17/09/2016 BBC Parliament on BBC Two


17/09/2016

David Davis MP, secretary of state for exiting the European Union, speaks at the Foreign Affairs Select Committee inquiry into the implications of leaving the EU.


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Welcome to this afternoon session of the Foreign Affairs Committee

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on the ongoing enquiry into Brexit process.

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The Secretary of State, you are very welcome.

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I note this is your second meeting in two days

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and you told the House of Lords European Scrutiny

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Committee

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yesterday appearing in front of them

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was a particular pleasure.

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I hope to be back today.

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Is that what you schedule a meeting

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at that site of the building.

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It was not me who does the scheduling.

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The scheduling was theirs.

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You presumably make the decision to go there first

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and that is the gentle hook I want to take into my question,

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to examine your assessment of the legal and parliamentary

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implications of the Brexit process.

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Can you confirm there is going to have to be

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an Act of Parliament in order to leave the EU?

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There will have to be some legislation, no doubt about it.

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There are various stages.

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Firstly, legislation to deal with the European Communities Act 1972

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and the consequential legislation on from that.

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There may have to be parliamentary ratification under

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the relevant 2010 legislation.

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The so-called CRA legislation.

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That is the absolute minimum that I can see.

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So we cannot leave the EU if that is not in place?

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Well, we can leave but what the legislation does

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is put in place directives and various other pieces of law

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which will still have effect if we did not.

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Whilst we require a treaty change, we were in that sense still be

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reporting back to the European Court in some respects.

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What I am seeking to establish if there are acts of parliament

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to be put in place or repealed.

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So, that is perhaps why you were at the other side

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of the building, my assessment is that there is a majority

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in the House of Commons to support the Prime Minister in Brexit

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means Brexit and despite the fact the number of conservatives

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were campaigning to remain in the EU

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they have accepted the decision of the electorate

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and will now support the Government

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in the process of leaving the EU.

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However, it is my assessment you could not be as confident

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that is the position down the other end of the building

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in the House of Lords, would you agree?

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Well, you are wrong about the calculation

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in that there was no calculation in terms of who I saw first

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and second, I have not made an assessment of what the balance

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of power or balance of interest or voting with the end

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of each house.

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It is a bit early to do so for a start.

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Any legislative change would be based at least in part

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where the negotiation had got to buy them

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and whether or not individual members of each house approved.

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I do not know where we will be.

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My hope and intention is we will have a majority

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in both houses.

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Can I gently suggest the Government could be

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reasonably confident that of a majority in the Commons,

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in order to carry out the decision of the British people,

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that is a rather more open question

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about the attitudes of the house of Lords, where the Government has

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a significant minority and there are a number

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of conservatives who are appear to be determined to obstruct

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the country's route to Brexit.

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If you were in that place, then obstructing the Acts

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of Parliament that are required to enable Brexit is something that

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will have to be overcome by the House of Commons

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using the Parliament act.

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What I would suggest to you whether you would agree

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if it was a sensible idea for the legislative process to be

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commenced in sufficient time for it to be

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on the statute book having overcome opposition

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in the House of Lords by the use of the Parliament act

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so we can leave the EU by the early part of 2019.

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Again, I will challenge the basis on which you make your argument.

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The simple truth is what the Government is doing is

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carrying out the biggest ever mandate given

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to the Government by the British people.

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Nearly 17.5 million people.

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Had it been a general election between two parties called Leave

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and Remain, the majority for Leave would be bigger

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than Tony Blair's majority 1997.

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It is a clear mandate and the House of Lords

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would be unwise not to take that seriously.

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They have a perfectly reasonable possession and challenging

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elements of the negotiation but I would be very surprised

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if they were unwise enough to go down the route or blocking it.

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It has been a view of this committee the Government

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was guilty of gross negligence for not preparing

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for Brexit in advance.

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It is also the view that it may amount to gross

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negligence if you proceeded on the assumption all would-be

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hunky-dory and you would get you legislation in good order

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because the House of Lords were minded to upgrade instruction

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because the House of Lords were minded to obey instruction

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of the British people.

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Wouldn't it be prudent to make sure your legislation was then

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placed insufficient time to allow us to leave the EU?

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On a date of the Government's choosing or at the conclusion

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of negotiations two years after giving notice

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under article 50.

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under Article 50.

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You are jumping to the conclusion of the committee report

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on a decision I have yet to take.

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I suspect it is getting the committee ahead of itself.

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I am clearly intending to get us to a position of leaving the EU

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within the normal Article 50 timetable.

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I will make the legislative arrangements that are necessary

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to get there.

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That is the simple case of the matter.

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I will not, I am afraid, hypothesised with this committee

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or any other about the way I got house will vote.

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or any other about the way either house will vote.

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That is for the whips and the usual channels to do and I will make

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decisions based on the advice.

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I will not air this any more public

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to jeopardise them.

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I am grateful for Europe's reply this morning

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I am grateful for your reply this morning

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on my letter to the Attorney General

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of legal issues on leaving the EU.

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I wrote to him and invited him to reply by the 13th of July

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and I am delighted he finally replied on the 13th of September.

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Albeit from me.

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I am very grateful.

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What I am less satisfied by is the terms of your answers.

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I want to explore why you are unable

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to give answers to some rather basic questions.

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The first question I put to the attorney was can all be

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directly applicable regulations currently applied to the UK be

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transposed into UK law in a single act of Parliament.

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That struck me as a rather straightforward question

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and your reply said you would appreciate the questions raised

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in your letter touched on issues currently the subject of legal

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proceedings, to which the Government is party.

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Areas raised by them which it would therefore not be appropriate

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for me to comment on.

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Please do explain how this simple technical question

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about whether or not it is possible

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to use the single act of Parliament

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impinges on an action being taken against the Government

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about the operation of Article 50.

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I can talk about the issues relating

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to the act of Parliament.

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Let me do that here and now.

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There are a number of ways you can put into effect such

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an act of Parliament.

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One of them is to

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put everything in place at once.

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It would be huge and to come back to you earlier position

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about the timing on this,

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it would have to wait until very late on in the process

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because we would need to know what we were doing with each

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components of the exit from the EU.

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Even were it a simple exit with almost no amendments to it

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and were we setting out in order to do all the changes letter on it

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and were we setting out in order to do all the changes later

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would still be complicated because, taking a trivial example,

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when local government, under European law

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they have to put the bid into the European system.

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That would deal with all those tiny things

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either directly or with a spectacular

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Henry VIII clauses.

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That is one aspect.

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But you can do it rather more early

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and have a whole series of successive pieces

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of legislation,

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so there is a problem, which you can see...

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I am not sure I do.

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My question was, how does the question you opposed

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in my letter to the attorney excuse

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the reason you gave for not...

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No, your reason for not answering the question was that it impinged

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on that and I don't understand the connection.

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From memory, there was a reference to that, to Article 50,

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was in there?

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No.

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It was could all the current causes relating to the UK

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could be retained should Parliament wish that?

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Your argument is this is currently the subject of legal proceedings...

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That was an error because I thought

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it was a reference to Article 50.

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There was not.

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I wonder if you could have another go in a letter to the committee

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at answering that question.

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Of course we can but we can also deal with the substantive issue

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right here, which is the nature of the legislation we are likely

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to carry through.

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You can either have very simple legislation which meets your

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requirements of going earlier...

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What is the simplest?

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I suppose the position is that is, you've got all this directly

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applicable regulations not put through, so not in British law

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at the minute, we will leave the European Union-

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do we try to make a judgment about whether the 6987 regulations

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that directly apply, that we go through them one by one

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and decide which to keep on which to leave, when we leave,

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or will we keep...

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Put all of them into line take our time to go through and decide

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which ones we don't want?

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The decision we have to take is whether one has a simple piece

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of legislation with a cascading set of SIs

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following on from it and the House of Lords

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famously does not like that, it does not like things

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that create lots of statutory rights

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for ministers rather than going through primary legislation...

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Or you could do it with a small piece of upfront legislation

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and then a mixture of primary and secondary, or you could do

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a huge one that would need to be linked because you would need

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to know what the changes were before you started.

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Before you started the legislation.

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Right.

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It is...

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No, I think what you have said in answer to the first question

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is yes, which is obviously...

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I am grateful for an answer.

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Then there are options beyond that...

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Let me be clear.

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I do not want you to take this guidance from me.

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My answer to question one was yes.

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What was question one in this context?

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Can all the directly applicable legislation is that

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apply currently in the UK be translated

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to the law.

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Yes.

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Am grateful for that.

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The second question posted in the letter I posed.

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Let me for the benefit of the record...

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The second question I asked you.

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On what terms will the UK and EU trade at the end of the two-year

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negotiating period mandated by Article 50 of the Lisbon Treaty,

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if no deal has been agreed between the UK and EU on the terms

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of the UK's exit from the EU, or no deal has been agreed

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on the future relationship between the UK the EU?

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What that posits is the rather obvious possibility that there

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is either a blocking minority amongst the 27 who declined

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to come to an agreement, or the European

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Parliament who has a majority against whatever is negotiated

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between you and the 27.

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That strikes me as a rather obvious possibility.

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The answer you gave to me and the committee was,

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"Turning to trade, we are about to begin these

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negotiations and it would be wrong to set out further unilateral

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positions in advance."

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"As the Prime Minister has said, the UK will strike a bespoke

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agreement that gets the best deal for people at home and the right

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deal for Britain abroad."

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That is not in the gift of the Prime Minister, is it?

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It will have to be an agreement between us and our 27 partners

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endorsed by a majority of the European Parliament?

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The Prime Minister cannot make that statement.

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No, those are her aims.

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Those are her aims, yes, but the fact is

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she cannot guarantee it and neither can you.

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Nobody can guarantee the negotiations.

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The process we are about to embark on, there is no agreement.

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That is...

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That as a possible outcome.

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One possible outcome.

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But all I have done is asked you, or as the Attorney General,

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and you were kind enough to send me a letter which...

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Has not in my judgment entirely addressed the question,

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shall I say?

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That...

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I think it is a rather straightforward

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and simple question.

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And I think there is a very important reason you should answer

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it as soon as you are in a position to do so,

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and that is it is a kind of technical question.

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What happens if there is no agreement?

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That then addresses a vast amount of the uncertainty that is out

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there, for example, you know, in a memorandum

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from the Japanese, for example.

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People looking for certainties as to what happens.

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If it is clear, if there is no agreement in the negotiation,

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what the position is, then you address a vast amount

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of the uncertainty out there with individual companies

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and the rest, and they can then watch the negotiations

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and make their commercial judgment according to

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how they perceive them as going given whatever guidance

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you will be able to get,

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but then they will at least know how bad it can get

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from their position, or how good it can get,

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if there is no deal.

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There may be an opportunity for them

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if there is no deal,

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but simply explaining what the technical position

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is going to be, our terms of trade into the Single Market,

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in those circumstances, that strikes me as firstly

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answerable and indeed necessary to answer.

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It depends what you are after.

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If you want a factual statement of what the outcome could be,

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I guess it is what is normally known as world trade

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organisation rules, largely.

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That is I guess what the conclusion would be

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if we are outside with no deal, but I would not

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anybody to think in my view that was a likely outcome.

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I am not asking whether it is a likely outcome or inviting

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you to put probability on it.

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I am inviting us to get us tooks to an agreed understanding

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it is World Trade Organisation rules that

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will govern us into the Single Market...

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I think that is a matter of commonly held fact.

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That is all I was seeking to get the confirmation

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of because there have been people suggesting there are complications

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about putting the World Trade Organisation rules in position

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and if you are telling this committee that is a matter

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of commonly held fact, and it is a fact, then that gives

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everybody a bottom-line from which to work all the...

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And all the interests, which as you know is

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a very large number...

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Except, and this is one of the problems, we are dealing

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with negotiations which as I said yesterday

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are extremely complicated.

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The World Trade Organisation rules essentially apply just as tariffs

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but the nontariff barriers are one of the primary barriers.

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It is a simple answer.

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Of course there is a complacency about how the nontariff barriers

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are operated on the rest.

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But I think there is a very great need for as much clarification

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of what can be reasonably clarified

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and is part of the obvious bounds of which a negotiation

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can take place and obviously one of those is no agreement,

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for that to be clearly established and put out there.

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You've gone very great deal further in answers

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to me than you,

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than the you probably signed off in some case this morning

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when he realised it was outstanding.

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It was not outstanding for me...

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Yes, and the Attorney General has not done this to mind

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and I appreciate that, and I am grateful...

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No good deed ever goes unpunished.

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LAUGHTER

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I am very grateful for the detail you have now given.

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One further question from me before moving on to Mr Gates.

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Sorry, but who will you be negotiating with?

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First off, the commission has appointed Mr Barnier,

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the Parliament has appointed Mr Verhofstadt,

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and I went to Dublin and spoke to Mr Flannigan, and...

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My question is, in a sense, who are you

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formally negotiating with?

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We are formally negotiating with the council.

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And...

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There appears to be some dispute between the council.

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If you will forgive me that is not for me to resolve.

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We may return to the involvement of the European Parliament

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later in questions.

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I wanted a little bit more clarity on the question of the letter

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when you see it is possible to have a position where we adopt

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all the 6800 EU laws...

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But I thought he then went on to say

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that would be problematic and give the example of the local

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authority having to publish all their European...

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So it wouldn't be workable?

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You have to deal with that by a series of follow-on

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legislation, something like that- would through an SI,

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and it would not be confirmed to just that.

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It would not be confirmed to the sort of minor problems

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like that - they would be substantive changes,

0:22:400:22:43

changes in immigration law, changes in a whole series

0:22:430:22:46

of matters currently to do with European Union,

0:22:460:22:50

some of which could be quite significant.

0:22:500:22:54

So the problem there is generating a lot of secondary legislation

0:22:540:22:59

and possibly some primary legislation.

0:22:590:23:01

It may not resolve the issue in the way your chairman

0:23:010:23:04

was saying earlier.

0:23:040:23:05

If there is not time to get it through, what happens?

0:23:050:23:09

That is why it is difficult.

0:23:090:23:11

And just on the timetable and of course I completely

0:23:110:23:14

understand you cannot give any committee a running commentary

0:23:140:23:18

on negotiations or positions the Government would take,

0:23:180:23:22

but could you at least see when you expect the Government

0:23:220:23:26

to agree a clear set of objectives for Brexit negotiation.

0:23:260:23:31

Do you have a target?

0:23:310:23:34

That is one of them and probably the primary one

0:23:340:23:37

is the Prime Minister has said we will not trigger Article 50

0:23:370:23:41

is the Prime Minister has said we will not trigger Article 50

0:23:410:23:44

until sometime in the New Year, after the end of this year.

0:23:440:23:48

Because we are going through that process as it stands,

0:23:480:23:52

and I can talk you through that if you want to hear it.

0:23:520:23:56

Assessing, negotiating aims, negotiate and tactics,

0:23:560:23:58

the legalities, the very things we have been speaking about,

0:23:580:24:01

the legalities of Article 50, and all those things really have

0:24:010:24:04

to be fairly clear before you start,

0:24:040:24:09

so we will arrive at that something in the New Year.

0:24:090:24:13

So you will have all of your objectives in place sometime

0:24:130:24:16

in the New Year, so by January?

0:24:160:24:21

I will not guess on that, with the best will in the world.

0:24:210:24:25

I have said before I would rather go one month late

0:24:250:24:28

and get it right and go a month early

0:24:280:24:30

and get it wrong.

0:24:300:24:31

That has slightly flipped the phrase

0:24:310:24:33

but it characterises it.

0:24:330:24:34

But early in the New Year?

0:24:340:24:36

Your target?

0:24:360:24:45

The Prime Minister certainly one very public comment and one

0:24:450:24:47

that was implicit I figured what she said.

0:24:470:24:49

Firstly, it will not be this year.

0:24:490:24:51

Secondly, she knows that British people expect us to be

0:24:510:24:54

expeditious about it.

0:24:540:24:55

After reaching that position when will the Government set

0:24:550:24:57

out your objectives or will you not

0:24:570:25:00

set them out at all?

0:25:000:25:03

We will certainly set out some objectives,

0:25:030:25:06

the level of detail of the game is another matter but the overall

0:25:060:25:18

Is

0:25:180:25:18

Is that

0:25:180:25:19

aim will be set out clearly.

0:25:190:25:29

Apart from anything else, you have got Parliament is having

0:25:290:25:32

an interest in its and as I said yesterday to the Lords committee

0:25:320:25:35

we will meet that as far as we can without jeopardising

0:25:350:25:38

the overall aim.

0:25:380:25:39

Also, we have, when rewriter Donald Tusk under Article 50

0:25:390:25:42

we will write a letter and a sum that would include a statement

0:25:420:25:46

of our aims.

0:25:460:25:46

So that would be early in the New Year?

0:25:460:25:49

I will not be drawn on dates.

0:25:490:25:54

You said you would hold roundtable debates with stakeholders.

0:25:540:26:02

Can you explain in more detail how the process will actually work?

0:26:020:26:09

Will you publish open calls for evidence or contributions

0:26:090:26:11

from stakeholders will you and other departments

0:26:110:26:13

select those who you wish to hear from?

0:26:130:26:22

A bit of both.

0:26:220:26:23

Some of it is self-selecting because anybody who is concerned

0:26:230:26:26

about their own industry will be wanting to have a round table so,

0:26:260:26:30

for example, last week a city group

0:26:300:26:32

had a roundtable chair by the Chancellor.

0:26:320:26:41

I have one other retail this week.

0:26:410:26:55

I have set in the house I saw the TUC,

0:26:550:26:57

they were the first people I saw.

0:26:570:27:02

The fishermen's organisations, you name it.

0:27:020:27:07

The whole series where we think it is at issue

0:27:070:27:10

and people who are concerned.

0:27:100:27:13

And that is how you ensure it is wide-ranging and representative?

0:27:130:27:17

Bear in mind...

0:27:170:27:18

Sorry, I left out the section.

0:27:180:27:21

Also bear in mind is we put to one side the devolved administrations

0:27:210:27:27

because they have got a separate set

0:27:270:27:29

of almost parallel operations going on,

0:27:290:27:33

but every single department is it's also been asked,

0:27:330:27:37

was passed at the beginning of the summer.

0:27:370:27:41

Coming back with their primary concerns and their client group.

0:27:410:27:50

That is also happening.

0:27:500:27:53

I cannot think of any other way of making any

0:27:530:27:56

more exhaustive comments.

0:27:560:27:57

And the Department is suitably resourced for this?

0:27:570:28:07

More of the resources in the department that with us.

0:28:070:28:16

My department is quite small but has expanded rapidly

0:28:160:28:19

in the past month but is still only around 200 people.

0:28:190:28:28

What we are doing, the strategy we are taking is having a small

0:28:280:28:31

number of very high calibre civil servants of each of the main

0:28:310:28:36

departments, not trying to replicate

0:28:360:28:38

the entire policy went off, let's say, the Home Office.

0:28:380:28:41

That makes it work better, more effective, we not duplicating,

0:28:410:28:46

there are no turf wars and it is a better way of doing it.

0:28:460:28:53

How will it work when you start negotiating?

0:28:530:28:57

You are missing out this step.

0:28:570:29:00

The step between now and then, the negotiations starting,

0:29:000:29:04

will involve a degree of assessments

0:29:040:29:06

of the size of the problem.

0:29:060:29:13

For example, somebody has said that the nontariff barriers

0:29:130:29:18

are better than tariff barriers and they have cited various ways

0:29:180:29:26

are bigger than tariff barriers and they have cited various ways

0:29:260:29:29

so we will do a quantification of natural before we start

0:29:290:29:32

negotiating we will have an idea of what is big or small

0:29:320:29:35

and what matters and what does not.

0:29:350:29:37

We will not necessarily publish all that because that is a gift

0:29:370:29:40

to the other side that we will know it.

0:29:400:29:43

Welcome, secretary of state.

0:29:460:29:47

These are complex negotiations at you do not want to compromise

0:29:470:29:50

your position, but many of us believe if access to the single

0:29:500:29:56

market cannot be gains on terms reasonable to both sides then

0:29:560:30:04

market cannot be gained on terms reasonable to both sides then

0:30:040:30:07

certainly for those goods subject to tariffs we should not be afraid

0:30:070:30:10

to fall back on the WTO rules.

0:30:100:30:12

Is there any reason we should not do that?

0:30:120:30:16

I will not commit to any particular strategy at the moment,

0:30:160:30:20

for obvious reasons.

0:30:200:30:24

Firstly, let me offer a philosophical approach.

0:30:240:30:31

I think it is a bad idea to go into negotiation

0:30:310:30:34

fearing any outcomes.

0:30:340:30:35

Because that weakens you in one respect of another.

0:30:350:30:41

Speaking about the calculations that

0:30:410:30:45

will go on and we will assess not just

0:30:450:30:48

what the costs of a given strategy is but also

0:30:480:30:51

what the policies that go with it.

0:30:510:31:00

So, people might say it will cost this or that,

0:31:000:31:04

they have not necessarily taken on board how we might

0:31:040:31:06

mitigate costs.

0:31:060:31:08

I see nothing to fear in any outcome.

0:31:080:31:11

On immigration, mainly in the EU Commission the early suggestions

0:31:110:31:15

are linking immigration or free movement with trade negotiations.

0:31:150:31:22

Many of those who voted to leave, one of the key reasons was we had

0:31:220:31:26

a immigration system discriminatory against the rest of the world

0:31:260:31:30

outside the EU and what was wanted was fairness,

0:31:300:31:35

whatever the criteria that will guide the policy

0:31:350:31:37

going forward it must be fair

0:31:370:31:41

so that is the discrimination.

0:31:410:31:50

so that there is no discrimination.

0:31:500:31:54

Is that the sense of the position within the Government,

0:31:540:31:57

as you see it?

0:31:570:31:58

My job is to get those powers back,

0:31:580:32:05

respect the will of the British people which I tend to think of...

0:32:050:32:09

To respect that as much as we can in negotiations.

0:32:090:32:17

When we get it back it is only Home Office to make decisions

0:32:170:32:20

on how to use that power.

0:32:200:32:24

Whilst I have sympathy with your description of it,

0:32:240:32:31

it is not me who the decision.

0:32:310:32:33

The decision on how we decide on the final policy.

0:32:330:32:36

Final question.

0:32:360:32:39

The certainty of that position is if you endear to the principle

0:32:390:32:42

of fairness, whatever the criteria used, essentially adhere

0:32:420:32:44

to the principle there will be no discrimination,

0:32:440:32:48

you effectively divorce immigration

0:32:480:32:51

and free movement from the trade negotiations

0:32:510:32:55

because you can offer nothing special to the EU as such.

0:32:550:33:01

You need to explain that begin to me.

0:33:010:33:04

The subtlety of the principle of fairness is not only

0:33:040:33:06

that it is right, in that you will not discriminate

0:33:060:33:11

against one region of the world against another, but in pursuing

0:33:110:33:15

the principle of fairness you actually divorce in effect

0:33:150:33:19

immigration and free movement of labour from trade negotiations.

0:33:190:33:24

I did actually understand that the first time.

0:33:240:33:31

For obvious reasons I will not be drawn on it.

0:33:310:33:45

Can you not say anything?

0:33:450:33:46

Can I pressure on this?

0:33:460:33:48

It is a key plank of the campaign.

0:33:480:33:50

The Prime Minister made it plain the current system cannot be

0:33:500:33:53

allowed to stand.

0:33:530:33:54

She said we will not have free movement as it now is.

0:33:540:33:57

She talked about control borders so I do not think there is

0:33:570:34:00

any doubt about the priority that is on this

0:34:000:34:03

and I do not think our European partners would doubt that either.

0:34:030:34:06

And some of them have commented publicly in disagreement with her,

0:34:060:34:09

for example, the Irish head commented over the weekends

0:34:090:34:13

disagreeing with us but it is plain

0:34:130:34:16

this is a priority.

0:34:160:34:25

You mentioned you have a meeting with the TUC,

0:34:250:34:27

which is very welcome and unusual for the Government

0:34:270:34:32

in recent years to have such an early meetings with

0:34:320:34:35

ministers and the TUC.

0:34:350:34:39

You previously...

0:34:390:34:46

I do have form on this.

0:34:460:34:48

Perhaps then you can answer the question that you previously

0:34:480:34:50

said workers should not lose their rights as a result of Brexit.

0:34:500:34:56

Is that your personal view or is that because the view

0:34:560:34:59

of the Government?

0:34:590:35:00

It is a personal view but I have not

0:35:000:35:03

been disagreed with.

0:35:030:35:04

So there has been no discussion in Government yet about an erosion

0:35:040:35:07

of workers' writes?

0:35:070:35:13

of workers' rights?

0:35:130:35:15

Not on that specific issue and what I have said two other

0:35:150:35:21

Not on that specific issue and what I have said to other

0:35:210:35:24

members of the committee is we will not get drawn

0:35:240:35:27

into the policy elements of this.

0:35:270:35:28

Because it has implications that would...

0:35:280:35:32

To put it another way, if you lay a red lines

0:35:320:35:36

you are negotiating opponent does is head straight for that line

0:35:360:35:39

and use it against you.

0:35:390:35:43

I do not propose to elaborate but the comment stands.

0:35:430:35:53

Yesterday you told the Lords Select Committee

0:35:530:35:56

you will ask businesses to give you a quantitative

0:35:560:36:00

assessment of theimpacts of various scenarios

0:36:000:36:03

on their sectors.

0:36:030:36:08

How are you going to assess that data, the validity of that paper?

0:36:080:36:15

I was talking to Lord Green and what I said

0:36:150:36:19

what we would carry out these assessments and some

0:36:190:36:22

of the information will,

0:36:220:36:29

come that but the same way you test any data

0:36:290:36:32

given to you, you look at how it is calculated.

0:36:320:36:36

Will the businesses carry out or will you.

0:36:360:36:38

We will carry out some of our own.

0:36:380:36:41

Earlier I sighted people comparing effect of tariff and nontariff

0:36:410:36:43

barriers on how you set it.

0:36:430:37:01

You said your department does not date have the capacity says

0:37:010:37:11

You said your department does not date have the capacity to access

0:37:110:37:15

When do you expect to have that capacity?

0:37:150:37:22

Before we need it but the sequence of events

0:37:220:37:24

is like this, at the moment we are doing the round tables

0:37:240:37:28

and bilateral discussions.

0:37:280:37:28

We will then asked for data and submissions from them,

0:37:280:37:31

we will then begin assessment.

0:37:310:37:33

That is a little while away but I suspect the department

0:37:330:37:35

will double again in size.

0:37:350:37:38

Will that be before or after Article 50's triggered?

0:37:380:37:40

Before.

0:37:400:37:46

You will not trigger Article 50 until your department

0:37:460:37:49

is at capacity to carry out the functions.

0:37:490:37:51

To carry out those functions.

0:37:510:37:52

That is self evident, I would have thought.

0:37:520:37:54

And will you be drawing on the competencies

0:37:540:37:56

and documentation produced by ministers before the referendum,

0:37:560:38:03

the whole process went through when William Hague

0:38:030:38:06

was Foreign Secretary.

0:38:060:38:10

Most of this is a new process.

0:38:100:38:16

I think when the committee...

0:38:160:38:19

It is a very big process and there is a lot of work

0:38:190:38:23

going on and pretty much every department is involved

0:38:230:38:25

and they will be doing a fair amount of analysis

0:38:250:38:28

themselves and then challenging it.

0:38:280:38:32

Final question.

0:38:320:38:35

Given the clear reluctance you have two states

0:38:350:38:41

what you're negotiating position is going to be and not give

0:38:410:38:47

answers today or yesterday,

0:38:470:38:49

how long do you think you can sustain this position?

0:38:490:38:57

Isn't the reality that it will become politically impossible

0:38:570:39:00

domestic calling, not just internationally and are

0:39:000:39:06

therefore it might be better that the Prime Minister

0:39:060:39:08

and her new team actually got a mandate from the British

0:39:080:39:11

people before they trigger Article 50?

0:39:110:39:16

An early general election before article 50.

0:39:160:39:21

I am tempted to say that is above my pay grade

0:39:210:39:29

but it puts the rest of your questioning in context.

0:39:290:39:32

My questions are the kinds of questions people want answers

0:39:320:39:36

to your job is to answer them.

0:39:360:39:41

My job is to make decisions on behalf of the people.

0:39:410:39:44

We have a mandate like no other.

0:39:440:39:49

It is our job to deliver on that mandate and our job to do it as best

0:39:490:39:54

we can which means carrying out the negotiation in an intelligent

0:39:540:39:59

way, making the decisions on the basis of the data we collect,

0:39:590:40:02

analyse and make a decision on that basis, not the other way round.

0:40:020:40:07

It may be your approach to save because we are asking

0:40:070:40:10

the question you must tell us the answer before you have out

0:40:100:40:13

but that seems daft, to me.

0:40:130:40:16

You have not worked out the answers to any of these questions yet?

0:40:160:40:20

We have worked out some answers but not to the questions you have

0:40:200:40:24

asked and we have a major exercise under way and we will look at every

0:40:240:40:28

single sector industry, every single department of state has

0:40:280:40:33

got the workloads on less and they will come to intelligent

0:40:330:40:36

conclusions and that will drive the outcome,

0:40:360:40:40

empirical outcome to this process, not politically driven answers

0:40:400:40:44

but allowing you to say should we have an election.

0:40:440:40:49

I think these questions have established the level

0:40:490:40:52

of negligence...

0:40:520:41:05

Not above my pay grade...

0:41:050:41:08

Yes, not responsible to, Secretary State.

0:41:080:41:21

Good to see you back in Government, Mr Davies.

0:41:210:41:24

We are clear on the accentuation of the fact that was preparatory

0:41:240:41:27

work on the situation post Brexit, and it has clearly been indicated

0:41:270:41:30

the ball is in our court for triggering this.

0:41:300:41:34

Can I ask you, bearing in mind we have up to two years for this

0:41:340:41:38

renegotiation process, what are the delays in invoking

0:41:380:41:45

Article 50?

0:41:450:41:46

The primary delay is doing the necessary preparations.

0:41:460:41:55

It would be quite difficult for any government to do the level

0:41:550:41:58

of analysis we are undertaking now.

0:41:580:42:00

It is enormous.

0:42:000:42:04

As I say, every department is involved in it, pretty much.

0:42:040:42:07

That is the first thing.

0:42:070:42:10

It is time consuming, it simply is time-consuming,

0:42:100:42:12

first to collect the data, to establish the nature of the...

0:42:120:42:15

Let me give you another example.

0:42:150:42:20

The City of London, there has been a lot of concern about passports

0:42:200:42:24

and so on, and some companies have raised issues about this.

0:42:240:42:28

Some companies care about it and some do not.

0:42:280:42:31

We need to understand why some care and some don't

0:42:310:42:33

and what the differences are, we need to understand

0:42:330:42:36

whether there needs to be a policy as do it or can be fixed

0:42:360:42:40

the problems themselves with brass plates around the place and so on?

0:42:400:42:43

There are a whole series of issues and that is just one sector.

0:42:430:42:49

And the ecosystem is not an industry which fits together like a complex

0:42:490:43:02

tower as many as are of the opinion, say 'aye'.

0:43:020:43:06

To the contrary, 'no'.

0:43:060:43:09

Together like a complex jenga tower.

0:43:090:43:11

The only way to do this responsibly is to do the analysis first,

0:43:110:43:14

and clearly work out what the National priorities are,

0:43:140:43:17

on the basis of that, then designed a negotiating

0:43:170:43:20

strategy around that.

0:43:200:43:23

That is why it takes time and I make no bones about it.

0:43:230:43:26

I think the British people want us to do this properly,

0:43:260:43:29

not necessarily incredibly fast.

0:43:290:43:34

I understand obviously there is a huge amount of work to be

0:43:340:43:37

done, analytical work, and we want to be ready for those

0:43:370:43:40

negotiations with all the facts at our disposal.

0:43:400:43:44

It is not an issue, though, however, on lack of resources

0:43:440:43:47

for your department, is it?

0:43:470:43:49

Do you have sufficient resources?

0:43:490:43:51

There is a time constraint in the sense that the department has

0:43:510:43:54

come from scratch.

0:43:540:43:57

It did not exist two months ago, a little over two months ago.

0:43:570:44:01

Most people around this table, you know what Whitehall

0:44:010:44:03

is like in August.

0:44:030:44:05

The recruitment process is not a straightforward

0:44:050:44:07

as you might think.

0:44:070:44:09

So it has taken time.

0:44:090:44:11

There is no way round it.

0:44:110:44:13

It is not a shortage of money resource.

0:44:130:44:16

It is just a question of establishing the organisation

0:44:160:44:18

in place.

0:44:180:44:20

As I said to the Lords' committee yesterday,

0:44:200:44:26

at the moment it is mostly civil servants, in fact entirely civil

0:44:260:44:32

servants, and they are all quite young, smart people,

0:44:320:44:34

but they do not have experience in the City,

0:44:340:44:36

in industry, in various other areas, and the next phase is to bring

0:44:360:44:41

in some grey hair to bring in that experience.

0:44:410:44:46

It is not resources in the sense of money.

0:44:460:44:55

There is no problem with that.

0:44:550:44:57

our European partners have been I think very understanding,

0:44:570:44:59

certainly in public, about our delay.

0:44:590:45:03

Obviously they are keen for us to invoke it as quickly as possible.

0:45:030:45:08

Do you envisage a time when they will start to say publicly

0:45:080:45:11

that they are concerned about the delay?

0:45:110:45:16

Have you had any discussions with them about that?

0:45:160:45:19

I think I am right...

0:45:190:45:21

What the Prime Minister has been saying, and it may well have come up

0:45:210:45:25

in those discussions, but I don't think it is material.

0:45:250:45:28

The French government have been saying they wanted

0:45:280:45:30

to be precipitated soon.

0:45:300:45:34

I think one or two members of the Commission,

0:45:340:45:39

Mr Jean-Claude Juncker, he has said he would like to be

0:45:390:45:42

soon, but, you know, they are the other side

0:45:420:45:44

of this negotiation.

0:45:440:45:45

We will not necessarily do everything they say when they want

0:45:450:45:48

us to do it.

0:45:480:45:51

The counter to this is that they need some time as well.

0:45:510:45:56

For example, to give you the parallel to this,

0:45:560:45:59

my opposite number within the commission if you like,

0:45:590:46:04

Michel Barnier, is just at the moment about to establish his

0:46:040:46:08

own Department of 25 people, not 200 or 400, but 25 for this

0:46:080:46:12

instance so he can do his analysis, and they will need to work out

0:46:120:46:16

for themselves what the consequences of our negotiating request questions

0:46:160:46:19

are and they are also starting a process I do not think

0:46:190:46:22

it is wasted time.

0:46:220:46:29

OK, thank you.

0:46:290:46:34

I can say I am familiar with some of the young talent supporting

0:46:340:46:41

you in this role, obviously which iss some of which I am aware

0:46:410:46:44

of as a minister.

0:46:440:46:45

But speaking about grey hair, has approved rather more difficult

0:46:450:46:48

to find experienced servants to come and join your department?

0:46:480:46:59

You say experienced civil servants...

0:46:590:47:00

And others...

0:47:000:47:05

Outsiders?

0:47:050:47:06

Yes.

0:47:060:47:07

This morning we had on offer, and I probably should not mean

0:47:070:47:10

the company, but we had an offer of three senior partners from a very

0:47:100:47:14

major law firm in this area, so we have had other offers as well.

0:47:140:47:18

So no, there is not a shortage of interest in getting involved.

0:47:180:47:21

For many of the companies in the City, indeed,

0:47:210:47:24

in business in Britain, there are strong interests,

0:47:240:47:29

shall we say?

0:47:290:47:31

In providing us with good calibre people when they can.

0:47:310:47:34

Some of the interest groups, not companies,

0:47:340:47:37

are doing their own analyses as well, which we will incorporate

0:47:370:47:40

and draw on as well.

0:47:400:47:45

I wouldn't worry...

0:47:450:47:48

I mean, I will tell the committee if I run into a constraint on this

0:47:480:47:52

and I'm very happy to do so, but I am not at the moment

0:47:520:47:56

concerned about that.

0:47:560:47:57

There is a natural limitation on how long it takes to set

0:47:570:48:00

up an organisation.

0:48:000:48:01

I am setting up a battalion from scratch, basically.

0:48:010:48:04

To put it in words you would be familiar with.

0:48:040:48:07

You know, I am the recruiting Sergeant...

0:48:070:48:11

Well, actually, it might be a battalion!

0:48:110:48:13

We will see what we get.

0:48:130:48:15

It will be as big as it needs to be.

0:48:150:48:19

Good afternoon, Secretary of State.

0:48:190:48:23

The people voted to leave the European Union.

0:48:230:48:27

They expect us to leave the European Union.

0:48:270:48:31

And we understand that it takes time to get these things right before

0:48:310:48:35

we can actually do it.

0:48:350:48:36

But in the meantime can you reassure the public,

0:48:360:48:40

can you take actions, even small symbolic actions,

0:48:400:48:43

to indicate that the Government is absolutely serious,

0:48:430:48:47

deadly serious, about doing this, because there are jitters

0:48:470:48:50

and there are people worried that this is not actually

0:48:500:48:53

going to happen in the way they thought?

0:48:530:48:58

Well, at the beginning of the summer, the Chancellor

0:48:580:49:00

carried out the statement that we would underpin spending,

0:49:000:49:08

structural funds, CEP funds and so on.

0:49:080:49:11

If you wanted signal we wanted to reduce the jitters and say,

0:49:110:49:16

we are definitely doing this, that was one CAP.

0:49:160:49:23

That was one decision.

0:49:230:49:29

Those argument is notwithstanding the be made over again.

0:49:290:49:37

Those arguments notwithstanding the be made over again.

0:49:370:49:39

There was a debate I think in Westminster Hall last,

0:49:390:49:43

in fact last Monday, on whether there should be

0:49:430:49:45

a second referendum.

0:49:450:49:47

The Prime Minister has said time and time again,

0:49:470:49:50

you know, no second referendum, no reversals, nor avoidance.

0:49:500:49:54

We are leaving the European Union.

0:49:540:49:58

As a transition between now and when we leave

0:49:580:50:01

the European Union, is there a possibility

0:50:010:50:07

that we could look at EFTA is a way of continuing the existing trade

0:50:070:50:11

relations and leaving the European Union much earlier

0:50:110:50:14

by actually having that kind of transition?

0:50:140:50:24

No, I don't think so.

0:50:240:50:26

I don't want to get into it and I will not get

0:50:260:50:29

into what arrangement we end up with when we leave.

0:50:290:50:34

There are people who argue that as an outcome.

0:50:340:50:37

There are others who argue instant departure, so I will not get

0:50:370:50:41

into that but, no, I think this is the case.

0:50:410:50:47

The strategy of the Government is to depart the Union at the end

0:50:470:50:51

of the Article 50 process.

0:50:510:50:52

Up until then, the Government will absolutely obey

0:50:520:51:03

the European Union law and will be a good European Union citizen,

0:51:030:51:09

that is the approach we are taking and we think

0:51:090:51:13

that is the approach we are taking and we think it is the best approach

0:51:130:51:17

in terms of our responsibilities

0:51:170:51:18

and also we think it is the best negotiating approach.

0:51:180:51:21

We will not walk away from our responsible days.

0:51:210:51:25

We will take a stronger stance on European matters on defence,

0:51:250:51:27

security and a whole series of other things.

0:51:270:51:30

This is a bit of an indicator.

0:51:300:51:32

But whether there are things we can do that would be legally OK to do,

0:51:320:51:45

that show we are symbolically...

0:51:450:51:47

One example is new passports that will be issued from now on will go

0:51:470:51:51

back to the traditional blue British passport rather than the pink things

0:51:510:51:54

we have been using.

0:51:540:51:56

You would need to ask the Home Secretary...

0:51:560:51:58

Could we have symbolic gestures such as that to show the British people

0:51:580:52:02

we are absolutely serious about leaving the EU?

0:52:020:52:06

Attractive as the idea is, we're not in the business,

0:52:060:52:10

or at least I am not in the business, of symbolism.

0:52:100:52:13

I am in the business of delivering on this,

0:52:130:52:16

and that is the point.

0:52:160:52:18

On that very point of delivering, in your deliberations

0:52:180:52:21

and negotiations and discussions about Britain's future,

0:52:210:52:23

the United Kingdom's future, with the EU, what assurance can

0:52:230:52:27

you give your taking into account the interests of Gibraltar

0:52:270:52:34

and the British Overseas Territories and Crown dependencies,

0:52:340:52:37

but particularly Gibraltar that have a huge amount of concerns

0:52:370:52:39

about their position following Brexit?

0:52:390:52:44

Well, we are, and I am seeing the chief minister of Gibraltar

0:52:440:52:47

almost after this meeting.

0:52:470:52:51

Simon thank you very much.

0:52:510:52:54

The Secretary of State seems reluctant to go into specifics

0:52:540:52:57

about exposing his negotiating hand but as you will recall straight

0:52:570:53:01

after the referendum there was huge uncertainty in markets.

0:53:010:53:06

The pound slumped, share prices down.

0:53:060:53:17

We were led to understand they would not be a rush to invoke

0:53:170:53:21

Article 50.

0:53:210:53:21

To give some breathing space and the markets and many major

0:53:210:53:24

investors time to speculate, on which approach we will take.

0:53:240:53:33

You clearly do not want to be transparent about this

0:53:330:53:36

but our markets, businesses and inverses want is to some degree

0:53:360:53:39

transparency that the outcome will be something they can live with.

0:53:390:53:49

You made it quite plain that you are not sure an EFTA model

0:53:490:53:54

is for Britain, but do you have some arrangement you will keep secret

0:53:540:53:58

until the last minute and that at the end of tonight years will be

0:53:580:54:06

until the last minute and that at the end of two years will be

0:54:060:54:09

brought out like a rabbit out of the hat, that the international

0:54:090:54:13

community, and in particular the business community,

0:54:130:54:15

will be satisfied with, and in the meantime what damage do

0:54:150:54:18

you think that will do to our international standing

0:54:180:54:20

in the markets and the strength of the pound, and what is happening

0:54:200:54:24

in investment in this country?

0:54:240:54:25

Let me take it apart from the beginning.

0:54:250:54:28

Firstly the description of the financial markets was just

0:54:280:54:30

simply not true.

0:54:300:54:32

The FTSE 100 and all the various indicators are good.

0:54:320:54:38

The standing of the pound is not in a poor place.

0:54:380:54:55

Indeed a previous government believed that that is where it

0:54:550:54:57

should be, so I am not in the business of speculative

0:54:570:55:00

on that but that description you have given is a little

0:55:000:55:04

like descriptions people were giving in August trying to blame things

0:55:040:55:06

on Brexit then of course all those things they were calling on Brexit

0:55:060:55:10

dissolved on wearing there, so...

0:55:100:55:11

Let me finish.

0:55:110:55:12

You ask the question so I will answer.

0:55:120:55:14

Firstly, your description of the economy is simple

0:55:140:55:16

not the case.

0:55:160:55:17

The first thing to say to you is a big business decisions

0:55:170:55:21

are not taken on the right thing of one commentator

0:55:210:55:26

in the Financial Times, they are taken over a period of time

0:55:260:55:30

and not taken off the back of the movement of the markets

0:55:300:55:33

on one day or another.

0:55:330:55:35

You will see the foreign investment into this country after the election

0:55:350:55:39

of a Government that had undertaken the referendum was as high as it

0:55:390:55:44

has ever been.

0:55:440:55:49

We saw investment in the country in a big way.

0:55:490:55:59

We saw investment.

0:55:590:56:02

One business said they were going to continue to invest.

0:56:020:56:06

So I frankly do not accept the premise but let's take the next

0:56:060:56:10

step as well.

0:56:100:56:16

That is what business views as uncertainty.

0:56:160:56:20

A business that wants to see a decision taken on the basis

0:56:200:56:23

of the facts, a Government doing representing the national interest

0:56:230:56:26

and that is what this Government is doing.

0:56:260:56:30

If I were still in business and worrying about whether to

0:56:300:56:33

invest, I would not be panicked by a Government taking its time

0:56:330:56:38

but by the Government rushing to do something in a tremendous hurry.

0:56:380:56:45

The premise of your question is flawed.

0:56:450:56:49

You say that, I know you had discussions with the Japanese

0:56:490:56:52

ambassador so let me give you a short passage.

0:56:520:56:57

What Japanese businesses wish to avoid the situation

0:56:570:57:00

in which they are unable to play discern the rear brakes

0:57:000:57:09

in which they are unable to play discern the Brexit

0:57:090:57:12

and negotiations are going and only grasping the whole picture

0:57:120:57:14

at the end.

0:57:140:57:15

It is imperative to regain the confidence of the world

0:57:150:57:18

and ensure competitiveness by increasing the predictability

0:57:180:57:20

of the Brexit process.

0:57:200:57:21

That is not just through a Japanese company

0:57:210:57:23

but of companies around the world is wondering

0:57:230:57:25

whether or not to pull out of Britain.

0:57:250:57:27

Because we will not have access.

0:57:270:57:34

You said yourself, we may not be in the single market when this

0:57:340:57:38

process is finished.

0:57:380:57:43

Did I say that?

0:57:430:57:44

You are basing that on what evidence?

0:57:440:57:48

Let me deal...

0:57:480:57:51

Secretary...

0:57:510:57:52

Let me finish, secretary of state.

0:57:520:58:00

You mention investment but that is not companies

0:58:000:58:02

like Nissan and a wholly owned by building factories,

0:58:020:58:04

it is a British company is taken over by a Japanese company.

0:58:040:58:20

It is not jobs and hard manufacturing.

0:58:200:58:22

Let's not mix this thing as equivalent to the big car

0:58:220:58:25

investments made in this country.

0:58:250:58:32

You were the one who raised is the FTSE numbers.

0:58:320:58:35

Many of the companies listed on the FTSE foreign-owned

0:58:350:58:37

and that is why the FTSE has not been affected to the same degree.

0:58:370:58:41

Where was the question at the end of that?

0:58:410:58:46

Let me deal with the Japanese point first.

0:58:460:58:52

The simple way of dealing with it is to go back to the Today

0:58:520:58:57

programme on the first day of the G 21 Japanese ambassador said

0:58:570:59:00

about how attractive Britain is and will continue to be.

0:59:000:59:07

If there is nothing new,

0:59:190:59:20

then the Court of Appeal aren't going to change their decision.

0:59:200:59:24

David Davis MP, secretary of state for exiting the European Union, speaks at the Foreign Affairs Select Committee inquiry into the implications of leaving the EU for the UK's global role, from 13th September.


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