Nissan must have had 'very strong assurances' on the single market before making Sunderland decision, claims Tony Blair

Nissan must have been given "very strong assurances" on access to the single market before boosting its UK car production, former prime minister Tony Blair has insisted as the Government said it did not wave a chequebook at the giant multi-national.

Friday, 28th October 2016, 12:19 pm
Updated Monday, 31st October 2016, 8:52 am

With Labour demanding the Government comes clean on any "secret deal" with the car manufacturer, Ministers side-stepped reports Nissan was given written guarantees it would be compensated if the EU imposed a post-Brexit tariff barrier against British exports.

Mr Blair said he backed moves by the Government to keep investment in the UK.

"I know the leadership at Nissan, I'm absolutely sure they would not have made this commitment unless they received very strong assurances from the UK government. Now, if the UK government are giving those assurances, I welcome that.

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"I should imagine they gave strong assurances about the car industry's access to the single market. If this is an indication that the UK government are giving strong assurances about access to the single market, this would be important," he told BBC Radio Four's Today programme.

As controversy over allegations of a secret deal continued to swirl, Labour chairman of the Commons Business Committee Iain Wright insisted Business Secretary Greg Clark must appear before the watchdog to give evidence on the matter.

Mr Clark told BBC Question Time that no financial favours were offered, saying: "There's no chequebook. I don't have a chequebook.

"The important thing is that they know this is a country in which they can have confidence they can invest. That was the assurance and the understanding they had, and they have invested their money."

Mr Wright told the BBC: "On the one hand, it's taxpayers' money, and, I think, we would need to know. And, on the other, it could be commercial confidence as well. But, in terms of transparency, in respect of how government will intervene and provide that reassurance and support, I do think that's important."

The Japanese giant's decision to build its next-generation Qashqai, and add production of the new X-Trail model, at its Sunderland plant was seized on by Prime Minister Theresa May as proof that the UK was an attractive investment hub despite the flux caused by the Brexit vote.

When pressed on whether written assurances on compensation for any future EU tariffs had been given, Mr Clark told the BBC: "We have had, obviously, as you might imagine, lots of communication between us, but actually what it rests on is a very strong mutual confidence."

Colin Lawther, Nissan's senior vice president for manufacturing in Europe, denied there was a special deal for the company.

"No, there is no offer of exchange. It's just the commitment from the Government to work with the whole of the automotive industry to make sure that the whole automotive industry in the UK remains competitive," he told the programme.

Asked if Nissan had received written assurances from the Government on what would happen if tariffs were imposed in the future, he said: "There's nothing, there's no special deal for Nissan. We are working within the whole of the automotive industry. We would expect nothing for us that the rest of the industry wouldn't be able to have access to."

Shadow chancellor John McDonnell warned that "secret deals behind closed doors" would damage business confidence in the UK.

"It's utterly chaotic at the moment. We have got a situation where we get leaks and rumours. Are they now going to decide, literally, factory by factory the support they are going to give?"

Labour leader Jeremy Corbyn said: "It must be made public, because it is public money that will be used if there are any inducements that have been offered and, quite obviously, if you are offering big inducements to one industry or one manufacturer, then all the others will quite reasonably say 'Well, what about us?'"

Liberal Democrat leader Tim Farron welcomed the investment news but said it was "utterly ridiculous" that Mrs May was having to give "special assurances" to key manufacturers to deal with the "Brexit fallout her Government is creating".

Nissan boss Carlos Ghosn went to Downing Street earlier this month for crunch talks with the Prime Minister.

He said the manufacturer could make the production decision due to "support and assurances" from the Government.

Downing Street suggested written assurances were given to Nissan, telling a Westminster briefing that the Government and the car company had communicated in "all forms".

But a spokesman reiterated that there was "no compensation package" and "nothing about tariffs".

The spokesman said: "There's been communications in all forms.

"The dialogue between Nissan and the Government has obviously been going on for some period of time."

They added: "We've made it perfectly clear, Nissan have made it perfectly clear, there was no deal, there was no compensation package, there was nothing about tariffs.

"It was just a open and honest dialogue about what the Government sees in the future for the automotive industry of this country and what we are determined to do for that industry in terms of getting the best possible deal leaving the European Union."

Shadow Brexit secretary Sir Keir Starmer urged the Government to set out exactly what it told Nissan.

The Labour frontbencher said: "It's welcome that the Government have done a deal with Nissan that protects jobs and supports the local community and economy.

"But that deal needs to be accompanied by transparency and accountability.

"We can't have the Government doing deals that affect jobs and the future of our economy without telling the public or Parliament what the basic terms are.

"They now need to spell that out and strike a wider deal that gives certainty to businesses, workers and communities across the country."