Brexit customs row: Greg Clark suggests thousands of jobs at risk without close ties

Posted On: 
6th May 2018

Business Secretary Greg Clark has suggested that thousands of manufacturing jobs could be put at risk if the UK does not "minimise friction" in its trade with the EU after Brexit, amid a Conservative row over the UK's future customs ties.

Mr Clark warned against adding new barriers to trade for the motor industry, amid a Cabinet row over the UK's future EU customs ties
Credit: 
PA Images

The Cabinet minister said that while it was “absolutely right” that the UK should leave the customs union, he warned that the deal that replaced it would be of "huge importance" - and he confirmed that a controversial plan for a post-Brexit 'customs partnership' remains on the table.

The comments come amid a Cabinet row over the future trade arrangements between the UK and EU, with Mr Clark reportedly among those backing Number 10's preferred solution of a 'customs partnership' in the teeth of opposition from leading pro-Brexit figures.

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Eurosceptics in the party argue that the partnership option, which requires the UK to collect tariffs on behalf of Brussels, will hobble future trade deals with countries outside of the EU.

But the Business Secretary said that a failure to keep a frictionless border with the EU would hit firms like Toyota, who he said were already reviewing their business operations in Britain.

“They are making a big decision about where the next motor plant should be in Europe," he told the BBC's Andrew Marr Show.

“We have a very successful one in Deeside in North Wales, but there are choices as to whether that should be located on the continent. Between that plant and the plant in Burnaston in Derbyshire, there are 3,500 people employed.”

Mr Clark said the firm relied on deliveries arriving without any delay as part of its “just in time” manufacturing process, and said it was "crucial" that a smooth flow of goods was maintained post-Brexit.

He added: “What we’ve always said, what the Prime Minister said in the Lancaster House speech, what she said in the Mansion House speech, what we have said throughout to businesses is that we will have a customs agreement that has the minimum of friction. Now that is crucial.

"We’ve got three requirements for this new arrangement. We’ve got to minimise frictions at the border. It is also to make sure we can conclude free-trade agreements as a sovereign nation with other countries..and to ensure we avoid a hard border in Northern Ireland.

“This requirement to do what it takes to get the minimum of frictions is something that we have made a public commitment to, and we need to make sure that we get that right."

Mr Clark's comments earned the praise of former Home Secretary Amber Rudd, who tweeted following the exchange that the Business Secretary was backing a "Brexit that protects existing jobs and future investment.”

However, the comments earned a stinging rebuke from Tory arch-Brexiteer Jacob Rees-Mogg, who reignited claims of "project Fear" scaremongering.

The leader of the influential pro-Brexit European Research Group has previously branded the solution of a customs partnership "cretinous".

Pressed on Mr Clark's comments, he told ITV's Peston on Sunday: "We’ve had endless scare stories about project fear… 800,000 people were meant to lose their jobs according to the Treasury forecasts just on a vote to leave the European Union.

"Project fear has been so thoroughly discredited that you would have thought that it would come to an end by now. 

"We trade successfully all over the world, the delays on goods coming into Southampton are tiny and we will have control of goods coming in to this country, we will set our own, laws our own policies, our own regulations. And therefore we will determine how efficient the border is coming into us."

"CLEAR-EYED"

Mr Clark also dismissed reports that he had been close to tears during a crunch Cabinet meeting to discuss the future arrangements.

“I’ve never been so clear-eyed in my life about this, but I do feel very strongly," he said.

The frontbencher added: “It was a much more professional, collegiate discussion than you’d ever think from the reports about this. “

Business lobby group the CBI welcomed Mr Clark’s comments on customs ties, saying it was “time for pragmatic solutions, not ideology”.

CBI chief Carolyn Fairbairn said: “The single most important Brexit priority for British manufacturers is to protect frictionless trade with the EU. Hundreds of thousands of jobs across the UK depend on it.

“We therefore welcome the Secretary of State’s recognition that any customs solution must deliver this goal, with no tariffs or additional border checks, delays or red tape for EU/UK exports and imports, which account for nearly half of all UK trade."