Ms Katie Daughen:

In terms of the EU citizens' Single Market freedom of movement, what we are proposing would see the UK remove itself from the Single Market. That is not because we think it is the best for business. We think the absolute best outcome for business would be for the UK to remain in the Single Market and the customs union, but politically we do not believe that is achievable at present, which is why we are putting forward the best Plan B, which is what our big principles proposal really is.

We agree that the movement of people is by far the most politically sensitive issue within the UK. What we are proposing in terms of the customs arrangement largely relies on the trade of goods and we are seeing the UK can set its own migration policy within limits. We are also proposing that it be coupled with a comprehensive deal on services.

The more the UK wants to have alignment with the EU on services and trade into the EU, the more there will be conditions around that mainly to do with the movement of people. If one is selling a service into a different market, one needs to be able to travel there to sell that service. Likewise things such as the future Framework Programme 9 that will replace Horizon 2020 will also rely on whether the UK wants to remain party to the movement of academics and so on. It will be down to how much the UK wants access to services. If one looks at CETA, which is by far the most comprehensive deal the EU has signed with a non-European country, the trade and services covered in it are quite limited but it does allow for some procurement and investment and things like that which would allow people selling those services to travel. At the other end of the spectrum is the Deep and Comprehensive Free Trade Area, DCFTA, that the EU has with Georgia, the Republic of Moldova and Ukraine, that is done through the adoption of the EU acquis. There are models that are not fully reliant on the freedom of movement. We do not think the UK would probably get that, given that this is seen as more towards accession rather than leaving. There are models that can be worked with. From a business perspective there are labour needs in the UK that are currently being filled by EU citizens. I think Scotland, especially, has serious concerns because of the demographics around its workforce. We will advocate as this is such a strong issue and politically sensitive one.

The UK can have control over freedom of movement. Much of that will depend on what deal is struck on services as well. Outside that we will advocate strongly to the UK Government in its own domestic migration services to ensure that businesses that need access to labour get it. There are other ways around it, but we cannot ignore the fact that this is a hugely politically sensitive issue in the UK. That is why it is factored into our proposals.