Nissan was told the UK was seeking an EU deal that would mean no tariffs for car manufacturers and no bureaucratic impediments to trading, Greg Clark, the business secretary, has revealed.
Clark said he wrote to Nissan with a series of four assurances as he went “all out” to allay concerns about Brexit and convince the company to build its next two models in Sunderland.
The government has been under pressure for days to reveal what it promised Nissan to secure the investment and whether there would be any implications for taxpayers in future.
Three days after the deal was announced, Clark revealed on the BBC’s Andrew Marr Show he had told Nissan the government was confident of getting a deal that would mean the whole car industry remained competitive.
That suggests No 10 is seeking a free trade relationship similar to the single market and customs union. At the same time, Theresa May has said she wants greater immigration controls and freedom from the oversight of the European court of justice; a combination of aims that Brussels politicians have repeatedly said is unachievable.
Clark said: “Our intention, our negotiating remit, when it comes to the discussions with our European partners is to have a constructive dialogue and look for the common interest here. Our objective would be to ensure we have continued access to the markets in Europe and vice versa without tariffs and bureaucratic impediments, and that is how we will approach those negotiations.”
He suggested that this applied to the car industry in general, and possibly other major sectors of UK business.
The government repeatedly refused to confirm it had given Nissan any written guarantees last week, but Clark revealed on Sunday that he had sent the carmaker a letter containing four assurances. He said the promises included a continuation of funds for training and skills, regional relocation grants, scientific research and keeping the industry competitive at the point the UK leaves the EU.
On the promise relating to Brexit, he said the UK could not know the outcome of negotiations with the other 27 members but it was “very important that we make a commitment to keep competitive the UK industry” through the government’s industrial strategy. The business secretary said there was no specific promise to compensate Nissan or other carmakers if they did face tariffs because that would not be allowed under competition laws.
Clark’s interview immediately led to criticism that the government has been telling industry more about No 10’s negotiating aims that the UK electorate. Keir Starmer, Labour’s shadow Brexit secretary, told ITV’s Peston on Sunday that Nissan “has been told more about it than we have in parliament,” adding that the government had “got to come clean”.
The senior Labour MP also accused the prime minister of prioritising greater immigration controls over the health of the UK economy as she headed towards triggering Brexit early next year.
Starmer said the government still needed to disclose the terms of any deal struck with Nissan.
He said he intended to seek an urgent question in the Commons on Monday to try and compel ministers to reveal any guarantees that they may have given.
“There may be a financial element to it – I accept that. They say no money is changing hands,” he told Peston On Sunday.
“I don’t know. We need to know and I’m going to try and raise this in parliament … because something has been said.
“It’s good Nissan are investing, of course it’s good, but there are other businesses up and down the country of every size and every sort that need (reassurance).”
He added: “It’s not just this deal that we need to know about – it’s what happens to the other businesses. Businesses are talking to me all of the time and they are very worried about what happens to them.
“They want to trade on the same terms and if there is a deal that’s good enough for Nissan they are saying, and it’s quite understandable, ‘Well, we want broadly the same deal for us.’”
A key question for May will now be whether she is willing for the UK to continue paying into the EU budget in order to secure tariff-free trade without bureaucratic customs checks.
Nadhim Zahawi, a leading Brexit supporter and Conservative MP for Stratford-upon-Avon, wrote in the Mail on Sunday that paying a proportion of the UK’s annual £8.5bn would be worth it for favourable trading arrangements combined with freedom from the EU’s immigration rules and the jurisdiction of its courts.
“I was one of those who campaigned to leave, but the government should be absolutely clear that our motive is not for the European Union to fail – we just don’t think it is right for us,” he wrote.
“That is why we should pay a proportion of the £8.5bn that we will save through leaving back into its budget. We should help bridge some of the EU’s funding gap, but only on the condition that the EU delivers our demand of providing British businesses with tariff-free access to the single market.”
UK seeking tariff-free EU deal for carmakers, Nissan told – The Guardian