UK-EU Common Understanding Negotiations

With permission, Madam Deputy Speaker, I would like to make a statement on the Government’s strategic partnership with the EU.

The Government were elected with a manifesto commitment to reset relations with our European partners; to tear down unnecessary barriers to trade and cut costs and red tape for British producers and retailers; to increase national security through strong borders and greater co-operation with our closest allies; and to support jobs here in the UK and opportunities abroad.

In May this year, the Government agreed a new strategic partnership with the EU, which the Prime Minister announced at the historic UK-EU summit—the first of its kind. It is a landmark deal that is good for bills, good for our borders and good for jobs. We took that decision, exercising our sovereignty, to strike a deal in the national interest. We had to fix a bad deal passed on to us by the previous Government—the first trade deal in history that made it harder to trade. Just as we have done with the US and India, this Labour Government are striking deals to bring down bills for British people and open new opportunities for British businesses.

Since that summit, I have led negotiations with the European Commission to implement the commitments we made. I am therefore pleased to inform the House that, earlier today, the UK and the European Commission concluded negotiations for the UK’s association to Erasmus+ from 2027. This will open up world-class opportunities for students, teachers, youth workers, sports sector professionals and communities of all ages in our education, training, sport and youth sectors—both for the professionals who work in those sectors and, crucially, for our young people.

For students, this means more chances to study, train, work or volunteer abroad, gaining language skills and experience that will make them attractive to employers; for our teachers, youth workers and those who work in the sports sector, it means greater opportunities for professional development; and for our schools, colleges, universities and providers, it means access to networks and partnerships that will drive quality, encourage research links, and enhance the reputation of the UK’s world-leading education system. This morning, I met students at New City College in Hackney to see the range of benefits there are going to be, including playing basketball.

As part of Erasmus+, participants can travel to any European Union member state, as well as to several countries outside the European Union. It will go further than schemes that have come before, offering a broader scope of activity and a specific focus on unlocking opportunities for all. It is an investment in opportunity for young people from all backgrounds, for our workforce, and for our future. It will open doors for tens of thousands more young people across the UK, renewing our ties with Europe and beyond. This Labour Government have always been clear that we want young people to have access to the best opportunities in life, no matter what their background or where in this country they live. That is what we have consistently delivered, and it is what we are delivering through today’s announcement.

We are pleased that the EU has agreed financial terms that represent a fair balance between the UK’s contribution and the benefits the programme offers. The 30% discount in 2027, compared with the default terms in the trade and co-operation agreement, has paved the way for UK participation in the programme.

We also agreed that there will be a review of the UK’s participation in the programme 10 months after our association, so that we can look at the actual data concerning the demand for funding in the UK. Going forward, any continued participation in Erasmus+ under the next multi-annual financial framework will be informed by that data and our experience of association in 2027. We have always said that we will not sign deals unless they are in the national interest, and in this case I am happy to say that the agreement passed that test.

The Government will now work to maximise take-up across all sectors so that the benefits of Erasmus+ association can be fully realised. We will work closely with institutions and our young people to support this, particularly among disadvantaged groups. A UK national agency will be appointed to administer the programme in due course.

In addition, I am pleased to inform the House that the UK and the European Commission have concluded exploratory talks on the UK’s participation in the EU’s internal electricity market. The details of this will be set out in an exchange of letters between me and Commissioner Maroš Šefčovič, to be published next week. Closer co-operation on electricity will bring real benefits to businesses and consumers across Europe. It will drive down energy costs and protect consumers against volatile fossil fuel markets. It will also drive up investment in the North sea and strengthen energy security. The UK and the EU will now proceed swiftly with negotiations on a UK-EU electricity agreement.

But that is not all. I welcome the clarification from the European Commission today that, in practice, there should be no carbon border adjustment mechanism costs levied on UK electricity exports—a welcome development that reflects our extensive use of renewables. Negotiations to link our carbon markets are also under way, which will cut costs, make it cheaper for UK companies to move to greener energy and, once agreed, save £7 billion-worth of UK goods exports from EU CBAM charges.

Negotiations on the food and drink agreement are also under way, which will enable food and agriculture businesses to trade more cheaply and easily by slashing the red tape and costly paperwork introduced by the last Government, which result in businesses facing £200 for export health certificates on every single shipment, or small businesses choosing not to trade with the EU altogether. Our new agreement will put this right, boosting our exports, cutting costs for importers, and bringing down prices on supermarket shelves.

The UK and the EU are committed to implementing the commitments of the May 2025 summit in a timely manner. We are working swiftly to conclude negotiations on the food and drink deal and on linking our carbon markets by the time of the next UK-EU summit in 2026. Across all these areas, the UK is clear that there will be no return to the single market, the customs union or freedom of movement. We will agree deals that are in our national interest. The Government are exercising our sovereignty to deliver for the British people.

We are committed to building this new strategic partnership with the European Union. Indeed, last week I spoke with my counterpart in the Commission, Maroš Šefčovič, and we underlined our shared commitment to implementing the common understanding that the Prime Minister and the Commission President agreed at the UK- EU summit in May. Whether it is through boosting opportunities for young people and educators across the country, cutting energy bills or agreeing a food and drink deal that slashes red tape and cuts costs, I will always negotiate in the interests of this country and our people.

I will continue to lead negotiations with the Commission. I look forward to the next annual UK-EU summit, where the Government will continue to build that new strategic partnership. That is what a grown-up, pragmatic relationship looks like. We work together under shared aims for mutually beneficial solutions to our shared problems. That is the approach the Government are taking and that is the approach that is delivering results. I commend this statement to the House.

I call the shadow Minister.

We on the Opposition side of the House recognise the importance of giving young people educational opportunities, but it is vital—[Interruption.] Government Members clearly do not recognise the need for schemes to offer genuine value for money. The UK already had the opportunity to remain a member of Erasmus, but it was precisely because the Conservative Government recognised that the scheme did not offer value for money to the taxpayer that we chose not to.

That is why the Conservative Government created the Turing scheme instead—a global programme for young people in the UK that did not require us, one-sidedly, to hand a blank cheque to Brussels. The Turing scheme delivered 43,000 placements around the world last year, 23,000 of which were to learners from disadvantaged backgrounds, at a cost of just over £100 million. Can the Minister confirm that his statement in no way undermines the future of the Turing scheme? Is that scheme guaranteed, or are those opportunities being sacrificed for a smaller number of opportunities available under Erasmus+?

The Minister has confirmed that the UK will pay £570 million to rejoin Erasmus+. We understand that will be paid from existing budgets, but can he tell us where the money is coming from? Is that £570 million being added to the £6 billion special educational needs and disabilities black hole that the Office for Budget Responsibility identified in the education budget? Does the Minister expect more students to take part in the new scheme than the 10,000 previous participants in Erasmus+, or are we paying £570 million for essentially 10,000 placements a year?

The Minister spoke about a fair contribution being a 30% discount. Of course, it is only a matter of weeks since the Government were briefing that a fair contribution would be a 50% discount. They clearly failed in those negotiations. Can the Minister assure us that while he says that he has a discount for the first year, a discount will be available in subsequent years? If those assurances have not yet been received and the EU does not offer a similar deal in future years, is he prepared to walk away?

If I have got this right, I chose not to sign up to participate in the SAFE—Security Action for Europe—fund because it did not represent value for money, and the Opposition are criticising me for that, but they are also criticising me for signing up to something that is value for money. Let me tell the hon. Gentleman about fish. A big advantage to our fishing sector, which exports 70% of its catch to the EU, is the food and drink agreement that I am going to secure by the time of the next UK-EU summit. That is what will benefit our fishers.

On the hon. Gentleman’s point about the Turing scheme, it is important that I say from the Dispatch Box that any person on the Turing scheme in this academic year will continue to be funded. I have to tell him, however, that his numbers are absolutely all over the place. First, the Erasmus+ scheme has changed significantly since the version that his Government walked away from. Furthermore, do we seriously think that that lot could have secured a 30% discount? Absolutely not.

The one figure that the hon. Gentleman did get right was 43,200, which is the number of people involved in the last year of the Turing scheme. Erasmus is a far bigger scheme. We will expect tens of thousands of young people—100,000-plus—and others to have opportunities from Erasmus. But let me tell the hon. Gentleman this as well: Erasmus is a great deal broader than the Turing scheme in terms of opportunities. The Turing scheme is about colleges, schools and universities. Erasmus+ presents wider opportunities, including youth work, sports and the ability of staff to have professional exchanges. Let me just say, before Conservative Members start talking about the fact that Turing is all around the world, that the grant-making bodies for Erasmus+ in the UK can still allocate 20% of the funding if they want to, if people want to go to other parts of the world as well. What this is doing is vastly increasing the opportunities not just for young people, but for adult learners. If the Conservative position is now to oppose a massive expansion in opportunities for young people, I will welcome that debate at the next election.

Young people have lost so much. The pandemic kept them in their homes when they should have been in the classroom, years of austerity under the Tories saw cuts in the services on which they rely, and a bad Brexit deal stopped the invaluable chance to study abroad in Europe. Rejoining Erasmus opens up real opportunities for young people to study, train and gain experience abroad. Will the Minister say more about how this experience can help young people to grow in confidence and get them work-ready?

My hon. Friend is quite right about the wonderful opportunities that this presents, and not just for self-confidence; the young people I spoke to only this morning at a further education college told me that going overseas had helped them to grow as people. However, the House should not just take my word for it: the Association of Colleges says that this is “brilliant news” for further education colleges. Universities UK says that it is

“fantastic news for the UK”.

The Russell Group of universities is “delighted” about this reassociation. But who is opposed to it? The Conservative party.

I call the Liberal Democrat spokesperson.

We welcome the Minister’s announcement. As a recovering academic—a distinction that I think I share with him—I have witnessed at first hand the impact of our exiting the Erasmus scheme on university student intake. Welcoming students from across the EU into our education institutions and giving our own students opportunities to study abroad have undeniably strengthened our education system, so after years of campaigning, the Liberal Democrats welcome the news that the UK is finally set to rejoin the Erasmus scheme in 2027. However—I am sure the Minister expected there to be a “however”—while this represents an important first step towards building a closer relationship with Europe, I urge him to go further and faster.

Beyond this fixed-term experience of Erasmus+, will the Government commit to a proper youth mobility scheme for the benefit of the next generation, and can he update the House on what progress has been made in such negotiations? How confident is he that our food, drink and sanitary and phytosanitary scheme will be agreed by 2026, and how long thereafter will it take to fully implement the scheme? Agrifood and horticultural businesses cannot afford any further delays.

Finally, on the subject of unnecessary barriers to trade—which is where the Minister began his statement—will his Department commit itself at the very least to conducting a transparent assessment of the potential economic growth benefits of a UK-EU customs deal of the kind that the House voted for last week?

We are aiming to conclude negotiations on the youth experience scheme by the next summit—which I see in the context of the 13 youth mobility schemes that already exist, many of them signed by the previous Government, although the Conservatives seem to have a collective amnesia about it nowadays—together with the linking of our emissions trading systems and the food and drink agreement. The hon. Gentleman asked me a direct question about the implementation of that agreement. I want to see it implemented by the first half of 2027, which will mean bringing a piece of legislation to Parliament in 2026 and then getting it through Parliament. I hope that, whatever our views may be, we will have support in doing that as quickly as possible in 2027.

Let me, for a moment, speak more broadly about Erasmus+—and, indeed, this applies to the youth experience scheme as well. I want both schemes to be open to people from all backgrounds across the United Kingdom. People often refer to Erasmus+ as a university exchange programme, and of course that is a vital part of it, but it is not just a university exchange programme; it is accessible across the country. I have been looking at, for example, the Welsh Government’s Taith programme, which has done an extremely good job with regard to accessibility. Where there is there are lessons to be learned from that, we will absolutely learn them.

Where I disagree with the hon. Gentleman is, of course, on the issue of the customs union, because the Government has only in recent days signed an additional free trade agreement with South Korea, and we also have the economic deal with the United States and the free trade deal with India. All those would have to be torn up if we went down the path that he has suggested.

I warmly welcome the announcement that the UK will rejoin Erasmus+. I had the opportunity to live and work in Europe as a young person aged 18, and it was an experience that has continued to benefit me throughout my life. I particularly welcome the extension of the scheme beyond study, and the Government’s desire to extend that opportunity to young people from all backgrounds. It is one of the very many detriments of Brexit that young people were denied the opportunity to live and work and study through the Erasmus scheme.

Having announced this welcome development, can the Minister confirm that he will now be turning his attention to some of the other detriments that continue to be experienced, particularly by small and medium-sized businesses in my constituency, as a consequence of the inability to trade in Europe because of barriers resulting from Brexit? Can he confirm that work is ongoing in that regard, and that all options that are in the national interest will remain on the table?

My hon. Friend is quite right. Tens of thousands more people, many of them young people, will benefit from the accession to Erasmus+, although I seriously think, on the basis of what the shadow Minister said, that the Conservatives will go into the next election opposing those additional opportunities for people. As for my hon. Friend’s second point about reducing trade barriers, since Brexit 16,000 businesses have stopped trading with the EU altogether, and as for the food and drink agreement, she can be assured that work is ongoing to seek to complete those negotiations by the time of the next summit.

I call the Chair of the Select Committee.

In his white shirt and red tie, the Minister is doing a very good impression of Santa making an early visit. The announcements that he has made this afternoon are—I think—to be warmly welcomed, and he is to be personally congratulated on the good faith and patience that he has shown in his conversations with Maroš Šefčovič and others. That is clearly paying dividends.

Does the Minister agree that those of us on the Opposition Benches who last week voted against the idiotic proposal from the Liberal Democrats for a customs union have been proved right and them wrong, because the evolution of the relationship within the guardrails of the existing arrangement are the way to go, preserving those new free trade deals and seeing them extended while encouraging businesses to trade with Europe?

Absolutely. As always, the hon. Gentleman has made a sensible, well-informed contribution, and I am grateful for his kind words and his personal congratulation, which is deeply appreciated. He is entirely right: there is a set of guardrails that constitute this Government’s democratic mandate not to rejoin the single market or the customs union, or to go back to freedom of movement. We are exercising that independent trade policy, as has been seen in recent days in respect of the deal with South Korea. Within that framework, today’s announcement shows that the negotiations are progressing and delivering tangible results for the British people.

Order. We have less than 45 minutes for this statement, so questions must be short.

I thank the Minister for his announcement on Erasmus+, which is hugely welcome news for students and for my youngest constituents in Stratford and Bow. Before I came to this place I worked with the Mayor of London in calling for an Erasmus scheme, and the UK-EU Parliamentary Partnership Assembly, of which I am a member, has called for it constantly, alongside our European partners. We want students to have the same chances of opportunity that we had, so that they do not suffer the consequences of a Brexit that they had no say in. Can the Minister outline the next steps in the UK’s participation?