Murnaghan Interview with Lord Lansley, former Health Secretary, 20.11.16

ANY QUOTES USED MUST BE ATTRIBUTED TO MURNAGHAN, SKY NEWS

DERMOT MURNAGHAN: The Chancellor’s autumn statement, we’re going to discuss that because in the Chancellor’s autumn statement 60 Conservative MPs … I’m a little bit confused here but I know we have got Andrew Lansley there, Lord Lansley, thank you very much indeed and I do want to discuss the autumn statement because we are told that Philip Hammond, who is of course the Chancellor, is going to try and use it to mitigate some of the effects of the Brexit vote which the estimation is that it could cost the Exchequer a hundred billion pounds over the next five years so let’s talk to Lord Lansley, a very good morning to you, I know you’re not confused.  What do you think then about the Chancellor’s strategy?  Would it be prudent to borrow a bit more now to mitigate against the effects of Brexit?

LORD LANSLEY: Well I think the first thing is we’re not clear yet what the effects of Brexit itself are going to be.  I mean insofar as the Chancellor has got a worsening financial position, it’s as much to do with the change in bond yields as it is anything else and the increased cost of government borrowing.  There is going to be an increased cost of borrowing, there is going to be a larger deficit than was previously intended and insofar as that has a counter-cyclical effect and helps us to smooth the path, that’s probably a necessary thing but I don't think he should let go nor we should let go of the necessity of living within our means and that means we have got to bring the budget back towards balance and we can’t let that go on forever.

DM: Could things for the Treasury be even worse, these 60 MPs today pushing for a so-called hard Brexit, no access to the European Economic Area, no customs union, no single market?  What’s your guess, your estimate about the effect that would have on UK trade?

LORD LANSLEY: Well this is I think an area where we do need to get a sense of where we’re going and we need to get it quickly.  The referendum took a decision and that was to leave the European Union, in that sense actually where my Conservative colleagues in the Commons I think are saying something that people would generally agree with.  As a matter of necessity I think that means we can’t be in the European Economic Area because we would end up subject to European rules, subject to the European Court of Justice, paying into the European budget and getting the rules made for us by the rest of Europe rather than being a participant in making those rules so I think that’s understood. The question however that they wrap up with it is whether or not we’re in the customs union and I don’t want to get bogged down in the detail too much but actually people didn’t decide to be out of the customs union, they decided to be out of the European Union and it is perfectly possible to have a customs union while we are not actually subject to all the other aspects of European Union legislation which people want to get out of.  

DM: And within all this discussion about money and the Brexit camp, it’s something you know an awful lot about of course, the NHS.  A lot more money was promised for the NHS if Britain did exit the European Union, there doesn’t seem to be an awful lot of money around but it sorely needs it, so how much would you suggest?

LORD LANSLEY: Well I was very clear, I talked to the NHS providers last month who of course are right at the front line of dealing with the current financial situation in the NHS and yes, the government is providing more money to the NHS during the course of this parliament but unfortunately demand is rising faster than the money is increasing and the public, all of us out there as voters, were told whichever we voted there was going to be more money for the NHS, either because we had a stronger economy or because we had the benefit of not having to pay into the European budget or potentially both.  Now to me what that means is towards the end of this parliament, at the point at which our contributions to the European Union reduce, there is an expectation on the part of the public and the NHS that there should be an increase and I think actually by the end of this parliament in order to put the NHS on the right path for the future, it will be something of the order of £5 billion extra a year by about that stage.

DM: Can I ask you what you think about this recommendation, coming from a variety of different views on Brexit within the Conservative party, about the government’s appeal to the Supreme Court about Article 50 and the involvement of parliament, there are those on both sides of the Brexit debate saying the government is pretty likely to lose this so why not drop it now and then get on with dealing with the consequences.  Would you endorse that view?

LORD LANSLEY: Yes, I would. I read the High Court judgement and I thought it was, in the end, compelling in the argument that the government did not have the power to notify under Article 50 so unless the government were somehow to argue – which it hasn’t argued – that Article 50 was not irrevocable, Article 50, the notification has the necessary consequence that it substantially changes what would otherwise be statutory rights for people in this country.  Now they voted to leave the European Union but the actual process, the power to do it – and it’s nothing to do with politics, it’s to do with statute – the statutory power does not exist for the government to do it and it is a long established convention that the use of the Crown Prerogative should not override statutory rights.  So they should get on.

DM: All right, so if they do get on with it do you think it would just take a Bill of a couple of lines saying you are authorised to go ahead and trigger Article 50?  That’s it?

LORD LANSLEY: Yes, I think you are right about that and I don’t see why the government doesn’t get on because in my view both the House of Commons and the House of Lords will pass a Bill that gives the government the power to notify under Article 50.  There may be, we’ve heard from some Labour and Liberal Democrat MPs that they would want to amend it but I don't think there would be support for that.  If it is a very simple power, we all know that subsequently we have the right in the legislation, the so-called Great Repeal Bill, we will have the opportunity and the right to scrutinise and if necessary to amend what the detail of the implementation of that decision looks like but that they have the power to leave is clear.

DM: But on that then, we are closing in on negotiations, they formally start perhaps on the 1st April or maybe a little bit before that, I just want to ask you about the ground work being prepared for that, in particular by the point man on it, the Foreign Secretary.  Do you feel he’s being rather sure footed enough at the moment with his insulting of the Italians, German politicians saying they can’t stand being in the room with him and using a B word to the Czechs?

LORD LANSLEY: Well the truth of the matter is it is the Prime Minister who is going to lead the negotiations, let’s not kid ourselves about that.  She, David Davis, Boris Johnson, Liam Fox, Philip Hammond, there is going to be a collective decision by Cabinet but it is the Prime Minister’s lead that really matters. She has been very clear I think, and she has a lot of confidence in her on the part of her European colleagues, they’ve dealt with her, they knew how for example and I knew personally, I could see how she dealt with the thorny issues of justice and home affairs and struck a pragmatic decision.  Now that’s what we’re looking for, that’s what we’re all looking for, is something that is pragmatic and to be perfectly honest what some of my 60 colleagues who are talking about simply walking away from the customs union, we’ve got to think about these things.  There are estimates that suggest it could add 4-5% to the cost of export or import of goods to go through that kind of customs formalities, to deal with the rules of origin difficulties, to deal with these formalities.  We don’t want that, we may be able to avoid it and frankly, most people I talk to don’t think that being out of the customs union for the export and import of goods and complicated supply chains that we have at the moment makes sense but I think we can be in the customs union but still have control over freedom of movement, have control of immigration, it does not necessarily require contributions to the EU budget and it doesn’t necessarily require control by the ECJ.  In fact the issues that really matter in the negotiation will be about immigration, about budget contributions and about how we co-operate with Europe in terms of setting standards, making laws and resolving disputes.  That’s where the negotiations should take place and I think this thing about getting out of the customs union, that really is cutting off our nose to spite our face.  We want access to the single market and for people who manufacture goods in this country, being in the customs union is a no-brainer, it makes sense and makes life easier for them.  It’s not about tariffs, it’s principally about rules of origin and dealing with the difficulties that would otherwise be in customs formalities.

DM: Okay Lord Lansley, great talking to you, thank you very much indeed for your thoughts.