were it a simple exit with

:11:18. > :11:24.almost no amendments to it and were we setting out in order to do all

:11:25. > :11:33.the changes letter on it would still be complicated because, taking a

:11:34. > :11:37.trivial example, when local government, under European law they

:11:38. > :11:44.have to put the bed into the European system. That would deal

:11:45. > :11:46.with all those tiny things either directly or with a spectacular Henry

:11:47. > :11:59.VIII closes. That is one aspect. But you can do it rather more early

:12:00. > :12:05.and have a whole series of successive pieces of legislation, so

:12:06. > :12:11.there is a problem, which you can see... I am not sure I do. My

:12:12. > :12:15.question was, how does the question you opposed in my letter to the

:12:16. > :12:21.attorney excuse the reason you gave for not... No, your reason for not

:12:22. > :12:24.answering the question was that it impinged on that and I don't

:12:25. > :12:30.understand the connection. From memory, there was a reference to

:12:31. > :12:39.that, to Article 50, was in there? No. It was good all the current

:12:40. > :12:42.causes relating to the UK could be retained should Parliament wish

:12:43. > :12:45.that? Your argument is this is currently the subject of legal

:12:46. > :12:50.proceedings... That was an error because I thought it was a reference

:12:51. > :12:54.to Article 50. There was not. I wonder if you could have another go

:12:55. > :12:57.in a letter to the committee at answering that question. Of course

:12:58. > :13:03.we can but we can also deal with the substantive issue right year, which

:13:04. > :13:07.is the nature of the legislation we are likely to carry through. You can

:13:08. > :13:14.either have very simple legislation which meets your requirements of

:13:15. > :13:20.going earlier... What is the simplest? I suppose the position it

:13:21. > :13:26.that is, you've got all this directly applicable regulations not

:13:27. > :13:29.put through, so not in British law at the minute, we will leave the

:13:30. > :13:35.European Union- do we try to make a judgment about whether the 6987

:13:36. > :13:39.regulations that directly apply, that we go through them one by one

:13:40. > :13:44.and decide which to keep on which to leave, when we leave, or will we

:13:45. > :13:48.keep... Put all of them into line take our time to go through and

:13:49. > :13:51.decide which ones we don't want? The decision we have to take is whether

:13:52. > :14:00.one has a simple piece of legislation with a cascading set of

:14:01. > :14:05.SIs following on from it and the House of Lords famously does not

:14:06. > :14:10.like that, it does not like things that create lots of statutory rights

:14:11. > :14:12.for ministers rather than going through primary legislation... Or

:14:13. > :14:17.you could do it with a small piece of upfront legislation and then a

:14:18. > :14:22.mixture of primary and secondary, or you could do a huge one that would

:14:23. > :14:26.need to be linked because you would need to know what the changes were

:14:27. > :14:34.before you started. Before you started the legislation. Right. It

:14:35. > :14:40.is... No, I think what you have said in answer to the first question is

:14:41. > :14:44.yes, which is obviously... I am grateful for an answer. Then there

:14:45. > :14:48.are options beyond that... Let me be clear. I do not want you to take

:14:49. > :14:54.this guidance from me. My hands at the first question was yes. What was

:14:55. > :14:57.question one in this context? Can all the directly applicable

:14:58. > :15:03.legislation is that apply currently in the UK be translated the EU

:15:04. > :15:13.law... -- translated to the law. Yes. Am grateful for that. The

:15:14. > :15:23.second question posted a to you, -- posted in the letter I posed. Let me

:15:24. > :15:27.for the benefit of the record... The second question I asked you. On what

:15:28. > :15:33.terms will the UK and EU trade at the end of the two-year negotiating

:15:34. > :15:39.period mandated by article 50 of the Lisbon Treaty, if no deal has been

:15:40. > :15:44.agreed between the UK and EU on the terms of the UK's exit from the EU,

:15:45. > :15:51.or no deal has been agreed on the future relationship between the UK

:15:52. > :15:57.the EU? Plot that posits is the rather obvious possibility that

:15:58. > :16:03.there is either a blocking minority amongst the 27 who declined to come

:16:04. > :16:05.to an agreement, or the European Parliament who has a majority

:16:06. > :16:11.against whatever is negotiated between you and the 27. That strikes

:16:12. > :16:20.me as a rather obvious possibility. The answer you gave to me and the

:16:21. > :16:24.committee was, "Turning to trade, we are about to begin these

:16:25. > :16:28.negotiations and it would be wrong to set out further unilateral

:16:29. > :16:32.positions in advance." "As the Prime Minister has said, the UK will

:16:33. > :16:36.strike a bespoke agreement that gets the best deal for people at home and

:16:37. > :16:42.the right deal for Britain abroad." That is not in the gift of the Prime

:16:43. > :16:46.Minister, is it? It will have to be an agreement between us and our 27

:16:47. > :16:51.partners endorsed by a majority of the European Parliament? The Prime

:16:52. > :16:59.Minister cannot make that statement. Yes, those are her games. Aims, yes,

:17:00. > :17:05.but the fact is she cannot guarantee it -- those are her aims. She cannot

:17:06. > :17:08.guarantee it and neither can you. Nobody can guarantee the

:17:09. > :17:14.negotiations. The process we are about to embark on, there is no

:17:15. > :17:20.agreement. That is... That as a possible outcome. One possible

:17:21. > :17:24.outcome. But all I have done is asked you, or as the Attorney

:17:25. > :17:30.General, and you were kind enough to send me a letter which... Has not in

:17:31. > :17:38.my judgment entirely addressed the question, shall I say? That... I

:17:39. > :17:41.think it is a rather straightforward and simple question. And I think

:17:42. > :17:47.there is a very important reason you should answer it as soon as you are

:17:48. > :17:50.in a position to do so, and that is it is a kind of technical question.

:17:51. > :17:56.What happens if there is no agreement? That then addresses a

:17:57. > :18:01.vast amount of the uncertainty that is out there, for example, you know,

:18:02. > :18:05.in a memorandum from the Japanese, for example. People looking for

:18:06. > :18:10.certainties as to what happens. If it is clear, if there is no

:18:11. > :18:13.agreement in the negotiation, what the position is, then you address a

:18:14. > :18:17.vast amount of the uncertainty out there with individual companies and

:18:18. > :18:20.the rest, and they can then watch the negotiations and make their

:18:21. > :18:24.commercial judgment according to how they perceive them as going given

:18:25. > :18:29.whatever guidance you will be able to get, but then they will at least

:18:30. > :18:34.know how bad it can get from their position, or how good it can get, if

:18:35. > :18:37.there is no deal. There may be an opportunity for them if there is no

:18:38. > :18:42.deal, but simply explaining what the technical position is going to be,

:18:43. > :18:46.our terms of trade into the Single Market, in those circumstances, that

:18:47. > :18:50.strikes me as firstly answerable and indeed necessary to answer. It

:18:51. > :18:54.depends what you are after. If you want a factual statement of what the

:18:55. > :18:59.outcome could be, I guess it is what is normally known as world trade

:19:00. > :19:04.organisation rules, largely. That is I guess what the conclusion would be

:19:05. > :19:09.if we are outside with no deal, but I would not anybody to think in my

:19:10. > :19:13.view that was a likely outcome. I am not asking whether it is a likely

:19:14. > :19:20.outcome or inviting you to put probability on it. I am inviting you

:19:21. > :19:28.to get us tooks to an agreed understanding it is W -- World Trade

:19:29. > :19:31.Organisation rules that will govern us into the Single Market... I think

:19:32. > :19:37.that is a matter of commonly held fact. That is all I was seeking to

:19:38. > :19:41.get the confirmation of because there have been people suggesting

:19:42. > :19:43.there are complications about putting the World Trade Organisation

:19:44. > :19:46.rules in position and if you are telling this committee that is a

:19:47. > :19:55.matter of commonly held fact, and it is a fact, then that gives everybody

:19:56. > :19:59.a bottom-line from which to work all the... And all the interests, which

:20:00. > :20:05.as you know is a very large number... Except, and this is one of

:20:06. > :20:11.the problems, we are dealing with negotiations which as I said

:20:12. > :20:16.yesterday are extremely contributed. The World Trade Organisation rules

:20:17. > :20:21.essentially apply just as Paris, but the nontariff barriers are one of

:20:22. > :20:26.the primary barriers. -- applied just as tariffs. It is a simple

:20:27. > :20:30.answer. Of course there is a complacency about how the nontariff

:20:31. > :20:36.barriers are operated on the rest. But I think there is a very great

:20:37. > :20:41.need for as much clarification of what can be reasonably clarified and

:20:42. > :20:45.is part of the obvious bounds of which a negotiation can take place

:20:46. > :20:52.and obviously one of those is no agreement, for that to be clearly

:20:53. > :20:58.established and put out there. You're gone very great deal further

:20:59. > :21:02.in answers to me than you, than the U probably signed off in some case

:21:03. > :21:08.this morning when he realised it was outstanding. It was not outstanding

:21:09. > :21:13.for me... Yes, and the Attorney General has not done this to mind

:21:14. > :21:18.and I appreciate that, and I am grateful... No great deed ever goes

:21:19. > :21:21.unpunished. LAUGHTER

:21:22. > :21:29.I am very grateful for the detail you have now given. One further

:21:30. > :21:43.question from me before moving on to Mr Gates. Max Orrin, -- sorry, but

:21:44. > :22:01.who will you be negotiating with? First off, the commission has

:22:02. > :22:23.appointed Mr Barnier, the Parliament has

:22:24. > :22:32.appointed Mr Verhofstadt, and I went to Dublin and spoke to Mr Flannigan,

:22:33. > :22:36.and... My question is, in a sense, who are you formally negotiating

:22:37. > :22:45.with? We are formally negotiating with the council. And... There

:22:46. > :22:49.appears to be some dispute between the council. If you will forgive me

:22:50. > :22:57.that is not for me to resolve. We may return to the involvement of the

:22:58. > :23:01.European Parliament later in questions. Awarded a little bit more

:23:02. > :23:04.clarity on the question of the letter when you see it is possible

:23:05. > :23:10.to have a position where we adopt all the 6800 EU laws... But I

:23:11. > :23:13.thought he then went on to say that would be problematic and give the

:23:14. > :23:17.example of the local authority having to publish all their

:23:18. > :23:24.European... So it wouldn't be workable? You have to deal with that

:23:25. > :23:30.by a series of follow-on legislation, something like that-

:23:31. > :23:36.would through an SI, and it would not be confirmed to just that. It

:23:37. > :23:42.would not be confirmed to the sort of minor problems like that - they

:23:43. > :23:46.would be substantive changes, changes in immigration law, changes

:23:47. > :23:49.in a whole series of matters currently to do with European Union,

:23:50. > :23:56.some of which could be quite significant. So the problem there is

:23:57. > :23:59.a generating a lot of secondary legislation and possibly some

:24:00. > :24:02.primary legislation. It may not resolve the issue in the way your

:24:03. > :24:05.chairman was saying earlier. If there is not time to get it through,

:24:06. > :24:11.what happens? That is why it is difficult. And just on the timetable

:24:12. > :24:16.and of course I completely understand you cannot give any

:24:17. > :24:20.committee a running commentary on negotiations or positions the

:24:21. > :24:25.Government would take, but could you at least see when you expect the

:24:26. > :24:33.Government to agree a clear set of objectives for Brexit negotiation.

:24:34. > :24:37.Do you have a target? That is one of them and probably the primary one is

:24:38. > :24:42.the Prime Minister has said we will not trigger Article 50 until

:24:43. > :24:48.sometime in the New Year, after the end of this year. Because we are

:24:49. > :24:52.going through that process as it stands, and I can talk you through

:24:53. > :24:55.that if you want to hear it. Assessing, negotiating aims,

:24:56. > :25:00.negotiate and tactics, the legalities, the very things we have

:25:01. > :25:04.been speaking about, the legalities of Article 50, and all those things

:25:05. > :25:09.really have to be fairly clear before you start, so we will arrive

:25:10. > :25:12.at that something in the New Year. So you will have all of your

:25:13. > :25:18.objectives in place sometime in the New Year, so by January? I will not

:25:19. > :25:23.guess on that, with the best will in the world. I have said before I

:25:24. > :25:29.would rather go one month late and get it right and go a month early

:25:30. > :25:32.and get it wrong. That has slightly flipped the phrase but it

:25:33. > :25:40.characterises it. But early in the New Year? Your target? The Prime

:25:41. > :25:43.Minister certainly one very public comment and one that was implicit I

:25:44. > :25:48.figured what she said. Firstly, it will not be this year. Secondly, she

:25:49. > :25:53.knows that British people expect us to be expeditious about it.

:25:54. > :26:00.After reaching that position when will the Government set out your

:26:01. > :26:05.objectives or will you not set them out at all? We will certainly set

:26:06. > :26:09.out some objectives, the level of detail of the game is another matter

:26:10. > :26:17.but the overall aim will be set out clearly. Apart from anything else,

:26:18. > :26:23.you have got Parliament is having an interest in its and as I said

:26:24. > :26:26.yesterday to the Lords committee we will meet that as far as we can

:26:27. > :26:38.without jeopardising the overall aim. Also, we have, when rewriter

:26:39. > :26:43.Donald Tusk under Article 50 we will write a letter and a sum that would

:26:44. > :26:51.include a statement of our aims. So that would be early in the New Year?

:26:52. > :27:00.I will not be drawn on dates. You said you would hold roundtable

:27:01. > :27:04.debates with stakeholders. Can you explain in more detail how the

:27:05. > :27:10.process will actually work? Will you publish open calls for evidence or

:27:11. > :27:14.contributions from stakeholders will you and other departments select

:27:15. > :27:19.those who you wish to hear from? A bit of both. Some of it is

:27:20. > :27:25.self-selecting because anybody who is concerned about their own

:27:26. > :27:35.industry will be wanting to have a round table so, for example, last

:27:36. > :27:44.week a Citigroup had a roundtable chair by the Chancellor. -- a drip

:27:45. > :27:53.from the City. I have one other retail this week. I have set in the

:27:54. > :28:00.house I saw the TUC, they were the first people I saw. The fishermen's

:28:01. > :28:07.organisations, you name it. The whole series will stop where we

:28:08. > :28:11.think it is at issue and people who are concerned.

:28:12. > :28:17.And that is how you ensure it is wide-ranging and representative?

:28:18. > :28:22.Bear in mind... Sorry, I left out the section. Also bear in mind is we

:28:23. > :28:27.put to one side the devolved administrations because they have

:28:28. > :28:31.got a separate set of almost parallel operations going on, but

:28:32. > :28:39.every single department is it's also been asked, was passed at the

:28:40. > :28:44.beginning of the summer, -- was passed. Coming back with their

:28:45. > :28:52.primary concerns and their client group. That is also happening. I

:28:53. > :28:57.cannot think of any other way of making any more exhaustive comments.

:28:58. > :29:04.And the Department is suitably resourced for this? More of the

:29:05. > :29:10.resource is in the department that with us. My department is subject to

:29:11. > :29:18.Solomon... My department is quite small but as Grand Rapids. -- has

:29:19. > :29:26.expanded rapidly in the past month but is still only around 200 people.

:29:27. > :29:31.What we are doing, the strategy we are taking is having a small number

:29:32. > :29:36.of very high calibre civil servants of each of the main departments, not

:29:37. > :29:40.trying to replicate the entire policy went off, let's say, the Home

:29:41. > :29:46.Office. That makes it work better, more effective, we not duplicating,

:29:47. > :29:55.there are no turf wars and it is a better way of doing it. How will it

:29:56. > :30:00.work when you start negotiating? You are missing out this step. The step

:30:01. > :30:04.between now and then, the negotiations starting, will involve

:30:05. > :30:17.a degree of assessments of the size of the problem. For example,

:30:18. > :30:22.somebody has said that the nontariff barriers are better than tariff

:30:23. > :30:26.barriers and they have cited various ways so we will do a quantification

:30:27. > :30:29.of natural before we start negotiating we will have an idea of

:30:30. > :30:34.what is big or small and what matters and what does not. We will

:30:35. > :30:39.not necessarily publish all that because that is a gift to the other

:30:40. > :30:46.side that we will know it. Welcome, secretary of state. These

:30:47. > :30:52.are complex negotiations at you do not want to compromise your

:30:53. > :30:58.position, but many of us believe if access to the single market cannot

:30:59. > :31:02.be gains on terms reasonable to both sides then certainly for those goods

:31:03. > :31:08.subject to tariffs we should not be afraid to fall back on the WTO

:31:09. > :31:16.rules. Is there any reason we should not do that?

:31:17. > :31:25.I will not commit to any particular strategy at the moment, for obvious

:31:26. > :31:28.reasons. Firstly, let me offer a philosophical approach. I think it

:31:29. > :31:34.is a bad idea to go into negotiation feeling any outcomes. Because that

:31:35. > :31:41.weakens you in one respect of another -- fearing any outcomes.

:31:42. > :31:53.Speaking about the calculations that will go on and we will assess not

:31:54. > :31:57.just what the costs of a given strategy is but also what the

:31:58. > :32:02.policies that go with it. So, people might say it will cost this or that,

:32:03. > :32:09.they have not necessarily taken on board how we might mitigate costs. I

:32:10. > :32:14.see nothing to fear in any outcome. On immigration, mainly in the EU

:32:15. > :32:18.Commission the early suggestions are linking immigration or free movement

:32:19. > :32:25.with trade negotiations. Many of those who voted to leave, one of the

:32:26. > :32:31.key reasons was we had a immigration system discriminatory against the

:32:32. > :32:35.rest of the world outside the EU and what was wanted was fairness,

:32:36. > :32:40.whatever the criteria that will guide the policy going forward it

:32:41. > :32:43.must be fair so that is the discrimination. Is that the sense of

:32:44. > :32:57.the position within the Government, as you see it?

:32:58. > :33:00.My job is to get the power was back, that raggedy power back, respect the

:33:01. > :33:10.will of the British people which I tend to think of... -- get those

:33:11. > :33:15.powers back. To respect that as much as we can in negotiations. When we

:33:16. > :33:21.get it back it is only Home Office to make decisions on how to use that

:33:22. > :33:27.power. Whilst I have sympathy with your description of it, it is not me

:33:28. > :33:35.who the decision. The decision on how we decide on the final policy.

:33:36. > :33:38.Final question. The certainty of that position is if you endear to

:33:39. > :33:45.the principle of fairness, whatever the criteria used, essentially

:33:46. > :33:48.adhere to the principle there will be no discrimination, you

:33:49. > :33:52.effectively divorce immigration and free movement from the trade

:33:53. > :34:00.negotiations because you can offer nothing special to the EU as such.

:34:01. > :34:05.You need to explain that begin to me. The subtlety of the principle of

:34:06. > :34:08.fairness is not only that it is right, in that you will not

:34:09. > :34:12.discriminate against one region of the world against another, but in

:34:13. > :34:19.pursuing the principle of fairness you actually divorce in effect

:34:20. > :34:23.immigration and free movement of labour from trade negotiations. I

:34:24. > :34:34.did actually understand that the first time. For obvious reasons I

:34:35. > :34:40.will not be drawn on it. Can you see nothing? Can I pressure on this? It

:34:41. > :34:44.is a key plank of the campaign. The Prime Minister made it plain the

:34:45. > :34:49.current system cannot be allowed to stand. She said we will not have

:34:50. > :34:52.free movement as it now is. She talked about control borders so I do

:34:53. > :34:57.not think there is any doubt about the priority that on this and I do

:34:58. > :35:02.not think our European partners would doubt that either. And some of

:35:03. > :35:11.them have commented publicly in disagreement with her, for example,

:35:12. > :35:19.the Irish head commented over the weekends disagreeing with us but it

:35:20. > :35:24.is plain this is a priority. You mentioned you have a meeting

:35:25. > :35:30.with the TUC, which is very welcome and unusual for the Government in

:35:31. > :35:37.recent years to have such an early meetings with ministers and the TUC.

:35:38. > :35:44.You previously... I do have formed in this.

:35:45. > :35:47.Perhaps then you can answer the question that you previously said

:35:48. > :35:56.workers should not lose their rights as a result of Brexit. Is that your

:35:57. > :35:59.personal view or is that because the view of the Government? It is a

:36:00. > :36:07.personal view but I have not been disagreed with. So there has been no

:36:08. > :36:12.discussion in Government yet about an erosion of workers' writes?

:36:13. > :36:17.Not on that specific issue and what I have said two other members of the

:36:18. > :36:27.committee is we will not get drawn into the policy elements of this.

:36:28. > :36:33.Because it has implications that would... To put it another way, if

:36:34. > :36:36.you lay a red lines you are negotiating opponent does is head

:36:37. > :36:44.straight for that line and use it against you. I do not propose to

:36:45. > :36:50.elaborate on the comments -- I do not propose to elaborate but the

:36:51. > :36:56.comment stands. Yesterday you told the Lords select

:36:57. > :37:02.committee you will ask businesses to give you a quantitative assessment

:37:03. > :37:08.of the impacts of various scenarios on their sectors. How are you going

:37:09. > :37:17.to assess that data, the validity of that paper? I was talking to Lord

:37:18. > :37:22.Green and what I said what we would carry out these assessments and some

:37:23. > :37:30.of the information will, from that but the same way you test any data

:37:31. > :37:34.given to you, you look at how it is calculated. Will be businesses carry

:37:35. > :37:41.out or will you. We will carry out some of our own. Earlier I sighted

:37:42. > :37:52.people comparing effect of Paris and nontariff barriers on how you set it

:37:53. > :37:55.-- Paris and nontariff. -- tariffs and nontariff. Usage of the

:37:56. > :38:00.department does not date have the capacity says that they do. When do

:38:01. > :38:05.you expect to have that capacity? The trite answer is before we need

:38:06. > :38:12.it but the sequence of events is like this, at the moment we are

:38:13. > :38:16.doing the round tables and bilateral discussions. We will then asked for

:38:17. > :38:23.data and submissions from them, we will then begin assessment. That is

:38:24. > :38:28.a little while away but I suspect the department will double again in

:38:29. > :38:34.size. Will that be before or after article

:38:35. > :38:39.50s triggered? Before. Slot and you will not

:38:40. > :38:44.trigger article 50 until your department is at capacity to carry

:38:45. > :38:48.out the functions. To carry out those functions. That is self

:38:49. > :38:54.evident, I would have thought. And will you be drawing on the

:38:55. > :39:03.competencies and documentation produced by ministers before the

:39:04. > :39:08.referendum, the whole process went through when William Hague was

:39:09. > :39:14.Foreign Secretary. Most of this is a new process. I

:39:15. > :39:17.think when the committee... It is a very big process and there is a lot

:39:18. > :39:21.of work going on and pretty much every department is involved and

:39:22. > :39:29.they will be doing a fair amount of analysis themselves and then

:39:30. > :39:39.challenging it. Final question. Given the clear reluctance you have

:39:40. > :39:49.two states what you're negotiating position is going to be and not give

:39:50. > :39:53.answers today or yesterday, how long do you think you can sustain this

:39:54. > :39:58.position? Isn't the reality that it will become politically impossible

:39:59. > :40:04.domestic calling, not just internationally and are therefore it

:40:05. > :40:07.might be better that the Prime Minister and her new team actually

:40:08. > :40:14.got a mandate from the British people before they trigger article

:40:15. > :40:19.50? An early general election before article 50.

:40:20. > :40:25.I am addicted to say that is above my pay grade but it puts the rest of

:40:26. > :40:32.Europe questioning in context. -- I am tempted to says.

:40:33. > :40:39.My questions are the kinds of questions people want answers to

:40:40. > :40:42.your job is to answer them. My job is to make decisions on behalf of

:40:43. > :40:49.the people. We have a mandate like no other. It is our job to deliver

:40:50. > :40:53.on that mandate and our job to do it as best we can which means carrying

:40:54. > :40:58.out the negotiation in an intelligent way, making the

:40:59. > :41:02.decisions on the basis of the data we collect, analyse and make a

:41:03. > :41:06.decision on that basis, not the other way round. It may be your

:41:07. > :41:10.approach to save because we are asking the question you must tell us

:41:11. > :41:16.the answer before you have out but that seems daft, to me. You have not

:41:17. > :41:19.worked out the answers to any of these questions yet?

:41:20. > :41:23.We have worked out some answers but not to the questions you have asked

:41:24. > :41:28.and we have a major exercise under way and we will look at every single

:41:29. > :41:32.sector industry, every single department of state has got the

:41:33. > :41:38.workloads on less and they will come to intelligent conclusions and that

:41:39. > :41:41.will drive the outcome, empirical outcome to this process, not

:41:42. > :41:43.politically driven answers but allowing you to say should we have

:41:44. > :41:54.an election. I think these questions have

:41:55. > :42:03.established the level of negligence... As a not above my pay

:42:04. > :42:14.grade... Yes, not responsible to, Secretary State. Goodies you back in

:42:15. > :42:21.Government, Mr Davies. We are clear on the accentuation of the fact that

:42:22. > :42:27.was preparatory work on the situation post Brexit, and it has

:42:28. > :42:30.clearly been indicated the ball is in our court for triggering this.

:42:31. > :42:36.Can I ask you, bearing in mind we have opted two years for this

:42:37. > :42:51.renegotiation process, what are the delays in invoking Article 50 -- up

:42:52. > :42:53.to two. The primary delay is doing the necessary preparations. It would

:42:54. > :42:57.be quite difficult for any government to do the level of

:42:58. > :43:01.analysis we are undertaking now. It is enormous. As I say, every

:43:02. > :43:08.department is involved in it, pretty much. That is the first thing. It is

:43:09. > :43:11.time consuming, it simply is time-consuming, first to collect the

:43:12. > :43:15.data, to establish the nature of the... Let me give you another

:43:16. > :43:21.example. The City of London, there has been a lot of concern about

:43:22. > :43:24.passports and so on, and some companies have raised issues about

:43:25. > :43:28.this. Some companies care about it and some do not. We need to

:43:29. > :43:33.understand why some care and some don't and what the differences are,

:43:34. > :43:38.we need to understand whether there needs to be a policy as do it or can

:43:39. > :43:42.be fixed the problems themselves with brass plates around the place

:43:43. > :43:46.and so on? There are a whole series of issues and that is just one

:43:47. > :43:57.sector. And the ecosystem is not an industry which fits together like a

:43:58. > :44:00.complex As many as are of the opinion, say 'aye'. To the contrary,

:44:01. > :44:02.'no'. Tower so there are studies underway and some still to be

:44:03. > :44:07.started which will take time to complete -- together like a complex

:44:08. > :44:15.jenga tower. The only way to do this responsibly is to do the analysis

:44:16. > :44:18.first, and clearly work out what the National priorities are, on the

:44:19. > :44:22.basis of that, then designed a negotiating strategy around that.

:44:23. > :44:26.That is why it takes time and I make no bones about it. I think the

:44:27. > :44:31.British people want us to do this properly, not necessarily incredibly

:44:32. > :44:36.fast. I understand obviously there is a huge amount of work to be done,

:44:37. > :44:41.analytical work, and we want to be ready for those negotiations with

:44:42. > :44:44.all the facts at our disposal. It is not an issue, though, however, on

:44:45. > :44:48.lack of resources for your department, is it? Do you have

:44:49. > :44:50.sufficient resources? There is a time constraint in the sense that

:44:51. > :44:55.the department has come from scratch. It did not exist two months

:44:56. > :45:01.ago, a little over two months ago. Most people around this table, you

:45:02. > :45:04.know what Whitehall is like in August. The recruitment process is

:45:05. > :45:09.not a straightforward as you might think. So it has taken time. There

:45:10. > :45:13.is no way round it. It is not a shortage of money resource. It is

:45:14. > :45:22.just a question of establishing the organisation in place. As I said to

:45:23. > :45:26.the Lords' committee yesterday, at the moment it is mostly civil

:45:27. > :45:31.servants, in fact entirely civil servants, and they are all quite

:45:32. > :45:36.young, smart people, but they do not have experience in the City, in

:45:37. > :45:44.industry, in various other areas, and the next phase is to bring in

:45:45. > :45:47.some grey hair to bring in that experience. It is not resources in

:45:48. > :45:54.the sense of money. There is no problem with that our European

:45:55. > :46:00.partners have been I think very understanding, certainly in public,

:46:01. > :46:06.about our delay. Obviously they are keen for us to invoke it as quickly

:46:07. > :46:09.as possible. Do you envisage a time when they will start to say publicly

:46:10. > :46:15.that they are concerned about the delay? Have you had any discussions

:46:16. > :46:20.with them about that? I think I am right... What the Prime Minister has

:46:21. > :46:25.been saying, and it may well have come up in those discussions, but I

:46:26. > :46:30.don't think it is material. The French government have been saying

:46:31. > :46:35.they wanted to be precipitated soon. I think one or two members of the

:46:36. > :46:39.Commission, Mr Jean-Claude Juncker, he has said he would like to be

:46:40. > :46:43.soon, but, you know, they are the other side of this negotiation. We

:46:44. > :46:49.will not necessarily do everything they say when they want us to do it.

:46:50. > :46:59.The counter to this is that they need some time as well. For example,

:47:00. > :47:03.to give you the parallel to this, my opposite number within the

:47:04. > :47:07.commission if you like, Michel Barnier, is just at the moment about

:47:08. > :47:12.to establish his own Department of 25 people, not 200 or 400, but 25

:47:13. > :47:16.for this instance so he can do his analysis, and they will need to work

:47:17. > :47:22.out for themselves what the consequences of our negotiating

:47:23. > :47:25.request questions are and they are also starting a process I do not

:47:26. > :47:34.think it is wasted time. OK, thank you. I can say I am familiar with

:47:35. > :47:42.some of the young talent supporting you in this room, obviously which

:47:43. > :47:46.iss some of which I am aware of as a minister. But speaking about grey

:47:47. > :47:48.hair, has approved rather more difficult to find experienced

:47:49. > :47:56.servants to come and join your department? You see experienced

:47:57. > :48:02.civil servants... And others... Union outsiders? Yes. This morning

:48:03. > :48:06.we had on offer, and I probably should not mean the company, but we

:48:07. > :48:10.had an offer of three senior partners from a very major law firm

:48:11. > :48:15.in this area, so we have had other offers as well. So no, there is not

:48:16. > :48:23.a shortage of interest in getting involved. For many of the companies

:48:24. > :48:28.in the City, indeed, in business in Britain, there are strong interests,

:48:29. > :48:32.shall we say? In providing us with good calibre people when they can.

:48:33. > :48:36.Some of the interest groups, not companies, are doing their own

:48:37. > :48:44.analyses as well, which we will incorporate and draw on as well. I

:48:45. > :48:47.wouldn't worry... I mean, I will tell the committee if I run into a

:48:48. > :48:52.constraint on this and I'm very happy to do so, but I am not at the

:48:53. > :48:55.moment concerned about that. There is a natural limitation on how long

:48:56. > :48:59.it takes to set up an organisation. I am setting up a battalion from

:49:00. > :49:03.scratch, basically. To put it in words you would be familiar with.

:49:04. > :49:11.You know, I am the recruiting Sergeant... Well, actually, it might

:49:12. > :49:17.be a battalion! We will see what we get. It will be as big as it needs

:49:18. > :49:23.to be. Good afternoon, Secretary of State. The people voted to leave the

:49:24. > :49:28.European Union. They expect us to leave the European Union. And we

:49:29. > :49:33.understand that it takes time to get these things right before we can

:49:34. > :49:38.actually do it. But in the meantime can you reassure the public, can you

:49:39. > :49:43.take actions, even small symbolic actions, to indicate that the

:49:44. > :49:47.Government is absolutely serious, deadly serious, about doing this,

:49:48. > :49:51.because there are jitters and there are people worried that this is not

:49:52. > :49:59.actually going to happen in the way they thought? Well, at the beginning

:50:00. > :50:06.of the summer, the Chancellor carried out the statement that we

:50:07. > :50:12.would underpin spending, structural funds, CEP funds and so on. If you

:50:13. > :50:15.wanted signal we wanted to reduce the jitters and say, we are

:50:16. > :50:31.definitely doing this, that was one CAP. That was one decision.

:50:32. > :50:36.CAP. Those argument is notwithstanding the be made over

:50:37. > :50:41.again. There was a debate I think in Westminster Hall last, in fact last

:50:42. > :50:47.Monday, on whether there should be a second referendum. The Prime

:50:48. > :50:51.Minister has said time and time again, you know, no second

:50:52. > :50:56.referendum, no reversals, nor avoidance. We are leaving the

:50:57. > :50:58.European Union. As a transition between now and when we leave the

:50:59. > :51:11.European Union, is there a possibility that we could

:51:12. > :51:18.look at EFTA is a way of continuing the existing trade relations and

:51:19. > :51:21.leaving the European Union much earlier by actually having that kind

:51:22. > :51:27.of transition? No, I don't think so. I don't want to get into it and I

:51:28. > :51:30.will not get into what arrangement we end up with when we leave. There

:51:31. > :51:36.are people who argue that as an outcome. There are others who argue

:51:37. > :51:44.instant departure, so I will not get into that but, no, I think this is

:51:45. > :51:49.the case. The strategy of the Government is to depart the Union at

:51:50. > :52:02.the end of the Article 50 process. Up until then, the Government will

:52:03. > :52:06.all be absolutely the European Union law and will be a good European

:52:07. > :52:09.Union citizen, that is the approach we are taking and we think it is the

:52:10. > :52:13.best approach in terms of our responsibilities and also we think

:52:14. > :52:18.it is the best negotiating approach -- the Government will absolutely

:52:19. > :52:23.obey European law. We will not walk away from our responsible days. We

:52:24. > :52:25.will take a stronger stance on European matters on defence,

:52:26. > :52:32.security and a whole series of other things. This is a bit of an

:52:33. > :52:38.indicator. But whether there are things we can do that would be

:52:39. > :52:44.legally OK to do, that it sure are symbolically... One example is new

:52:45. > :52:47.passports that will be issued from now on will go back to the

:52:48. > :52:53.traditional blue British passport rather than the pink things we have

:52:54. > :52:57.been using. You would need to ask the Home Secretary... Could we have

:52:58. > :53:00.symbolic gestures such as that to show the British people we are

:53:01. > :53:06.absolutely serious about leaving the EU? Attractive as the idea is, we're

:53:07. > :53:10.not in the business, or at least I am not in the business, of

:53:11. > :53:16.symbolism. I am in the business of delivering on this, and that is the

:53:17. > :53:19.point. On that very point of delivering, in your deliberations

:53:20. > :53:23.and negotiations and discussions about Britain's future, the United

:53:24. > :53:30.Kingdom's future, with the EU, what assurance can you give your taking

:53:31. > :53:34.into account the interests of Gibraltar and the British Overseas

:53:35. > :53:38.Territories and Crown dependencies, but particularly Gibraltar that have

:53:39. > :53:42.a huge amount of concerns about their position following Brexit?

:53:43. > :53:48.Well, we are, and I am seeing the chief means the Minister of

:53:49. > :53:52.Gibraltar almost after this meeting. -- the chief minister of Gibraltar.

:53:53. > :53:57.Simon thank you very much. The Secretary of State seems reluctant

:53:58. > :54:00.to go into specifics about exposing his negotiating hand but as you will

:54:01. > :54:04.recall straight after the referendum there was huge uncertainty in

:54:05. > :54:13.markets. The pound slumped, share prices down -- yes, thank you very

:54:14. > :54:20.much. We were led to understand they would not be a rush to invoke

:54:21. > :54:25.Article 50. To give some breathing space and the markets and many major

:54:26. > :54:29.investors time to speculate, on which approach we will take. You

:54:30. > :54:35.clearly do not want to be transparent about this but markets

:54:36. > :54:40.want what businesses want -- one markets, businesses and inverses

:54:41. > :54:43.want is to some degree transparency that the outcome will be something

:54:44. > :54:54.they can live with. You made it quite plain that you are not sure an

:54:55. > :54:57.EFTA model is for Britain, but do you have some arrangement you will

:54:58. > :55:01.keep secret until the last minute and that at the end of tonight years

:55:02. > :55:04.will be brought out like a rabbit out of the hat, that the

:55:05. > :55:07.international community, and in particular the business community,

:55:08. > :55:10.will be satisfied with, and in the meantime what damage do you think

:55:11. > :55:16.that will do to our international standing in the markets and the

:55:17. > :55:21.strength of the pound, and what is happening in investment in this

:55:22. > :55:23.country? Let me take it apart from the beginning. Firstly the

:55:24. > :55:30.description of the financial markets was just simply not true. The FTSE

:55:31. > :55:42.100 and all the various indicators are good. The standing of the pound

:55:43. > :55:46.is not in a poor place. Indeed the previous government I believe that

:55:47. > :55:48.that is where it should be, so I am not in the business of speculative

:55:49. > :55:54.on that but that description you have given is a little like

:55:55. > :55:57.descriptions people were giving in August trying to blame things on

:55:58. > :56:00.Brexit then of course all those things they were calling on Brexit

:56:01. > :56:04.dissolved on wearing there, so... Let me finish. You ask the question

:56:05. > :56:05.so I will answer. Firstly, your description of the economy is simple

:56:06. > :56:19.and not the case. The first thing to say to you is a

:56:20. > :56:24.big business decisions are not taken on the right thing of one

:56:25. > :56:29.commentator in the Financial Times, they are taken over a period of time

:56:30. > :56:35.and not taken off the back of the movement of the markets on one day

:56:36. > :56:40.or another. You will see the foreign investment into this country after

:56:41. > :56:46.the election of a Government that had undertaken the referendum was as

:56:47. > :56:53.high as it has ever been. We sought investment in the country in a big

:56:54. > :56:58.way. That night we saw investment. -- we saw investment. One business

:56:59. > :57:07.said they were going to continue to invest. So I frankly do not accept

:57:08. > :57:16.the premise but let's take the next step as well. That is what business

:57:17. > :57:20.views as uncertainty. A business that wants to see a decision taken

:57:21. > :57:26.on the basis of the facts, a Government doing representing the

:57:27. > :57:30.national interest and that is what this Government is doing. If I were

:57:31. > :57:36.still in business and worrying about whether to invest, I would not be

:57:37. > :57:40.panicked by a Government taking its time but by the Government rushing

:57:41. > :57:45.to do something in a tremendous hurry. The premise of your question

:57:46. > :57:49.is flawed. You say that, I know you had discussions with the Japanese

:57:50. > :57:57.ambassador so let me give you a short passage. What Japanese

:57:58. > :57:59.businesses wish to avoid the situation in which they are unable

:58:00. > :58:06.to play discern the rear brakes and negotiations are going and only

:58:07. > :58:12.grasping the whole picture at the end. It is imperative to regain the

:58:13. > :58:15.confidence of the world and ensure competitiveness by increasing the

:58:16. > :58:19.predictability of the Brexit process. That is not just through a

:58:20. > :58:24.Japanese company spot of companies around the world is wondering

:58:25. > :58:27.whether or not to pull out of Britain -- but of countries around

:58:28. > :58:35.the world. Because we will not have access. You said yourself, we may

:58:36. > :58:40.not be in the single market when this process is finished. That I say

:58:41. > :58:50.that? You are basing that on what evidence? Let me deal...

:58:51. > :59:00.Secretary... Let me finish, secretary of state. You mention

:59:01. > :59:03.investment but that is not companies like Nissan and a wholly owned by

:59:04. > :59:13.building factories, it is a British company is taken over by a Japanese

:59:14. > :59:20.company. It is not jobs and hard manufacturing. Let's not mix this

:59:21. > :59:25.thing as equivalent to the big car investments made in this country.

:59:26. > :59:31.You were the one another is the FTSE numbers. Many of the companies

:59:32. > :59:37.listed on the FTSE foreign-owned and that is why the FTSE has not been

:59:38. > :59:45.affected to the same degree. Where was the question at the end of that?

:59:46. > :59:52.Let me deal with the Japanese point first. The simple way of dealing

:59:53. > :59:59.with it is to go back to the Today programme on the first day of the G

:00:00. > :00:01.21 Japanese ambassador said about how attractive Britain is and will

:00:02. > :00:10.continue to be. There is an underlying issue to

:00:11. > :00:14.grapple with. I think the memo on Brexit released by the Japanese

:00:15. > :00:22.watch top of unpleasant surprises and you have this balance to manage

:00:23. > :00:30.-- which talked of. Balance of avoiding economic uncertainty and

:00:31. > :00:36.maintaining your negotiating hand. How do you propose to manage that

:00:37. > :00:44.and do you simply... Well, your robot answer would suggest they

:00:45. > :00:52.should trust us because we are responsible. No, that was not the

:00:53. > :00:59.robust answer. Robustly delivered. Out will let you judge that in your

:01:00. > :01:03.report. -- I will let you. There are a number of things. Firstly, what

:01:04. > :01:09.will International companies look for? I assume you mean

:01:10. > :01:17.internationally mobile companies that can move the capital. They will

:01:18. > :01:22.be looking for where the Government's aims are, as you told

:01:23. > :01:28.me at the beginning of this, we do not decide the outcome alone. It

:01:29. > :01:32.will be negotiated. They will want to know where our aims are and at

:01:33. > :01:41.this stage what the Prime Minister has done has made it clear what

:01:42. > :01:44.priority she sees were inherent in the original referendum and also

:01:45. > :01:50.said we want to do that maintaining the best possible trade

:01:51. > :01:56.opportunities for both manufacturers and service industries. Now, how

:01:57. > :02:00.much clearer you want to be I do not know. Once you get beyond that you

:02:01. > :02:04.get down to industry specifics because that is a good outcome, if

:02:05. > :02:12.we achieve it, for the whole economy. Then needed to industry

:02:13. > :02:17.specifics and there is a whole exercise about round tables and

:02:18. > :02:22.bilateral discussions and departmental conversations with

:02:23. > :02:30.their client companies and client groups. That has a part to play

:02:31. > :02:36.because they will learn we are taking their interests seriously and

:02:37. > :02:42.assessing them as well as they can. And then we're going to create a

:02:43. > :02:47.strategy which as best as possible, given it is a negotiation, will

:02:48. > :02:50.deliver. Frankly, there are times when you are making business

:02:51. > :02:55.decisions when you do not necessarily good for the outcome,

:02:56. > :02:59.you look for direction of travel. Within that answer there is an

:03:00. > :03:02.element of the answer to the memorandum from the Japanese

:03:03. > :03:10.Minister of foreign affairs. What would be helpful is if you could

:03:11. > :03:15.submit to us in effect be replied to that Japanese memorandum. And

:03:16. > :03:20.address the point about uncertainty for investors in the UK. You have

:03:21. > :03:26.given the guts of an outline of an answer but there is a lot of detail

:03:27. > :03:30.any memorandum. You must bear in mind the memorandum was addressed to

:03:31. > :03:42.the EU and the British Government. I think it would be... I would be

:03:43. > :03:54.grateful if they are, through this committee, you could give a formal

:03:55. > :03:58.answer to that memorandum. Briefly, do you take heart from the

:03:59. > :04:01.fact that at the end of the actions speak louder than words when it

:04:02. > :04:10.comes to business? It was big business that made the case for the

:04:11. > :04:14.ERM and big business, swathes of the establishments that made the case

:04:15. > :04:20.for the single currency and yet despite is going against that

:04:21. > :04:23.consensus from their point of view, inward investment drove up words and

:04:24. > :04:27.what it comes down to at the end of the day is how attractive the

:04:28. > :04:30.country is to do business in relative to the alternatives and

:04:31. > :04:36.when corporation tax is more here than in the continent and flexible

:04:37. > :04:43.labour market practices, those are the key decisions when it comes to

:04:44. > :04:50.business. Memorandum from Japanese companies and ambassadors, imported

:04:51. > :04:54.though they are, -- important though they are, how we do business is the

:04:55. > :05:01.most important. I speak as someone coming from the

:05:02. > :05:08.commercial sector, for debt the different companies have different

:05:09. > :05:12.interests. Large manufacturing corporations with multinational

:05:13. > :05:17.sourcing and marketing have one viewpoint. It was some of those I

:05:18. > :05:25.believe that favoured the euro because that took us the accounting

:05:26. > :05:30.risk out of their balance sheet. But they assess it from their own point

:05:31. > :05:33.of view, not from the country at a hall or the economic system as a

:05:34. > :05:39.whole and that is often the case for businesses, they will look at their

:05:40. > :05:43.own interests but does not have, or had a big impact elsewhere they are

:05:44. > :05:53.not accountable for. That is one thing we will assess. It will not

:05:54. > :05:59.just be an... Is this actually have a bigger impact on somebody else?

:06:00. > :06:03.Sort that leads into the fact that of course businesses make mistakes

:06:04. > :06:08.in some of these assessment and clue on the Europe of those companies

:06:09. > :06:15.that wanted Britain to join the euro would probably have changed their

:06:16. > :06:20.view today. Yesterday you promised them British

:06:21. > :06:23.parliament would not be kept at an information disadvantage relative to

:06:24. > :06:28.the EU Parliament. What practical measures can you to guarantee that?

:06:29. > :06:39.Firstly we have to make sure know what is given to the European

:06:40. > :06:45.Parliament. The information given to the European Parliament is... The

:06:46. > :06:53.said some information will be limited because of confidentiality.

:06:54. > :06:56.It doesn't enter institutional agreements. Framework agreement on

:06:57. > :07:04.relations between the EU Parliament and European Commission. And annexed

:07:05. > :07:06.to that agreement provides for the forwarding of confidential

:07:07. > :07:13.information to the European Parliament to request the site of

:07:14. > :07:20.confidential information. Will you replicate that arrangement? For

:07:21. > :07:25.those items yes. They will not be replicating to them information

:07:26. > :07:32.which is part of negotiating strategy but as far as I can yes, I

:07:33. > :07:36.will, to the committee. You inform the house you want to

:07:37. > :07:42.ensure the field of security and defence matters that despite the

:07:43. > :07:46.Brexit we will continue to engage with our European partners on these

:07:47. > :07:51.very important issues. How do you plan on doing that?

:07:52. > :08:01.I don't quite understand the cost of the question. -- thrust of the

:08:02. > :08:05.question. In terms of security and our standing on Nato and defence

:08:06. > :08:10.matters, that will be a public stance. The Prime Minister has

:08:11. > :08:19.already talked about it, as have I, and that was made clear. We also

:08:20. > :08:25.will be having discussions, Justice and home affairs as part of the

:08:26. > :08:29.negotiation and we will take European security as seriously as

:08:30. > :08:38.our own security. We have, from time to time, provided assistance. They

:08:39. > :08:41.are acutely conscious of that. There will be some, you are

:08:42. > :08:47.obviously responsible for the negotiations in terms of Brexit and

:08:48. > :08:51.pulling out of some of the mechanisms for joint defence and

:08:52. > :08:56.foreign policy matters, I presume those will be part of your

:08:57. > :09:01.discussions. Can you allude to anything further? What do you have

:09:02. > :09:08.in mind? I am not sure but I personally am very concerned when

:09:09. > :09:12.you see European leaders making an announcement together they intend to

:09:13. > :09:17.move forward with the single European army. I see that it is huge

:09:18. > :09:22.challenge and a threat to Nato which has secured peace in Europe for

:09:23. > :09:28.decades. As part of the negotiations Jubal come across several other

:09:29. > :09:31.European countries who have similar concerns -- come across. And will

:09:32. > :09:35.you will you ensure you work with them to try to prevent this

:09:36. > :09:40.happening because even though we are pulling out of the EU it is not in

:09:41. > :09:47.our interest for this to happen. We will ensure we do not see Nato

:09:48. > :09:52.undermined. That is a strategy. The European army as an argument going

:09:53. > :10:03.on since you work in the Foreign Office, Mr Chairman. My view is not

:10:04. > :10:11.the same. But you will remember the primary concern was the little

:10:12. > :10:21.access to trips. -- needs or access to troops. We will work from that

:10:22. > :10:24.position. -- Nato access to troops. You will acknowledge other countries

:10:25. > :10:30.do not want to fall as part of the European army and given the strength

:10:31. > :10:34.and size of a position and historic protection of Europe as an entity

:10:35. > :10:39.over many generations we would want to play a part.

:10:40. > :10:46.I am having to guess who you're talking about, but the simple truth

:10:47. > :10:58.is we will not see the weakening of Nato. That is our strategy.

:10:59. > :11:08.You don't make a pledge early on that ?350 million a week -- you did

:11:09. > :11:10.make a players that would be spent on the NHS. When did you abandon

:11:11. > :11:22.that? I made no such pledge. I'm sorry, but I made no such

:11:23. > :11:26.pledge. By those arguing for Brexit... Some did, and if you want

:11:27. > :11:30.them to argue the case you should invite the people here who made that

:11:31. > :11:40.argument and you will find no speech of my made reference to that. That

:11:41. > :11:48.is very interesting... I don't want to be rude to you at all. I am an

:11:49. > :11:54.admirer, but the simple approach to this that I am taking is to try to

:11:55. > :11:57.deliver this outcome in the national interest. That is a judgment that is

:11:58. > :12:02.made not on the basis of somebody else's speech some other time. It is

:12:03. > :12:07.made on the basis of hard data we are gathering right now. That is

:12:08. > :12:16.what I am doing. No more, no less. Can I ask you then, until the UK

:12:17. > :12:21.extracts itself from its obligations and the EU treaties, the policy of

:12:22. > :12:26.freedom of movement remains unchanged, is that correct? That is

:12:27. > :12:31.correct. Given the current shortfalls in health and social

:12:32. > :12:38.services, it is very difficult for the NHS to retain staff, or to

:12:39. > :12:43.recruit staff. Given the uncertainty over what will happen in future, how

:12:44. > :12:49.are you going to protect people who work in the service? The Prime

:12:50. > :12:56.Minister has made it clear. I think what you are alluding to is the

:12:57. > :12:58.question of the position of existing European citizens here. Is that

:12:59. > :13:03.where we are going with this question? And those who want to come

:13:04. > :13:08.here. That is a different category, I think. Let me deal with the ones

:13:09. > :13:12.here already. For the ones here already, the Prime Minister has made

:13:13. > :13:18.clear that we would seek to give them as generous treatment in terms

:13:19. > :13:25.of getting leave to remain and other such things as possible, subject,

:13:26. > :13:29.and only subject to our own citizens abroad getting a similar sort of

:13:30. > :13:33.treatment. The reason for that. I mean I heard people referring to

:13:34. > :13:38.this as making a sort of bargaining chip out of people- it isn't. It is

:13:39. > :13:42.making sure nobody gets turned into a bargaining chip. And it is aimed

:13:43. > :13:47.for the best outcome for everybody, citizens abroad as well. One of the

:13:48. > :13:51.thingss I would say as well, in the argument that took place in all

:13:52. > :13:54.this, it is very important that people understand what the current

:13:55. > :13:58.situation really is. You would have thought, listening to the argument,

:13:59. > :14:03.that people were about to be deported. The simple thing is that

:14:04. > :14:07.for people here already, and indeed the majority of European citizens

:14:08. > :14:12.here, they already have or will have by the time they depart, leave to

:14:13. > :14:16.remain under existing rules, and I think it is very important we do not

:14:17. > :14:20.frighten people by the end, no, you're going to be... Most of them

:14:21. > :14:24.will be, you know, and are perfectly safe position matter what the

:14:25. > :14:28.Government does, and I believe... I find it very hard to believe other

:14:29. > :14:39.European countries will misbehave. And under those circumstances they

:14:40. > :14:44.will all be protected. Thank you. Just very quickly on that, Secretary

:14:45. > :14:53.of State, obviously I engage with a lot of members of the Polish Dyas

:14:54. > :14:56.brassieres, 900,000 strong, and they make a huge contribution to our

:14:57. > :15:02.country, and there have been some reporting is of hate crime around

:15:03. > :15:06.the country and I am a little concerned about how certain sections

:15:07. > :15:12.of the media are trying to overplay some of those difficulties. Is there

:15:13. > :15:23.any words of shoes you can give to the Polish community on this?

:15:24. > :15:27.Firstly every member of this House, never mind just this Government,

:15:28. > :15:31.would condemn every hate crime. What this is is frankly unspeakable

:15:32. > :15:37.people making use of what they think is an excuse, and it is not. It is

:15:38. > :15:40.unforgivable and will continue to be treated as fiercely as we have

:15:41. > :15:48.always treated it in modern times, as we have always treated hate

:15:49. > :15:51.crimes in this country. Thank you. Can I return us to deport until

:15:52. > :15:58.issuers? First of all in your negotiations with the EU -- to

:15:59. > :16:03.departmental issues. Reading the news, and from what we also hear,

:16:04. > :16:08.there seems to be a bit of a separation between the commission

:16:09. > :16:13.and elected politicians in the year. The commission perhaps wanting to

:16:14. > :16:19.play a slightly hard-nosed game, the elected politicians conscious that

:16:20. > :16:23.many EU countries, particularly France and Germany, I met exporters

:16:24. > :16:26.to the UK, and there are domestic elections around the corner, and

:16:27. > :16:34.they are worried about the implications of playing hard-nosed

:16:35. > :16:36.when actually in relative terms, and I know there are losers and winners

:16:37. > :16:44.of the situation, they could come off worse. Have you picked that up?

:16:45. > :16:50.Yes. What will be your approach as regards that situation, giving you

:16:51. > :16:55.have listed three or four possible opposite numbers... ? The first

:16:56. > :17:01.thing to understand is the Commission in particular, there are

:17:02. > :17:03.institutions in general, but the Commission in particular take the

:17:04. > :17:11.viewpoint of this which reflects what they see as the interests of

:17:12. > :17:14.the whole Union, or in a way of the whole project if you like, the

:17:15. > :17:19.European Union project. For them, they do not want a country leaving

:17:20. > :17:30.the Union to be better off out than it was in. Better off outside than

:17:31. > :17:35.in, that is there a sort of, I guess, there raison d'etre in this.

:17:36. > :17:39.The countries, quite properly, of course, as they are all democracies,

:17:40. > :17:46.but broadly have taken an interest in what is the interest of their own

:17:47. > :17:51.citizens, and you're quite right that the balance of trade, certainly

:17:52. > :18:00.with manufacturing, the balance of trade tends to be to the advantage

:18:01. > :18:03.of the manufacturers, such as -- soldiers threaten to promise an

:18:04. > :18:06.element of British industry tends to carry with it a threat to their own

:18:07. > :18:11.industries -- so to threaten. In terms of our approach, firstly, I

:18:12. > :18:20.have argued and will continue to argue that... Which I did

:18:21. > :18:23.elliptically sort of in the Chamber statement, that trade is actually a

:18:24. > :18:29.mutual benefit. Nobody should have repay anybody else to trade them.

:18:30. > :18:31.They should not be any sort of exchange for that. And we will make

:18:32. > :18:35.that argument and it will become very explicitly apparent, I think,

:18:36. > :18:42.to those countries, as their own industries and organisations argue

:18:43. > :18:47.their case. I would expect the German car-makers, the French

:18:48. > :18:53.farmers, and many others, the Polish manufacturers and so on, to make the

:18:54. > :18:59.arguments to their governments, and actually reinforce the argument, and

:19:00. > :19:02.I think it is no secret end our negotiating is that the strategy

:19:03. > :19:06.that I will be using that line. Time as you say it is not just

:19:07. > :19:09.politicians facing elections but the fact that many industrialists are

:19:10. > :19:14.expressing concerns and have done so. The German CBI a few days before

:19:15. > :19:24.the referendum -- yes, and as you say. Paris obviously hurt our net

:19:25. > :19:29.exporters. -- tariffs. But does this influence the timing of things? If

:19:30. > :19:38.the Commissioner will try to square the circle and go with that

:19:39. > :19:41.ideological approach adopted by the commission, it may encourage them to

:19:42. > :19:46.push the timetable out actually and not bring it forward? Without

:19:47. > :19:51.getting into the minutiae of the red lines and everything, has that

:19:52. > :19:58.happened? I don't think it can very easily. There have been people who

:19:59. > :20:04.argue Article 50 favours, or dis- favours, somebody trying to leave,

:20:05. > :20:10.to put it that way round... But I do not agree with that. In fact it it's

:20:11. > :20:16.a discipline on everybody. But everybody does understand this is a

:20:17. > :20:19.process which is quite quick, by trade negotiations standards. We

:20:20. > :20:24.have some advantages in terms of existing commonalities. It is

:20:25. > :20:28.moderately quick, so they know they do not have time to waste. The

:20:29. > :20:33.endgame you described earlier, the sort of WTO endgame that the

:20:34. > :20:42.chairman asked about, it is not helpful for them by comparison with

:20:43. > :20:46.us, so I think it is not necessarily wise... There are other bigger

:20:47. > :20:51.problems I think with the timetable than that. So I do not think that is

:20:52. > :20:58.a big problem. Finally, from our point of view, I do not doubt you

:20:59. > :21:03.think it is a good idea to create a department to support Brexit

:21:04. > :21:06.negotiations. You are the Secretary of State sitting on the top of it so

:21:07. > :21:11.I issue music does a good idea, but can you tell us what the budget is

:21:12. > :21:16.for the Department? -- would assume you think it is a good idea. Do you

:21:17. > :21:22.think the processes are working fast enough to recruit the expertise that

:21:23. > :21:25.you require, putting to one side all the offers of voluntary help and so

:21:26. > :21:32.forth? Are you happy with progress from that point of view, the nuts

:21:33. > :21:35.and bolts? This is one of those strange departments were budget

:21:36. > :21:40.comes second. What we will get is what we need, really. And, yes, so

:21:41. > :21:50.far. I have been moderately surprised. Despite the rather

:21:51. > :21:53.strange stories over the summer, my department almost by definition

:21:54. > :21:57.stands on everybody's toes, because we have involvement on the lean back

:21:58. > :22:01.in every department virtually, and actually we have had very little in

:22:02. > :22:10.terms of sort of problematic response. -- involvement in every

:22:11. > :22:17.department virtually. This was not my design but was that of my private

:22:18. > :22:22.secretary and I read it but it is one of having a small unit -- I

:22:23. > :22:26.agreed to it. Having a small unit inside the department liaising with

:22:27. > :22:31.whatever policy department there is, let's say in the Home Office, the

:22:32. > :22:35.DWP or whatever, and that approach actually has worked rather well.

:22:36. > :22:43.With hindsight, it was a very wise approach. Not so smart on my part,

:22:44. > :22:49.but, yes, not so far, no. I would tell you, as I said to the German,

:22:50. > :22:56.if I thought I was running into difficulties, and I don't think so.

:22:57. > :22:59.-- I said to the chairman. This stage, the stage, analysis later,

:23:00. > :23:04.policy designed later, and so on, I don't think we are to have a

:23:05. > :23:08.problem. The simple truth is that this... For Whitehall civil

:23:09. > :23:12.servants, this is an incredibly attractive problem. It is a history

:23:13. > :23:17.changing problem. It will alter whichever way our country goes,

:23:18. > :23:21.whatever the outcome is. But also, frankly, for business, for lawyers,

:23:22. > :23:26.and for pretty much every profession, this is their one chance

:23:27. > :23:29.in a life them to alter the future of a country, so I don't think there

:23:30. > :23:34.is a problem of attracting people in to start in terms of timing, I would

:23:35. > :23:40.worry if we went any faster, in truth. Because it is the quality of

:23:41. > :23:47.recruitment as much as the numbers that matter. It is the output, not

:23:48. > :23:51.the input, I am worried about. So far everything I have seen shows

:23:52. > :23:58.that the quality is good. And that we are getting the best and

:23:59. > :24:03.brightest at Whitehall. Finally, briefly, reports in the media about

:24:04. > :24:10.followeds between your department and others and all that sort of

:24:11. > :24:16.thing. Nobody has organised a pyjama party yet! I suppose we will use it

:24:17. > :24:25.for something, I'm not quite sure what yet. But, no, it was August...

:24:26. > :24:30.I had the misfortune of working through August, so I was here to

:24:31. > :24:38.read it, but I didn't recognise any of it. Secretary of State, you're

:24:39. > :24:43.sort of Squadron group of 180 people... What sort of job are they

:24:44. > :24:48.doing? Could you speak to us about that. A variety of things. Firstly

:24:49. > :24:54.there is the central analysis with about 50 crosscutting sectors they

:24:55. > :25:01.are actually working through, what will happen, what are the problems

:25:02. > :25:06.of those industrial groups and so on... And that is both them and in

:25:07. > :25:10.liaison with the Department. They are setting up... Someone is setting

:25:11. > :25:15.up an engagement strategy at. We have not spoken about liaison with

:25:16. > :25:22.the devolved administrations but that has been quite important as

:25:23. > :25:26.well. That is a lot of processes, very so three type stuff. All the

:25:27. > :25:37.commissions on things we will have -- very Sir Humphrey type stuff. How

:25:38. > :25:40.it has been going on between Scotland, Northern Ireland, Wales

:25:41. > :25:46.and ourselves. Legal issues. The issue the chairman started with, the

:25:47. > :25:53.question of the legislation has taken some time, and that is

:25:54. > :25:56.ongoing. Work of course on the international legislation as well,

:25:57. > :26:02.WTO legislation as well as... There were other skier stories about WTO.

:26:03. > :26:12.We are a full member of WTO so those sorts of things were going on --

:26:13. > :26:17.scare stories. Similarly the Article 50 process itself, other trade

:26:18. > :26:24.agreements, the Canadian trade agreement, those sorts of things. A

:26:25. > :26:29.whole series of both legal, political and economic operations,

:26:30. > :26:32.and that does not include... Just as an aside, I don't know whether it

:26:33. > :26:39.was made clear to everyone, we have taken over the operation of the

:26:40. > :26:48.General Affairs Council, it's normal day-to-day work. What sort of skill

:26:49. > :26:53.sets are you looking for from outside the civil service? We are

:26:54. > :27:02.not really working yet on that front but it will be specific industrial

:27:03. > :27:13.skill sets. Some quantitative work. Not very much consultancy. Frankly,

:27:14. > :27:21.anything that's helped us solve some of the problems I have listed. It is

:27:22. > :27:25.likely in four weeks' time I want to scope out need another two or three

:27:26. > :27:36.skill sets and then I would either go to departments or outside

:27:37. > :27:38.sources. Thank you. You told the Lords committee yesterday the

:27:39. > :27:44.mechanism for coordinating the work of Brexit would go to the Foreign

:27:45. > :27:49.Secretary and the secretary of state for international trade. It was a

:27:50. > :27:59.Cabinet committee chaired by the Prime Minister. How often does that

:28:00. > :28:04.committee meets? So far, twice. That is across August. I would say at

:28:05. > :28:09.least once a month. Is that sufficient? Yes, we talk to each

:28:10. > :28:17.other as well and it also comes up in Cabinet. That is the super

:28:18. > :28:21.committee. There are other internal committees but that is the primary

:28:22. > :28:35.driver. From time to time we talk informally. Either bilateral or

:28:36. > :28:42.trilateral or between ourselves or last week for example with the Prime

:28:43. > :28:53.Minister. You do not to the National security Council. Why not? That is a

:28:54. > :29:01.matter of my pay grade. Yesterday you told the Lords

:29:02. > :29:06.committee you have taken separate responsibility for... Can you

:29:07. > :29:13.confirm that means it now report exclusively to your department and

:29:14. > :29:22.not the Foreign Office? Principally. If the bilateral matters then before

:29:23. > :29:25.Foreign Office is involved. This is its Humphrey question. I do

:29:26. > :29:34.not understand the problem with this. -- sir Humphrey. Does it also

:29:35. > :29:41.report to the Foreign Secretary? I do not know. We can write to you on

:29:42. > :29:50.that if you would like. You it would be helpful. At the moment this

:29:51. > :29:55.committee is probably best placed to oversee your departmental plan and

:29:56. > :30:03.budget and resources because of the close relationship with the Foreign

:30:04. > :30:09.Office. Exactly how that works and on what the budget line it appears

:30:10. > :30:20.would be very helpful. One thing I do not do is micromanage things like

:30:21. > :30:25.who pays Uprec and so on. It must give you a concern because it goes

:30:26. > :30:28.to a central challenge for our Government, the presentation of the

:30:29. > :30:32.United Kingdom any post Brexit world. It is the opinion of this

:30:33. > :30:36.committee the budget of the foreign operas will need to double or triple

:30:37. > :30:40.to meet that challenge because we will have to get serious about

:30:41. > :30:44.presenting the UK well and explaining our new role in the world

:30:45. > :30:51.and establishing the depth of bilateral relationships. There is a

:30:52. > :30:52.direct overlap between resources going into your department to

:30:53. > :31:02.negotiate Brexit and this whole hole in promoting our wider role in

:31:03. > :31:14.the Wells and that belongs to the Foreign Office -- in the world. In

:31:15. > :31:22.the end of this and around three years' time the department well Gaul

:31:23. > :31:25.and those members who are within the foreign operas will return to the

:31:26. > :31:36.Foreign Office. That is why I am not sure. -- foreign operas. When you

:31:37. > :31:40.presented your position in terms of your priority in establishing

:31:41. > :31:51.capability that a certain lots the Foreign Office -- certainly not.

:31:52. > :31:57.Neither am I a financial backing on behalf of the Foreign Office. I

:31:58. > :32:01.would rather hope you would be. That would be one way of getting my

:32:02. > :32:09.budget stopped right away, I would suspect. Can recall to what will

:32:10. > :32:19.happen the next two years or so when we are still within the EU, given

:32:20. > :32:27.that Uprec reporting to you, do you believe they have the capacity and

:32:28. > :32:34.your department has the capacity to direct their work on matters not

:32:35. > :32:45.directly related to the Brexit process? Yes. Do you think you need

:32:46. > :32:52.extra staff and resources to cope with the additional work of Brexit.

:32:53. > :33:02.No. Not at all? No. The reason I say that is the way it works is

:33:03. > :33:08.secondment from other departments and I have no indication that is an

:33:09. > :33:14.issue. In terms of the representation so it is rather like

:33:15. > :33:21.for like. , policy development is primarily with us. In terms of

:33:22. > :33:32.diplomatic and information they are very good as it stands. As I said to

:33:33. > :33:37.the chairman... What about the individual hosts within the 27 EU

:33:38. > :33:43.countries. Do we have enough people there to provide a relationship and

:33:44. > :33:50.information we need is given there will be bilateral discussions here

:33:51. > :33:57.as well as they are. I have no reason to think otherwise. The

:33:58. > :34:13.Foreign Office itself is a very effective network and I see nothing

:34:14. > :34:20.to indicate there is a problem. But then withdrawn or Talon, they resort

:34:21. > :34:24.to the Foreign Secretary directly -- British representatives in Rome, for

:34:25. > :34:30.example reportedly Foreign Office, but UKRep reports to you. One of my

:34:31. > :34:38.daily duties is dealing with these telegrams and when they come to me.

:34:39. > :34:45.We have asked you a series of questions here and would you mind if

:34:46. > :34:52.I asked you what you see as the opportunities and pitfalls as far as

:34:53. > :34:54.Europe are concerned with regard to the negotiations. Or to put it

:34:55. > :35:01.another way, what are the questions we should have asked. What the

:35:02. > :35:09.Americans say? I will take the fifth.

:35:10. > :35:19.There are a lot of opportunities. You know my view on the upside of

:35:20. > :35:32.Brexit although most of those forward then the Secretary of State

:35:33. > :35:36.for trade purview. Lots of those I will not list them again but is the

:35:37. > :35:48.committee will be conscious of them. In terms of risks, I am tempted to

:35:49. > :35:53.know and no is an unknown unknowns, things we have not thought of yet.

:35:54. > :36:02.But some of the things we're looking at, take Canadian treaty. The

:36:03. > :36:09.Canadian treaty by the standards of the EU is a very good treaty but is

:36:10. > :36:14.a mixed procedure which will take quite a long time. It requires all

:36:15. > :36:22.36 parliaments in Europe to approve it. So one of the things we have to

:36:23. > :36:26.look carefully at is how the endgame, what the decision-making

:36:27. > :36:30.procedure is. Will be set around after the two years waiting for

:36:31. > :36:38.approval? There are issues like that's. The obvious negotiating

:36:39. > :36:46.risks, the risks of the commission's highlighters, wins the battle inside

:36:47. > :36:50.Europe and you do not beat me, you know those already. My concern is to

:36:51. > :36:59.make sure we do not fret over in unseen wires -- trip over unseen

:37:00. > :37:05.wires. One of the things I violated was some of the legal issues. Can I

:37:06. > :37:15.pressure you -- one of the things I highlighted. Can I ask about WTO one

:37:16. > :37:19.trade? Can I bring you to the City of London and passport thing. We

:37:20. > :37:29.have not touched upon that in this line of questioning. When I worked

:37:30. > :37:33.in the city... What is your approach to this and what are the

:37:34. > :37:42.opportunities and pitfalls there and do you understand the concerns or

:37:43. > :37:49.are they overstating them? How will you proceed? One of the things to

:37:50. > :37:54.say about passporting, it does represent a symbolically a number of

:37:55. > :37:58.other problems because we get 180 degrees difference of opinion

:37:59. > :38:07.depending who you talk to. Both in terms of how important it is to

:38:08. > :38:12.them. Whether it is a retail bank or wholesale bank or investment bank,

:38:13. > :38:22.different issue if the bank is a national or basis. -- National or

:38:23. > :38:26.global basis. You then have argument relating to whether the mutual

:38:27. > :38:35.recognition approach will work to protect them but also whether it's

:38:36. > :38:40.stable and safe after we leave. I will not go any further into

:38:41. > :38:44.details. We have been thinking and talking with some of the main

:38:45. > :38:51.players and how we deal with those issues in turn. I accept you must

:38:52. > :39:01.not reveal your red lines but the briefly, there was reasonable view

:39:02. > :39:09.within the banks concerned about the passporting issue will stop the

:39:10. > :39:17.employ a lot of people. What reassurance can you give because

:39:18. > :39:20.confidence is important in the City, what reassurance can you give to the

:39:21. > :39:24.issue of passporting? Is there anything more you can save rather

:39:25. > :39:31.than what you have just said which does not necessarily reveal anything

:39:32. > :39:37.more. Most of this will be ignored to the specialists in the city in so

:39:38. > :39:43.nothing I will tell you will be new to them. -- most of this will be

:39:44. > :39:47.known. We have some thoughts but forgive me but I will not get into

:39:48. > :39:50.it. Partly because they may represent negotiations but also

:39:51. > :40:00.because they are incomplete at this stage. In operational terms if you

:40:01. > :40:05.take into account Brussels and London largely shut down in August,

:40:06. > :40:10.we have been operating for four weeks and some of these things I

:40:11. > :40:17.want the grounds are more closely than we have before talking openly

:40:18. > :40:26.about them. We nearly ends. I am enjoying myself! We are near the end

:40:27. > :40:30.of the session. I have had a helpful suggestion while we're sitting here

:40:31. > :40:37.to invite me to ask you about the man's issued today described as, no

:40:38. > :40:45.migrant control if you want access to the single market. I then checked

:40:46. > :40:50.what this man actually said which is the position of the parliament is a

:40:51. > :40:55.very clear, if the UK wants to remain part of the single market it

:40:56. > :41:05.will have to accept the free movement of our citizens. I think

:41:06. > :41:10.that, he... Who will be involved in these negotiations his use of

:41:11. > :41:16.language is probably precise whilst obviously the question I had from

:41:17. > :41:23.our college in the fourth estate models up the issue of access and

:41:24. > :41:31.being in and do we not need to be clearer about our use of language

:41:32. > :41:36.and the position that he has made clear is the common except the

:41:37. > :41:44.position. We cannot be in the single market is or remain a part of it if

:41:45. > :41:45.we are not prepared to concede one of the fool freedoms that underpin

:41:46. > :42:05.it. Firstly, or... I will allow you to

:42:06. > :42:10.draw your own conclusions, chairman. His comment is not new. He has been

:42:11. > :42:17.saying this for some time. While I will not get drawn into what our

:42:18. > :42:23.position on it is because all these options are being kept open, while

:42:24. > :42:30.we calculate these things through, you are right in one respect that

:42:31. > :42:36.the language used about the single market, access to the single market,

:42:37. > :42:42.and membership of the single market, does get very confused. What we want

:42:43. > :42:49.to see is the best trading capacity for British manufacturing and the

:42:50. > :42:56.service industry. That could be any of those things. Is it not clear

:42:57. > :42:59.that the baseline is we are leaving the European Union? That means we

:43:00. > :43:05.will not be in the single market, not least because it is impossible

:43:06. > :43:10.for us to concede that full freedom around the freedom of movement of

:43:11. > :43:14.labour, and what is being negotiated the terms of our access to the

:43:15. > :43:16.single market. Would it not be better to clear some of the

:43:17. > :43:24.undergrowth about language and everything else, that that is what

:43:25. > :43:29.we are talking about? Otherwise, Brexit will not mean Brexit. We will

:43:30. > :43:40.clear the undergrowth when it is necessary. We look forward to that.

:43:41. > :43:49.You have not asked in an article 50 Atul! What was your question again?

:43:50. > :44:01.Will you have an election before you trigger it? I apologise. But can I

:44:02. > :44:11.come back to giving further answer that? I did not mean to be rude. The

:44:12. > :44:15.whole argument about article 50 is this, the government's position is

:44:16. > :44:21.it is an exercise of Crown prerogative. Crown prerogative is

:44:22. > :44:26.that the Crown represents the nation. This is the only time that I

:44:27. > :44:32.am aware of in British history that the Crown prerogative has been

:44:33. > :44:37.backed up by a mandate, in other words, it is the will of the British

:44:38. > :44:43.people. When it comes to how you deal with that, it seems to me very

:44:44. > :44:49.plain, you do not need a second referendum. When there was a second

:44:50. > :44:53.referendum debate in the Commons last week, nobody spoke of the

:44:54. > :44:57.second referendum. You do not need another election because we have had

:44:58. > :45:02.the mandate directly. And you do not need a vote of Parliament either

:45:03. > :45:10.because in the event that you had a vote of Parliament, either in favour

:45:11. > :45:14.or against triggering article 50, that is the manifestation of the

:45:15. > :45:20.referendum. Parliament will either support the referendum will refuse

:45:21. > :45:29.it. Would it be Parliament versus the people? That is the key point. I

:45:30. > :45:36.would not want you to walk away with me not answering the constitutional

:45:37. > :45:39.question. But the Lords constitutional committee have

:45:40. > :45:45.published a report today which directly contradicts what you said.

:45:46. > :45:53.No, it is agreed with what I said. The simple truth is that a proposal

:45:54. > :45:56.that could put Parliament in opposition to the people over

:45:57. > :46:07.something as simple as this is extraordinary. If you look at the

:46:08. > :46:15.wording... Where does that say advisory? The reason you have not

:46:16. > :46:18.been asked about this is you made your position extremely clear in the

:46:19. > :46:25.statement you go to the Commons last week. He is perfectly entitled to

:46:26. > :46:28.challenge this. But I do not think the position of the government in

:46:29. > :46:36.your position is in any doubt. I think it is fair. The point is, go

:46:37. > :46:40.back to the debate, go back to Hansard. The Foreign Secretary said

:46:41. > :46:46.this is a matter for decision by the British people. The government in

:46:47. > :46:51.its manifesto said it would respect the result of this referendum.

:46:52. > :46:57.People did not think they would being asked their opinion. Previous

:46:58. > :47:02.Prime Minister did not resign because of the opinion. The

:47:03. > :47:07.referendum did not say, we would trigger article 50 of the day after

:47:08. > :47:12.the referendum. It was not the position in the referendum.

:47:13. > :47:18.Similarly, it did not say would be done in March or May. It surely has

:47:19. > :47:21.to be for Parliament to debate and decide when and under what

:47:22. > :47:27.circumstances the trigger article 50. It is not for Parliament to

:47:28. > :47:40.gainsay the view of the British people. Once article 50 is

:47:41. > :47:45.triggered, would it be incorrect to believe that actually, given the

:47:46. > :47:50.groundwork you're putting in now, while everybody is talking about two

:47:51. > :47:59.years, actually, progress could be made over a much shorter period of

:48:00. > :48:12.time? In theory yes but in practice unlikely. Two years is the limit, if

:48:13. > :48:16.you are unanimous, an extension. My experience of European negotiations

:48:17. > :48:20.is that decisions tend to get taken in the last second of the last

:48:21. > :48:23.minute of the last day because that is how the negotiation works and

:48:24. > :48:36.people try to use the time pressure on one side of the other. Let's

:48:37. > :48:42.assume we are at that last minute. And we do not have the optimistic

:48:43. > :48:46.outcome you envisaged and we do not agree acceptable terms. What do you

:48:47. > :48:57.see happening? That would give it all away! I will not say what you

:48:58. > :49:00.will see! Some sort of answer, Secretary of State. You can probably

:49:01. > :49:09.guess what I am doing, you know me well enough! An article 50, I recall

:49:10. > :49:15.a former Prime Minister saying he would make a decision immediately on

:49:16. > :49:19.the Monday morning. That may have been the position of the government

:49:20. > :49:22.formally as we went into the referendum. That is right, as did

:49:23. > :49:31.the Leader of the opposition. And the fact that things change rather

:49:32. > :49:37.rapidly after the decision of the British people, it is all yesterday.

:49:38. > :49:43.You mentioned things we have not thought about yet. May I commend our

:49:44. > :49:48.report on the 26th of April, looking at the implications of Brexit? I

:49:49. > :49:55.trust that that will be... I have not read it since I have been a

:49:56. > :50:05.minister. I formally want to say thank you very much for your

:50:06. > :50:09.evidence. The exchange of correspondence... We happen put up

:50:10. > :50:18.an alliance people can understand the exchange. On the subject of

:50:19. > :50:23.courtesy and seeing that the charming courtesy was afforded to

:50:24. > :50:28.you in the House of Lords, I do want to concur with the Lord's view the

:50:29. > :50:34.oversight of Parliament can be and should be an asset to the

:50:35. > :50:40.examination of the process you are doing and help you build a robust

:50:41. > :50:45.negotiating hand on by half of people we represent. I want to

:50:46. > :50:50.finish by saying thank you very much for the evidence you have given to

:50:51. > :50:55.us and of course we wish you all the very best with conducting a

:50:56. > :51:09.successful negotiation on behalf of the United Kingdom. Pleasure is all

:51:10. > :51:17.mine, chairman. And now we return live to the House of Commons. But

:51:18. > :51:24.more generally, the bill makes it easier for public organisations to

:51:25. > :51:25.share data without an individual's explicit