2. 2. Debate: The Outcome of the EU Referendum

Part of the debate – in the Senedd at 3:34 pm on 28 June 2016.

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Photo of Carwyn Jones Carwyn Jones Labour 3:34, 28 June 2016

He has spent months and months complaining about money being controlled from Brussels, saying it should come to Wales, and is now saying that it should be controlled by the Treasury in London. That is not in keeping with devolution. That is not what was promised by the ‘leave’ campaign. It’s not what we will ever sign up to, or agree to, in this Assembly, on this side and others of the house. He has to stop thinking like somebody sitting in Westminster and thinking about somebody sitting in Wales, and start thinking about what it means for Wales. There is no cause, no cause whatsoever, for suggesting that the money that we received from Europe should not come to Wales, but apparently should sit in London, at the discretion of the Treasury as to how it’s spent. That’s what he said. And now he is caught by his own words, which he denied earlier in the Chamber. He needs to explain to his own party—if you could see their faces—. He needs to explain to his own party why it is, suddenly, that what was said, the promise that was made that this money would come to Wales, is now not going to come to Wales for this elected Assembly to decide how that money is spent. And that is a fundamental attack on devolution. Not repeated by UKIP—not repeated by UKIP. It shows the direction the Conservatives are going in.

I listened carefully to the other points that were made by other Members, particularly to the leader of the opposition, which I listened to carefully. She and I are not in the same position when it comes to what she has suggested today, which is independence in the EU, because the Welsh people have voted to leave the EU. I think there are difficulties in suggesting that way forward, when people have already said they want to leave. But it is right to say that constitutional change is needed. The UK cannot go on as it is, or it will not go on. I don’t share the Member David Rowlands’s optimism that the UK will continue forever and a day. This is the greatest threat to the UK that’s ever been posed. We see the opinion polls again in Scotland—not that anyone can trust polls, necessarily, but I do fear that what is happening in Scotland is very different to what was happening there in 2014, and there will be an effect on Wales. We know there’ll be an effect on Northern Ireland.

I am in this strange situation now, where, of the four in my household, I am the only one who will not in the future have a right to live and work anywhere in the EU. Everyone else will, because they’ve got dual nationality. And it shows that even families are in different positions because of the vote that happened last week.

We know that, in Northern Ireland, there are issues with the border, because it’s an open border, and the immigration policy on both sides of it will be different. And so there are great issues as to how that border will be monitored, and how that border will be patrolled. They are not issues that affect us directly in Wales, but they do affect the UK and its relationship with the European Union via that land border.

Can I deal with the issue of free trade? Access to the single market is absolutely fundamentally critical to the prosperity of Wales. If we do not have free and unfettered access to that single market, many of our businesses will be put at a disadvantage that their competitors elsewhere in the EU will not have. If you look at the automotive industry, there is a tariff on automotive parts of 5 per cent, a tariff on importing cars of 10 per cent; those are WTO rules. That affects so many of Wales’s automotive plants, not least my own in Bridgend. Unless there is a trade deal on the table that removes the fear and danger of tariffs, those plants will not be able to compete, because what they produce will automatically be more expensive than plants elsewhere. Now, the suggestion has been made, well, Europe exports more to the UK than the UK exports back. Well, the European Union is eight times bigger than the UK, so, in monetary terms, of course more is exported from the EU to Britain than the other way round. But, if you look at the percentages, nearly 50 per cent of what the UK exports goes to the EU. The movement back is between 7 per cent and 10 per cent. Actually, we are far more dependent on being able to export freely into the EU than the EU is to us.

If we look at the car market, people have said, ‘Well, German car manufacturers will want to export’. The difficulty is that makes like BMW can export with a 10 per cent tariff and people will still buy them, because people see it as a prestigious car to buy. It doesn’t apply to all car makes, and that’s the danger that we face. So, it is absolutely critical that the free movement of goods and services continues between the UK and the EU.

Now, we have to remember that, in the negotiations that will take place, the UK Government will, inevitably, take the lead. We will have our own method of discussion with the EU. But the UK Government will negotiate mainly as the UK Government, but sometimes as the Government of England, when it comes to agriculture and fisheries. It won’t negotiate as the UK at all times. That’s why, to me, it is absolutely critical that, when there is a deal on the table, it is ratified separately by each of the national parliaments. Then we will get proper buy-in to any trade deal. It is not good enough simply for the Parliament in Westminster to ratify it, when there are some areas like agriculture and fisheries, which are wholly devolved, which will be affected. And so, this elected legislature must have a strong say—indeed, a ratification process for that.

The Member Steffan Lewis raised some important points. He discussed first of all—talked first of all—about the need for an economic fairness Bill. I’m not entirely sure what that would mean. I don’t mean that in a disparaging way, I’m not quite clear about it, because what we find is, when investors come to Wales, they want to go to a specific site in Wales. You can’t say to them, ‘You can’t go there; you’ve got to go there’. So, Aston Martin was only ever going to go to St Athan. It wasn’t going to go anywhere else. So, it’s not as easy as it sounds simply to say, ‘Well, we’ll ensure that investment travels all over Wales’, because private companies don’t work like that. Public investment is easier, clearly; private investment, much more difficult.

He talked about an investment bank of the isles—interesting and something, of course, that I’m sure will be explored in the months to come, and he also talked about Wales making its own way in the world. I have to say that UKTI have been hugely supportive of us as we’ve travelled around the world. We’ve received support from them. The embassies around the world have been nothing but supportive of us in attracting investment into Wales. We have opened offices in different parts of the world where we know we can be effective in adding something extra in terms of Wales’s voice. But I don’t think that the result last week will alter our ability to sell ourselves to the world in terms of being able to project Wales to the world. It will affect, of course, what we’re able to offer in terms of market access if there’s no deal on the table. One of the issues we always grapple with is, if we’re looking to expand our presence in a particular country, do we expand a presence in one country or do we open an office in another? These are issues that we constantly wrestle with. But we know that the offices in the US and India, particularly, are hugely, hugely important in terms of projecting Wales as a place to invest, and that will continue.

Mark Isherwood I listened to carefully. Many years ago, Members will recall Steve Wright when he was on Radio 1. He had a character called Mr Angry from Purley, who was somebody who began calmly and then worked himself up into a rage, almost choking on his own rage. Well, he did that again today. He is, after all, somebody in this Chamber who once described us on these benches as ‘left-wing fascists’. So, I remember that phrase. But I have to say to him, he talks about inclusivity—for years his party had Secretaries of State for Wales who didn’t even represent Welsh constituencies. We will not take lessons from the Conservative party about inclusivity when they had people representing us who had no connection at all with the people of Wales. Thankfully, those days have changed.

I listened to what Caroline Jones had to say and I think I’ve dealt with that in terms of what she said about the narrowness of the referendum result. But we have to understand that it is said that there are opportunities. They’re not apparent yet—not apparent yet. I’ve not heard any in this Chamber that present themselves as opportunities. We know there are challenges. Right, that’s what the people of Wales have delivered and that’s what the people of Britain have delivered; we have to get on with it. But it’s hugely important, as I’ve said, for ‘leave’ campaigners to come up with an idea of what they think the UK is going to look like. What sort of relationship do we have with the EU? What sort of relationship do we have on the world stage? If that is not articulate and clear—[Interruption.]—in a second. If that is not articulate and clear then that gap will be filled by those who are more extreme.