ANY QUOTES USED MUST BE ATTRIBUTED TO SUNDAY WITH NIALL PATERSON, SKY NEWS

NIALL PATERSON: Rumours swirl round Whitehall this week with even the usually loyal Spectator magazine demanding the Prime Minister show leadership or leave. Joining me from Westminster is the Housing Minister, Dominic Raab, a very good morning to you Mr Raab.

DOMINIC RAAB: Good morning.

NP: Michel Barnier is due to sit down with the Prime Minister this week, when he asks her what do you want the UK’s future relationship with the European Union to look like what will she say?

DOMINIC RAAB: I think we’ve been very clear all along from the Lancaster House speech through the negotiations and the recent Florence speech that we are taking back control over our borders, our laws and our money but we do want a close relationship, a deep and special partnership on trade, on security cooperation and all those other things so it will be good to get down to the details.

NP: Simply put, should there be a customs union after Brexit?

DOMINIC RAAB: We have been clear all along, we are not going to be in the Customs Union but equally very early on David Davis talked about the fact that it’s precisely because we are leaving the Customs Union that we’ll want some sort of arrangements on border, whether it is for example with trade to make sure there is advance notification of goods coming across the border and technology that can be used to keep trade frictionless so I think that’s been clear all along.

NP: I’m afraid there’ll be a few people watching this who perhaps disagree with you. It seems to me there are two options on the table and there hasn’t been a decision made yet as to which the government would prefer: you either maintain a good deal of cooperation with the European Union aligning with them or you make a clean break as the harder Brexiteers would wish. Which is government policy today?

DOMINIC RAAB: Well first of all there will always be people watching this who will not be very happy because Brexit is a very contentious issue but the government has made clear, the Prime Minister has made clear, she was out in China this week looking at the relationship we want to have with the growth markets of the future over in Asia. So we have been very clear that we need to go and strike free trade deals with other parts of the world, from Latin America to Asia but of course we start from the point of close proximity in terms of regulation with the EU and over time where we diverge – and it is natural that that will be possible because that’s what leaving the EU involves but obviously we’ll keep half an eye on what the EU is doing, they’ll keep half an eye on what we’re doing and precisely because we are going to diverge in our laws, make sure we have a sensible dialogue to manage that responsibly.

NP: But again, the Prime Minister when in China was asked that very question: did she want to see continued close alliance with the European Union or that clean break that the hard Brexiteers say is necessary if you are indeed to take back control. I mean your colleague, Bernard Jenkin, does have a point doesn’t he when he says that Ministers are bitterly divided. You have got Philip Hammond on one side saying he wants only a modest change to a relationship with the European Union which seems to suggest the possibly of being in a customs union if not the customs union and then you have Liam Fox who says that any customs union would mean we couldn’t have free trade agreements, we couldn’t sign free trade agreements the like of which you talked, so which is it, which is government policy right now?

DOMINIC RAAB: Well the Prime Minister has been very clear, we are leaving the customs union and …

NP: What about a customs union?

DOMINIC RAAB: No, no, as I said, we’re leaving the customs union which would mean that if we stayed in it we wouldn’t have control over our international trade policy and the Prime Minister wouldn’t have set up the Department for International Trade, she wouldn’t have been out in China looking at the broader future export opportunities that we wanted to tap into if we weren’t going to do that and I think it’s important to understand why she has been very clear on this all along because having free trade from Latin America to Asia is good for jobs, it also will increase the productivity of our domestic economy which is good for raising real wages and also in terms of free trade has got a long track record of reducing prices so in terms of easing some of the cost of living pressures on low and middle income families it is very important. This is one of the great advantages, opportunities of Brexit so it is important that we grasp it.

NP: But again, you have Philip Hammond and Liam Fox saying things which frankly are entirely at odds with each other. Now these are not backbench MPs, they are not shouty protestors at Carriage Gate, they are senior members of the Cabinet who are saying entirely different things about our future relationship with the European Union so again I’ll ask, which is it? Is Liam Fox correct that we cannot have that continued close alignment with the European Union or is Philip Hammond right when he says that we can?

DOMINIC RAAB: I think you are rather caricaturing both of those but look, it is absolutely right and Liam Fox is not saying anything inconsistent with what the Prime Minister has said, to say we want to grasp the global free trade opportunities for the reasons I gave and equally, it’s of course important and Philip Hammond is right to be saying, look, let’s make sure that we manage very sensitively and carefully and responsibly our trading relationship with the EU. The EU is our biggest trading partner but the opportunities of the future will probably – and in fact according to the European Commission’s own analysis, will come from those emerging economies from Latin America to Asia, so it’s about getting the right balance and it’s great that Michel Barnier will be in London, we can thrash out more of those details. Of course it’s not just about what we say, it’s about what’s in their interests as well so we are going to look for that win-win deal and I think it’s important for everyone to get behind the Prime Minister, to make sure we get that best deal that we possibly can.

NP: Are you honestly saying, Mr Raab, that the government is speaking with one voice on this matter? That there is not a fundamental difference of opinion around the Cabinet table when it comes to our future relationship with the European Union? Is that what you’re saying?

DOMINIC RAAB: No, I think there are inherent tensions in dealing with Brexit because different people take different views, it’s not just in the Conservative party, it’s not just in the Labour party, it’s across the country and actually we need a bit of team effort here, that’s what I’m saying loud and clear and we should be rallying behind this Prime Minister and this government and David Davis is doing a tremendous job in the negotiations and making sure that we carry people with us. I was a Brexiteer, you know that, we’ve discussed it before but I also understand the importance of mitigating the risks of Brexit as well as grasping the opportunities and it will require a team effort and that’s what we need to see.

NP: Okay, but just on that basis then, I’ll ask my second question once again, do you think that after we leave the European Union there is any possibility that we could be in a form of customs union, not the customs union but an arrangement which differs from it but looks quite similar?

DOMINIC RAAB: No, I don't think we’ll be in any form at least as conceived in international trade practice of customs union because if we were we would have our hands tied in negotiating free trade deals with other parts of the world, whether it’s Brazil, whether it’s China or India and the Prime Minister has been very clear, we want to be able to grasp those opportunities but at the same time we want frictionless trade with the EU and so there will be important negotiations on the technical detail of making sure that actually goods and services can flow freely across the border and that’s the distinction.

NP: In a week when the Spectator, of all publications, puts on its front page “Leader Go”, can you honestly say that Theresa May is doing an effective job of leading your party? Can you look directly into that camera and tell the electorate I think Theresa May is doing a good job?

DOMINIC RAAB: Yes, because I think first of all Brexit is inherently difficult, look at the shambles of the Labour party’s position on it, but I recognise that as the government of course it is incumbent on us actually to deliver this but what I’m saying is it is an inherently sensitive issue, it is a crossroads moment for Britain. I’d expected there to be tensions along the way, both in terms of the politics here at home but also in terms of our negotiations with the EU so what matters most is a team effort, a bit of discipline, dare I say it a bit of emotional intelligence along the way as well and not react to every negative story that the media want to ham up and actually focus on the prize, which is a win-win deal with EU but also grasping the opportunities of Brexit and that’s what I’m 100% focused on and that’s what I think and the overwhelming majority of MPs are behind the Prime Minister in that regard.

NP: Have you read the Sunday papers this morning? Have you seen any of the stories that are around this morning, which are clearly sourced by the Sunday Times’ Tim Shipman from senior cabinet sources or colleagues of those senior cabinet sources, telling the Prime Minister look, if you don’t do what we want we’re going to have a coup, have you seen those stories?

DOMINIC RAAB: Yes and I’ve got huge respect for the Sunday Times and for Tim Shipman in particular but lots of these stories are from anonymous sources. There are clearly tensions in parliament and in the wider country about this but what I would say to you is, and I think the public know this, the aim out for this is that the media magnify all the negatives and actually the overwhelming majority of MPs and Ministers that I talk to in the Ministry of Housing, when I was at the Ministry of Justice working with David Lidington, who is a remainer, and right across parliament, we’re focused on keeping the economy driving and firing on all cylinders. Yes, getting the best deal we can for Brexit, we know it’s going to be a team effort and also dealing with some of those important other social issues like housing which I’m taking forward with Sajid Javid and the Ministry of Housing team and we’ve had some important work we’ve been doing this week on that. So the vast majority are focused on that but, look, I’m not saying there are no tensions.

NP: We will discuss your brief in just a moment but some are suggesting that perhaps one of Theresa May’s biggest recent mistakes, in admittedly something of a crowded field, was not giving Jacob Rees-Mogg a ministerial post, putting the reins on him. Instead this week he accused the Treasury of fiddling the numbers, making things up. I mean, is he correct?

DOMINIC RAAB: Is he correct about fiddling figures?

NP: Yes.

DOMINIC RAAB: No, I don't think so, I don't think there is any fiddling of figures, I mean …

NP: Why has he been allowed to get away with it?

DOMINIC RAAB: Say again?

NP: Why has he been allowed to get away with it?

DOMINIC RAAB: Well look, Jacob is a very thoughtful contributor to the Brexit debate, he is a backbencher, he has got the freedom of the back benches but I’ll just say this about forecasts because you asked about it and it is presented in a very politicised way. I read Kirstin Forbes, sorry Kristin Forbes account of Bank of England forecasting, she was on the committee at the Bank of England and stepped down, a very renowned American economist and she has made the point that some of these forecasts are inherently uncertain and actually the forecasting model is flawed so I think it is fair to say that look, some of these forecasts have proven wrong in the past and treating them like a science is bound to end up being proved wrong. But my experience of the civil service in the current Ministry of Housing, Communities and Local Government is that there is a great can-do attitude, a huge level of expertise so I don't think it’s right to start criticising individual civil servants or bad mouthing the civil service as a whole. Actually they are doing a great job and, you know, it’s a challenge for them too.

NP: So you don’t identify an ever lengthening list of enemies within? I mean we have the judiciary, the media, the CBI, the civil service isn’t part of that list?

DOMINIC RAAB: You have never heard me talk about anyone as the enemy within. Look, I can tell you, I have been doing the housing job now for less than a month and what I’ve been struck by the Ministry of Housing, Communities and Local Government is the great can-do spirit, a lot of creative thinking and a real excitement, a real buzz about this challenge we’ve got of building the homes Britain needs and making them more affordable for the nurses, the teachers and the young families who want to get on the housing ladder so actually I think we’ve got a great team. Look, all I can tell you is my experience day in, day out, when I go into the office.

NP: So tell us some of the creative radical thinking that is going to solve the crisis in housing then.

DOMINIC RAAB: Well there’s no silver bullet, there’s no magic wand. We have done two things this week which I think are important, one you have seen in the papers probably today which is the announcement that we are going to allow local authorities the flexibility, the freedom to build up when they need to meet their housing targets and that’s important because whether it’s providing apartments, whether it’s terraced housing, we want to make sure they have got the freedom to provide the homes that they need in their local community. At the same time, earlier in the week we had our Homes Infrastructure Funding and it was £866 million which will unlock 200,000 new homes but the real point is this, we are encouraging local authorities to build more homes and people rightly ask but where will the roads be to deal with the congestion or will we be able to get our kids into the local school or what about the pressure on the NHS services? We’ll be providing the funding not just to build those homes we need but to make sure we have the infrastructure to build up and strengthen our communities as well. So those are just two examples of a range of reforms we are coming forward with to make sure Britain has the homes we need and to make them more affordable, as I said, for the low and middle income families, for the next generation that believe and share in the Conservative vision of home ownership but can’t currently get on the housing ladder. We want to make sure …

NP: Sorry to interrupt but one thing you would not countenance is building on the green belt, you’re a bit of a NIMBY aren’t you?

DOMINIC RAAB: Me personally?

NP: Yes.

DOMINIC RAAB: Well actually if you want to look at my record, I’ve argued for, for example in my constituency, the expansion of a local infant school on the green belt when there were no other options. Why? Because I think it’s really important that the …

NP: We’re talking about housing now.

DOMINIC RAAB: Yes, but I haven’t been a NIMBY in the way you described. There are of course existing safeguards which are really important because we cherish our greenbelt and they are not absolute but they do need to be respected. But overall, whether it is planning reform which is important and that’s why the building up announcement is so important on density, releasing public sector land, making sure builders once they have got their planning permission actually deliver the homes that they have undertaken to and also this targeted investment. If we keep going on, we can build on our existing record, 217,000 new homes built, delivered in the last year, and get to that level of 300,000 new homes being delivered each year and that’s important because not only will it provide the homes we need but start to see the affordability come down for the nurse, for the teacher, for the young families that want to get on the housing ladder and that’s the plan and we’re restless and really straining to get cracking on it.

NP: Dominic Raab, definitely not a NIMBY, many thanks for being with us.

DOMINIC RAAB: Thank you.