Official Report 1019KB pdf
The next item of business is a debate on motion S6M-15093, in the name of Clare Adamson, on behalf of the Constitution, Europe, External Affairs and Culture Committee, on the United Kingdom-European Union trade and co-operation agreement.
I invite those members who wish to speak in the debate to press their request-to-speak buttons and I advise members that, as we have a substantial amount of time in hand, I can be generous with speeches and there will also be plenty of time for interventions.
With that, I call Clare Adamson, on behalf of the Constitution, Europe, External Affairs and Culture Committee, to speak to and move the motion.
14:55
I am delighted to open the debate as convener of the Constitution, Europe, External Affairs and Culture Committee. I begin by thanking all the committee members, who have approached our work in such a collegiate and informative manner. I thank the clerks who organised all our evidence sessions, and I thank everyone who submitted written evidence, appeared at committee or met us during the inquiry.
We considered how trade in goods between the European Union and the United Kingdom is currently working and, importantly, where there are opportunities to improve the trading relationship. That comes in advance of the forthcoming mandatory review of the implementation of the UK-EU trade and co-operation agreement, which is due in 2026.
The agreement governs the UK’s relationship with the EU post-Brexit and sets out the terms of trade with the EU, which is the UK’s largest trading partner. Trade with the EU and the agreement that governs it is of central importance to the Scottish economy. Let us not forget that the EU accounts for a significant proportion of the export value of our key Scottish produce, from 60 per cent of Scottish salmon exports to 95 per cent of red meat, including Scottish beef, lamb and pork. That is why it is crucial that we understand how better to facilitate trade with our European neighbours. It is also why the committee was pleased to undertake the first parliamentary inquiry in the UK on the impact of the post-Brexit trade agreement on business and trade.
I thank again those who gave evidence, particularly the individual trade bodies, as well as civil society and think tanks, which were all consulted.
We visited two Scottish businesses that are trading with the EU—the haggis and black pudding producer, Macsween of Edinburgh, and the confectionery firm Aldomak. We learned more about the barriers to trade that have arisen post-Brexit and how they might be addressed.
As we discussed the operation of the TCA with academics, businesses and parliamentarians on a visit to Belfast and Dublin, we got rich evidence that helped our inquiry and contributed to our report. The evidence was overwhelmingly that Scottish businesses were experiencing a significant challenge in exporting goods to the EU under the terms of the TCA, with there being considerable non-tariff barriers to trade. Under the TCA, there are zero tariffs and zero quotas on trade in goods between the UK and the EU, but there is no agreement on non-tariff barriers and the TCA does not provide for common regulatory standards for goods.
The National Farmers Union of Scotland said that trade is now
“tariff free and quota free, but it is certainly not friction free.”—[Official Report, Constitution, Europe, External Affairs and Culture Committee, 7 March 2024; c 2.]
As the UK is no longer required to observe EU rules, the respective regulations in the UK and the EU might diverge further over time. That means that customs and regulatory checks are imposed at the EU border, with all imports to the EU market required to meet all EU regulatory standards. However, border checks on goods entering the UK from the EU are still being phased in, following delays post-Brexit. That disparity has created an uneven playing field for UK businesses. We found that non-tariff barriers, including the requirements for full customs and regulatory checks, have placed considerable administrative resource and cost pressures on Scottish businesses, particularly our small and medium-sized enterprises—so crucial to the Scottish economy—as they have no capacity to absorb that additional cost.
The additional burden is not only in complying with customs and regulatory requirements, but in monitoring UK-EU divergence to ensure compliance of goods with changing EU regulations. Increasing regulatory divergence between the UK and the EU presents challenges for businesses in seeking to comply with changing EU regulations. If such divergence intensifies, it will be a barrier to future trade.
The Agricultural Industries Confederation Scotland has said that:
“divergence in regulatory standards between”
the UK
“and the EU ... is causing difficulties for members to trade goods.”
I should have said “GB” there, in fact, as Northern Ireland is not constrained by the terms of the TCA.
We heard from UK in a Changing Europe that there has been a
“slow drip”
of divergence
“that will create new regulatory barriers”.—[Official Report, Constitution, Europe, External Affairs and Culture Committee, 14 March 2024; c 19.]
Those non-tariff barriers to trade have harmed exports, with many businesses withdrawing from the EU market as a result.
The challenges have been particularly acute for our agri-food producers, which are required to meet the EU’s sanitary and phytosanitary measures. There are additional requirements for veterinary inspections, and there is increased risk as a result of the time-sensitive nature of products if goods are delayed during border checks. We heard from Quality Meat Scotland of an incident last year in which £250,000 of Scottish produce was written off as a result of delays with SPS checks at the French border. We also heard from Innovate Foods, which had stopped exporting to the EU since it had goods held up at the border and written off. As I mentioned, that has an impact in particular on the sole traders, sole exporters and smaller businesses—there is a disproportionate impact on our smaller operators.
Let us be clear: all those challenges are a consequence not only of leaving the EU, but of the type of Brexit that the TCA was intended to deliver. In the committee’s view:
“There is now therefore a need for the UK Government to negotiate improvements to the trading relationship to better facilitate UK-EU trade.”
The Labour Government has told us that it wants to “reset” relations with the EU and “tear down” barriers to trade. However, the committee is still waiting for a full response from the UK Government and a meeting with the UK Minister for the Constitution and European Union Relations.
The committee has recently returned from Brussels, where we presented the findings of our report to members of the European Parliament, as well as to the European Commission and the European Council. It was clear that, while the general view from Brussels is that it is open to offers and to negotiation of the TCA, and there is a willingness to consider proposals from the UK Government on how to improve the UK-EU trading relationship further, it is not keen on an opening up of the TCA in full and major renegotiation in this area.
Would the convener agree that the general message was that they want to get their hands on British fish, and that fish would be at the centre of any of their asks in return for any adjustments to the TCA?
Mr Kerr will know that the areas for negotiation are always around the areas of interest to both the UK and Europe, and that those discussions will have to take place.
The proposals from the UK Government have yet to emerge, following the general election, but on the EU side, there are clear red lines. Removing or limiting the impact of non-tariff barriers will require greater regulatory alignment with the EU. We heard that message loud and clear in Brussels.
The committee’s report also considered key areas of possible alignment in which the UK Government could seek to negotiate supplementary agreements or adjustments; the deputy convener will touch on more of those areas in his closing speech. The core recommendation in our report is that
“the UK Government should seek”
an SPS
“agreement with the EU”,
as that would
“significantly reduce border checks and the administrative burden on exports of agri-foods”
and reduce
“barriers to trade for many Scottish businesses.”
That is the position of the Scottish Government and a manifesto commitment of the new UK Government. It was central to the calls that we heard from most of the stakeholders and businesses with whom we discussed those issues.
As I have said, the EU is willing to consider those proposals, but the UK has yet to implement the TCA requirements in full, and border checks have not been established on the UK side of the border. That might bring more pressure within the EU, as the same challenges that face British and Scottish exporters might be experienced in relation to goods that come into the UK.
We have recently started to take evidence on the second phase of our inquiry, focusing on trade in services and the mobility of people following Brexit, and we will report in due course.
I welcome this debate and the proposed reset in UK-EU relations.
I move,
That the Parliament notes the conclusions and recommendations contained in the Constitution, Europe, External Affairs and Culture Committee’s 2nd Report, 2024 (Session 6), UK-EU Trade and Cooperation Agreement: Barriers to trade in goods and opportunities to improve the UK-EU trading relationship (SP Paper 639).
15:05
I thank the convener and members of the committee for their on-going work on examining the effects of the trade and co-operation agreement in Scotland.
In debates on the impact of Brexit, we should never forget that people in Scotland voted overwhelmingly to remain within the European Union. We should also remember that the TCA is a hard Brexit. It removed Scotland from the EU—and its huge European single market and customs union—and brought an end to freedom of movement, which was so important for our country. It did not need to be that way.
Will the cabinet secretary give way on that point?
I will make some progress before I give way to Mr Kerr.
The Scottish Government shares the committee’s conclusions that that hard Brexit has caused—and is causing—significant difficulties for many Scottish businesses and traders.
The Office for Budget Responsibility reported in its assessment of the UK budget that
“Weak growth in imports and exports over the medium term partly reflect the continuing impact of Brexit, which we expect to reduce the overall trade intensity of the UK economy by 15 per cent in the long term”.
Indeed, the UK Government now states that 60 per cent of the harmful economic impact of Brexit has yet to materialise.
The cabinet secretary is quite wrong to describe the agreement as a hard Brexit. During the Brexit debates, everybody was well informed that a hard Brexit would have meant our leaving with no agreement at all and operating on World Trade Organization terms with the European Union. That is not what we have. We have tariff-free, quota-free trade and an unprecedented free trade agreement.
I am sorry that Mr Kerr is trying to rewrite history. Those who supported Brexit gave all kinds of impressions that there were ways that the United Kingdom could continue to trade within the single European market, and the record is absolutely clear on that.
There are varying estimates of the damage of Brexit in relation to gross domestic product, lost economic growth and forgone tax revenue that would have been available to fund public services. The National Institute of Economic and Social Research estimates a 2.5 per cent hit to gross domestic product due to Brexit in 2023, which will increase to 5.7 per cent by 2035. As was debated here last week, consumers have been hit by higher food prices, which adds to the cost of living crisis.
It is clear that rejoining the European Union is the best future, not just for Scotland but for the United Kingdom as a whole. In the meantime, colleagues and I applaud the committee’s efforts to identify how the European Union-UK trading relationship could be improved. Those improvements are now urgent. As I and others made clear in providing evidence to the committee, the extent of non-tariff barriers to trade in goods has been a significantly harmful consequence of Brexit.
The committee’s report directly addresses the Scottish Government on three specific issues. I will touch on those points here and now. First, the report raises concerns regarding the border arrangements between the UK and Europe. Scottish ministers agreed to endorse the UK’s border target operating model in order that checks take place to protect our people, businesses and environment from possible biosecurity risks. That endorsement was contingent on the previous UK Government addressing a set of outstanding issues. Regrettably, that did not happen, and critical elements of the UK border model are still unfinished. The system is not yet live for inbound goods from the Irish Republic and Northern Ireland. The model’s interactions with the Windsor framework are still to be determined. Anti-avoidance schemes to deter illicit trade—and the underpinning legislation—remain in development.
It is such on-going uncertainty that is so damaging for business. Scottish ministers are ready to work collaboratively with the UK Government to deter illicit trade and to protect our biosecurity. We will continue to stress that minimising the burden on business and providing as much operating clarity as possible are paramount.
Secondly, the committee’s report notes that the regulatory requirements for businesses trading with the European Union have become significantly more complicated as a third country because of additional non-tariff barriers such as logistics, SPS controls, labelling and other regulatory requirements.
We will continue to work with Scottish Enterprise so that it can provide on-going support and advice through company-specific approaches, as well as a range of export digital tools, webinars and workshops to help companies to identify the right markets and latest export opportunities.
Will the cabinet secretary give way?
I will just get to my third point and then I will be happy to give way to Willie Rennie.
Thirdly, the committee noted issues around regulatory alignment arising from Brexit, and it has long expressed its concerns about the operation of the United Kingdom Internal Market Act 2020. Indeed, that piece of legislation, alongside the previous Government’s stop-start approach to imposing new border controls, its capricious approach to regulatory standards and checks and the passing of the Retained EU Law (Revocation and Reform) Act 2023 all caused further significant uncertainty.
Around the time of Brexit, we had many debates in Parliament about the Scottish Parliament and the Scottish Government having keeping-pace powers. How many times have those powers been utilised?
The issue of Scotland remaining as aligned as possible with the European Union has been explored and worked on at length in partnership with the committee. There is a range of ways in which we are able to do so, and we are best able to do so not by using the powers that Willie Rennie outlines but by finding other ways. I am happy to share the reports with him. I do not know whether he is putting in a bid to become a member of the committee. He would be very welcome there, and I am sure that he would learn, as other colleagues in the chamber would, about the efforts that are being made. I think that there is agreement between the committee and the Government that the reporting mechanism on the issue is working well, but I would be happy to discuss it further with Willie Rennie.
The Scottish Government has consistently called for alignment with European Union law, including so-called dynamic alignment, and in devolved areas, we are seeking to remain aligned wherever meaningful and appropriate. Perhaps unsurprisingly, maintaining regulatory alignment with the world’s largest single market is now seen as increasingly relevant to economic growth by the UK Government as well as the Scottish Government.
That brings me to the important part of the committee’s report about what opportunities exist to improve trade relations with the European Union. We know that many Scottish food industries are suffering due to lower exports to the European Union. For example, fruit and vegetable exports between 2019 and 2023 fell by a whopping 45 per cent.
When it comes to imports, research by the London School of Economics and Political Science’s centre for economic performance suggests that UK households have paid £7 billion to cover the cost of post-Brexit trade barriers on food from the EU, pushing up average household food costs by £250 since December 2019.
What can be done to improve the UK-EU trading relationship? We urgently want the UK Government to deliver on its declared aim to reset its relations with the rest of Europe. We welcome the statement in early October in which Keir Starmer and Ursula von der Leyen jointly declared their wish to strengthen the UK-EU relationship. However, we need to see concrete progress.
I will highlight four areas where the situation needs to improve for trading goods. First, as we discussed last week, we urgently need a comprehensive SPS agreement—an agriculture, food and drink agreement—between the UK and the EU that includes animals, plants and related products, food and drink, veterinary medicines and wider agricultural goods and products, as well as pet travel.
Secondly, we seek a mutual recognition agreement on conformity assessments, so that businesses do not have to comply with two different systems of safety assessment.
Thirdly, we want consistency in customs processes between the UK and the EU for smoother trade flows. It is simply not sustainable that, as the Scottish Chambers of Commerce stated, more than 40 per cent of firms that export under the Brexit deal say that they
“face difficulties adapting to its rules on buying and selling goods”,
nor is it acceptable that 60 per cent say that trade with the EU has got “more difficult” in the past year alone.
Fourthly, we would like to see talks move forward on linking the UK and EU emissions trading schemes. That could help to avoid the negative impacts of the EU carbon border adjustment mechanism, which will have significant consequences for goods being traded across the UK-EU border.
Of course, the best trading relationship would be European Union membership. However, improvements can still take place, particularly if the new UK Government is more realistic about what would be required to unlock such improvements. I believe that much of that agenda will find support in the chamber, and I look forward to hearing colleagues’ views during the rest of the debate.
15:15
This is my first committee debate as a member of the Constitution, Europe, External Affairs and Culture Committee. It is only fair to be clear that I am not speaking for my party on this subject, but I welcome the opportunity to share my thoughts.
Although I was not part of the committee during the evidence gathering, I think that the report is thorough, balanced and fair. I record my thanks to the convener, the committee members at the time, and the clerks.
Whatever members think of Brexit, it is done, and it is not going to be undone. We are not going back. I do not disguise that I am glad that we are out of the European Union, and I would vote leave again. I represented Stirling during the Brexit Parliament, and I voted for Brexit countless times during that Parliament.
Would the member not consider, given all that he has heard and what the report says, that Brexit is not done? People are paying for it day in, day out and week in, week out. Businesses are losing money, we are losing trade and exports are being lost. Brexit is far from done. Can he not see that from the report?
We have a new relationship with the European Union, so Brexit is absolutely done.
Let us be clear that leaving the European Union was always going to be disruptive. It was always going to change our relationship with the single market. However, the transition could and should have been smoother. The terms of departure and the new relationship should have been negotiated together and not sequentially, because all that that did was make a complex issue even more complex. Of course, the European Union has no interest in making it easy for a member state to leave, and the EU did everything in its power to make it as difficult as possible for the UK to leave.
I turn to the trade and co-operation agreement. It was then, and it still is, an unprecedented agreement for the EU to strike with any third country. It is not the hard Brexit that the cabinet secretary was describing. He has to remember that I sat in the UK Parliament for two and a half years and heard Scottish National Party MPs witter on about a hard Brexit. That would have meant that we left the EU on WTO terms—we have not. We left with an unprecedented agreement.
The member struggles with the concept of a hard Brexit. Would he accept that it was a Conservative Brexit deal?
The agreement was indeed put through Parliament by a Conservative Government after a general election in which, sadly, I lost my seat, but we ended up with a big majority of more than 80—in all, 365 Conservative MPs. Yes, Brexit was done. That was the point of the December 2019 election.
We left with a free trade agreement with many pluses. However, like all negotiations, the agreement was a compromise, and some aspects of it could and should be improved. The committee report effectively outlines how the TCA can be improved to support Scottish businesses, and I support that pragmatism.
Border checks for goods entering the UK from the EU should be implemented without further delay, as is required by the TCA. Allowing EU imports free access to our domestic market while British producers face EU import checks creates, as the report says, “an uneven playing field” and offers us no basis for further negotiation. We cannot negotiate improvements to the TCA without leverage. We have to have something that the other side wants, other than our fish.
There has been much-needed improvement in the working relationship between the UK and the EU since Rishi Sunak’s Windsor framework agreement. I, for one, welcome Britain’s return to Horizon, which is evidence of the improving nature of the relationship post-Brexit. However, when it comes to the TCA review, we must be realistic. The EU is a protectionist bloc. It is tightly focused on shielding big corporate and producer interests. It is not in the business of encouraging competition from imports but is institutionally biased towards producers and certainly not in favour of consumer interests. Therefore, let members be in no doubt that any changes to the TCA will come at a high price, with the EU demanding access to British waters and the return to free movement.
We should not sacrifice British sovereignty, British waters or British fisheries. Should anyone expect the public to be in a mood to be in favour of open borders and uncontrolled immigration, I politely suggest that they have not been paying attention to recent elections, not only here but throughout the western democracies.
I am optimistic about Britain’s place in world trade. Since leaving the EU, we have gone up the global league table of leading export nations. We are now fourth in the world, having just overtaken France and the Netherlands. Meanwhile, the EU’s share of global trade has continued to decline. In 1992, it was 28.8 per cent; now, it is 17.5 per cent. The decline continues.
To quote a former US presidential strategist, “It’s the economy, stupid!” Since Mr Kerr is in a positive mood, what does he think about the report’s finding that the SMEs in Scotland are struggling to get to the major market that they freely had access to not so long ago?
I will give you the time back for the intervention, Mr Kerr.
I have been clear that I would like the agreement to be amended so that it is easier and smoother to trade with the EU. However, the cards are in the hands of the EU, not the UK. Yes, we want to improve trade with the EU, but it is a declining market. We certainly should not be locking ourselves into EU regulations. I am against lockstep aligning with the EU; I support pragmatic divergence, which, in my view, is happening too slowly. We must be more dynamic and build on the achievements of the previous Conservative Government by striking more bilateral trade agreements. If one believes in free trade, how can one possibly be against more of it?
There are exciting and emerging opportunities for British businesses all around the world. In December, Britain will join the trans-Pacific partnership—an agreement that will put the UK alongside the world’s fastest-growing and most dynamic economies.
The real prize came back to the table last week. Joe Biden did not want to do trade deals with anyone, but the one thing we know for certain about President-elect Trump is that he loves to do deals. Donald Trump loves Britain, especially Scotland. His business has invested hundreds of millions of pounds in Scotland and created hundreds of jobs. A trade deal in an advanced stage of readiness was being negotiated when President Trump left office; now, with President Trump’s return, we should be working every muscle to get back to the negotiating table to do a free trade deal with our biggest single global partner, the United States.
A trade deal with the United States would be the biggest prize of all. I have no doubt that a Conservative Government would be doing that, but I have my doubts about whether Labour will take that on—Labour’s recent budget shows that, as the SNP in Scotland does, it has an anti-business and anti-entrepreneur agenda, whether it is through a vendetta against small family farmers or an increase of the tax on jobs.
Yet, I remain optimistic. We can and must make the TCA work better, as is well highlighted in the report, but there is a real opportunity in using the benefits that Brexit can bring in freeing our economy and doing trade deals around the world to support our entrepreneurs, create better jobs and give workers higher wages in every single part of our United Kingdom.
I advise members that there is a bit of time in hand, so you will get the time back for any interventions that you take. I can be fairly generous in the speaking times. I call Neil Bibby, who has a generous six minutes.
15:24
I welcome the opportunity to speak in the debate on behalf of Scottish Labour. I, too, welcome the publication of the Constitution, Europe, External Affairs and Culture Committee’s important report on the UK-EU trade and co-operation agreement, which is due to be reviewed by 2026. I join the committee convener, the cabinet secretary and Stephen Kerr in thanking the clerks and those stakeholders who gave evidence to the inquiry.
The committee report makes clear and identifies many areas in which non-tariff barriers from Boris Johnson’s trade and co-operation agreement have caused significant problems and led to costs for Scottish businesses post-Brexit. We have already heard differing views from Mr Kerr on the context of that agreement. He also accused other parties of being anti-business, so let us hear what Scottish businesses have said about Mr Johnson’s agreement. The committee heard extensive evidence, including testimony from the Scottish Association of Meat Wholesalers, which told the committee about the additional time and cost burden of having to produce export health certificates for individual products.
Quality Meat Scotland told us about the physical inspections that result in significant delays to shipments, which reduce the value of fresh products on arrival. Macsween told the committee that, on one occasion, regulation changes as its products arrived at the border meant a four-month delay and £5,000 in extra costs. We also heard similar evidence on delays from Seafood Scotland and Salmon Scotland. The freshness of their products is key.
I am interested to hear, given what is in the report—which I agree with—whether the UK Labour Government will introduce the much-needed import checks on EU products entering the United Kingdom.
I will come on to Labour’s position. However, the Labour Government is committed to upholding our international agreements that we sign up to.
If that was not enough and did not illustrate the point, the committee also heard from Innovative Food Ltd, which referenced its goods, including chilli cheese nuggets, which were held up at the border for six weeks, meaning that the products melted and were lost. As a fan and consumer of chilli cheese nuggets, I have to say that any loss of such products is to be deeply regretted.
I jest, Presiding Officer, but, in all seriousness, the supplier lost considerable sums of money and has not tried to ship to Europe since that incident. Those are serious issues and many small businesses in Scotland have not even tried to export to the EU.
From increased paperwork for our exporters to the rising cost of importing goods, the challenges are evident. The needs of our farmers, fishers and small businesses are not being met under the agreement as it stands. I welcome that the committee, on a cross-party basis, the new UK Labour Government and the Scottish Government all recognise that.
For me, one of the most important aspects of the report is, as the cabinet secretary said, that it points to ways forward. It is also clear that we must work together to try to resolve those issues for the benefit of Scottish businesses, consumers and, indeed, for those across the whole of the UK—and I believe that we can.
The first step to achieving potential solutions to those issues has to be resetting our relationship with the European Union. Part of that must be to recognise the significant job that has to be done to repair damage to our international relationships that were brought about by 14 years of isolationism under the previous UK Conservative Government. The new UK Labour Government, which was elected just four months ago, is already at work repairing our international relationships, having scrapped the Rwanda scheme, and is working to reset the relationship that we have with the European Union, as well as resetting the relationship that it has with the devolved Governments.
Although a formal review of the trade and co-operation agreement is on the horizon, the new Government is not waiting before acting. I know that some members are keen to know what that reset in relations means. It can be seen by the immediate action to rebuild our global reputation through credible and respectful diplomacy.
As we have already heard, the commitment was underlined by the meeting on 2 October between Prime Minister Keir Starmer and EU President Ursula von der Leyen, when they agreed to strengthen co-operation in key areas such as the economy, energy, security and resilience. Just this week, the Prime Minister was again in Europe, attending the armistice day service in France, with President Macron. He is the first British Prime Minister to do so since Winston Churchill.
The reset is well under way. Do not just take my word for it: the new era of constructive engagement in an attempt to build new positive relations has been welcomed by leaders in capitals across Europe. The committee also heard that from everyone whom we met on our recent visit to Brussels. It represents a fresh, practical commitment to work together in the best interests of both the UK and the EU and sets the stage for more comprehensive agreements in the future.
Neil Bibby mentioned the committee’s trip to Brussels, but I am sure that he is aware that, despite everything that he said about the reset of the relationship, no one in Brussels really knows what the UK Government wants. In fact, one of them—David McAllister—went as far as to quote the Spice Girls, saying,
“tell me what you want, what you really, really want.”
What does the Labour Party want, Mr Bibby? Tell us now what the Labour Party wants.
I will tell George Adam now, but we also told him in July, through our manifesto. We said that we
“will work to improve the UK’s trade and investment relationship with the EU, by tearing down unnecessary barriers to trade. We will seek to negotiate a veterinary agreement to prevent unnecessary border checks and help tackle the cost of food”,
and it continues.
The question of what we do now is important and has to be our focus, with the pragmatic and forward-looking approach that Scotland needs. That practical approach should include, as the committee heard, advice and support for Scottish businesses from the Scottish Government to help them to be informed and to navigate the current situation. I welcome what the cabinet secretary said in that regard, because there is more that can be done.
Fundamentally, as the committee recognises, we must make trade with the EU more smooth and efficient. As the committee recognises, we should seek a veterinary agreement with the EU—
Will Neil Bibby give way?
I have already taken two interventions. I am sorry, but I would like to make some progress.
As I said, we should seek a veterinary agreement with the EU to significantly reduce border checks and the administrative burden on exports of agrifoods to the EU. I am pleased that the new UK Labour Government is committed to doing so in order to make it easier for Scottish businesses to export.
The reduction in costs from a reduction in unnecessary trade barriers is not just a potential benefit to businesses; it can be beneficial to consumers with the cost of living.
Will Neil Bibby take an intervention?
I will give way at that point.
I am sorry that Neil Bibby did not take Keith Brown’s intervention, but I am happy that he has taken mine.
This is all well and good, but we have very little with which to negotiate with the European Union unless we begin to implement the TCA, as is detailed in the committee report. Will a Labour Government introduce checks at the border on EU produce entering the UK—yes or no?
We have said that we will uphold the international agreements that we have signed up to. A negotiation will take place and a number of issues will need to be discussed. We have said that we want to reduce unnecessary border checks to help businesses and consumers and that we want to work to reset the relationship with our European neighbours.
Will Neil Bibby give way on that point?
I will give way to Mr Robertson.
I am seeking to be helpful in the spirit of our cross-party agreement.
Does Mr Bibby agree that it is estimated that the price of the veterinary agreement is a 90 per cent reduction in the necessity for border checks, which would be hugely welcome not only for exporters from Scotland and the rest of the UK but for importers from the European Union?
I absolutely accept that—it would be significantly beneficial. That is why the new UK Labour Government is committed to seeking the veterinary agreement. It would be beneficial to consumers and businesses in the UK as well as in the EU. We certainly want to see progress in that area.
These are still early days. Not only is the UK Government new in office; so, too, are members of the European Parliament and the EU commissioners who are taking up their posts. Fourteen years of our relationship with the European Union being undermined cannot be undone overnight.
The report is timely and welcome. However, it is clear that the UK Government is moving quickly in the right direction to reset relationships with the European Union and the devolved Governments. That is to be welcomed, for our businesses, our citizens and the country as a whole.
I invite members who still intend to speak to ensure that they have pressed their request-to-speak buttons.
15:34
I thank Clare Adamson and the rest of the committee for welcoming me back. I rejoined the committee at the turn of the parliamentary year, so I missed the bulk of the work that went into the first part of the inquiry, which led to the report that we are debating today. I want to acknowledge the work that went into that process and to thank the other members of the committee, the witnesses and the clerks for the work that they did.
I do not take credit for any of the work that went on before I rejoined the committee, but I have to say that, on rejoining it and beginning to catch up with the work that it had done in that period, I was struck by the level of agreement that has clearly been achieved in a report on what could otherwise have been quite contentious political territory. It is striking not only that there was consensus among the politicians on the committee, but that the broad sweep of evidence that the committee took showed a very strong level of consensus on the scale of the harm that Brexit has done and on the fact that the trade and co-operation agreement, although it is necessary, does not, in fact, solve or wish away that harm. Indeed, in some ways, it entrenches it.
Whether we are focused on Scotland or the UK, the country now faces significant non-tariff barriers, as several members have mentioned. I think that Neil Bibby mentioned chilli cheese bites; I am sure that the same issue applies to edible produce. The impacts that those non-tariff barriers have do not affect only products; they affect people’s lives—their jobs, their livelihoods and their wellbeing.
The lack of regulatory alignment also undermines human wellbeing. When we talk about regulatory alignment, we are not talking simply about red tape in the abstract. We are talking about rules that have been carefully and painstakingly developed over many years in order to protect human health, wellbeing and our safety.
Will Patrick Harvie give way?
I will.
I encourage Mr Kerr, who is likely to make interventions throughout the debate, to press the intervention button when he wants to make an intervention.
I am grateful to Patrick Harvie for giving way. He talks about regulations, but does he accept that many of those regulations have been put together to protect the business interests of big corporates in the European Union?
What I believe today is what I believed and set out when we were debating Brexit as a concept, before the appalling referendum that dragged us out of the EU without the consent of the people of Scotland. Regardless of where on the spectrum we stand—whether we believe in a free market and deregulation or whether we believe in strong regulation and a well-regulated social market economy—having a larger market with a common set of rules is an immense benefit to the country. If we were part of a wide EU with many more members that had a deregulation, free market obsession, I would oppose that economic model, but I would not seek to remove people’s rights and freedoms by taking us out of the EU; I would seek to change the economic arguments.
We have been left with a trade and co-operation agreement that, as I said, entrenches some of the harms of Brexit rather than solving them. There is a need for a new, closer relationship. It is understandable that Neil Bibby was challenged a wee bit on the detail of what Labour intends to achieve, but I welcome the fact that a UK Government that seeks a better, stronger relationship is now in place. I still do not know what that relationship will be, and I do not think that it is a condemnation to say that the UK Government has probably not figured out the detail of where it will be able to take that, but I welcome the opportunity.
The review of the TCA, in itself, will not achieve a new, closer relationship, as it will be a narrow, technical process. At the same time, there is the potential for renegotiation of a veterinary agreement and a sanitary and phytosanitary agreement. That is all well and good. They offer the opportunity for specific improvements and closer alignment on regulation—in my view, the closer the alignment, the better—and they require the question of freedom of movement to be addressed.
Some of what committee members heard during our visit to Brussels amused me a wee bit. On a number of occasions, EU officials or institutional voices would tell us that they were, of course, willing to discuss what the UK wanted but that we would have to accept every dot and comma of EU law and would have to apply all those laws without having any part in shaping them. We also heard a UK voice telling us that the European Union would, of course, give us what we ask for because, in the end, it would be in its interests to do so. There was a slightly funny and false position in some of the opening negotiating stances, but I do not think we should take that stage in the argument very seriously.
However, both sides discussed the value of mobility. We should recognise the value of human mobility because, in any market where capital is free to move but people are not free to do so, the only result is exploitation: the owners and controllers of capital will be able to force wages down to the level that they choose, rather than allowing people to be free to seek the economic opportunities that they wish, on their own terms. I believe that having an economy in which human freedom matters more than the freedom of capital means that people must be freer than money. It is important to have the opportunity to address the issue of mobility.
The EU does seem willing to give some flexibility in how that is framed, for example by talking about the “youth experience” because they think that it might be less threatening for the UK to discuss that than to talk purely about “youth mobility”. I will make the case for youth mobility, but if we can achieve any improvement to the youth experience that will be so much the better. However, that will not achieve or restore everything that has been lost because, in my view, the establishment of the principle of freedom of movement was one of the most astonishing political achievements of the post second world war era.
For generations, the young people of Europe knew that their fate might be to be rounded up by their own Government, marched across fields and ditches and made to slaughter each other in the interests of those Governments. After the second world war, we began building a set of relationships and institutions that allowed young people to choose for themselves whether they wanted to travel to another European country to work, study or make a life—or just for pleasure. That astonishing principle of freedom of movement is one of the most extraordinary political achievements since the second world war and it is tragic that that right and freedom has been ripped away from the young people of the current generation. It can and should be restored to them and, according to the most recent poll of polls on Brexit, 56 per cent of people in the UK think that that right should be restored, because that is the number of people who support rejoining Europe, with 44 per cent saying that we should stay out.
I will address some other points in my closing speech, but will finish now by noting that the UK Government says that it wants a reset. It must be put under pressure, including from Scotland, to define what a reset means. We must recognise that the European Union is not yet ready to use the language of “reset” and that it wants to know what the UK Government has in mind. We all have a right to know what the UK Government has in mind and I hope that it is the maximum alignment with Europe that we can possibly achieve.
15:43
I am so grateful to Clare Adamson and the committee for bringing this debate to the chamber. My heart skipped a beat when we were given the opportunity to debate Europe again, because, for years, this Government has deprived us of that. The Government was fixated on debating Europe almost every single day during the Brexit process but we have been deprived of that since then, so I am delighted that we are debating this motion. I say that with all sincerity, because I am strongly pro-European, probably to a fault, and deeply regret the Brexit process. Liberal Democrats were among the leading campaigners trying to stop Brexit, but we did not succeed.
Will the member accept an intervention?
Yes, I will take an intervention.
Stephen Kerr is still not pressing his intervention button.
Willie Rennie makes a good point, but he must remember that the Liberal Democrats were the party that first suggested we should have an in/out referendum on the European Union. We had that referendum and we voted to leave. That is the reality, is it not?
I am not sure that we want to go back into the ugly period of parties proposing various types of competing referendums and saying how different they were from one other. Nevertheless, Mr Kerr has a point, because we wanted people to have a say in certain circumstances. We did not want the campaign that the Conservatives put forward or the outcome that we saw. We recognise that that is what people voted for, but we deeply regret it, because the damage has been incredibly deep, as I am sure Mr Kerr, in his quiet moments—if they exist—would acknowledge.
I have the example in my constituency of a small business that used to trade small volumes of its product to Europe, sometimes on a trial basis with new customers. That is now stone dead. Given the expertise that is required, there is no point in it going through the whole process of understanding all the regulatory changes and the costs that are involved for a small product when it may not result in a bigger volume of trade, so it does not do that any more. That is deeply regrettable for a company that is particularly valuable for my constituency. We have also seen the impact on the agrifood sector, which has been severe.
We need to take people with us. We campaigned for years to try to reverse Brexit, but we did not succeed. We now have a four-stage process of repair, building confidence, deepening the relationship and, ultimately, going for single market membership. However, that has to be done pragmatically. I think that our debate today and the committee’s report will help in that regard.
With regard to the process that Willie Rennie articulated, does he agree that it has to follow in that sequence? We first need to start building relationships with individuals and at Government and parliamentary levels. Moving ahead of that at this point would be a foolish thing to do. We saw the result of that approach during the Brexit negotiations that we witnessed only a few years ago.
Mr Whitfield has a valid point. That is why I am pleased about the tone or the vibe that the Labour Government has set in proposing a reset, because that will start to seep through to the European institutions so that they understand that there is a willingness on this side of the Channel to reset the relationship. To be fair to Rishi Sunak, I think that the Windsor agreement was a step in the right direction, particularly as regards trying to settle the arrangements in Northern Ireland. The signal that he and Ursula von der Leyen gave about the Horizon arrangements between research institutes and universities was also a step in the right direction.
Both Governments—latterly, after the deep damage was caused—have recognised that the political will needs to be in place for all the things that we have talked about today to be implemented effectively. The veterinary agreement must be first on the list. There is a commitment from the Labour Government to make that happen. It is probably the single most valuable thing that we can do to make a big difference and build confidence with our European partners so that we can take other measures as well.
An awful lot of this involves detailed practical work that most of us would probably not understand, but it is really important that we set the political framework for it to work effectively. For example, we need the rules of origin arrangements to make sure that products and parts of products that come from other parts of the world do not clog up the whole system and that we have mutual recognition, particularly in relation to regulations on the registration, evaluation, authorisation and restriction of chemicals, or REACH. We need to have an understanding on both sides. To be honest, the UK REACH is broadly similar to the EU REACH, so I am not sure why we have different ones. We could have something that is very similar and understood by everyone.
Stephen Kerr talked about having much more progressive changes to the regulations to seek opportunities in the rest of the world. The reality is that an awful lot of changes happen almost every day and we have no contemplation of what they are or what they mean. We have not been able to keep on top of even the passive changes between Europe and the UK, and that is a problem. Before we get to making progressive changes, we need to understand what is happening now. That makes it much more difficult to have an understanding of divergence and how we can prevent it. Another example is emissions trading and linking the two things together. Again, there will be a pragmatic and sensible way of making that happen.
I am a bit more sceptical about whether the Government is in a position to be able to offer practical advice to individual businesses about the way in which they can understand the European Union, but we should try to make that happen. However, as I said, if the changes that are progressing are happening almost every day, that will be difficult.
Finally, I notice that the minister was incapable of answering my question about keeping pace. At one time, it was the big solution from Michael Russell: we were to have keeping pace measures whereby Scotland could stay in alignment with the European Union, so that, when the glorious day came for independence, there would be a smooth transition from one to the other. According to what the minister said, that seems to have been completely abandoned, and he is now going for an alternative process.
Will Willie Rennie take an intervention?
Let me just finish my point.
All the work that we did at that point seems to have come to not very much. I would be interested in hearing from the convener on whether she can enlighten me that I am wrong.
I ask Willie Rennie to reflect on the fact that the Welsh Government, which did not seek independence at that time, had exactly the same keeping pace powers that were established here. That was all about pragmatism on the way forward. It was about not independence but pragmatism.
The idea that the Welsh Government is as incompetent as the Scottish Government does not fill me with great confidence.
The most important issue is that we have had political opportunism from the SNP—which has been desperate to show that it is more pro-European than everybody else—but, in reality, that comes to nothing.
I will finish with a point on Erasmus. We were promised an Erasmus scheme like that of the Welsh, and we do not have it. It was promised endlessly by the minister but is now not happening. That is a big let-down for young people in this country and is why they are a bit sceptical of the Government.
We move to the open debate. I call George Adam to speak for a generous six minutes.
15:51
I thank the other committee members and the clerks for all the work that they have done to get us to this stage with the report. Obviously, we will come to the service industry side of the report in the future.
For a debate like this one, a member spends a lot of time working out what to say on such a diverse subject, how to say it within their allocated time and where the best place is to start. Obviously, a preamble like that is not a good place to start, but the trip to Brussels was a good start for us, because, when the committee went there, we managed to see the European Commission and speak to various individuals. All spoke with a united voice in asking us what the UK wanted. There was also a lot of love for Scotland—Stephen Kerr would be shocked to hear the love for Scotland in the European Union.
Those people were very pragmatic. When I intervened on Neil Bibby, I made the remark about the Spice Girls song that was mentioned. They want to know what is happening. I am not asking the UK Government to show its hand in negotiations beforehand, but, when the door is half open, the opportunity must be taken to go in and start the conversation.
One of the reasons why the European Union does not like Labour’s idea of a reset is that—to be fair to the Conservatives, which is not something that people hear me say often—it regarded Rishi Sunak’s Windsor framework as a step in the right direction. However, relationships could not have got any worse because, from Boris Johnson, there was absolutely no idea of any sort. It was a stalemate. There was no way forward.
Will George Adam take an intervention on that point?
Yes—no problem.
I should have pushed my button.
George Adam made a fair point about the relationship. There is no doubt that, during the Brexit process, relationships got to rock bottom. Does he not agree, though, that the events of spring 2022 on Ukraine’s eastern border somewhat changed the dynamic of the relationship? As a European family of nations, we realised that, regardless of which bloc we might sit in, we need one another. When something as sacred as the principle of freedom is at stake, as it is in Ukraine, our countries have come together, and the relationship has been touched by that in a positive way.
Mr Adam, I will give you the time back.
The valid point is that, during our discussions with those in Brussels, that was brought up quite a lot. When there is a war on the borders of Europe, there is talk about how we—as Europeans, I say to Mr Kerr—defend not just trade and freedom of movement but what we believe in with regard to how we want Europe to go forward. European countries want to talk more about that, and Scotland and the UK should have our doors open to having those discussions with them, as the situation affects every one of us and we must make progress on it—although, following the outcome of the American presidential campaign, who knows what will happen, now that Mr Putin’s good friend is in the White House?
I would like to take some credit for the committee’s excellent report, but, although it features my shiny face, I was, unfortunately, only a member of the committee for the very last part of the inquiry. However, I look forward to talking about the service industry part of the report. In one of the first evidence-taking sessions that we held on that part of the inquiry, the Faculty of Advocates told us that many of its members are registering in and moving to Dublin, because Ireland is an English-speaking country from which they can still get access to the EU. Scotland is losing the ability to be part of the provision of that service.
The question of professional recognition of doctors, teachers and medical professionals has haunted us since Brexit, and it is one of the areas that needs to be looked at. It will be interesting to see whether the follow-on work of the committee deals with that specific aspect.
Now that Mr Whitfield has said that, I will make sure that I ask questions about that when the relevant people come to the committee.
One of the important aspects of the report is that the UK-EU trade and co-operation agreement has created significant challenges for Scottish businesses that want to export to the EU, primarily due to non-tariff barriers, which include customs formalities, regulatory checks and rules of origin requirements. Agrifood producers face particular challenges in that respect. However, my colleagues on the committee and I have concerns about the fact that the situation has affected Scottish small and medium-sized enterprises disproportionately. As we all know, Scotland has a long-standing tradition of having small family businesses, and there is a higher proportion of SMEs in Scotland than there is in the rest of the UK. All those businesses play a vital part in our economy, and they have been let down by a hard Brexit that the vast majority of Scotland did not want.
If we look at Scottish SMEs in more detail, we can see the key sectors that they are in: tourism; food and drink; technology; and the service industry. It was obvious that those sectors would be affected by Brexit, so it is no wonder that most of Scotland voted to remain in the EU. Everyone benefited from being part of the EU and from Scotland trading as an equal member. Now, however, businesses have to get bogged down in the administration around exporting their produce to Europe—what some Tories called red tape in the old days. Many SMEs, particularly companies in Renfrewshire that were supplying produce to the EU, are having difficulty doing that because it is not worth their time to go through all those hoops. That is something that we have lost. Those SMEs have been the backbone of our economy and shall remain so, but the UK Government’s Brexit policies have made life harder for every one of them.
On 23 June 2016, people in Scotland voted to remain in the European Union, by a margin of 24 per cent. Every local authority area in Scotland voted for that. However, despite that democratic expression, the UK Government went for a hard Brexit—a hard Brexit that has harmed our economy and caused all manner of problems for individuals and businesses. The problem that we have is that the UK Government has blatantly gone down that route instead of trying to find a way to negotiate and work with colleagues in Europe.
As I said, our SMEs are the backbone of our economy, but who is going to be looking out for them? Who is going to be talking them up? It will not be the Conservatives, because they forgot about doing so a long time ago—the ideology of Brexit is more what they are interested in. Who is going to talk about small family businesses in Scotland that want to move forward? It has to be people like us who put their voice forward. Who is talking to the European Union? When we had our discussions in Brussels, we mentioned that, proportionally, we had more SMEs than anywhere else in the United Kingdom. Those we were talking to were surprised by that. However, that never came from a UK delegation, and it would never come from a UK delegation.
Scotland’s economy is needlessly suffering billions of pounds of damage due to Westminster’s decision to take Scotland out of Europe. Brexit is costing the UK economy about £100 billion every year. That is a loss of investment that should be going towards our public services. Labour members, like the Tories before them, do not want to address the elephant in the room when it comes to the single biggest issue that is damaging our economy. By ignoring Brexit, however, they are guilty of ignoring the needs of businesses across our country.
The SNP is resolute in its belief that Scotland’s interests are served through EU membership, and we will continue to campaign for Scotland to rejoin the EU single market as an independent, free nation.
16:01
It is always a pleasure to follow George Adam. I agreed with almost all his speech—bar the last paragraph.
As other members have done, I extend my thanks to the Constitution, Europe, External Affairs and Culture Committee for what I think is an excellent report. Indeed, it falls into a series of reports dealing with such matters, which committees can look at more usefully. The committee’s remit obviously lends itself, in essence, to the relationship between ourselves and Europe through the UK Government, and I welcome much that has been said in the report, which lays out the reality of the impacts of the trade and co-operation agreement that was negotiated by the previous Conservative UK Government.
We had an interesting discussion about what we should call that Brexit—a “hard Brexit” or a “Conservative Brexit”, for instance. Sadly, the Brexit deal is the reality, and it has affected us ever since it was entered into. Members have been right to point out that the breakdown in the relationships between individuals and institutions across Europe and the United Kingdom occurred because of the approach that was taken for other reasons—which I might understand but certainly do not agree with. To recover or come back from that position is, to be honest, very difficult.
Work is already taking place, with groups from the committee travelling to Europe, which is essential—it is a very important part of the role of committees in the right inquiries—and work by the UK Government is taking place. Work is also taking place through myriad conversations between SMEs and people across Europe in an attempt to build a relationship, at which point discussions can start to take place.
There is, of course, an opportunity in 2026. By fair play, good luck or whatever, the option exists in 2026 to make a change and an improvement. The committee has highlighted that there is so much more that the UK and Scottish Governments can do to support businesses, so that they can better manage and navigate the complexity of the current trading environment. That work—the preliminary work and the discussions that will take place running up to 2026—is so important.
I return to the point that I was trying to make to Neil Bibby. We heard from Stephen Kerr that Brexit was done, but, somewhat awkwardly, he had to admit that the leg that required border controls for coming into this country had not been implemented. Those two things do not sit side by side. I am not asking for the Labour Government’s view, but what is Martin Whitfield’s view about when those measures should be introduced?
The member highlights one of the great tragedies of this situation, which is the lack of detailed work on the minutiae that needed to happen following the Brexit decisions back in 2019. We find ourselves in a position in which we lack the individuals to put in place at various places, and we lack the regulations, the skills, the notifications and the information for businesses. The border checks were supposed to start rolling out throughout 2024, but, in effect, nothing has happened because the detailed work was not done previously. I could pick a date, but I would be picking it out of the air, because I am not in the circle where the discussions about the minutiae need to take place. If those discussions do not happen, we will have chaos where we have had false starts until now.
As has been mentioned a number of times, with the change in the UK Government, we are now seeing positive moves towards a veterinary agreement. One always has fears about talking about low-hanging fruit, but the significance of arriving at a veterinary agreement would be particularly considerable for businesses in Scotland.
I note that, in her opening speech, the convener talked about the committee’s invitation to the UK Government. I understand that the Minister for the Constitution and European Union Relations, Nick Thomas–Symonds, has indicated an intention to have discussions with the committee, and I am sure that the committee welcomes that, as I do. We have seen a sea change in the relationship between the two Governments in that each respects the other. By simply achieving that, we are opening doors to discussions in which the Scottish Government should rightly have an input and the UK Government can set out its position.
I realise that time is tight, but I want to discuss Mr Kerr’s pragmatic approach to the future as well as his optimism about democratic elections in various parts of the world, particularly the United States. I gently remind him of what happened the last time that we were in this position with tariff wars, particularly with regard to the whisky industry. At that time, he and I worked to reduce the damage, and it was a challenge.
I have enormous regard and respect for Martin Whitfield, and he knows that, but does he agree with Peter Mandelson’s comments, which were reported yesterday, that the position that the UK needs to take in relation to the United States and the EU is to seek the best of both worlds and that that will require the UK Government and its diplomatic missions to be nimble?
I am grateful for that intervention. Labour wants to build and lead a developing global trade that puts people, our communities and our SMEs first. The results of the harsh language that we heard during the Brexit referendum showed the foolishness of taking such an approach.
In the short time that I have left, I want to mention something in the report. I was fascinated by the paragraphs that deal with the role of the parliamentary partnership assembly. I hope that, in its subsequent reports, the committee can return to that issue. We are talking about not only a body that scrutinises but the expertise that needs to feed into all these discussions. In essence, that comes down to the lived experience and professionalism of various groups and stakeholders at various levels, including SMEs, the Scottish Government, the Scottish Parliament and beyond.
I am grateful for your indulgence, Presiding Officer.
16:08
I welcome this debate. I spent some time as a substitute on the Constitution, Europe, External Affairs and Culture Committee and was there for some of the sessions that looked at the UK-EU trade and co-operation agreement. I will come back later in my speech to some of the things that I heard there.
Since that time, and since the publication of the committee’s report, the world has changed yet again. The election of Donald Trump has fundamentally changed the international world on which the UK’s relationship with the EU is built. The Brexiteers laboured under the belief that the UK could be a bridge between the US and the EU, but we all know that, under Trump, it is his way or the highway. Trump’s threats of 20 per cent tariffs on all overseas imports will decimate global trade. With the UK being one of the most trade-reliant places in the world, the folly of Brexit has never been so clear.
Would the member agree that the threat that he quite rightly outlines from Trump itself justifies the argument that we must rely on multilateralism if we want a world that is going to work in the interests of humanity everywhere? The right is currently pushing the idea that we should all move to bilateral relationships, but that is only going to increase the opportunities for Trump and people like him.
I agree completely with Mr Harvie. Even if Trump’s isolationist America-first approach leads to bilateral agreements with some places, it will be Trump’s way or there will be no deals at all. I will come back to some of that in a moment.
We need to secure trade with our biggest markets in the EU, and prepare for the onslaught of Trump’s tariffs. Ideally, we would abandon bonkers Brexit and return to the European fold, but it is clear that Labour in London is a Brexit-first party still. It is vital, therefore, that we in Scotland do everything that we can to maintain alignment with EU standards while weathering the storm that is to come.
Does the member accept that, if we went back into the EU, that would mean rejoining the dreaded common fisheries policy, which would damage so many businesses in the north-east?
To be quite honest, I would like to conduct negotiations with the EU as an independent Scotland. Europe would then recognise that we, as Scotland, see fishing as a priority. It was never a priority for the UK, and that is why we ended up with some duff deals. We would have done better in fishing negotiations as an independent Scotland.
It is vital that we do everything that we can to weather the storm, because the other path—the path of appeasement with Trump—is the path to disaster.
Does the member have time to reflect on the evidence that the committee took from seafood producers and exporters in Scotland on the damage that Brexit had done to them? Far from Brexit being good for the fishing industry in the north-east, it has been very detrimental.
Absolutely—I will come to that in my speech, if I get there.
I return to Trump, who is a man who is interested only in what he and his mates can get. For closer alignment with Trump’s America, he will demand access to the world-leading Scottish farming industry with a US standard of pesticide-laden plants and Frankenstein foods. For that reason, I fear that Scotland’s farmers will be caught between Trump’s agribusiness conglomerates and the UK Government’s contempt for small family farms.
Of course, for closer alignment with Trump’s America, Trump will also demand access to our NHS; Wes Streeting’s creeping privatisation has already opened the door for that.
We can look to the aeronautics industry for the reality of the Trump takeover if we do not maintain close alignment with the EU. Yesterday, trade unions announced that UK production of the Eurofighter had ground to a halt, with the Labour Party in Westminster more interested in buying the American F-35 than building planes in the UK. By abandoning partnership with Europe, and destroying the UK’s defence industry, we will have no choice but to go cap in hand to Trump, and where does that leave Ukraine?
One of the worst-affected industries in Scotland has been our seed potato industry, which we took evidence about. Prior to 2021, the industry exported 30,000 tonnes of seed potatoes to the EU. However, thanks to Brexit, Scotland is now a third country. Everyone knows that Scottish seed potatoes are the best, as not only do we grow excellent tatties, we are too far north for aphids and the viruses that they carry. However, thanks to Brexit, we cannot export our tatties, and the EU has to settle for second best. [Interruption.] I have already taken an intervention from Mr Lumsden, so he should sit down.
The situation for seafood is a little better. We can at least export our seafood to the EU. [Interruption.]
Misrepresenting the—
Mr Stewart, could you resume your seat for a second?
Every member who has spoken in the debate has been generous in accepting interventions, and it is up to the member whether they take the interventions. That is not an invitation for interventions to be shouted from a sedentary position, Mr Carson, as you know.
Mr Stewart, please continue.
Thank you, Presiding Officer. I have taken three interventions.
The situation for seafood is a little bit better, as we can at least export some of our seafood to the EU. However, the piles of paperwork make it more expensive, and delays at customs can cause shipments to spoil. As the convener pointed out, our seafood exporters now export to fewer destinations and fewer customers, which means that prices are poorer. We need to remove barriers to the EU for our seafood industry, to allow the finest prices for the finest fresh produce.
Another sector that has taken a hit is our universities. They need to attract the brightest and the best, not only to come to study here but to transfer that world-leading education into world-leading ideas and to build world-leading companies. Those folk are the gold mine of talent that every other country wants, but the mantra of broken Brexit Britain is to send them home.
Of course, the door that Brexit closed swings both ways, and our young folk now struggle to spend time in the EU. All of that has been disastrous for Scotland and for the rest of the UK.
We need to make change, and I think that that change should be an independent Scotland within the EU. However, we need to draw a line now and say to Westminster and Washington that Scotland is open for business, but Scotland is not for sale.
The final speaker in the open debate is Keith Brown, who has a slightly less but still reasonably generous six minutes.
16:17
I thank the clerks and the convener of the committee for the report. I know the work that the conveners had to do to make sure that we got a report that has been commended by everybody. Bringing together a consensus is not easy on the committee sometimes.
Before Brexit, Scotland enjoyed a frictionless trading relationship with the EU, thanks to our membership of the single market and the customs union. It was a system that allowed our businesses to thrive, from our iconic salmon and seafood industries to our small and medium enterprises, which could access European markets with ease. However, today, as the committee’s report highlights, that reality has dramatically changed. The UK trade and co-operation agreement, while boasting of being tariff free and quota free, is far from frictionless.
The evidence that is presented in the report makes it clear that non-tariff barriers are strangling Scottish exports, especially for our smaller businesses. One of the witnesses the committee heard from, who was from Northern Ireland, said:
“The UK is ... becoming one of the most expensive places in the world ... to do business.”—[Official Report, Constitution, Europe, External Affairs and Culture Committee, 2 May 2024; c 13.]
Another witness said that it was easier to export to Russia or North Korea than to the EU.
Those are damning statements on the impact of Brexit. For example, for the seafood industry, which relies on the EU for more than 70 per cent of its exports, Brexit has been a significant blow. Salmon Scotland has reported a loss in export value to the EU of up to £100 million since 2019. That is not just about numbers and money but about the livelihoods of thousands of Scottish families who depend on those industries.
Incidentally, one of the vaunted benefits was that we would get a grip of immigration. Today, it has been published that the UK has the highest immigration rate in the whole of the Organisation for Economic Co-operation and Development. Obviously, that never worked for those who wanted that.
The Federation of Small Businesses has shown that Europe remains the largest market for UK SMEs, yet those are the very businesses that are being hit by the added costs and the regulatory burdens that are imposed by the TCA.
The report also emphasises the growing regulatory divergence between the UK and the EU. I say to whoever mentioned that point earlier that there was no way that we—even the House of Lords, which did most of the work—were ever able to monitor convergence, and there is no way that we can properly, in my view, monitor divergence. It is so expansive and it happens all the time.
The Independent Commission on UK-EU Relations has warned that further divergence could hamper trade not only with the EU but with other global markets that recognise EU standards. We are committed to aligning with the EU wherever possible, but our powers to do so are limited by Westminster.
I think that the efforts of the Prime Minister in relation to some of the security work that is going on now are commendable, and he should go further. That work is very important, but it also shows what we lost—in the EU, we could work not only with France and Germany but with defence partners across the board.
The seed potato industry has been mentioned. Britain used to export 30,000 tonnes of seed potatoes to the EU, valued at £13.5 million, but that market was closed overnight. The NFUS—
Will the member take an intervention?
I will, if Mr Carson can be brief.
I do not know whether I can be brief because there are quite a few things to say. The Scotch Whisky Association suggests that exports are up by 8 per cent compared with 2019. QMS has suggested that, after an initial dip, beef and lamb exports are coming back to pre-Brexit levels. Seafood Scotland suggests that there has not been a reduction in the trade of seafood. Will the member comment on that and on the hard work of those businesses?
Keith Brown, I can give you the time back.
I will repeat what the seafood industry has said. Salmon Scotland has reported a £100 million loss in the value of exports to the EU since 2019. I was about to mention the NFUS, which has made it clear that the
“consequence for growers has been immediate and grave”.
Although we welcome the committee’s support for securing a derogation for Scottish seed potatoes, we cannot afford to see other sectors face similar fates.
As we have heard, the situation in Northern Ireland provides a stark contrast. The benefits that Scotland would have had as an independent and English-speaking member of the EU were huge at the point of Brexit. Instead, that value has gone to Ireland and, to some extent, to Northern Ireland, which, like Scotland, voted to remain part of the EU. At the committee has heard, Scottish businesses are watching Northern Ireland as it uses its unique status to attract investment and trade that we can no longer access under the TCA. That unequal treatment only strengthens the case for Scotland to chart its own course.
In a previous inquiry, the committee heard how Brexit has decimated the music industry in Scotland and the rest of the UK because people are unable to participate in festivals across the EU.
In its recent manifesto, the Labour Party promised to reset the relationships. That is a step in the right direction, but—let us be honest—tweaking the TCA will never bring us back to the frictionless trade that we once enjoyed. The only way to truly restore Scotland’s prosperity is through rejoining the single market.
Stephen Kerr said that it was not a hard Brexit. I remember Daniel Hannan and Boris Johnson saying that they were not going to touch the single market—that it was not about the single market—but they lied, because they eventually did exactly that. They took the hard Brexit that they said they would not take. I think that some people need to research and understand what free markets are about. In the 1980s, Margaret Thatcher said that the single European market would be the best thing ever for the UK, which view seems to have been turned on its head by the current crop of Conservatives.
A single market works only if it has regulation and measures that prevent it from going out of control. To find the Labour Party, to some extent, and the Conservatives trying to deny the reality of the damage that Brexit is causing is unbelievable. It has been disastrous for our economy, and our businesses deserve better. We hear parties say that they are champions for small businesses, but they are willing to turn a blind eye to the billions that are being lost by our businesses since Brexit.
It is clear from the report that Scotland’s interests are best served by being part of that European family. If the UK Government is unwilling to listen to the calls for a better trading relationship, it is up to the people of Scotland. We had a discussion—
Will the member take an intervention?
I will just finish this point. Some have said that we should have a referendum—somebody even said that the Liberal Democrats were the first to propose a referendum. I think that we should have a referendum. Nothing is more guaranteed in this life than that Scotland will one day join the EU, and that the UK will rejoin the EU. Everyone knows the benefits of doing so, but they do not want to talk about it yet, because they are scared of political consequences. However, it will happen, and the sooner we do it, the less damage Brexit will have caused. If he still wants to intervene, I will give way to Mr Kerr.
Very briefly, Mr Kerr.
It is not going to happen—but can we get the facts right? It is not the UK that is stopping exports from the UK to the EU; it is the EU. It is the EU that has to be persuaded about the seed potatoes and about all these other regulations, not the UK—
Thank you. Keith Brown—[Interruption.] Keith Brown, if you could wind up, please.
That is a consequence of the deal that the Tories did, so it is back to the Conservatives. The FSB has said that that has been very damaging and very serious for businesses.
The other point about the EU and EU membership is the one that Patrick Harvie made: the biggest achievement of the EU was peace in Europe. If people want to know the value of peace, which people do not appreciate until they have war, they should go to Ukraine and ask people there about the value of peace. That is why the EU won the Nobel prize.
One day, Scotland will rejoin the EU, and I am sure that the UK will follow thereafter.
I advise the chamber that any additional time that we had in hand has now been exhausted, and therefore members will have to stick to their speaking time allocations. We move to closing speeches.
16:25
I especially commend some of those last comments by Keith Brown.
The tone of the debate has shown very clearly that our politics still suffers from the effects of 2016: the manipulation and the false promises that were made to engineer the result, and the polarisation in politics that resulted.
I spent my life as a European citizen, as this country joined Europe at roughly the moment I was born. Throughout all that time, I perceived the European project as one that showed that co-operation had many benefits. Those benefits were not only economic, although a number of members have described clearly the economic benefits that have been lost. I have to say that the frequency with which a certain member in the chamber has laughed at the description of the loss of those benefits has been remarkable.
The benefits were also social and political. The creation of a society across Europe that would reject the far right was, to me, fundamental to being part of the European project, for an individual as well as for a country. That is ending now; it is being threatened as we see the far right on the rise in the UK, in the US and in many European countries.
It is noticeable, and it needs to be remarked on in this debate—which is about not just the technicalities of the TCA but the changing relationship that we have with Europe—that the rise of the far right in the UK came in the form of Brexit. That is what Brexit was as a political project. Much of the UK’s media boosted Nigel Farage’s cult, and then along came Boris Johnson with his false promises printed on the side of a bus.
If Mr Kerr’s position is reflective of the Tory position in seeing the election of a fascist in the US as an opportunity—as something to be positive about—it is clear that there are no moral depths to which these people will not sink. Trump is clearly not a democratic politician and poses a severe threat to the rest of the world. One of the threats that he poses to the rest of the world will be worsened if we do not restore our relationship with the European Union. [Interruption.]
Mr Harvie, can you resume your seat?
I appreciate that emotions may run high in this debate, but I will not have members on the front benches chatting to each other while another member has the floor.
Mr Harvie, please resume.
Taking the opportunity, and, I believe, the responsibility that the new UK Government has to begin to restore the damaged relationship that our country has with the European Union will be critical if we are to find new ways to resist the continued rise of the far right.
I want to address a point on which Willie Rennie disagreed with colleagues. I hope that he might reflect on the point that throwing the odd random insult at the Welsh Government just because he does not like the Scottish Government might be beneath him, but he made an important point about what regulatory alignment means.
I believe that regulatory alignment was the right policy to set as an objective in the wake of Brexit. It aimed to achieve the least damage and to sustain the most benefit that we possibly could in circumstances that we had not chosen. However, it is true that, as time moves on, divergence will emerge, not only on the UK side, which we do not have control over in Scotland, but on the European side. We need to be willing to ask ourselves what we seek to achieve by regulatory alignment and how that policy must change in order to keep up with changing circumstances.
I come back to the value of freedom of movement, about which I spoke, and, in particular, the value of youth mobility. Youth mobility has been an extraordinary benefit of being part of the European Union, but it has not been shared equally; it has not been felt by all parts of our society. People who were studying certain higher education courses got the opportunity that youth mobility in Europe offered, but others in society did not—there are too many examples of that. We need to try to ensure that, as we restore the benefit of youth mobility, it is widely shared.
I want to make the case for the net zero agenda and, in particular, Scotland and the UK’s shared need to catch up with European countries that are decades ahead of us in decarbonising their heat, whether through heat networks, the installation of heat pumps, or just through what should be a basic normality in a cold northern European country—building homes that are fit for a cold climate.
We need to learn from countries that are decades ahead of us, not just by importing skills but by ensuring that not only people who study particular courses at university but every construction worker, plumber and heating engineer gets the opportunity to spend time in Europe. That is one example of where the net zero agenda needs to connect to the mission that we should share of restoring our relationship with Europe and ensuring that its benefits are shared more equally in society.
On a point of order, Presiding Officer. Can I have your guidance on how I might get it into the Official Report that no one on the Conservative side of the chamber laughed—at all—at the struggles and the challenges of SMEs in Scotland? What was said is an example of the bullying tactics that we see too often in the chamber from Patrick Harvie.
Thank you, Mr Kerr. That was not a point of order, but I think that you have answered your own question.
16:32
I am pleased to close the debate for Scottish Labour. I join other members in thanking the committee for its work in publishing the report, and the stakeholders who gave evidence. As we move further into the post-Brexit world, it is right that we work to understand the implications of the new rules created by the “Conservative Brexit”, as Martin Whitfield called it.
The report outlines how the current trade and co-operation agreement is affecting our businesses, as well as the opportunities that we have to improve it. However, if we are to renegotiate the agreement, we must have a positive relationship with Europe. I am pleased that members of other parties welcomed the Labour Government’s reset of European relations. Although renegotiation of the agreement will not take place until 2026, the work on rebuilding Britain’s relationship with the EU and repairing the damage that was done by the previous Conservative Government is already under way.
I join the cabinet secretary in welcoming the joint statement by Keir Starmer and Ursula von der Leyen, which reaffirms our shared values and agrees to strengthen the relationship between the UK and the EU. I hope that today’s spirit of co-operation can extend to relations between Governments across the UK.
I note that the UK Minister for the Constitution and European Union Relations will be discussing the report with the committee, which shows how the new Labour Government has reset relations with Scotland as well.
The report makes clear how we can improve the deal. I highlight the issue of guidance to businesses to deal with changing regulations. Evidence given to the committee shows that the Conservatives failed to ensure a smooth transition to the new rules. Logistics UK said that the guidance, information and technical details that were provided were “Too little, too late” throughout the process of the Windsor framework. [Interruption.] I am sorry, but I have a lot to get through in limited time. In addition, the Agricultural Industries Confederation said that support from Government to address market access issues was “limited”.
Willie Rennie mentioned a business in his constituency that had stopped trading with Europe as there was too much red tape, and George Adam discussed the struggles that SMEs are having. Offering businesses assistance to make sense of the new regulations will boost existing exporters and attract others to start trading with Europe. The committee’s recommendation for an accessible summary of divergence between the UK and EU is welcome in that regard.
Clare Adamson said that agrifood exporters in particular are being held back. The requirement for an export health certificate adds extra costs and increases complexity. The British Chambers of Commerce said that the checks have added “vast amounts of bureaucracy”. The increased delays are felt in particular for items with a shorter shelf life, which lose value the longer that they are in transit. My colleague Neil Bibby mentioned Innovative Foods Ltd and a border dispute holding up products, causing them to melt by the time that they reached their destination, which led the company to stop shipping to Europe. Although I do not share the affinity for chilli cheese nuggets, I understand that that is a major issue. Patrick Harvie rightly said that this is not just about red tape; it is impacting people’s wellbeing, jobs and the cost of living.
We also need a veterinary agreement. Research from Aston University found that a veterinary agreement could increase exports by at least 22.5 per cent. The new Labour Government was elected on a manifesto to negotiate such an agreement. I am glad that members, including my colleague Martin Whitfield, agree on its significance.
Members are largely in agreement that the TCA should be renegotiated. We have a number of opportunities to improve that bad Conservative deal. The committee’s report makes clear what we need to do to make it work.
The new Labour Government at Westminster is rebuilding our relationship with Europe, making it one of co-operation rather than opposition. I look forward to seeing the Scottish and UK Governments working together to achieve that and to seeing any further work by the committee.
16:38
In opening the debate, Clare Adamson referenced the NFUS and its view that, although we have tariff-free trade, it is not friction-free trade. Let us not forget that, despite significant efforts from industry and Government, our European friends, who so love Scotland, still block our seed potato exports without justification. They are cutting off their nose to spite their face.
We also heard about border checks that are still being phased in. I am well aware of that, because the Rural Affairs and Islands Committee, which I convene, has dealt with the bulk of the interim and transitional legislation. Of course, EU and UK convergence must also keep up with divergence and comply with changing EU regulations, which will obviously lead to more and significant non-tariff barriers to smooth trade.
Here in Scotland, much of our produce is time critical, with scallops from my hometown of Kirkcudbright, other shellfish products and our world-renowned beef industry all having faced additional issues. I have many constituents who are angry at the barriers to trade; I can tell members that, right now, they are also angry at the Scottish Parliament, which, much to Willie Rennie’s delight, spends more time debating the past than looking towards opportunities and maximising benefits, no matter how significant or not members across the chamber think those might be.
We all accept that leaving the European Union was never going to be easy or straightforward. As my colleague Stephen Kerr rightly said, quitting the single market was always going to be disruptive and, at best, result in hurt feelings and animosity. It was never going to be in the interest of the EU to allow member states to say, “Enough is enough,” and go it alone. The danger, of course, is that others might consider following suit, especially if it would return control to their countrymen and women rather than their being pushed into a corner and collectively told what to do.
Although some aspects of Brexit might not be entirely to our liking, we have to deal with what we have whether we support it or not—that is democracy at work. We are part of the UK, and the UK voted to leave the EU. That deal has now been done, and we have to make good on the significant opportunities that should be there for Scottish businesses in the future both in the EU and globally, as new markets such as those in the pan-Asian countries open up to us.
Cementing a future relationship with the European Union, which, it must be remembered, we were part of for more than 40 years, was always going to be critical. However, this is not a new situation: we voted to leave the EU in 2016. Although we need to look back at the past, we should at this stage be looking towards the future and not continually using Brexit as an excuse for constitutional grievance.
The creation of a new trade framework is vital, as is the establishment of an international relationship that respects the sovereignty of the UK while maintaining the mutual benefits of co-operation with our European friends.
Will Finlay Carson take an intervention?
I have very little time in hand, but I will take an intervention.
Let us make sure that we talk about the here and now. Finlay Carson will be aware that, during my speech, I talked about Scotland’s SMEs and how Brexit has been harmful to many of them. What are his ideas on that? I have not heard anything from the Conservatives about that; it just seems to be, “Brexit is a good thing, and away to those businesses—tell them to go elsewhere.”
I cannot quite understand that. At no point did I suggest that. What I am saying is that, rather than spend year after year and debate after debate looking at how bad Brexit is, we should be looking at the opportunities. I said that some might see the opportunities as more significant than others—[Interruption.]
Let us hear Mr Carson.
However, small businesses do not want us to continually moan about it. They want us to get our finger out and get on with making the deals work, which the Government certainly has not been doing.
Thankfully, some speeches today have focused on what is ahead of us in the post-Brexit landscape and the UK-EU trade and co-operation agreement. The agreement, which came into effect on 1 January 2021, marked a new chapter in the relationship between the United Kingdom and the European Union, with far-reaching implications, as we have heard, for trade and co-operation. As we know, the key features of the arrangement are trade, governance, a level playing field, subsidies, state aid, fisheries and security. There will be no tariffs or quotas on trade in goods, provided that rules are met.
We have heard from members across the chamber that the TCA is possibly one of the most comprehensive free trade agreements in the world and probably the most comprehensive free trade agreement that the EU has ever agreed to. It is a platform on which we should be looking to build and grow our economy.
The work that was carried out by the convener of the Constitution, Europe, External Affairs and Culture Committee, Clare Adamson, and her colleagues looks at ways of improving the trade relationship between the UK and the EU. I wish that we had concentrated more on that today. That relationship will continue to develop and improve for decades to come, and it will have to change as the UK develops trade deals with countries in other parts of the world.
It is important that we look for the positives rather than the negatives and take encouragement from the fact that the committee has carefully examined how it can further improve the TCA in the future for the good of Scottish businesses, including SMEs. In fact, I understand that Clare Adamson and her committee intend to produce a further report focused on trade in services and mobility, which are areas of significant interest.
The committee agrees, and I agree, that the UK and Scottish Governments must provide businesses with greater support to enable them to manage the complexities of the current trading environment. Help must be provided to allow all business sectors to understand the changing EU regulations and to navigate the customs and regulatory requirements that are involved in trading with the EU. Perhaps the cabinet secretary will provide a commitment to ensuring that assistance is available to SMEs to help them to improve their trading conditions.
I appreciate that I am fast running out of time. In conclusion, no one is under any illusion when it comes to the challenges that we face and the hard work that needs to be done on all trade deals that we enter into, whether with the EU, the US or wherever. Such deals need to be done in the interests of our businesses. If our businesses are to succeed, the focus must be on the future, not the past, and certainly not on UK constitutional issues.
I must ask you to conclude, Mr Carson.
Where there is a will, there is a way.
16:45
I thank colleagues for their helpful contributions to today’s debate. It is abundantly clear from the committee’s report and from the debate that Brexit is not working. I record the fact that the Scottish Government has worked hard to promote the interests of Scotland in the autumn round of specialised committees that oversee the trade and co-operation agreement. However, it is also abundantly clear that the implementation of the trade and co-operation agreement simply does not meet the needs of Scottish businesses. There is a pressing and urgent need for change. We will continue to be advocates for such change on behalf of the people, businesses and economy of Scotland.
I genuinely believe that the change that we want to see will also benefit our European partners. Young Scots need to have opportunities to work and travel across Europe; our brilliant creative professionals should be able to work across the European Union; the iconic Scottish food and drink sector demands the ability to trade more freely with Europe, and the economy urgently needs EU markets to be reopened for Scottish exporters. So, we will continue to urge the UK Government to be ambitious in its proposals to improve its relations with the EU, especially the trading relationships.
I turn to some of the issues that have been raised in today’s debate. I again repeat my appreciation for the work of Clare Adamson and her committee colleagues on their report, which is what we are debating this afternoon; it is not a general, free-ranging debate on Brexit. Clare Adamson was absolutely right to underscore the overwhelming evidence that the committee was given on the damaging impact of Brexit. It is also worth noting the fact that the committee’s report and its conclusions were agreed to on a cross-party basis. All parties on the committee supported the conclusions of the report.
Stephen Kerr opened his speech by saying that he thought that the report was “thorough, balanced and fair”. He then went on to speak in a way that was totally detached from the contents of the report, the conclusions of which, ironically, were supported by his colleagues. On a number of issues, what we had was, frankly, a reality bypass. We were told that what we are currently involved in is not a hard Brexit.
Will the cabinet secretary take an intervention?
No, I will not.
We are now outside the single market. We were told that we did not need to be. We are outside the customs union. We were told that we did not need to be. [Interruption.] To say that Brexit is done and that one cannot go back—
Cabinet secretary, will you pause for a moment?
I know that Mr Kerr knows that it is not appropriate to debate from a sedentary position when one has not been called to speak.
To say that Brexit is done and that one cannot go back is, first, a counsel of despair and, secondly, a denial of democratic choice. People should be able to determine their future, and I am sure that they will.
In passing, I want to make a comment about trade deals, including with the United States of America. The voters of America have spoken, but let us not deny the consequences of what is coming when we face the prospect of trade tariffs of up to 20 per cent. We should be very concerned about that.
In the main part of his speech, Neil Bibby rightly focused on the opportunity for a reset of the UK Government’s relationships with the European Union and with the devolved Administrations. I think that that is a good thing, and I am working with UK Government colleagues to make the most of that. In relation to the prospect of a veterinary agreement—which I think is misnamed, to be honest; we should all be talking about an agriculture, food and drink agreement—I agree that such an agreement could have a profound impact. We will work with the UK Government to deliver that.
Will the cabinet secretary take an intervention?
I do not have enough time; I must make progress.
Patrick Harvie was absolutely correct to seek further detail about what “reset” means. It is good to hear about a possible veterinary agreement, but what about Erasmus+, Creative Europe and the restoration of free movement for younger people? I agree with Mr Harvie about the importance of mobility.
Willie Rennie said that we should debate Europe more often, but we debated it only last week. I do not think that he took part in that debate, but I agree with him that we should make the most of the opportunity to debate Europe more often. I agree that we should be looking at education and co-operation but I make it absolutely clear that there is no substitute for Erasmus+. That is why this Government is keen for the UK Government to work with European colleagues who are open to the United Kingdom returning to Erasmus+. That is the prize and I hope that Mr Rennie will join the Scottish Government in seeking it.
George Adam was absolutely right to highlight the needless economic suffering—
Will the minister accept an intervention?
I have already indicated three times that I am not taking interventions because my time is short, so no, I will not take an intervention.
George Adam was absolutely right to highlight the needless economic suffering and on-going damage that is captured in the committee’s report—a report that was agreed to by Conservatives on the committee.
Martin Whitfield talked about low-hanging fruit. I agree that securing a veterinary agreement would be a major prize, but I once again say that Erasmus+, Creative Europe and mobility are all on the table and that I look forward to the UK Government articulating those points as soon as possible to the European Commission, which has made offers on those issues.
Kevin Stewart, echoed by Keith Brown, spoke about seed potatoes and seafood, two really important challenges that must be sorted.
If Conservative members disagree with the evidence and conclusions in the report, I have no doubt that they will vote against it today. I will be interested to see how they choose to—[Interruption.]
Please sit down, cabinet secretary.
Mr Kerr, I have asked you already to cease shouting from your seat; I will not ask you again.
On a point of order, Presiding Officer. The cabinet secretary names members and misrepresents their views. How are we to set the record straight about the fact that he is saying things in his speech that are diametrically opposed to what was in the speeches given by Conservative members?
Mr Kerr will be aware that the content of members’ speeches is a matter for those members and that a point of order should be raised only when a member is trying to ascertain whether proper procedures are being, or have been, followed. That was not a point of order.
Please resume, cabinet secretary.
It was indeed not a point of order, but we are used to such contributions from Mr Kerr.
Cabinet secretary, I must ask you to conclude.
I turn to summing up. Patrick Harvie reiterated the importance of reminding ourselves that Europe is also about peace. He spoke about the dangers of populism and the Brexit right and we must be well aware of those. Foysol Choudhury spoke about the importance of a veterinary agreement. We agree with him. Finlay Carson did not in any meaningful way address the content or conclusions of the committee report so it will be of great interest to see how he votes later.
In finishing, I once again thank the committee for its important report. As has been noted, the committee plans to continue its work on the trade and co-operation agreement, with the next phase of that work looking at mobility and at trade in services. Scotland has important interest in both areas and the Government will offer the committee its support and co-operation as it continues its work. We will also continue seeking the views of stakeholders—
You must conclude, cabinet secretary.
We will work with them to promote—
Thank you, cabinet secretary.
—Scotland’s vital interests to the UK Government.
I call Alexander Stewart to wind up the debate on behalf of the Constitution, Europe, External Affairs and Culture Committee.
16:54
This has been a helpful and robust debate on the future of the relationship between the United Kingdom and the European Union. Before I respond to some of the contributions that have been made, I extend my thanks to the convener for the report, the important aspects of which she referred to in her opening speech.
We have heard today about the significant challenges that businesses experience when trading with the EU under the terms of the TCA. Although there have been recommendations that there should be an agreement between the EU and the United Kingdom to reduce those trade barriers, more support and guidance is required in the meantime from the United Kingdom and Scottish Governments to allow all businesses to manage the complexities of the current trading environment.
Support is particularly needed on monitoring divergence to allow for compliance with EU regulations—something that is necessary to export to the EU. The Agricultural Industries Confederation Scotland told us that
“small misalignments”
in regulation and technical standards
“happen all the time”
and that, to continue exporting to the UK, businesses and trade bodies must
“keep up with every single one of those changes.”—[Official Report, Constitution, Europe, External Affairs and Culture Committee, 7 March 2024; c 3.]
Salmon Scotland said that, to monitor regulatory developments, the industry has
“had to have more people in station”.—[Official Report, Constitution, Europe, External Affairs and Culture Committee, 28 March 2024; c 9.]
That comes at an administrative and financial cost.
To that end, we have invited the UK Government to explore the establishment of a formal mechanism to track divergence between the EU, the UK and Scotland. That should be publicly available as a resource for industry so that the monitoring burden does not sit with individual businesses or their representative bodies. In addition, the UK Government and the European Commission should work with businesses to develop clear guidance for them on customs procedures and rules of origin, among other things.
In the convener’s opening remarks, she mentioned stakeholders’ views that there is a need for closer regulatory alignment with the EU to address trade barriers. Scottish Chambers of Commerce wanted to see
“a closer regulatory policy relationship ... between the EU and UK, so that businesses do not face new trade barriers through passive regulatory divergence”.
Our report considers key aspects of possible alignment with the EU that the UK Government could pursue, including the SPS or veterinary agreement that we heard about in the debate. Such agreements could play a vital role in improving trade flows.
Although the Scottish Government has a commitment to align with EU law, the extent to which that has facilitated improved trade with the EU, without such agreements with the EU being in place, is unclear. We therefore recommend that the UK Government further reduces barriers to trade through a mutual recognition agreement with the EU on conformity assessments. That would allow UK and EU certifying bodies to confirm that a product that was made in one territory meets the regulations of the other. We recommend that, through work with the European Commission, the UK and EU emissions trading schemes be linked to enable Scottish businesses to be exempted from the charges and administrative burdens of the EU carbon border adjustment mechanism. Both of those actions would require greater alignment with the EU.
We also suggest the UK Government seeks
“to negotiate adjustments to the rules of origin on exporting to the EU”
and works alongside the European Commission to enable
“Scotland’s seed potato exporters to access their significant market in the EU.”
That could all be pursued through the timely upcoming review of the TCA.
However, negotiations to improve the trading relationship must not be confined to the formal review. There is a need for on-going co-operation and collaboration to make continued improvements to the operation of the TCA—an agreement that is still in its infancy and has several unresolved implementation issues. Effective governance of the TCA will be necessary to support improvements to the trading relationship through the implementation of the agreement, as well as the negotiation of further adjustments to the TCA or supplementary agreements.
Under the TCA’s governance structures, significant decisions regarding its operation can be made by political agreement between the European Commission and the United Kingdom Government. That means that there is a need for a strong level of scrutiny and stakeholder input on those decisions, including through improved engagement with civil society, business and trade unions via the domestic advisory group and the civil society forum. There is also an important role for the parliamentary partnership assembly, at which the Scottish Parliament is an observer.
We have heard many speeches this afternoon and I would like to mention some of them. The cabinet secretary said that trade could be improved and talked about the working relationship that is needed between the Government and Scottish Enterprise, as well as the opportunities that are available and the processes that exist. There is no doubt that there have been some difficulties for sectors. Nobody denies that.
Stephen Kerr talked about our report being “thorough, balanced and fair”. I echo that. It is thorough, balanced and fair, but the issue has been and continues to be complex. We should be assisting with the TCA going forward, with all of that in mind.
Neil Bibby spoke about the burdens, the regulations, the delays and his beloved chilli cheese bites. [Interruption.]
I am aware of conversations that are happening in the chamber, and I would be grateful if we could hear Mr Stewart.
Thank you, Presiding Officer. Neil Bibby also spoke about the advice that is required from the Scottish Government.
Willie Rennie spoke about his delight in having the debate; about the processes, the sectors, the committee report and the tone; and about trying to reset the success of the Windsor agreement and how it has worked and whether there is a political will. He also talked about Erasmus and the challenges that come with that.
George Adam talked about the successful trip to Brussels and said that he and others were asked about knowing what they want. He also talked about the relationship for defending democracy across Europe and the Irish question about the recognition of professionals.
Martin Whitfield spoke about the breakdown in relationships, about the continued attempts to rebuild and refocus and about supporting businesses—giving them the skills and the support that they need—and all the SMEs that require that support.
I support the motion in the name of the convener on behalf of the committee of which I am deputy convener.
That concludes the debate on the UK-EU trade and co-operation agreement, on behalf of the Constitution, Europe, External Affairs and Culture Committee.
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Decision Time