PARLIAMENTARY DEBATE
European Council - 23 October 2017 (Commons/Commons Chamber)

With permission, Mr Speaker, I will make a statement on last week’s European Council.

Long after we have left the European Union, the UK will continue to be a strong and committed partner, standing alongside our neighbours and working with them to advance our shared values and interests. This Council provided a further opportunity to demonstrate that ongoing commitment, through discussions that included migration, the digital single market, Turkey, North Korea and Iran, and it made important progress in moving towards the new, deep and special partnership with the European Union that we want to see.

On migration, the UK is playing its full part. The Royal Navy has intercepted 172 smuggling boats and saved more than 12,000 lives since Operation Sophia began. Our National Crime Agency is working with Libyan law enforcement, enhancing its capability to tackle the people-smuggling and trafficking networks. At the Council, we welcomed the reduction in migrant crossings and the renewed momentum behind the Libyan political process; but we must also continue to address the root causes driving people across the Sahara and the Mediterranean, so the UK is also continuing to invest for the long term in education, jobs and services, both in countries of origin and countries of transit.

On the digital single market, it is right to keep up the pressure on completing its implementation by the end of 2018. That will continue to benefit us even after we have left the European Union. At the Council, I also argued that the free flow of data was key to unlocking the potential of Europe’s digital trade, and we secured conclusions which recognised that. As the Government set out in a paper over the summer, such arrangements will be an important part of the future relationship between the UK and the EU.

Let me now turn to the discussions on Turkey. We share concerns over the arrests of EU nationals and others defending human rights. I raised that personally with President Erdogan when we met at the UN General Assembly, and we are publicly calling on Turkey to protect freedom of expression and to release those defending human rights. At the same time, I believe that we must take a long-term view of the enduring importance of our relationship with Turkey, which is a vital partner in ensuring a secure and prosperous European neighbourhood. We must also continue to recognise the challenges to which it is responding, not least the military coup that it faced only 16 months ago.

We must continue to work with Turkey as our ally and partner, particularly as we respond to the shared challenges of terrorism, migration and instability in the middle east. In so doing, however, we must do all that we can to convince Turkey that it must demonstrate its commitment to human rights and the rule of law. To turn away from Turkey now would undermine those who seek to secure a European future based on our shared values.

On North Korea, we welcomed the EU sanctions that were adopted last week, and reaffirmed our clear condemnation of North Korea’s aggressive and illegal missile and nuclear tests. We urged all states, including China, to play their part in changing the course that Pyongyang is taking. As for Iran, the Council built on the joint statement made by Chancellor Merkel, President Macron and myself last week, reiterating its firm commitment to the nuclear deal. The deal was the culmination of 13 years of diplomacy and is a major step towards ensuring that Iran’s nuclear programme is not diverted for military purposes, which is vitally important for our shared security. We are continuing to work particularly closely with our French and German allies on that crucial issue.

Turning to our negotiations to leave the European Union, I shared the vision I set out in Florence for a creative and pragmatic approach to a new, deep and special partnership between the United Kingdom and the European Union: a partnership based on the fundamental beliefs we share—in democracy and the rule of law, but also in free trade, rigorous and fair competition, strong consumer rights, and high regulatory standards. I have also been clear that the United Kingdom is unconditionally committed to maintaining Europe’s security. Both sides have approached these talks with professionalism and in a constructive spirit, and we should recognise what has been achieved to date.

On citizens’ rights, both sides share the same objective of safeguarding the rights of EU nationals living in the UK and of UK nationals living in the EU. This has been my first priority from the very beginning of the negotiations, and it remains so. The negotiations are complicated and deeply technical, but in the end they are about people, and I am determined that we will put people first. EU citizens make an extraordinary contribution to our national life and we want them to stay. I know that EU member states also value the UK nationals living in their communities, and I want them to have their rights protected, too. We are united on the key principles, and while there are a small number of issues that remain outstanding, we are in touching distance of a deal.

This agreement will provide certainty about residence, healthcare, pensions and other benefits. It will mean that EU citizens who have paid into the UK system, and UK nationals who have paid into the system of an EU27 country, can benefit from what they have put in. It will enable families who have built their lives together to stay together, and it will provide guarantees that the rights of those UK nationals currently living in the EU, and EU citizens currently living in the UK, will not diverge over time.

We will also ensure that the implementation of the agreement we reach does not create complicated and bureaucratic hurdles. For example, I have said that applying for settled status will cost no more than a UK passport, and that people applying will no longer have to demonstrate comprehensive sickness insurance. We will also do everything possible to work closely with EU member states to ensure that their processes are equally streamlined for British nationals living in their countries.

We have also made significant progress on Northern Ireland, where it is absolutely imperative that joint work on the peace process is not affected in any way. The Belfast agreement must be at the heart of our approach, and we have clearly agreed that the unique circumstances across the whole of the island of Ireland will require specific solutions. There will not be any physical infrastructure at the border, and we have also developed joint principles to ensure the continuation of the common travel area. These principles will fully preserve the rights of UK and Irish nationals to live, work and study across these islands, and protect the associated rights to public services and social security.

This Council provided an opportunity to assess, and reflect on, how to make further progress in the negotiations. My speech in Florence made two important steps which have added a new impetus. First, I gave two clear commitments on the financial settlement: that the UK will honour commitments we have made during the period of our membership; and that none of our EU partners should fear they will need to pay more or receive less over the remainder of the current budget plan as a result of our decision to leave. As the House would expect, we are going through our potential commitments line by line, and that detailed work continues. Secondly, I proposed a time-limited implementation period based on current terms, which is in the interest of both the UK and the EU.

At this Council, the 27 member states responded by agreeing to start their preparations for moving negotiations on to trade and the future relationship we want to see. The Council conclusions call for work to continue with a view to being able to move to the second phase of the negotiations as soon as possible, and President Tusk in his press conference was clear that the EU’s internal work

“will take account of proposals presented”

in the Florence speech, and, indeed, that this agreement to start preparatory discussions would not be possible without the new momentum given by that speech.

So I am ambitious and positive about Britain’s future and these negotiations. If we are going to take a step forward together, it must be on the basis of joint effort and endeavour between the UK and the EU, but I believe that by approaching these negotiations in a constructive way—in a spirit of friendship and co-operation —we can and will deliver the best possible outcome that works for all our people, and that belief was shared by other European leaders.

We are going to leave the European Union in March 2019, delivering on the democratic will of the British people. Of course, we are preparing for every eventuality to ensure we leave in a smooth and orderly way, but I am confident that we will be able to negotiate a new, deep and special partnership between a sovereign United Kingdom and our friends in the European Union. That is my mission, that is this Government’s mission, and I commend this statement to the House.

I would like to thank the Prime Minister for giving me an advance copy of this statement. I too want to underline the importance of respect for human rights and democracy in Turkey, and say to the Government of Turkey that imprisoning journalists and lawyers is not part of that process and is not acceptable. Also, we need to defend the Iran nuclear deal, which was rightly defended at the EU Council last week. We must all do everything we can to defend it and to prevent the proliferation of any nuclear weapons.

I also commend the service of the Royal Navy in Operation Sophia which, as the Prime Minister pointed out, has already saved thousands of lives.

In relation to Libya, nothing is more pressing than securing a viable long-term peaceful settlement to that country’s problems. Given the language used by her Foreign Secretary on this matter, the Prime Minister might need to take the lead on this, just as she has had to take over the lead from her Brexit Secretary on negotiations with the EU.

I am beginning to feel a worrying sense of groundhog day every time the Prime Minister gives us an update on the progress of negotiations. Only two weeks ago, she told the House that her speech in Florence had put momentum into the article 50 negotiations and that an agreement on phase 1 of the talks was within touching distance. Well, here we are again, after another round of talks, and we are still no clearer as to when negotiations on Britain’s future with our largest trading partner will actually begin, and still no clearer as to what exactly she has agreed to in phase 1 of the talks.

In what are the most crucial negotiations in our country’s recent history, we are clearly stuck in an impasse. There has been no real progress abroad, and no progress at home, especially given the fact that the Prime Minister’s European Union (Withdrawal) Bill has been delayed, presumably to allow the Government Whips to pull together the splits in her own party. Maybe she can shed some light on all this confusion, which has only been escalated by members of her own Government. For instance, the Home Secretary says that no deal with the EU would be “unthinkable”. The Brexit Secretary still maintains that no deal must be an option, while the Secretary of State for International Trade says that leaving without a deal

“would not be the Armageddon that people project”.

Does the Prime Minister believe that an outcome that is not Armageddon might be setting the bar a bit too low?

The Prime Minister will also be aware that leaders of every major business organisation have written to her today urging her to provide clarity, and quickly. Across the UK, businesses in every region and nation are clear that they need a transition deal with the EU to be put in place as soon as possible so that they can take investment decisions in order to protect jobs and investment in this country. I know that the Prime Minister has talked about the need for an implementation period after we leave the EU, but she has not been clear about the terms and conditions involved. Can she tell us now what she means by accepting the same basic conditions in an implementation period? Surely this can only mean remaining within the single market and the customs union for the transition period, as Labour has made clear.

On EU citizens’ rights, the Prime Minister says, again, that an agreement is in reach. Can she tell us when the detail of that agreement will be ready to bring to the House and, more importantly, to show to all those people in this country and in the EU who are desperate to know what their future holds? That could have been dealt with 16 months ago. Instead, families are suffering anxiety, and some EU citizens are deciding to leave, including nurses from our national health service. If that had been resolved, as it should have been, hundreds of thousands of British nationals would also have the security that they need. Will the Prime Minister tell us what will happen to this specific agreement on citizens’ rights if her Government fail to secure a final Brexit deal with the EU? Will the Prime Minister now do the right thing and guarantee the rights of citizens living in the UK, regardless of the outcome of the article 50 negotiations?

On the financial settlement, clearly some within the European Union need to stop briefing astronomical and unacceptable numbers, but will the Prime Minister confirm the reports that she privately assured European leaders that Britain would pay more than the offer she made in her Florence speech? If that is the case, is she confident that it would pass the red lines set out by the Foreign Secretary a few weeks ago? The Prime Minister hails the progress that she has made so far in these negotiations. The biggest battle that she faces is not so much with the other 27 European states the Chancellor so deftly described as “the enemy”, but her battle to bring together the warring factions in her own Cabinet and party. The Prime Minister is too weak to do anything about it. The outcome of crashing out with no deal to become a deregulated tax haven—the dream of a powerful faction on her Back Benches and Front Bench—would be a nightmare for people’s jobs and living standards. Labour’s message is different and clear: only Labour can negotiate a Brexit and deliver an economy—[Interruption.]

Order. The Prime Minister’s statement was heard with courtesy, and so will the response be. No further discussion or comment is required. That is the situation.

I was making it clear that Labour’s message is different and very clear indeed: only Labour can negotiate a Brexit and deliver an economy that puts jobs and living standards first, and that is what we are ready to do.

I welcome the right hon. Gentleman’s comments on the Iran nuclear deal. It is important that we agree across the House that we should continue to support that deal. I also agree that what we of course want to see in Libya is a peaceful settlement that can enable that country to be stable and peaceful into the future. It is important that we all support the work that is being done by UN Special Envoy Salamé on this particular issue.

The right hon. Gentleman asked about the Brexit bill. What I set out to the European Council was what I set out in my Florence speech and what I have just repeated in my statement. He talked about us making no real progress. But:

“We haven’t reached a final agreement, but it’s going to happen.”

And:

“I’d have a degree of confidence that we’ll be able to get to the point of sufficient progress by December.”

After the Florence speech, it was said

“there is a new momentum.”

And the Florence speech was “a step forward”. There

“should be a positive response to the willingness to work on the interim period”.

And:

“There has been established a momentum.”

As it happens, those are not my words; they are the words of Chancellor Merkel, the Taoiseach, the Swedish Prime Minister, the Italian Prime Minister, the Polish Prime Minister and the Danish Prime Minister respectively, so I can assure the right hon. Gentleman that progress was indeed made. The Labour party talks about the need to move ahead in the negotiations. If Labour thinks it is so important, why did Labour MEPs vote against moving ahead in the negotiations?

The Leader of the Opposition talks about the withdrawal Bill as if it is something that Labour is very eager to see before the House. If it is so eager, why did it vote against the Bill on Second Reading and, in doing so, vote against bringing workers’ rights and environmental standards into UK law?

Finally, the Leader of the Opposition spent a long time talking about no deal. Well, I can only assume that the Labour party wants to talk about no deal because it simply does not know what sort of deal it wants. It cannot decide whether it wants to be in the single market or not. It cannot decide whether it wants to be in the customs union or not. It cannot decide whether it wants a second referendum or not. It cannot decide whether it agrees with the continuation of free movement or not. And, worst of all, it says it would take any deal, whatever price it is asked to pay. That is not the way to get a good deal for the UK; it is the way to get the worst possible deal for the UK.

Is it not clear that damaging delay will be caused if we do not make progress soon? The main problem is that other European leaders can see that a noisy minority in the Cabinet and on the Back Benches of the Prime Minister’s own party have persuaded themselves that no deal at all is completely desirable, which causes European leaders to doubt whether she is able to produce a clear picture of where she eventually wants to go and whether she is able to produce a majority here for any agreement they have with her.

Has the Prime Minister considered appointing some trusted Minister—she may have already done so—to make approaches to leading Opposition Members to see whether they will live up to some of the things the Leader of the Opposition appears to say, and perhaps to do better, so that we can have consensus in this Parliament, in the national interest, at least on the outline of a transitional deal that will enable us to negotiate final details and arrangements that the majority of this House could agree are in the long-term interests of the United Kingdom?

That sounds rather like a job application.

It is clear from my interaction with European leaders that they recognise that the vision I set out in the Florence speech—for a deep and special partnership for the future, and also for an implementation period—did bring clarity on the thinking of the United Kingdom. The 27 have agreed that it is now for them to consider what they want to see from the future of that relationship so that the next stage of negotiations can begin.

I thank the Prime Minister for an advance copy of her statement.

I welcome some of the conclusions from the Council summit, particularly on migration and the stronger commitment on resettlement. The Scottish National party also welcomes the united approach on sanctions against North Korea and fully endorses the EU’s call for North Korea to

“abandon its nuclear and ballistic missile programs”.

However, it is of deep concern that the ongoing crisis in Catalonia was not covered. EU citizens were brutally thrown to the floor while exercising their right to vote, and a Parliament was stripped of its constitutional status. What representations did the Prime Minister make to address that democratic outrage?

Last week, the EU27 voted unanimously to declare that there had not yet been sufficient progress on leaving the EU. It is clear that the negotiation sticking points are the same as before—the financial settlement, EU citizens’ rights and the Irish border. Jean-Claude Juncker made a poignant remark:

“nobody explained in the first place to the British people what Brexit actually meant.”

How true, and no wonder this Government are in such a mess.

Today, the UK’s five biggest business lobby groups have called for an urgent transition deal. Time is running out for the business community, and financial institutions are already giving notice or leaving London. Ireland has clinched deals with more than a dozen London-based banks to move operations from London. Ernst & Young has warned that 83,000 City jobs could be lost if the UK loses its euro-denominated clearing rights. Businesses need certainty, and we need to know the details of our future trading relationship and any transition deal before the end of the year. It is absolutely critical that we stay in the single market and the customs union. Will the Prime Minister end her Government’s catastrophic ideological flirtation with a no-deal scenario? Take this off the table and do it today.

First, may I say to the right hon. Gentleman that I have spoken to Prime Minister Rajoy on the issue of Catalonia on a number of occasions, including when I saw him at the European Council? We are absolutely clear that the referendum had no legal basis. We want to see people upholding the rule of law and upholding the Spanish constitution.

On the wider issue the right hon. Gentleman talks about—the future relationship of the United Kingdom with the European Union—I have set out the vision we have for that. As I have just said in answer to the Leader of the Opposition, the EU27 will now be looking at their vision for this. I am sorry to have to repeat again to the right hon. Gentleman, because he has raised this issue in the past, that full membership of the single market and of the customs union go with the jurisdiction of the European Court of Justice and freedom of movement, and they were issues that were voted against when people voted to leave the European Union. They would effectively mean that we would remain in the European Union, and we are going to leave in March 2019.

May I say to my right hon. Friend that she may wish to answer some of those who want certainty by reminding them that you cannot have agreement on an implementation period until you have something to implement? That is first and foremost. Secondly, during the course of her private discussions, —the ones that the acting President of the European Union, Martin Selmayr, has not put into the papers—did she remind her colleagues in the European Union that to reach a proper free trade arrangement they will need to have concluded those discussions before the summer of next year, otherwise it will be difficult to get things through in time, both in the European Union and here? Did she get an answer, therefore, about when they might like to start?

I thank my right hon. Friend, because he is absolutely right; as we have said on a number of occasions, the point of the implementation period is to put in place the practical changes necessary to move to the future partnership, and in order to have that you need to know what that future partnership is going to be. Obviously, in my discussions with other leaders I have raised the issue of the timetable we have, and of course the ultimate timetable that was set by the Lisbon treaty. He talks about knowing the details of the trade deal by next summer. Of course Michel Barnier himself has suggested that October 2018 might be the point at which it would be necessary to know that, but my right hon. Friend is absolutely right that of course there will need to be a period of time for ratification of any future arrangements by the various national Parliaments—and, as we know, this can be more than one in some of the countries concerned.

Can the Prime Minister explain why it is frequently said by those with whom we are negotiating that they do not know what the UK wants when it comes to a long-term deal? Does she think this has anything to do with the fact that the Cabinet appears not to have reached its own view yet about what the nature of that deal is going to be?

This is a negotiation and there will be different levels of detail at different stages of the negotiation. I have set out the vision for our future partnership and, as I have said in response to a number of remarks now, what happened at this European Council was that the EU27 agreed that they will now start the work of preparing their vision of what that future partnership will be, so that when we come to open those trade negotiations formally both sides have got that agenda and clearly know what those negotiations will cover.

Given business’s understandable wish to deal with uncertainty, does the Prime Minister agree that the best course for a business that trades with Europe would be to prepare for a smooth transition to World Trade Organisation terms, which the Government can and will guarantee unilaterally, but to expect the Prime Minister to have good luck in bringing back something better?

It is absolutely right and important that business prepares for a smooth and orderly move to the future relationship we have. That is why I have proposed an implementation period, which I believe is in the interests of businesses not only in the United Kingdom but in the European Union. As my right hon. Friend says, we are working to get the good deal that will also be not just in our interests but in the interests of the EU27.

Further to the Prime Minister’s answer to the right hon. Member for Chingford and Woodford Green (Mr Duncan Smith), the Secretary of State for Exiting the European Union said last week that

“a transition phase will be triggered only once we have completed the deal itself”—[Official Report, 17 October 2017; Vol. 629, c. 741.]

I understand that the Prime Minister’s spokesperson said today that an implementation period is

“a bridge to where you are heading. You need to know where you are heading.”

Will the Prime Minister clarify whether she is saying that if we have not agreed a long-term trade deal by this time next year, there will be no transition deal at all and Britain will end up on WTO terms by March 2019?

As I just said in my response to my right hon. Friend the Member for Chingford and Woodford Green (Mr Duncan Smith), an implementation period is about a period of adjustment to the future relationship. That is the basis on which I have put it forward to the European Union, and that is the basis on which we will be negotiating an agreement on it.

Does my right hon. Friend accept that it is a potential bear trap if the European Court is directly involved in any implementation period? Its case law asserts its supremacy over our Parliament and our courts, and includes a commitment to the charter of fundamental rights and political integration.

As my hon. Friend knows, I have been clear that one of the intentions of people who voted for the UK to leave the EU was to ensure that in future the jurisdiction of the European Court of Justice no longer covered the United Kingdom. We will of course have to negotiate the basis of the implementation period. If we are going to ensure that we have the greatest possible certainty for business during that period, it will be necessary for us to see as little change during that period as is commensurate with that certainty for business. Indeed, one of the purposes of the European Union (Withdrawal) Bill is to bring the EU acquis—the EU law—into UK law to give that certainty to businesses and individuals here.

Until recently, the British Government were leading the negotiations to create a digital single market in Europe that would benefit creative industries. The Prime Minister said in her statement that it is right to aim for the completion of the digital single market by 2018, but will she explain how she expects to be taken seriously when she is in the process of trying to leave it?

The United Kingdom continues to lead in the debate on the creation of the digital single market. We believe that it is important for the EU27 and it is important for the UK in or out of the European Union. We will therefore continue to encourage the completion of the digital single market while we are members of the European Union. It will be important for us, once we have left the EU, that that digital single market has been created. We will forge a new relationship and partnership with it.

I commend the Prime Minister’s statement and the progress she has made in the EU negotiations. As we have heard, representatives of British businesses of all sizes and from all sectors have today written to the Government to warn of the consequences of no deal and relying on WTO rules. They said:

“The Government should give certainty to business by immediately ruling this option out under any circumstances.”

Will the Prime Minister agree to listen to British businesses, and will she even go so far today as finally to rule out no deal?

We have of course been engaging with and listening to business. I was clear that the implementation period was something that business was very keen on having to ensure that businesses had that smooth and orderly process of withdrawal, but we are in a negotiation with the EU27, and it is important to remember as part of that negotiation that we want to get a good deal for the United Kingdom, but the best way to get a bad deal for the UK is to say that we will accept anything that they give us, regardless. We have to be clear that we are working for a good deal, and I am optimistic about that because we have made some progress and I believe that the good deal we are seeking is in the interests of both sides.

Is it not the case that the business community will be shocked to hear the Prime Minister’s words today, which seem to suggest that there will be no clarity on transition or implementation until we get a final deal in some number of months—or possibly longer—ahead? The business community wants to know that the cliff edge will not be there in March 2019. Will she not give a commitment now to treat attaining a transitional arrangement separately from trying to get a final deal?

I set out in my Florence speech the concept of the implementation period, and, of course, we have to discuss that with the EU27. I am confident that we will get a good deal precisely because getting a good deal is not just in our interests, but in the interests of the EU27 of the remaining European Union. That is what we are working for, and that is what our effort is going into.

Ah yes, a Lincolnshire knight. I call Sir Edward Leigh.

May I commend the Prime Minister’s approach based on the Florence speech, which is entirely sensible, pragmatic and moderate? Given that we are being entirely open about our negotiating tactics, which is that no European nation, or indeed any European citizens, should be worse off, may I encourage her to be more transparent and open with Parliament on the figures? I know that the reserve position of Whitehall is that Parliament is a nuisance, but what else was Brexit about except reviving parliamentary democracy? We still have no idea what we have offered or what is being demanded. We could do with some more information because, ultimately, there will be a vote on this in the House and that will be a vote that counts.

Of course we have said that there will be a vote on the deal in this House and we expect that vote to take place before the European Parliament votes on the deal. I have also said—I said this in my Lancaster House speech in January—that when we are able to make information available, we will do so. As my hon. Friend and others may recall, I also said that we will not give a running commentary on the details of the negotiations. We must not put this country in a position where we set out publicly everything that we are looking for in these negotiations, because that just hands the cards to the other side. This is a negotiation, and both sides will have to move on it.

Given the report from the business groups today calling for transition, and the lust for the cliff edge being displayed by some on the Prime Minister’s Back Benches, will she perhaps introduce some facts? Will she list any major economies in the world that trade with the EU on the basis of WTO rules alone, with no sectoral or other agreements in place?

The premise of the right hon. Gentleman’s question is false. He seems to be suggesting that the purpose of the Government’s negotiations is to, somehow, engineer a no-deal scenario; it is not. In terms of our future relationship with the European Union, we are working towards a deal and a good, deep and special partnership that covers both trade and security.

May I follow that up? The tenor of the Prime Minister’s negotiations last week and of her statement in the House today is very much, as she says, to seek a creative and pragmatic approach to a new, deep and special partnership. “Partnership” is the key word, is it not, because no partnership would be possible without dialogue within this House, with our European neighbours, with our fellow member states and within the Cabinet? Will she assure us that those talks will continue and that she will not listen to those, unfortunately sometimes on these Benches, who want talks to stop and us to go on to WTO rules?

I can assure my right hon. Friend that the negotiations are continuing. As I have said, we want to ensure, as we are doing, that we work towards getting a good deal. The purpose of my Florence speech was to set out a vision for that deep and special partnership in the future, and it is that partnership that the Government are working towards.

There has been much talk today of the time-limited implementation period that the Prime Minister referred to in her Florence speech. Others have referred to it as a transitional deal. Has there been any discussion with the EU27 as to what the legal basis of such a transitional period would be? Would it be article 50 or something else?

The European Union raised a similar concept to the implementation period in its April guidelines, and that would be on the basis of the article 50 process.

On the matter of North Korea, the Select Committee on Defence recently took evidence from a group of academics who argued that North Korea may already have an ability to reach the United Kingdom with a thermonuclear weapon. If that is true, does the Prime Minister agree that it would be the utmost folly to abandon our independent nuclear deterrent?

I absolutely agree that it would be folly to abandon our independent nuclear deterrent. There are many reasons why it is important for us to maintain and, as Parliament has voted, to upgrade our independent nuclear deterrent. It is also important because it is part of the collective defence of Europe that we provide as a member of NATO.

The Government’s position on the Brexit negotiations is simply absurd: the Prime Minister refused to rule out no deal just a moment ago; the Brexit Secretary was threatening no deal last week; and the Home Secretary was saying that no deal was “unthinkable”. What is this going to cost the British taxpayer? The Home Secretary told us that £50 million is already being spent this year on contingency planning in her Department. How much is now being spent across Government, and how many nurses, doctors or police could that pay for?

I have already said at this Dispatch Box that the Treasury has set aside £250 million this year to be spent across Government Departments on preparing contingencies for every eventuality.

I congratulate the Prime Minister on the great progress and change in tone of the negotiations. I particularly thank her for the progress that has been made on the citizens’ rights issue. Will she give us more detail on the areas where agreement has been cemented?

There are a number of areas where agreement has been reached, such as payments on pensions and healthcare arrangements for both EU citizens here in the UK and UK citizens in the EU. There are a small number of areas where we have yet to reach agreement but, as I said in my statement, it is clear from both sides—from the UK and from Michel Barnier and the European Union—that we can see the shape of that deal and that we are within touching distance of getting there.

I, too, welcome the Prime Minister’s statement and look forward to progress being made, especially after December when we move to phase 2 of the negotiations. However, has the Prime Minister taken the opportunity to remind the Republic of Ireland’s Taoiseach that it is about time that he started to pull his weight in the interests of the Republic of Ireland, rather than attempting to throw his weight around on the issue of the border? All that he doing is potentially damaging his economy more than the economy of Northern Ireland. Will the Prime Minister make an impression on the Labour party’s Front Benchers that when they visit Northern Ireland and threaten that the peace process is an exchange for Brexit, they are playing with fire and they ought not to encourage that beast?

It is very important that all sides are clear that we must ensure that the Belfast agreement is put into place, recognised and respected in its entirety. It is also important that we ensure that the peace programmes that have been possible through our membership of the European Union can continue. When it comes to resolving the issue of the border between Northern Ireland and the Republic, it will be for us to work with the Republic of Ireland Government and the European Union more generally to find a solution that we all want to see, whereby there is no physical infrastructure at the border and no return to the borders of the past.

May I reassure my right hon. Friend that anyone who is suggesting that she is weak is seriously underestimating her, seriously underestimating the Conservative party, which supports her, and underestimating the importance of the referendum mandate and the fact that she obtained more votes than any other Conservative leader for 30 years? Will she stick to her guns, follow through and have confidence that the only people undermining her on the Conservative side are those who, unfortunately, are threatening to go into the Lobby with the Labour party?

I thank my hon. Friend for the confidence that he has shown in me. I am sure that all members of our party want to ensure that we get the best possible deal for the United Kingdom. That is what the Government are working to, and I look forward to everyone on the Conservative Benches supporting us.

Did the EU Council discuss Russia, and in that context have the UK Government or their agencies been asked for help or information by the American congressional team or US special counsel Robert Mueller, who are investigating alleged Russian subversion of the US presidential election?

As it happens, on this occasion, Russia was not one of the subjects on the agenda of the European Union Council. As I say, we did discuss a number of foreign policy issues—North Korea and Turkey were on the agenda, but Russia was not.

I call the good doctor—Dr Julian Lewis.

If our EU friends were to demand a sum of, say, £1 trillion, rather than £100 billion, the position of the Opposition would have to be to accept that, because they would not walk away under any circumstances. Given that the Government would walk away under unacceptable circumstances of that sort, can the Prime Minister reassure us that all necessary preparations will be made so that we can walk away without a deal if we need to, which will, of course, maximise the prospect of getting a good deal and not having to walk away?

Can I say to my right hon. Friend that, indeed, we are ensuring that the Government are preparing for all contingencies? That is a sensible, pragmatic approach for any Government to take. Of course, we are working for a deal, as I have set out in answer to earlier questions. Can I also thank my right hon. Friend for very graphically illustrating the position that has been taken by the Labour party, which is that it would simply pay any price for a deal, whatever?

The Prime Minister says she wants a deep and special partnership with the EU, but some of her colleagues want a total and complete break. Is not the truth that her failure to resolve this fundamental issue is what stalled the negotiations and put the future of our country at risk?

No, the hon. Lady obviously failed to recognise the progress that was made at the European Union Council and the decision that was taken—that the EU27 will now be preparing their position in the negotiations on the future partnership and an implementation period in the lead-up to that partnership. In the Florence speech, I set out our vision for what that future partnership would look like, and it is now for them to look at what they believe that partnership should be in the future, and that is exactly what they are doing.

Last year, the European Union had a surplus with us of £71.8 billion. A report last week said that if we moved to tariffs, the German auto industry alone would lose 29,000 jobs. Was there any realisation at all, during my right hon. Friend’s discussions, of the impact of not discussing free trade arrangements, because it is massively in the interests of our partners to maintain reciprocal free trade? Do they understand that they would lose far more if we moved to WTO than we would?

It is very clear that, across the European Union, it is recognised that we need to look at what a trade relationship in the future might be, precisely because, as I, my right hon. Friend and others have said, this is not just about the United Kingdom’s future position; it is also about jobs in the economies in the EU27. As I say, the EU27 are now looking at what they think that partnership could be for the future, and, of course, as I am sure my right hon. Friend is aware, there are a number of organisations on the continent now starting to talk about the importance of this relationship for their businesses in the future.

Could I ask the Prime Minister a question that the Brexit Secretary was unable to answer last week? Given that the Government now envisage a two-year transition period where the existing structures of rules and regulations apply, can she clarify whether a pharmaceutical company wanting authorisation to market a new cancer drug in the UK during transition would do so via the European Medicines Agency or a new system as yet undefined?

The intention of the implementation period is, as far as possible, to ensure that there is not a cliff edge so that people are able to operate on the same basis as they do at the moment as they put in place the necessary changes leading up to the future partnership. Of course, that implementation period, which is now going to be looked at by the EU27, will be part of future negotiations.

Does my right hon. Friend agree with the Committee on Exiting the European Union that it would be in the best interests of both sides if we could conduct the negotiations on the divorce settlement in parallel with those on our new relationship? Does she therefore agree further that any flexibility on the size of our exit payment must be linked to flexibility in other areas to be negotiated?

I, and the Government, have been very clear that the whole question of the financial settlement cannot be finally settled until we know what the future partnership will be. It is not that we are going to sign up to a deal and then negotiate what that future partnership will be, so once the formal negotiations on the future of the trade relationship, and of course the security relationship, have started, there will continue to be negotiations on issues which were initially identified as being in phase 1.

Since the Brexit vote there has been a 96% drop in EU nurses registering to work here. With an NHS vacancy rate of 86,000 and rising, just how much bigger does this crisis have to get before the Government stop using these medics as bargaining chips and do something to make sure that there are nurses and doctors in our A&Es this winter?

First of all, I reiterate the point that I made in my statement and have made on a number of occasions—we value the contribution that EU citizens have made here in the United Kingdom and we want them to stay. The hon. Lady talks about numbers of nurses. There are more nurses in the NHS today than there were in 2010, and we have taken off the limit on the number of nurses who can be in training. There are 52,000 nurses in training, and there were two applicants for every nurse training place here in the United Kingdom.

Does my right hon. Friend agree that the progress achieved at the Council meeting demonstrates again that there is a weight of logic on both sides, both ours and the EU’s, that lends itself to a deal being done? Will she reassure the House that in the important weeks ahead every ounce of effort will be marshalled right across members of her Government to achieve that end?

I absolutely agree with my right hon. Friend that this is in both our interests. I can reassure him that Government as a whole, collectively across every Department, are putting the necessary effort into looking at what legislation we need to bring forward but also at preparing for all eventualities once these negotiations have finished. The whole effort of Government is being put into this.

The Prime Minister has raised expectations about the situation between Northern Ireland and the Republic, and that is welcome. Having no physical infrastructure on the border must be welcomed by all parties. But is it conceivable that this can be done without real negotiation between Dublin and London, and of course with Brussels as well, and is it really possible that we can talk about no deal in that scenario?

It is not that expectations have been raised this time in relation to this—it is the position that we have taken, and consistently taken, since my Lancaster House speech in relation to not wanting to see a return to the borders of the past between Northern Ireland and the Republic of Ireland. As I said in answer to a previous question, ensuring that we get the solution to this will require us not just to work with the European Commission and with the EU27 but to work hard with the Republic of Ireland Government as well.

The Prime Minister is absolutely right not to rule out a no deal scenario. To do otherwise would be utterly naive. What assurances can she give that the implementation period will, indeed, be strictly time-limited?

The key issue is that this is about the period of time required to make the practical changes that are necessary to move to the future partnership. Of course, by definition, those changes will have a time limit to them. I have said that that will be around two years, on the implications of the practicalities of what we are looking at. It is absolutely essential that it is time-limited, because we will have left the European Union and we will be moving to a new partnership. People in the United Kingdom want to ensure that we get to that partnership and our new arrangement outside the European Union.

I call Dr Philippa Whitford. [Interruption.] She looks surprised. It will not breach a precedent if the hon. Lady does not wish to contribute. She is not obliged to do so, but I assumed that she would wish to contribute, and she is welcome to do so. Let us hear the hon. Lady.

We have heard about the possibility of a no deal Brexit. What about the threat that that would pose, through leaving the single aviation market, to this country’s entire aviation industry?

We are aware of the necessity of looking very closely at and negotiating deals in relation to aviation, because we want people still to be able to fly, as they can today. But, once again, the hon. Lady is focusing on a no deal scenario, when the efforts of Government are being put into getting a good deal.

Absolutely splendid. A true parliamentarian is never lost for words.

Although we all hope that our European partners will start to negotiate on trade, is there not a silver lining if they are unreasonable? If that happens, we will have to move towards WTO rules, and suddenly the French and Germans will realise what a disaster that would be—for their economies, not ours. They will negotiate a good deal, and we will not write out the blank cheque that Labour Members want to give them.

My hon. Friend is right. I think it is in the interests of both sides—businesses here in the UK, and businesses in the EU27 countries—that we get that deal on trade. That is why we are working so hard for it.

When are we going to have the Committee stage of the European Union (Withdrawal) Bill? I ask only because if there is any hiatus or gap in the legislative programme, there is another Bill that has unanimously been given its Second Reading—an occasion on which the Conservatives did not vote, but that was because they were in support of the Bill—and that is the Assaults on Emergency Workers (Offences) Bill. Can we not just bring it into Committee and get it all the way through the process by Christmas, so that we can stand by our emergency workers?

I note the hon. Gentleman’s bid in relation to this matter. He tempts me to make a business statement, which I will not do because that is, of course, a matter for my right hon. Friend the Leader of the House. I am pleased that the Government are able to support the Bill that the hon. Gentleman has brought forward. I think that it is important, and we look forward to seeing it on the statute book.

Will my right hon. Friend show caution in respect of the suggestion that she reach out to, and enlist the support of, Opposition Members, particularly those who have shown their desire to thwart Brexit at every turn by voting against the principle of the withdrawal Bill?

My right hon. Friend, with his many years of wisdom, is right to urge caution on me in that regard. He is absolutely right that the Labour party has tried to thwart the very measure that would enable us to put in place the decision taken by the British people.

As we have heard this afternoon, many Conservative Members claim that leaving with no deal and trading on WTO terms will be relatively straightforward. But if we are in a no deal scenario, we will still need the EU, in its capacity as a member of the WTO, to agree to the new terms of our independent membership of the WTO. Can the Prime Minister guarantee that if there is no deal with the EU, she will at least get its agreement to the new terms of our independent membership of the WTO?

The whole question of our membership of the WTO, and the independent role that we will take once we are outside the European Union, is one on which the Department for International Trade is already working. It is looking ahead, with partners such as the European Union, to the position that we are going to take.

The reason why this country has been so successful in the past and will be in the future is our belief in the rule of law. May I therefore urge the Prime Minister to pay the European Union what is legally due to it when we leave the EU—not a penny less, but not a penny more either? If the Government have spare tens of billions of pounds in their coffers, and I am not sure that they do, that money should be used to pay for things such as social care and pay rises for public sector workers, not to go into the bottomless pit of the EU and into Jean-Claude Juncker’s wine cellar, which I am sure is rapidly diminishing as we speak. We cannot look public sector workers in the eye if we give tens of billions of pounds to the EU that we do not legally need to give to it and hold back their pay at the same time.

I assure my hon. Friend that, as I said in the Florence speech and have reiterated today, we are clear that we will honour our commitments, but we are going through those commitments line by line. Of course, part of the discussion about those commitments is precisely the legal nature of them. We are a law-abiding nation and we want to ensure that we stand by the commitments that we have made, but we are not just going to sign up to anything, as the Labour party would do.

Tomorrow, a number of EU nationals will converge on Parliament to speak to their Members of Parliament about their many feelings of distress and anxiety. What is the Prime Minister’s message to those individuals?

My message to them is that we value the contribution they have made here in the United Kingdom and we want them to stay. That is what we are working for, and we have made significant progress in relation to citizens’ rights. I made a number of commitments in a letter I wrote last week to EU citizens living here in the United Kingdom, and I stand by those commitments. We want them to stay.

Does my right hon. Friend agree that, by some happy accident, we have actually ended up in a rather more constructive space for a successful deal, because we are now going to have two months of private diplomacy on the future deep and comprehensive free trade agreement with our EU partners? Even so, it is necessary for us to prepare for no deal—these talks may fail—and even Gina Miller agrees with me that we should begin to surface the Government’s own preparations for their contingency plans. Does my right hon. Friend agree that the preparations should be surfaced so that not only the Government but businesses and people can begin to make the necessary contingency plans?

We are working to get the deal that we believe will be in the interests of the UK and the European Union for the future. That is where our focus is. Of course, as I have said, we are working across Government to make contingency arrangements for every eventuality. However, as I have also said, we are in negotiations, and we are not going to give a running commentary on every detail of them. We continue to work for what I believe is in our best interests, which is to get a good deal for us and for the European Union.

Last week, I took part in an Exiting the European Union Committee trip to Dover, where 10,000 heavy goods vehicles are processed per day. There we were told that if an extra two minutes are added to the customs proceedings, there will be an additional 17 miles of tailback—from Dover to Ashford. We were also told that, in that context, a no deal scenario would be a total catastrophe. Will the Prime Minister please explain what measures are being put in place to avoid total gridlock in Dover in the event of a no deal scenario? [Interruption.]

Order. It is a long way from Northumberland. The hon. Member for Blyth Valley (Mr Campbell) is wittering away from a sedentary position in evident appreciation of the point articulated by his hon. Friend, whose constituency is far distant from his own. It is all inexplicable.

I think the hon. Gentleman was making the point from a sedentary position that this issue will actually affect others on the other side of the channel, as well as those in the United Kingdom.

The point is that we have published proposals. The future customs relationship will be part of the negotiations, as we look to the future trade relationship, but we published proposals in the summer about a number of options that could be adopted to ensure that we see trade that is as frictionless as possible across the borders, and the problem that the hon. Member for Aberavon (Stephen Kinnock) raises does not arise.

It was very good of the Prime Minister to explain what the hon. Member for Blyth Valley was blathering on about, because I could not tell. I am very grateful for that bit of information.

This morning I met a gentleman who was singing the praises of the Prime Minister, saying that she is determined yet patient and that she gets things done. I think that the whole House would agree with that. He went on to say that he reads the newspapers and is very concerned about progress not being made and about things being terrible. Does the Prime Minister agree with what the newspapers are saying or not? One other thing, Mr Speaker: I asked the man what newspaper he read and it was the Evening Standard.

I say to my hon. Friend that we have a free press in this country and that is an important underpinning of our democracy. What I know is what the Government are doing to ensure that we get a good deal for the future.

Mr Campbell, I heard you from your seat; let us hear you on your feet if you are still interested.

And here’s me thinking you weren’t going to call me, Mr Speaker.

Seeing as we are not in the euro, will the Prime Minister guarantee that none of the money that the EU finally gets off us will be used to prop up the euro? That is a good question, like Mr Speaker said. We are not in the euro, so our money should not be used for it. The only problem the Prime Minister has is that some of her Cabinet Ministers are walking up the gangway towards the gallow.

My party has a track record of ensuring that we do not have to contribute to propping up the euro. That is exactly what my right hon. Friend the previous Prime Minister negotiated with the European Union.

I welcome the Prime Minister’s statement and the progress she has reported to the House. I do not believe that EU citizens living in the UK should have the European Court of Justice as the final arbiter of any disputes when we leave the EU. However, to the extent that this matter remains on the agenda for Brussels, will she give an assurance to the House that Britain is demanding that British citizens living in EU countries have recourse to our Supreme Court and not the ECJ?

The point that my hon. Friend makes shows up the issue of which court should have supremacy over such issues. What I have said in relation to citizens’ rights, which is one of the issues that remain on the table, is that we will give certainty to EU citizens in the United Kingdom by ensuring that what is agreed as part of the withdrawal agreement is put into UK law. They will then be able to take cases to the courts here in the United Kingdom. Of course, it is the case that courts here in the UK look at judgments that have been made by other courts, not just the ECJ, in matters where they are relevant. The important thing is that it is through our courts that EU citizens will be able to take their cases.

The Prime Minister used her new mantra of a “deep and special partnership” three times in the statement, even though the lack of progress, the business uncertainty and the splits in her Government mean that in reality, the phrase “deep and special” is the new “strong and stable”—an empty slogan from an empty-vessel caretaker Prime Minister. [Interruption.]

Order. Gosh, it really is a day of name-calling. I cannot imagine that that is the sort of behaviour I would ever have indulged in.

I say to the hon. Gentleman that what we saw at the European Council was the EU27 moving towards their own discussions about what that deep and special partnership will be in the future.

There are some misguided amnesiacs who think that nationalisation is good way forward. There are also some who think that we should stay in the single market. Will my right hon. Friend confirm that, due to state aid rules, a country cannot nationalise if it is in the single market?

My hon. Friend is absolutely right. That is yet another of the confusions in the Labour party that show that it really does not know where it is going.

What we have done, and what we will continue to do when we move on to the negotiations on trade, is talk about the future customs relationships we want to have with the European Union. We have set out proposals for that and we look forward to discussing them with the EU.

I was very pleased that the Prime Minister confirmed that the UK is fully playing its part on migration, and to hear that the Royal Navy had intercepted 172 smuggling boats and saved over 12,000 lives since Operation Sophia began. Will she confirm that, at the summit, the EU reported it has a looming deficit or pay gap of £225 million in the money going to migration projects in north Africa? I understand that Germany and Sweden offered more money towards those projects. Can she confirm that and say whether any other EU countries were forthcoming in offering more money to help to save lives?

My right hon. Friend is referring to the trust fund that has been established in relation to migration matters in Africa to which the UK has, alongside others, contributed. She is right that the Commission reported that deficit. From the United Kingdom’s point of view, we are putting extra money into activities in Africa in relation to supporting people in countries of origin and transit. We are working alongside that trust fund. The work we are doing is amounting to £75 million.

I am sure the Prime Minister’s confidence is well placed in that, were it necessary, the EU would agree to our being an independent member of the World Trade Organisation. In that situation, however, we would also need the agreement of every member, including Russia. What price does she think that Russia would extract?

We are a member of the WTO, but obviously we have that link in relation to the European Union. In future, we will want to be an independent member. We are working across the WTO to ensure we are able to put in place the necessary arrangements for that to happen.

I thank the Prime Minister for the huge amount of work she is putting into these negotiations. I am sure she has the support of the whole House as she does so. Does she intend to ensure, as she mentioned in her statement, that free flow of data is an absolutely integral part of any future relationship between the UK and the EU?

I am very happy to give my hon. Friend that reassurance. As I said when I was at the European Council, the free flow of data is important for us in relation to operations, in particular building a digital single market. Another point that I and others made is that we should look at the digital market as not just being about the European Union. Actually, this is a global issue. We need to ensure that the work is done on a global basis.

The Prime Minister talks a great deal about an implementation deal. We all know that we will be withdrawing in March 2019. There is no disagreement on the divorce deal. The free trade deal, however, may take some time to negotiate. Does the Prime Minister accept—this is what business needs to hear—that a transition deal may help to deal with the finer detail and the final conclusion of the trade negotiation, and therefore will not be so much of an implementation but a proper transition?

Both sides recognise that the timetable was set out in the Lisbon treaty, which does indeed refer to the future relationship. The withdrawal agreement can only be considered and agreed taking account of the future relationship. It is important that we negotiate that future relationship, so we have both the withdrawal agreement and the future partnership, and the implementation period then is a practical implementation period.

The hon. Lady looks as if she does not believe that that is possible. The point is that we start these negotiations on a completely different basis from any other third country. We start on the basis that we are already trading with the other member states of the European Union on the basis of rules and regulations, and when we leave we will have taken those EU regulations, EU law and the EU acquis, into UK law.

I think it is time to hear from the hon. Member for Huntingdon (Mr Djanogly), whose father is a sound Arsenal fan.

Actually, he always used to take me to Nottingham Forest, but there you are.

In contrast to the disappointment coming consistently from the bureaucracy of Europe, in my right hon. Friend’s discussions with the leadership—the politicians—of Europe and individual member states, is the position more nuanced? Is there hope for optimism?

Yes, there is hope for optimism. Obviously, we are negotiating a future partnership. One of the interesting issues is that the EU27 are themselves starting to think about their future and the nature of the relationship and arrangements they will have. We are working to negotiate that deal. As I indicated to the hon. Member for Penistone and Stocksbridge (Angela Smith), we will start those trade negotiations on the same basis of trading, which will make it easier for us, as it will not need to be as bureaucratic as it might in other circumstances.

Given that the prestigious Organisation for Economic Co-operation and Development reported last week that the British economy would be far stronger in the future without Brexit, and given that new horrors about Brexit are revealed on an almost weekly basis, is it not right that three years after the referendum, when we are thinking of taking this step, we allow the public to have a second opinion, in the knowledge that second thoughts are always superior to first thoughts?

This is about more than the decision to leave the EU; it is about whether the public can trust their politicians to put in place the decision they took. Any suggestion that we say to the public, “Oh, you’d better have a second referendum because we think you got it wrong,” is out of the question. We will be leaving the EU.

I welcome my right hon. Friend’s update and the tone and manner in which she is representing the UK during these negotiations. Although no deal is obviously better than a bad deal, does she agree that given reports that the German Foreign Ministry is preparing a draft trade accord and the Swedish National Board of Trade is drawing up trade plans, there are grounds for optimism that a mutually beneficial trade agreement can be struck that honours the instruction from the British people last year?

I absolutely agree with my hon. Friend that there are grounds for optimism that we will be able to move on to those detailed trade negotiations and get that good trade deal. As her question illustrated, it is precisely because this matters to others in the EU, not just to us, that it is in both sides’ interests to have that trade deal.

With a third of the designated negotiating time already passed, is it not clear that the EU holds the best cards? Would it not be far wiser for the British Government to perform a tactical retreat and base their position on permanent status within the customs union and the single market, instead of accelerating towards an uncertain destiny that costs jobs and further squeezes living standards?

The British people voted to leave the EU and that is what we will be doing, and that means we will no longer be full members of the customs union or the single market. We should be optimistic, however, about the opportunities that will be open to the UK, as a sovereign nation, not just from a good trade with the EU but in negotiating trade deals around the world.

Does the Prime Minister believe that there are still too many refuseniks on the Opposition Benches who find it impossible to come to terms with the result of the referendum, that by their antics they undermine not just the Government’s bargaining position but their own constituents’ verdict, and that the image of some of them crossing the channel recently, paying homage to the Commission, holding a bowl of British taxpayers’ money, like some Oliver Twist in reverse, saying, “Please sir, can we give you more?”, was not just absurd but a slight to the British taxpayer?

I agree with my hon. Friend. I am afraid that all we hear from the Opposition Benches are speeches and questions and, indeed, votes that are intended to thwart the will of the British people. What British taxpayers want is for the Government to get on with the job, which is exactly what we are doing. What they do not want is an Opposition who say to the European Union, “Just tell us the bill, and we will pay whatever it is.”

Tom Brake.

Thank you, Mr Speaker. I thought that that might be the timing.

When is the Prime Minister going to face down the ideologues in her party—on her Back Benches, and, indeed, in her Cabinet—who, from the safety of their stately homes and their châteaux, their trust funds and their inherited wealth, clamour for a no deal that they know would do huge damage to the “just about managing”, leave the UK weaker, and make our position in the world much smaller? When is she going to stand up for remain voters, and, indeed, for the leave voters who do not want the economic catastrophe that the Eurosceptic obsessives on her Benches wish to inflict on us?

I will tell the right hon. Gentleman who I am standing up for. I am standing up for the British people who voted that we should leave the European Union—unlike the Liberal Democrats, who want to tell the British people that they got the answer wrong. They did not. We gave them the choice, they voted, and we will deliver what they voted for.

Over the weekend, television broadcasters and newspapers have repeatedly used a photograph in which the German Chancellor and the French President are covering their mouths. Viewers of “Match of the Day” will be familiar with that pose, which is usually adopted by managers and coaches on the bench when they do not want the opposition to see their change of tactics. Does my right hon. Friend detect a change of tactics among our European colleagues, and does she think that they have ruled out victory, fear defeat, or are playing for a score draw?

I do think—this was clear from some of the comments from other European leaders which I quoted earlier—that the speech that I gave in Florence has brought about a change in momentum, and has been a spur to the negotiations and the progress that was made at the European Council. However, I could not possibly comment on what Chancellor Merkel and President Macron were saying when they were talking to me in that manner.

Today the North West British Leadership Team warned about the consequences of Brexit for jobs in the region, particularly manufacturing jobs. Is the Prime Minister withholding information about the risks posed to manufacturing by a bad Brexit, or, indeed, any Brexit?

As I have said, what I see is optimism about the trade deal that we can secure for the future with the European Union and about the trade deals that we can negotiate around the rest of the world, but also optimism about what we can do here in the UK, through our modern industrial strategy, to ensure that this is a country that works for everyone, that we see jobs being created in the north-west and in other parts of our country, and that we see those jobs—yes, in manufacturing, but also, crucially, in sectors of the future, such as artificial intelligence and driverless cars.

I welcome the Prime Minister’s positive approach, and the news that we are within touching distance of a deal, because that is in everyone’s best interests. However, in preparing for all eventualities, would the Prime Minister be willing to reinstate the seasonal agricultural workers scheme? Businesses in my constituency are keen to plan ahead for all eventualities.

I was Home Secretary when the scheme ended, and at that stage the Migration Advisory Committee made it clear that it felt it was not necessary to reintroduce it, at least for a period of time. However, the current Home Secretary has asked the committee to look into immigration needs throughout the UK economy. I am sure that that will include consideration of the sector that my hon. Friend has spoken about, and of whether or not a seasonal agricultural workers scheme is necessary.

I wonder whether the Prime Minister heard the Foreign Secretary’s attempt to be helpful this morning, following the European Council, by quoting Shakespeare, including the lines:

“There is a tide in the affairs of men,

Which taken at the flood, leads on to fortune.”

Those lines, from “Julius Caesar”, were uttered by Brutus, who went on to stab his leader and came to a sticky end himself. Is that not a perfect metaphor for the Prime Minister’s predicament?

I always welcome the literary and classical references that my right hon. Friend the Foreign Secretary brings to bear in his speeches and statements, and he and I are both working to ensure we get the right deal for the United Kingdom when we leave.

I, too, was listening to the Foreign Secretary’s speech, and I was heartened by his remarks on Korea. I thank my right hon. Friend the Prime Minister for her update on those discussions at the European Council; does she agree that, as we leave the EU, it is more important than ever that we reassure our important friends and allies in that region, such as Japan and the Philippines, that our support for them remains undimmed, and, indeed, is stronger than ever?

I am very happy to give my hon. Friend that reassurance. Indeed, I spoke to Prime Minister Shinzo Abe this morning to congratulate him on his victory, but also to reinforce the fact that we in the United Kingdom want to build on and enhance our relationship with Japan. We will continue to work with it and other international partners to ensure we get the right result by stopping the Democratic People’s Republic of Korea’s illegal activities, but we also want a stronger defence and trade relationship with Japan in the future.

On European security, in the week when Hillary Clinton reminded us of how pleased the Russians are about Brexit and instability across Europe, was there a discussion in the Council about the part Russia plays in Europe and the security of our nation going forward?

As I said in response to the right hon. Member for Exeter (Mr Bradshaw) earlier, Russia was not a subject on the agenda of this European Council, but it has been on previous Council agendas. The hon. Gentleman talks about disruption across Europe; of course, the Russians have indulged in disruptive activity—not just the illegal annexation of Crimea, but also the actions it has taken to interfere in democratic elections in a number of countries. This is a subject that I am sure the Council will return to.

My right hon. Friend has outlined the progress being made in the negotiations. That is particularly important in terms of exports by the services sector, which accounts for 80% of our economy. The sector has no protection under WTO rules; what assessment has been made of the impact of no deal on the services sector?

As I said earlier, we are obviously looking across all parts of our economy in the work we are doing for the future. My hon. Friend is right to raise the issue of the services sector, as it is very important for the UK, and it is one of the key issues we will be focusing on in the trade negotiations for the future. We have always been very clear that this is about both goods and services, and we want to retain both the value of our services sector and the world leadership that we have in many aspects of it.

The Brexit Secretary rightly says that it is useful to be able to know that, when Barnier speaks, he does so on behalf of a unified EU27 in terms of the negotiations. If Barnier wants to know the unified position of the UK Government, whom should he speak to?

The hon. Gentleman knows very well that that is in the Florence speech.

I thank my right hon. Friend for her statement and warmly welcome the progress she has outlined towards the deal that both we and our European partners require. I also welcome the statement about EU citizens. I note that my right hon. Friend says in her statement that “there are a small number of issues that remain outstanding”. What progress might be made in front of the December Council on those matters, because resolution of that would represent a real Christmas present for many EU citizens in my constituency and elsewhere?

I think both sides see the possible options for moving to that agreement, and I hope we can make rapid progress on that over the coming weeks leading up to the December Council.

The best contribution to the negotiations that the Government can make is the Prime Minister having a deep and special relationship with her fellow Cabinet members. If we are within touching distance of a common agreement, as she has said several times, it is surprising that there are so many different positions coming from her Cabinet colleagues so close to the recent summit. Can she get a grip of her Government, because that would be the most significant contribution to our negotiating position?

I used the phrase that we were within touching distance of a deal in relation to the citizens’ rights issue, and I have just indicated in response to my hon. Friend the Member for Wimbledon (Stephen Hammond) that there are a number of issues still on the table, but I think we can see where we can go to ensure that we get that deal and that agreement. The Government are very clear on the position we have taken into the negotiations. I set it out in the Florence speech, and that is setting that vision for the future deep and special partnership. It is that vision that the European Union is now responding to.

I welcome the conclusions about the need to have a fair and effective tax system in which all companies across Europe pay their share of taxes. Did the Prime Minister have the chance to urge the EU to follow the progress we have made on more transparency for international companies, and will she commit to extending that to overseas owners of UK properties?

My hon. Friend raises an interesting point. We have made clear to the European Union the work that the UK has done on this in the past. There was a particular discussion on this issue in relation to the digital market, and also a recognition in the European Union, given what we have always said and the efforts that we have made in the past, that this is an issue that has to be looked at on a global scale and not just within the European Union.

Surely the Prime Minister must recognise the concerns of business leaders about the lack of progress on at least a transitional deal, given that they are having to make decisions about investment and jobs in this country over the next 18 months to two years. What message does she think it sends to the people who create jobs and wealth in this country when her Cabinet is completely split over whether there should be a no deal cliff-edge scenario?

The Government are working to ensure that we get the best possible deal for the United Kingdom. That is where our efforts are being focused, and that is what we will continue to do. I set out the implementation period in my Florence speech, and, as I indicated earlier, this issue was alluded to by the European Council and by the Commission in the April guidelines. This is a matter on which I believe we can make progress because it is in both sides’ interests.

I thank the Prime Minister for her statement, for the constructive progress that has been made, and in particular for her reference in her reply to my hon. Friend the Member for Sandbach to the importance of financial services—[Interruption.] I am sorry, I meant my hon. Friend the Member for Eddisbury (Antoinette Sandbach). Eddisbury is remarkably close to Sandbach. I speak of course as a lowly West Ham supporter, Mr Speaker.

Will the Prime Minister bear in mind the important contribution that our Crown territory of Gibraltar makes to financial services? It strongly complements the City of London. Its Chief Minister is in London today, as she will know, and we will be celebrating the links later. Will she ensure that Gibraltar’s interests are firmly taken on board in relation to financial services, professional services and the operation of a free-flowing border as we go forward in the negotiations?

Yes, I am happy to give my hon. Friend that assurance. We have been clear that we have been keeping the Gibraltar Government in touch with the work that we have been doing, and we continue to work with them. We will continue to assure them that we will take their interests into account at every stage.

I call Mr Alan Brown.

Thank you, Mr Speaker—[Laughter.]

Was it something I said? Let us hear the hon. Gentleman.

Thank you, Mr Speaker. A week after the universal credit debacle, the Prime Minister has the cheek to come to the Chamber and tell us that she is determined to put people first. The reality is that we are 16 months down the line and there is as yet no agreement on settled status for EU nationals. Given that that is a No. 1 priority, this does not bode well for the rest of the negotiations that we are trusting her with. However, if we are within touching distance of an agreement on settled status, what plans does she have for being able to process up to 3 million applications?

That is a matter for the Home Office, which is putting the necessary arrangements in place. We have set out very clearly what we believe the arrangements in relation to settled status for EU citizens here in the United Kingdom must be, but in putting people first, we must not just put EU citizens in the UK first; we must also put UK citizens in the rest of the European Union first. That is why it is necessary for us to ensure that their rights are also being guaranteed.

The Prime Minister will have seen the recent EEF survey of companies’ future investment plans. Does she agree that it underlines how important it is for business that we get on to discussing trade arrangements at the earliest opportunity?

I absolutely agree with my hon. Friend. That was why I set out in my Florence speech what our future trade relationship could be like. That has elicited a response from the EU27, and they are now preparing for negotiations on that relationship.

May I just say what fine fettle the Prime Minister appears to be in, given the German media reports at the weekend suggesting that she was the opposite? Something must have been lost in translation. Anyway, does she share the concern of my constituents who work in the City of London at the declaration of the CEO of Goldman Sachs that he will be spending a lot more time in Frankfurt after all this? Similar musings have come out of J. P. Morgan and Morgan Stanley. What is the Prime Minister doing to stem the brain drain and corporate exodus that faces our great capital?

Of course we want to ensure that the City of London retains its place as the world’s leading financial centre. That has been reconfirmed recently. I say to those who think that the City of London will be damaged by our leaving the European Union that the very reasons why the City is so important in an international financial sense are the very reasons why it is important for the City to retain that financial services provision for the rest of the EU as well.

Page 7 of the Europe Council conclusions refers to

“combating terrorism and online crime”

and

“readiness to support appropriate measures at EU level”.

Germany is introducing legislation to have extremist material taken down within 24 hours. Is that something that the United Kingdom will be doing and urging other European countries to do? We are all in it together to defeat these poisonous ideologies.

The taking down of material is very important, as my hon. Friend says, and through the Counter Terrorism Internet Referral Unit we have been taking down significant amounts of material. My right hon. Friend the Home Secretary is working with the tech industry and with internet service providers, and they have established a global forum. We want to ensure that this material is taken down not within 24 hours, but within one or two hours. That is what we are working towards with the industry.

Did the Prime Minister have a chance over dinner with Michel Barnier to discuss the fact that he is soon to meet leaders of the UK’s core cities to discuss the Brexit negotiations? Does she welcome the fact that he is willing to meet the representatives of 19 million people? Is it not rather rude of the Brexit Secretary not to be prepared to do so himself?

I have to say to the hon. Lady that I am aware that Michel Barnier is meeting a number of people here in the United Kingdom and elsewhere around Europe to discuss the issues, but the Brexit Secretary has indeed put in place arrangements for meeting the metro mayors to ensure that the interests of the people they represent are taken into account.

Businesses on Teesside will give a warm welcome to the Prime Minister’s announcement that we are closer than ever to a deal, which is obviously great news as it is important that we get a deal as quickly as possible. However, does the Prime Minister agree with me and with so many of my constituents that Labour’s position that no deal is not an option represents not so much negotiation as capitulation?

I absolutely agree with my hon. Friend. It is important that it is clear when we go into the negotiations that we want to get a good deal that is the best deal for both sides. However, if it is necessary—as I have said before—no deal is better than a bad deal.

The EU citizens I have spoken to since they received the Prime Minister’s email a week or two ago have taken no reassurance whatsoever from it. Does the Prime Minister accept that when she appears to make concessions to EU nationals, what matters is not how loudly her Back Benchers cheer, but how reassured those 3 million people actually feel? At the moment, they are not reassured at all by her email.

I recognise that we want to ensure that we get to an arrangement with the EU through which we are able to guarantee the rights of the EU citizens living here in the UK. I want them to stay. I value the contribution that they have made. I recognise that they will want reassurance, which is precisely why I indicated the various issues that I did in the email and the article that I wrote about their future here in the UK. However, we also want to ensure that the rights of UK citizens living in the EU are guaranteed as well. I am sure that the hon. Gentleman, as a Member of Parliament in the United Kingdom, would want to give reassurance to UK citizens living elsewhere in Europe.

I congratulate the Prime Minister on taking the talks on citizens’ rights so close to within touching distance of a deal.

The logic of an implementation period partly implies time to prepare for our future trading relationships with Europe and elsewhere. Will my right hon. Friend confirm that, during the implementation period, we will be able to negotiate both the cloning of existing EU free trade agreements and any new arrangements with other countries so that as many as possible become effective on day one after the end of the implementation period?

I thank my hon. Friend for raising an important point. It is indeed our intention to be able to ensure that during the implementation period we are able to conduct negotiations so that, when we reach the end state of our future partnership, we can open those trade arrangements with other nations around the world.

There are two sets of documents that it would be helpful if the Prime Minister released to the House while we consider the European Union (Withdrawal) Bill. Is she willing to release the impact studies showing how Brexit will impact across Departments and across the UK, and also the legal advice on the powers that the House will assume for the devolved Administrations, many of which feel the House has no responsibility for subjects that are within their purview? Will she release those documents, please?

The hon. Lady talks about devolution and the arrangements with the devolved Administrations. We have been very clear about the issue, and we want to ensure that, when the powers that are currently with Brussels are brought back to the UK, we have a discussion and negotiation about those areas where we need to ensure we have UK frameworks in place. Her party’s Front Benchers suggest that, in fact, the powers should be devolved immediately to Northern Ireland—when there is an Executive—Scotland and Wales. Of course, that could lead to the break-up of the UK internal market, which is of most importance to those devolved Administrations.

I know at first hand that the EU citizens in my constituency of Redditch welcome the Prime Minister’s commitments and remarks. I am delighted that she has made a practical statement on the cost of settled status being no greater than the cost of a British passport, which is welcome. Will she also consider the documents needed for a person to apply for settled status? The process could be difficult for someone who has migrated to this country, and addressing that will give them reassurance.

My hon. Friend raises an important practical point, and I know that a number of EU citizens are concerned about the process of applying for settled status, and about how bureaucratic it will be. That is why the Home Office is working to make the process as light touch and streamlined as possible, so that people can be reassured that this will not be a difficult process.

The Prime Minister has stated her intention to create a new partnership with the European Union after Brexit that is built on shared fundamental values such as democracy, the rule of law, free trade, rigorous and fair competition, strong consumer rights and high regulatory standards, but does she agree that the hard-won and hard-fought-for workers’ rights that we have built within the European Union are also critical to those shared fundamental values and that we should uphold those rights after Brexit?

I have been clear that this Government want not only to maintain workers’ rights but to enhance workers’ rights. I am very surprised that the hon. Gentleman should ask that question, given that the Labour party voted against the very European Union (Withdrawal) Bill that will bring workers’ rights under EU law into UK law.

One of the first things I learned about contract law at law school is that an agreement cannot be agreed that creates an obligation to enter a future agreement when its terms are not known at the time the first agreement is signed. Does my right hon. Friend the Prime Minister agree that it is legally ridiculous and a terrible negotiating position to try to amend the European Union (Withdrawal) Bill to make no deal a legal impossibility and to force us to have an implementation agreement on a deal whose contents we do not know?

I bow to my hon. Friend’s legal knowledge on this issue, but I think he is absolutely right. As my right hon. Friend the Member for Chingford and Woodford Green (Mr Duncan Smith) indicated, the issue of an implementation period is about practical arrangements to reach the future partnership, and you do not know what those practical arrangements are until you know what that future partnership is.

Last week, two significant announcements were made. First, we heard from Peugeot Citroën that it preferred to reduce the number of jobs here in the UK and maintain its investment and job levels in mainland Europe. We also heard from Lloyd Blankfein, who announced that he, like many other business leaders, would be spending more time in Europe. Do those two announcements concern the Prime Minister?

We are of course working with business to ensure that we can get the right arrangement for our future trade relationship and for the implementation period, to give business the certainty it has asked for. But I am optimistic, not just about that trade relationship, but about the other trade agreements we can negotiate around the world. I am also optimistic about the opportunities for the economy and for firms here in the United Kingdom, not least because of the modern industrial strategy that this Government are putting in place.

There is a lot of talk of deals and no deals. Is it not a crucial distinction that the Prime Minister has shown total commitment to a deal on Northern Ireland, on citizens’ rights, on security and on a host of other issues, but where she is rightly sceptical is on whether a punishment deal is better than no deal on trade?

My hon. Friend is absolutely right, and this is where the Labour party gets it absolutely wrong; it thinks it should be signing up to any deal, across the whole board, regardless of the price and regardless of the conditions applied by the European Union.

Was the Prime Minister able to share any of the perspectives of the devolved Administrations with the other Governments at the summit, particularly the concerns around the European Union (Withdrawal) Bill? Given that the Secretary of State for Scotland has promised a powers “bonanza” for Holyrood, I wonder whether she could name today just one power that will definitely be devolved to Holyrood after Brexit.

Don’t worry, we will be making it clear where we expect further devolution to take place. The hon. Gentleman asks whether I discussed the European Union (Withdrawal) Bill with the European Council, and I have to say that that Bill is a matter for this Parliament and it is this Parliament that will decide on it.

I congratulate my right hon. Friend on her excellent statement. Does she agree that money invested in contingency planning and being ready on day one is money well invested, as an insurance policy, in giving us a stronger hand in the negotiations and as no-regrets investment in our world-class customs systems, our world-class border system and resilient roads that do not need to have the kind of gridlock that the Labour party hopes for?

I absolutely agree with my hon. Friend, and in fact some of the work being done on contingency arrangements will apply regardless of the nature of the outcome, whether there is a deal or not a deal.

I was disappointed with the European Council, as on this occasion it did not find the time to discuss the ongoing appalling situation in Venezuela. Does my right hon. Friend believe that this was to spare the blushes of the Leader of the Opposition, who, apparently, was in town working with the EU to undermine the UK’s negotiating position?

That may well indeed have been the case. I know the Leader of the Opposition was in town at the time, and of course what he was doing was basically saying to the European Union that he would be willing to take any deal, at any price. That is not the position of this Government.

I am starting to think it is the Christmas cards I am sending, Mr Speaker. You know how to give me a complex. Having relegated EU nationals to spectator status in this entire debate—

The Prime Minister shakes her head but she voted to exclude them from the referendum. Does she not think it is at best a tad gauche, if not outright rude, to charge them 70-odd quid in order to settle a status that they had no hand in establishing in the first place?

As part of the negotiations, we will be ensuring that we get those guarantees for EU citizens here in the UK and putting into place here in the UK the arrangements necessary to ensure that they are able to get that settled status, because we value the contribution they have made here in the UK.

Does the Prime Minister share my view that one factor that may well have contributed to the progress recently made was the fact that the EU has come to understand that the UK is not afraid of a no-deal outcome? Does this show why, in order to continue progress and focus minds, no deal has to stay on the table?

My hon. Friend is right. We are of course working to get a deal and to get the best deal for the United Kingdom, but we have to be very clear that we are prepared to say that no deal is an option if we are not able to get that good deal for the UK.

Thank you for calling me Mr Speaker—you have saved me a trip to the gym today.

Does the Prime Minister agree that in order to better represent the interests of EU citizens, the EU negotiators could benefit from a remedial course in economics so that they understand the difference between a £70 billion surplus and a £70 billion deficit? They seem to be getting it the wrong way around at the moment.

My hon. Friend makes an important point that just emphasises how the deal we are working towards is going to be to the benefit of the EU as well as the UK.

I warmly welcome the Prime Minister’s statement. In contrast to Scottish National party Members, I also warmly welcome her comments on and commitment to EU citizens, her commitment to putting people first and her open letter last week. I urge her to continue that work, because this issue is important not only to EU citizens but to UK citizens who live and work in the EU.

My hon. Friend is absolutely right. I was clear from the start that we needed to make that one of the early agreements we came to. It was part of the first stage of the negotiations and, as I say, we are within touching distance of a deal. It is important not just to EU citizens here but to UK citizens who have made their home elsewhere in the European Union.