Mutual recognition of professional qualifications and other crucial issues to the legal services sector have been overlooked in negotiations on a future trading relationship with the EU, a House of Lords committee warns today. Pointing out that the professional services sector contributes £225bn a year to the economy, the EU Services Sub Committee says the sector will suffer it its needs are not reflected in the Brexit deal.

The report appears in the run-up to Thursday's EU summit, where talks are likely to concentrate on the sticking points of state aid to businesses and fishing rights. The UK has set 15 October as the absolute deadline for reaching an agreement. 

However the Lords committee warns that mutual recognition of qualifications is one area where a bad deal could be worse than no deal. It said it supports the UK's position that mutual recognition should be the default position.

Committee chair Baroness Donaghy (the trade unionist Rita Donaghy), said: 'A free trade agreement on services is no silver bullet, but there are a number of areas that both sides need to get right to limit potential barriers to trade. It is essential that issues such as EU member state national reservations to the agreement, the mutual recognition of professional qualifications and business mobility are dealt with properly.'

John Gould, senior partner at top-100 firm Russell-Cooke, criticised the government's approach. 'Apart from a lack of focus and resource, the government’s difficulty is that it doesn’t seem to know what it wants. Does it continue close alignment with the prescriptive standards of the EU, does it align with a few compatible other countries or does it lower the requirements for recognition to the lowest common denominator as part of deals with the widest number of countries? Is it more interested in facilitating the movement of UK professionals abroad or regulating the inward flow? If you don’t know where to go, you tend to stand still.'