Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Bill [Lords]
Tuesday 19th March 2024
(9 months ago)
Commons ChamberTrade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Act 2024 View all Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Act 2024 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Consideration of Bill Amendments as at 19 March 2024 - large print - (19 Mar 2024)
16:56 - The House divided: - Ayes: 224 / Noes: 301 - Question accordingly negatived.
17:09 - The House divided: - Ayes: 217 / Noes: 305 - Question accordingly negatived.
17:21 - The House divided: - Ayes: 218 / Noes: 305 - Question accordingly negatived.
17:33 - The House divided: - Ayes: 219 / Noes: 306 - Question accordingly negatived.
Sir Iain Duncan Smith (Chingford and Woodford Green) (Con)
I beg to move, That the clause be read a Second time.
Madam Deputy Speaker (Dame Rosie Winterton)
With this it will be convenient to discuss the following:
New clause 2—Assessment of impact of CPTPP on deforestation and import of certain products—
“(1) The Secretary of State must lay before Parliament a report containing an assessment of the impact of the implementation of the CPTPP on—
(a) the volume of UK imports of palm oil;
(b) the volume of UK imports of tropical wood;
(c) the rate of deforestation in Asia;
(d) the UK’s ability to fulfil its obligations under—
(i) the United Nations Framework Convention on Climate Change; and
(ii) the United Nations Convention on Biological Diversity.
(2) A report under subsection (1) must be published no earlier than a year and no later than 18 months after the passing of this Act.”
New clause 3—Report on the impact and use of the Investor-State Dispute Settlement procedure—
“(1) The Secretary of State must, within six months of the passing of this Act, lay before Parliament a report on the impact of the implementation of the Investor-State Dispute Settlement aspect of the Investment Chapter of the CPTPP on the UK.
(2) A report prepared under subsection (1) must include—
(a) analysis of the likely use of the Investor-State Dispute Settlement procedure in relation to the UK, and the likely impact of such on the UK;
(b) details of discussions held with other signatories to the CPTPP regarding the use of the Investor-State Dispute Settlement procedure in relation to the UK; and
(c) discussions held with, or agreements made with, other signatories to the CPTPP regarding the exclusion or exemption of the UK from any use of the Investor-State Dispute Settlement procedure.”
New clause 4—Report: accession of new states to the CPTPP—
“(1) Before any decision is made by the Government on the accession of a new state to CPTPP under Chapter 30 of the CPTPP, the Secretary of State must publish a report assessing the potential benefits and impact of the accession of that candidate state on the United Kingdom.
(2) Both Houses of Parliament must be presented with a motion for resolution on the report under subsection (1).”
New clause 5—Review: Investor-State Dispute Settlement—
“The Secretary of State must lay before Parliament a review of the financial risk of the implementation of the Investor-State Dispute Settlement aspect of the Investment Chapter of the CPTPP, not more than 18 months after the day on which this Act is passed.”
New clause 6—Impact assessment: environmental standards etc—
“(1) The Secretary of State must lay before each House of Parliament an assessment of the impact of the implementation of the procurement Chapters of the CPTPP on—
(a) environmental standards,
(b) food standards, and
(c) animal welfare standards.
(2) An impact assessment under subsection (1) must be published not less than two years, but not more than three years, after the day on which this Act is passed and every two years thereafter.”
New clause 7—Report on business impact of CPTPP—
“The Secretary of State must, within six months of the passing of this Act, publish a plan outlining the steps being taken to—
(a) measure the impact on UK businesses of the implementation of the CPTPP; and
(b) support UK businesses to benefit from the UK's membership of the CPTPP.”
New clause 8—Impact assessment: labour standards—
“(1) The Secretary of State must lay before Parliament an assessment of the impact of the implementation of the CPTPP Labour Chapter not more than eighteen months after the day on which this Act is passed and every 18 months thereafter.
(2) The impact assessment under subsection (1) must include an assessment of—
(a) the impact on the Government’s commitments to the conventions of the International Labour Organisation;
(b) steps that have been taken to ensure adherence to the conventions of the International Labour Organisation in CPTPP partner countries; and
(c) how the experience and impact of implementation might inform negotiation of future trade agreements.”
New clause 9—Comparative analysis of impact on UK businesses—
“(1) Within three months of the passing of this Act, the Secretary of State must lay before each House of Parliament a report on the impact of the implementation of the CPTPP on the matters listed in subsection (3).
(2) The report must include an analysis comparing the respective situation for each of the matters listed in subsection (3) prior to the implementation of the CPTPP with the situation post the implementation of the CPTPP.
(3) The issues which must be included in the comparative analysis contained in the report laid under subsection (1) are—
(a) tariffs paid by UK businesses to bring in or remove items from the UK;
(b) costs of non-tariff border control measures paid by UK businesses to bring in or remove items from the UK;
(c) inflation in the UK;
(d) the extent of alignment of regulations relevant to UK businesses;
(e) the ability of UK businesses to trade with the EU;
(f) the implications for UK businesses of introducing new trade and climate regulations, including for carbon pricing;
(g) tariff and non-tariff costs facing businesses trading with the EU; and
(h) trade volumes for UK businesses trading with the EU.
(4) Within 10 days of a report being laid under subsection (1) the Government must schedule a debate on the findings of the report in each House.”
New clause 10—Report on economic impact of implementation of CPTPP—
“(1) The Secretary of State must, within six months of the passing of this Act, publish a report on the economic impact of the implementation of the CPTPP.
(2) A report published under subsection (1) must include an analysis comparing the respective situation for each of the matters listed in subsection (3) prior to the implementation of the CPTPP with the situation post the implementation of the CPTPP.
(3) The matters which must be included in the comparative analysis contained in the report laid under subsection (1) are—
(a) the UK’s trade in goods;
(b) the UK’s trade in services; and
(c) UK GDP.”
This new clause would require the Government to publish a comparative analysis of the impact of the implementation of the CPTPP on UK trade and GDP.
New clause 11—Impact assessment: new states acceding to the CPTPP—
“(1) The Secretary of State must prepare and publish a report assessing the impact of the accession of new states to the CPTPP on the United Kingdom.
(2) In respect of states that have submitted a request to the Depositary of the CPTPP to join the CPTPP since 2019, the Secretary of State must lay a report before both Houses of Parliament within three months of this Act coming into force.
(3) In respect of states submitting a request to the Depository of the CPTPP to join the CPTPP following the enactment of this Act, the Secretary of State must lay a report before both Houses of Parliament within three months of a request being made.”
This new clause would require the Secretary of State to provide an impact assessment on the accession of countries that have made and will make a formal request to join the CPTPP.
New clause 12—Impact assessment: UK performers’ rights—
“(1) The Secretary of State must publish an assessment of the impact of the implementation of performers' rights provisions in the CPTPP.
(2) The impact assessment under subsection (1) must include—
(a) consideration of the impact of performers' rights provisions on qualifying individuals in the UK;
(b) an assessment of the reciprocity of rights across qualifying countries;
(c) consultation with such persons as the Secretary of State considers appropriate.”
This new clause would mean the Government must publish an assessment of the impact the performers’ rights provisions in the CPTPP will have on qualifying individuals in the UK.
New clause 13—Review of regulatory impact of implementation of the CPTPP treaty on UK businesses—
“(1) The Secretary of State must, within one year of the passing of this Act, lay before Parliament a report on the regulatory impact of the implementation of the CPTPP treaty on costs to exporting and importing businesses in the UK.
(2) A report under subsection (1) must take account of the existing levels of costs to exporting and importing businesses arising from trade regulations.”
This new clause would require the Government to report on the impact of implementation of the CPTPP treaty on the costs to businesses in the UK. The report would need to take the existing trade costs facing such businesses into account.
Amendment 2, in clause 2, page 2, line 2, at end insert—
“(5) Regulations under subsection (1) may not be made before Government has moved a substantive motion to resolve that the UK Accession Protocol should not be ratified.”
Amendment 1, in clause 5, page 6, line 36, at end insert—
“(7A) The Secretary of State must, after a period of three years from the passing of this Act, lay a report before Parliament containing an assessment of the impact of changes made in this section.”
Sir Iain Duncan Smith
It is a pleasure to speak to new clause 1, which is signed by a cross-party group of MPs who all believe that Parliament should have the right to scrutinise trade deals. It seeks to ensure appropriate parliamentary scrutiny of the UK’s position toward the accession of economies that are designated—that word is very specific—as “threats” or “systemic challenges”. It would achieve two things. First, the Government would be required to produce a report assessing the impact of the economy’s accession on the UK, and both Houses of Parliament would have a non-binding vote on the UK’s position regarding the accession of the economy in question. In other words, we would take the temperature of Parliament’s view, even if it disagreed with the Government. That is important, because the public need to know about it, so we should not be frightened of this.
Anthony Mangnall (Totnes) (Con)
I thank my right hon. Friend for introducing the new clause. Some of us have been arguing for parliamentary scrutiny of trade deals for the last four years. There is a mechanism in the form of the Constitutional Reform and Governance Act 2010. Is that not the better vehicle, because it has already passed? It also offers a vote, theoretically, for us to be able to scrutinise our trade deals.
Sir Iain Duncan Smith
I will come to that in a minute, because it does not, and that is the whole point of the new clause. In the 2023 integrated review refresh, the countries defined as threats were Russia, Iran and North Korea, while China was designated a systemic challenge. The new clause does not directly mention China, but of the eligible countries under the current integrated review, China is the only economy that has applied to join. In fact it is theoretically next on the list to go into the comprehensive and progressive agreement for trans-pacific partnership.
Mark Garnier (Wyre Forest) (Con)
I completely understand the point my right hon. Friend is trying to make, but one of the interesting things about being a member of CPTPP is that countries then have a power of veto. That gives us quite a lot of strength to potentially prevent China from joining.
Sir Iain Duncan Smith
I enjoy the idea that my hon. Friend puts such trust in Government never to take other arrangements into consideration. We know how that works. It will be fine today with my right hon. Friend the Minister here, but there may be others in charge in future, and I am not sure I would always want to rest my defence in Ministers.
Liam Byrne (Birmingham, Hodge Hill) (Lab)
I am grateful to the right hon. Gentleman for giving way and for this new clause. Was he as surprised as I was that when we asked the Secretary of State whether she would block China’s accession to CPTPP she was unable to give us an unequivocal answer?
Sir Iain Duncan Smith
I think the right hon. Gentleman makes my point. I sat in Government and all I can say to him is that one cannot always say that Ministers will necessarily do the right thing; rather, they will do the right thing by the Government, which is sometimes not the same. I do not mean to cast aspersions on my party’s Government by any means, but that has happened in the past. I simply want to make the point that China’s potential accession has huge implications for all sorts of things, including because of its immense economic and political influence in the region and the pressures on the UK if we were almost isolated in our observations.
China is not a likeminded party—there may be other countries that are rather similar. It openly seeks to revise the liberal, open and rules-based order and establish itself as a regional hegemon. If admitted, it would be the largest economy and dominant economic and trading partner in the CPTPP, with unrivalled political influence. It could block a future US entry. As we join it is important for us to make way for the US and bring it in, which will help in a whole range of areas. China’s accession would help to cement Beijing’s desired leadership in global trade. I will remind the House that China is next up for the CPTPP, so this is not something conjured up.
China’s entry also risks further increasing economic dependence on it, which is already too high, and building resilience into the Chinese economy to weather sanctioning should tensions over Taiwan escalate, which they almost certainly will. That would run counter to the UK’s strategic efforts to de-risk and maintain the status quo in the region. Serious human rights abuses are and continue to be embedded within Chinese supply chains. China is the most egregious offender in this regard, with its actions on religion in Xinjiang and in Tibet, where slave labour is also practised. Slave labour undercuts the World Trade Organisation and normal trade. Those are good commercial reasons why the membership of any country with the views China happens to have would have a real impact.
China’s accession is unlikely to drive economic reform in the country. There is no political ability to drive such reform under President Xi, who has moved China further away from the spirit of the CPTPP on labour rights protections.
Daniel Kawczynski (Shrewsbury and Atcham) (Con)
I have just returned from leading a parliamentary delegation to Lithuania, where my right hon. Friend was talked about by many Lithuanian politicians. They mentioned the leading role he is taking in warning western democracies about the conduct of the Chinese Communist Government. Does my right hon. Friend agree that Lithuania is a very interesting case for us to study, so that we can perhaps learn from how a European country confronts and takes on the increasingly nefarious conduct of the Chinese Communist party?
Sir Iain Duncan Smith
It is always kind to be referred to in another country, which leads me to wonder whether I should stand there. [Interruption.] I need no encouragement from those on the Opposition Benches, thank you very much. My hon. Friend is quite right; Lithuania is a tiny country, but rather bravely it has recognised Taiwan and it has come under the cosh from China as a result. I thank him for that intervention.
As I said, this is not a pipe dream. China applied to join the CPTPP on 16 September 2021, and is next in line. It is widely reported that Beijing is already lobbying hard for membership, and that countries previously opposed have softened their line. Australia has done so because it has had trade problems, as we know. All that is required for Chinese accession is for other members to permit it. The current labour regulations would seem to preclude China’s accession, but the risk is there and we should not take it.
An actor-agnostic approach—linking to the integrated review rather than naming any specific actor—would also enable the Government to create a threshold that is reflexive to developments rather than static. That would means that a report, debate and vote would be required only where the integrated review had designated specific economies as threats or systematic challenges. The language in the review is weak in its own right, but none the less it is there.
I want to deal with the CRaG process quickly. The new clause is in line with the Government policy, but exposes a loophole in the CRaG process. There is currently no provision for a debate and non-binding vote on future accession to plurilateral trade agreements. The process would not require the Government to produce an impact report on China’s accession to the CPTPP, nor would it provide for a parliamentary debate or vote. Given the long-term significance to the UK of being in a plurilateral trade agreement where the biggest partner is China, it is appropriate for Parliament to be furnished with an up-to-date, accurate report, and to have the opportunity to consider the matter—after all, there is no other reason why we are here if not to discuss such important matters.
Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)
The right hon. Gentleman makes a good point about some of the weaknesses of CRaG and the need to strengthen it, particularly when there are accessions or other material changes to a treaty to which we are a member. The Public Administration and Constitutional Affairs Committee, which I sit on, has published a report that outlines some of the changes to the way that the Government operate under CRaG. Does the right hon. Gentleman agree that we need to change it so that significant changes to treaties and accessions should always automatically be subject to a report and potential vote in this House? Otherwise, we will sign ourselves up to things without knowing what will happen further along the line.
Sir Iain Duncan Smith
I agree. I was not so certain about this, so I looked at what Lord Lisvane, the one-time chief Clerk in the House, said about it. He produced a note on it, which I quote:
“The issue, as I recall, was whether a Motion to approve the PRC’s accession could be amended. Commons S.O. No 24B says that when a Motion in neutral terms (in the judgement of the Chair) is tabled, no amendments to it may be tabled. I think this would probably rule out seeking to amend a simple ‘take note’ or ‘has considered’ Motion.”
I want to emphasise that it is not true that a motion to take note can be amended—that was used in the other place as a defence. The CRaG process does not provide for a vote; it does not even guarantee a debate. That is why the new clause is needed.
Under UK trade policy, it is not unusual for bilateral trade agreements to be subject to parliamentary approval—free trade agreements are routinely subject to it. In response to criticism of the CRaG process in 2021, the Grimstone rule was established, whereby the Government agreed in principle to allow time to debate prospective FTAs where the International Agreements Committee has published a report. I happen to believe that there are Ministers who are keen and happy to have debates—I mention no names, but that is the case. However, I know that the Foreign, Commonwealth and Development Office absolutely opposes them, because it hates to have any serious debates about its prerogative.
John McDonnell (Hayes and Harlington) (Lab)
I am pleased that the right hon. Gentleman is keen on debates. On that basis, I invite him to sign my prayer against this treaty, to urge the Government to give us a debate on the treaty as a whole.
Sir Iain Duncan Smith
I ask the right hon. Gentleman not to tempt me beyond my new clause. I always happy to look at this issue, and I believe in debate. It is vital, otherwise Governments are never held to account.
Daniel Kawczynski
My right hon. Friend is highlighting the various concerns about China’s conduct and why it should not join the CPTPP. Does he agree that the conduct of the Chinese Government in the South China sea—a waterway through which 60% of the world’s trade passes—where it has stolen hundreds of atolls from Vietnam, Philippines, Malaysia, Indonesia and others, is also a cause for concern?
Sir Iain Duncan Smith
It is, although I cannot follow my hon. Friend through Lithuania and the atolls of the far east, because I would be ruled out of order by the Chair. I hope he will forgive me, but he makes a strong point.
I say gently to the Opposition spokesperson, the hon. Member for Harrow West (Gareth Thomas), that it was a Labour Member, Lord Leong, who tabled the amendment in Committee in the Lords. Labour said that it would whip for the amendment if it were reworked to not mention China. Strangely, the new clause does not mention China, so I would have hoped that Labour would support it, but it does not. I understand that Labour has tabled its own new clause.
Parliament should be able to make its voice heard on a matter of such national significance. The new clause does not overturn constitutional conventions by a long way. Having a report, a debate and a non-binding vote would not determine Government policy, but it would determine the House’s view on the elements of this particular trade deal. I note that Opposition new clause 4 also seeks to look at this, but there are other issues that I will not bring up now.
There are elements in the Government who believe that debate is not a bad thing, because it allows them to make their case for why such a trade deal is important. I urge the Government to be positive about this, because being positive about debate in the House of Commons is a restatement of democracy. It allows people to decide whether they agree. More importantly, this is about accession. If those who follow us in seeking to join the treaty are defined as a threat, as they are in the review, that will at least inform the Government. It will also allow the House to pressure the Government over its real concern about what they might be doing. In future, a Government from either side of the House or of whatever form may choose, under pressure from China over economic issues, to let it accede to the treaty. Who knows? I do not say that that is the mood, but it is for Back Benchers to make their point about what the Government should do and for them to take note. In that regard, I commend my new clause to the House.
Liam Byrne
It is a pleasure to follow the right hon. Member for Chingford and Woodford Green (Sir Iain Duncan Smith). I will speak in support of new clause 1, which he tabled, as well as the new clauses tabled in the names of my right hon. and hon. Friends.
I welcome this debate and the new clauses and amendments that have been tabled, but I lament the fact that we have not been permitted a full debate on the treaty—something the right hon. Gentleman argued for very eloquently. We needed a debate today not merely on the three chapters of the CPTPP covered by the Bill, but on the full 30 chapters of the treaty, with all the associated annexes and bits of analysis and argument.
I do not want to detain the House for very long, because the Business and Trade Committee went to the length of writing and publishing a report earlier this year. However, I want to underline the point about the lack of scrutiny. Of course, it was the Government themselves, in the Grimstone rule, who said that no new free trade agreements would be ratified by His Majesty’s Government without a full debate on whether we should agree to them. When I asked the Secretary of State on 23 January whether she would agree to a debate under the terms of the CRaG process, she said she would be “happy to support” such a debate. Her officials then wrote to the Clerks on the Select Committee to say that such a debate had been requested, only to be told by the Leader of the House that no time was available. The Leader of the House confirmed that in writing to me last week in a letter in which she said:
“it has not been possible to find time for a debate in Government time.”
The House of Lords is having a debate on the treaty today on the recommendation of the International Agreements Committee, so why can’t we? Are we second-class representatives in this House? Are we unqualified to have a debate on all 30 chapters of the treaty? Are we not qualified to speak, on behalf of the people we came into public life to represent, about how the treaty will affect their future? I think we are. I think we should have a debate on the full treaty.
And I cannot believe that we are out of time. Members will have seen the report in the Financial Times last week, which said that the working day in this Chamber
“has been shorter on average this parliamentary session than in any other in the past quarter century”.
Are we seriously saying that we have not been able to find time for a debate, which it is the Government’s policy to support, on one of the only free trade agreements that His Majesty’s Government have been able to bring forward since we left the European Union?
On Twitter, the Minister—I am a keen follower of the Minister on Twitter, he will be pleased to hear—said last week that there have been four parliamentary debates on the treaty, but I wonder if he is sure about that. When I asked the Clerks on the Select Committee to check that, they were left scratching their heads a little bit. They could not find all four that the Minister referred to. We have to accept that there is no shortage of controversy in the Bill, not least because the Secretary of State herself resiled from the figures that describe the benefits of the treaty to the country.
Anthony Mangnall
I thank the Chair of the Select Committee for giving way. It is a pleasure to serve on the Committee with him. I thought I might just throw a bone in the form of cross-party support on this point. Having a debate is not just about pointing out controversies; it is about having the opportunity to justify and debate things about which our constituents care. These trade deals make a difference not only to the businesses, but to the services and agriculture sectors in our respective constituencies. That is why it is damaging not to have a debate: it fails to allow us the opportunity to persuade people that trade deals can be a force for good.
Liam Byrne
The hon. Gentleman is absolutely right and I commend his contribution both to the Committee and to the report that we published on the CPTPP earlier this year.
There are a number of important new clauses and amendments not only about the future expansion plans of the CPTPP and what our policy on those might look like, but also, in the names of my right hon. and hon. Friends, about investor-state dispute settlement. This is important because in all the fanfare, arguments and passionate bits of literature and speeches offered by the Government about the virtues of the treaty, it was always positioned as a gateway to the fastest-growing economy on Earth that will represent a significant fraction of economic growth in the future. Of course, what was often missing from those eloquent descriptions was a recognition that the countries in the CPTPP represent only about a fifth, at best, of the Indo-Pacific region.
We are surely right to worry that there could well be a Government drive to expand the orbit of the treaty to a much wider group of nations. If the Government really want to take aim at the biggest economies on Earth, they may well encourage China to join. However, when I asked the Secretary of State whether it was her policy to agree to or block China’s accession, she said that that was not something we could discuss on the Floor of the House or in the Select Committee. That is why safeguards are needed. We might even be so bold as to merely ask for a little bit of clarity on the Government’s future strategy. That is why the amendments on the future pathway of the treaty are so important and why I hope we will have a vote on some aspect of that today, even if it is not on the new clause tabled by the right hon. Member for Chingford and Woodford Green.
I will talk briefly about new clause 3, which relates to ISDS. It is important, because His Majesty’s Government have agreed side letters with a number of countries to take us out of the ISDS process. That is not an exemption or safeguard that we saw when it came to agreeing to the treaty, yet the treaty includes countries such as Canada—I think we are just about on fraternal terms with Canada at the moment; we may have failed to agree an FTA with it, but quite why is a matter of some dispute between the Canadian Government and the Secretary of State. Canada is home to some of the biggest pension fund investors on the planet and we know that those funds are especially litigious. Although the Minister was right, when he answered these questions in earlier conversations, to say we have never lost an ISDS case, the reality is that many fear there will be a chilling effect on the regulations we bring forward because of a fear of the peril of ISDS procedures.
Lloyd Russell-Moyle
My right hon. Friend is speaking very well on some of the new clauses I have tabled on ISDS. It is of course true that getting the side letters for all member states was good enough for New Zealand, so it was protected more—not fully protected, I grant him. If it was good enough for New Zealand, it should have been good enough for us. Is it not a sign that Ministers have lacked ambition, or is it a sign of complacency?
Liam Byrne
My hon. Friend is absolutely right. Perhaps it is because we did not want to overly annoy the Canadians, but the truth is that the talks with the Canadians have broken down—at a cost, by the way, to the UK automotive industry. In fact, UK cars will be hit on average by a £3,000 tariff in about a month or two, because of the breakdown of those talks. It is important for us to have a vote on why we do not have those procedures, why we do not have those safeguards and why we do not have those side letters.
Finally, I want to underline the point made by the right hon. Member for Chingford and Woodford Green. As a House, we must become far more skilled, far more ready and far more adroit at debating the kinds of treaties we will be asked to sign. Once upon a time, when the Berlin wall came down, we promised ourselves that we could look forward to a new world of free trade, and we hoped that that free trade could bring political progress and a democratic process—Wandel durch Handel, as the Germans liked to say.
However, that reality is now smashed; that era ended with the second invasion of Ukraine. We are now in new times, when we have to debate not just military security but economic security, and economic security questions are always freighted with dilemmas. We are a small nation and our adversaries are big, so we must always act with our allies, but not all our allies are good, and many of our friends would prefer not to pick a side. Our adversaries plan for self-sufficiency, but we cannot. We prefer open, free trade, but global supply chains are risky. We like markets to decide, but security always requires state action. We know that we need to work proactively to shape the long term, but democracies frequently entail a short-term change of Government, and too often our politics is reactive.
Sir Liam Fox (North Somerset) (Con)
It is always a pleasure to follow the right hon. Member for Birmingham, Hodge Hill (Liam Byrne).
I rise to echo the comments made so eloquently and clearly by my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith), and to add just a few comments of my own. I have always been in favour of the CPTPP, and, as I said from the Front Bench in 2019,
“It is absolutely essential, particularly given the rise of protectionism globally, that we commit ourselves to a rules-based system based on the WTO. Of course, we have abilities to augment that by other regional relationships, which is why we have had the public consultation and the debate in Parliament about the potential accession to the CPTPP”.—[Official Report, 6 June 2019; Vol. 661, c. 250.]
I have also always believed that the benefits of the CPTPP have been at least as much about geopolitics as about simple import and export numbers. As the Royal United Services Institute put it,
“Joining the CPTPP provides the UK with not just economic benefits, but the means to help define and defend a rules-based order in the face of China’s diplomatic and economic heft.”
At a time of tense relations between China and the United States, the United Kingdom has joined a trade agreement in which neither is present, although the United States was instrumental in its creation—a point to which I shall return later.
The March 2023 integrated review refresh describes the Indo-Pacific as
“critical to the UK’s economy, security and our interest in an open and stable international order. Developments there will have disproportionate influence on the global economy, supply chains”
—that was mentioned by the right hon. Member for Birmingham, Hodge Hill—
“strategic stability and norms of state behaviour.”
The CPTPP, in turn, is about a contribution to the stability of the global trade and investment system.
Within that debate, what do we perceive China’s security threat to the UK to be? In their reply to a report from the Intelligence and Security Committee, in a section entitled “The Strategic Context”, the Government stated:
“China almost certainly maintains the largest state intelligence apparatus in the world. The nature and scale of the Chinese Intelligence Services are—like many aspects of China’s government—hard to grasp for the outsider, due to the size of the bureaucracy, the blurring of lines of accountability between party and state officials, a partially decentralised system, and a lack of verifiable information.”
They also stated:
“The Chinese Intelligence Services target the UK and its overseas interests prolifically and aggressively. While they seek to obtain classified information, they are willing to utilise intelligence officers and agents to collect open source information indiscriminately—given the vast resources at their disposal…To compound the problem, it is not just the Chinese Intelligence Services: the Chinese Communist Party co-opts every state institution, company and citizen. This ‘whole-of-state’ approach means China can aggressively target the UK”
—and UK interests, wherever those interests are globally. Sadly, we have discovered that to our cost in many of our governmental institutions here.
The question, given all that, is this: could China actually be admitted to the CPTPP, and if it is theoretically possible, how likely is it? I think it instructive to look first at the experience of the World Trade Organisation, a brief that my right hon. Friend the Minister and I shared over several years of my extremely enjoyable time working with him at the Department for International Trade. When China acceded to the WTO in 2001, the west saw it as promising and promoting economic and political reform. It was a time of great optimism that the Chinese communist system could be pulled in a direction that would be advantageous to, and in the interests of, the west. However, Jiang Zemin, the Chinese leader at the time, claimed that the motive of the United States in all this was to
“westernise and divide socialist countries”.
Thus the WTO itself was heading for a stalemate in its direction of travel almost from the point at which China acceded to it.
This has added to other WTO problems—and I mention that because we need to look at the CPTPP within the wider trading framework. The WTO’s problems have been compounded by its adoption of the concept of unanimity, while its rules talk about consensus. If consensus and unanimity meant the same thing, there would not be two different words for it in the founding documents. This has meant that virtually any country in the WTO now exercises a right of veto, which has prevented us from moving forward in what we perceived to be a process of genuine liberalisation of global trade.
Sir Iain Duncan Smith
I apologise for interrupting my right hon. Friend’s excellent speech. The key was, we were told at the time, that the move would change China, and that persuaded the Government, but what we have found is that China is now changing the terms of the debate, because it has not changed at all—it has got worse. Is that not a very good reason why we need to debate these issues whenever we can?
Sir Liam Fox
My right hon. Friend is entirely right. As I observed at the time, President Clinton took the view that the treaty was the best hope that the west had of pulling China into a much more market-orientated, rules-based economy, where we could gain the benefits of a more liberal, global economy, but that is not how it turned out. We have had only one multilateral treaty since the WTO was created, the 2017 trade facilitation agreement.
There is a hierarchy of agreements that we can secure in terms of liberalisation. A multilateral agreement is the best, but given the effective veto that countries have, that is unlikely, and it is very unlikely to give us the benefits that we would like to see, especially the liberalisation of trade in services. The next best is a plurilateral agreement, the next best after that is a regional agreement, and then we are down to what some people would unkindly describe as the bargain basement of bilateral FTAs. All those are useful in creating a more liberal global trading environment. However, if China were to seek to join the CPTPP, it would need to commit itself to liberalisation in line with CPTPP requirements, which would require a reduced role for the Chinese state. If anyone who keeps an eye on current affairs thinks that the Chinese state is tending in the direction of a smaller influence, they are watching different news outlets from the ones that I am watching.
China could, of course, seek a bespoke agreement to join the CPTPP, but the UK has already set the precedent by joining on current terms. Even if China could join the CPTPP, could it be trusted to meet any of the conditions of accession? Although Chinese leaders have declared their willingness to meet the conditions, many countries are extremely sceptical, given China’s behaviour as a WTO member. China has a poor record when it comes to complying with WTO rules and observing the fundamental principles of non-discrimination, openness, reciprocity, fairness and transparency on which the WTO agreements are based. China’s subsidies over capacity, intellectual property theft and protectionist non-market policies exacerbate distortions in the global economy, and—even more worryingly—China’s use of trade as a tool of coercive diplomacy has raised concerns further, especially given its behaviour towards Australia and Japan. This is not the sort of partner we should be wishing to join us in the CPTPP, unless there are previously unimagined changes in behaviour.
Finally, a word, if I may, beyond this Chamber to our US colleagues: I believe that the decision to leave the CPTPP by the United States was a mistake. It removed from United States policymakers a tool in its strategic ability to shape events in the region. UK accession provides an opportunity for the United States to seek to join this new grouping and gain greater direct influence over China trade relations with the fastest growing economic zone in the world. These are all reasons why we must keep a very close eye on what happens with China and our new membership of the CPTPP. We have gained a great deal; we cannot afford to have it thrown away, by ourselves or by others.
Damien Egan (Kingswood) (Lab)
It is with great pleasure that I rise to give my maiden speech as we speak to this Bill, which aims to boost international trade and economic growth. Stimulating growth and trade is vital to my constituents in Kingswood, as it creates new jobs and is ultimately about how we fund our public services.
As is traditional in a maiden speech, I would like to pay tribute to my predecessor, Chris Skidmore. I learnt during the campaign that there was a reason why Chris’s votes would go up every time he stood for election. Throughout the by-election campaign, people talked very warmly about Chris; he was described as being “a good man” and someone driven by values—a double-edged sword, some might say—but perhaps most importantly as someone who cared. I heard about some really complicated pieces of casework, where Chris had personally given a lot of his time to get people the help they needed, so I would like to place on record my thanks to Chris for his 14 years of service to the people of Kingswood.
Kingswood had four MPs before Chris. Roger Berry was a tireless campaigner—in fact, he still is—for disability rights. He brought forward the Civil Rights (Disabled Persons) Bill in 1993, which galvanised support for future legislation that made discrimination against disabled people illegal. Kingswood’s three other MPs were Rob Hayward, Jack Aspinwall and Terry Walker. On my second day here, when I got into my office, the first letter I received was from Terry Walker. If you are listening, Terry, thank you.
I have been asked by some Members, “So where exactly is Kingswood?” Kingswood lies on the eastern side of Bristol, and I would say that more people than not would say that they live in Bristol. It is a suburban collection of towns and villages that stretches from the edge of the city and extends into beautiful countryside.
Kingswood has an interesting story. In medieval times it served as a royal hunting ground: quite literally, the King’s wood. In the 18th century it was a thriving home for workers from nearby coalmines, and it was at that time that John Wesley was encouraged to deliver his very first outdoor sermons—in Kingswood. I must be one of thousands of children over the years who at primary school was taken to the site of those sermons, Hanham Mount, where today a spiring green beacon illuminates the spot where Wesley once preached.
In the early 20th century, Kingswood hosted the largest motorbike factory in the world, the Douglas motorbike factory, where 25,000 motorbikes were made to support the military in world war one. In one of those quirky bits of history—this did catch me out in a radio interview—legend has it that Kingswood hosted an elephant burial when Nancy, who was part of a travelling menagerie, died of yew leaf poisoning. I am told that archaeologists are investigating.
Being elected in a by-election towards the end of a Parliament does focus the mind; you have to think about making your moments count. Indeed, Rishi could still call a surprise election tomorrow! So I thought, Mr Speaker, that as well as giving you a little bit of information about Kingswood itself, I would also share what the people of Kingswood told me during the campaign, which I hope includes issues that are pertinent to all Members, whichever party in this Chamber they represent.
Several hon. Members rose—
Anthony Mangnall
It is a privilege to follow the hon. Member for Kingswood (Damien Egan), and may I congratulate him on his maiden speech? It is somewhat frustrating, as one of the younger Members on the Conservative side of the House, to find new Members turning up who look fresher, healthier and readier for the fight. He also managed to unify the House when talking about potholes; I do not think he will find any disagreement on that subject. He comes to this place with a huge amount of experience, not just from fighting other seats, but having been Mayor of Lewisham, where he did extraordinary work on community land trusts that Members from across the House have commented on and would like to follow in our constituencies. I am sure that his family are somewhere in the Gallery and will be proud of his maiden speech. He has done very well.
I would like to make a few remarks about CPTPP, the tongue-twister that seems to have made many Members of this place fall sideways. We should start by recognising what the United Kingdom has managed to do over the last four years. We have recognised the global ambition of fulfilling our trade objectives. We have succeeded in joining CPTTP, but we have also secured deals with Japan, Australia, New Zealand, Norway, Iceland and Liechtenstein, as well as joining the Singapore digital partnership. I spend my life repeating the fact that we have made those deals; it is important that we recognise their true value, not just to GDP, but to businesses, the economy, the environment and business people across the United Kingdom and, indeed, the world. It shows that we are determined to fulfil our promise and commitment to sign deals to bolster our position in the world. Of course, negotiations are also under way with the Gulf Co-operation Council, Israel and others.
In joining CPTTP, we are signing a deal with the fastest-growing region in the world. Now that we have tariff-free trade relations, the UK is set to increase trade with the countries in CPTTP by £37 billion by 2030. It is a market worth £110 billion to UK trade. With growth at 8% between 2016 and 2019, UK membership is only expected to boost that figure. Conservative figures—I say “conservative” because I feel that they are underestimates—suggest that there will be a £1.8 billion increase to GDP and an £800 million boost to take-home pay for workers. Additionally, estimates are that trade with the 11 members will increase by an average of 65%, with the west midlands, Scotland and Northern Ireland benefiting most, so I look forward to hearing the SNP’s point of view, and whether it will support the Bill.
As has already been mentioned, the point of this deal is that it allows us to have tariff-free trade in goods. CPTPP has new product regulations, expands our role and opportunities for services, and ensures mobility for business people. Digital trade will be enhanced and intellectual property enshrined, with benchmarks created by the United Kingdom, and the CPTPP has sustainability at its core. However, I would like to focus my remarks on new clauses 1 and 4.
It has been my cause, war or campaign—however one wants to phrase it—over the last four years that Parliament should do better on our trade agreements. We should spend more time scrutinising and debating them. It is always a source of frustration that when we have debates on trade, so few people show up. The ability of this House to explain the value of a trade deal to our constituents, to justify its economic value and to talk about the potential security risk is diminished when we do not have opportunities on the Floor of the House to discuss the merits or demerits of any trade agreement.
I disagree with new clauses 1 and 4 not because I am being belligerent, or because the Whips have me under the cosh, but because we need to focus on reforming the Constitutional Reform and Governance Act 2010. Parliament cannot opine on every single international treaty. My right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith) made a point about whether accession to CPTTP should be debated on the Floor of the House. There could be no limit to that, but he did not explain—I will let him intervene if he wants to—how he would get around the royal prerogative issue; international trade agreements are not in the hands of Parliament, but in the hands of Government Ministers. That was not considered in his remarks.
Sir Iain Duncan Smith
I agree. I could have taken this even further, but my point is that the Foreign Office dislikes any idea of debate and discussion. However, we have a Trade Department, which needs to be imbued with the power to ensure that debate happens. I am completely in favour of just punching through the nonsense and the poor use of the prerogative.
Anthony Mangnall
I understand that, but I feel that punching through on this occasion would be the wrong approach. I agree with my right hon. Friend that the Foreign Office’s appetite for us debating these issues in this place should not matter one jot, because it is our right as parliamentarians to discuss free trade agreements and whether they work. Respectfully, I say that the mechanism for ensuring that we get better trade agreements, and can be reassured about their economic value and benefits to the British people and our national security, has to be achieved by upgrading the Constitutional Reform and Governance Act.
The hon. Member for Brighton, Kemptown (Lloyd Russell-Moyle) made an excellent point when he referred to the Public Administration and Constitutional Affairs Committee report’s recommendation on enshrining a methodology to ensure that CRaG operates within 21 sitting days, and that a meaningful vote is held at the end of that period. If that were ever to take place, it would be meaningful, because it would delay the signing of any free trade agreement by 21 days.
Lloyd Russell-Moyle
The hon. Gentleman makes a very good point about the need to change CRaG; we mentioned that need in our report. Our report made it clear that a lot of changes do not necessarily need legislation, but they do need a change of approach from the Government. There should be a clear commitment made at the Dispatch Box that debates will always be called when there is significant interest in a subject, and particularly when there are commitments around new accession. If the Government made those commitments, it would be enough, but they are still not forthcoming. Does the hon. Gentleman agree that the Minister should stand at the Dispatch Box today and give those commitments, so that we can move forward with some certainty?
Anthony Mangnall
The hon. Gentleman and I served for a long time on the International Trade Committee, as it was previously known, and I should start my response to him by paying enormous credit to the Secretary of State, who came in front of the Committee a number of times, and who wrote to the Leader of the House to ask for time to debate CPTTP within the CRaG period. I am afraid that my ire and irritation at our not having secured that time must now be focused on the Leader of the House, but the hon. Gentleman is right to say there are simple steps that we can take to make sure that this House is properly briefed on these issues. One of them—I absolutely declare my interest—would be to give Privy Counsellor status to members of the Business and Trade Committee. I do not think anyone would disagree with that suggestion. It would certainly be a very popular move, and when it has been mentioned in the Committee, it has been welcomed with open arms. I am glad that it has the approval of the House. But, in all seriousness, there has to be a set process and the CRaG mechanism allows us that opportunity if done properly. It is there and it must be reformed, regardless of who is in government. It is in the interests of the entire House to amend and implement CRaG.
Sir Iain Duncan Smith
I fully agree with my hon. Friend’s wider purpose, but I come back to the point that Lord Lisvane made very clearly, which is that we still do not have the ability to debate the entry of a security risk country. He pointed out that CRaG does not do that because of its nature. I agree with my hon. Friend’s wider point that CRaG must be reformed, but we have a Bill going through the House at the moment and this is a better time to at least get a foothold in that debate rather than say that we will do it another time.
Anthony Mangnall
I really do accept the point that my right hon. Friend makes—how could I disagree when he is making that absolutely essential argument on national security. But what he is asking for might be viewed in very different terms by the other 11 members of the CPTPP. There are standards to join the CPTPP in the first place that would prevent China from joining unless it improved its act. He has talked about the lessening of appetites in places such as Australia for China to join. I am not sure whether that is the case, but there is a standard within the CPTPP that would prevent China from joining, and as my hon. Friend the Member for Wyre Forest (Mark Garnier) has already remarked, we have a veto in this instance. I think this is more about ensuring that we have a debate and a vote in this place on the values of a trade agreement. If we are worried about a new accession to the CPTPP, it is for us to make that case to the Secretaries of State in the Foreign Office and the Department for Business and Trade, and for them to go back to the other 11 countries and make the case in that way.
Lloyd Russell-Moyle
I welcome almost everything that the hon. Gentleman—my hon. Friend—is saying, he and I having worked together a lot on this issue, but the reality is that other countries in the CPTPP have arrangements that allow their Parliaments to have deliberations on significant treaty changes and on the incoming of new members. We are talking not about the CPTPP arrangements but about our arrangements for authorising our Government to go ahead and agree. Surely he must agree that it would not undermine the CPTPP if we were to make our own arrangements on how we were to instruct our Government.
Anthony Mangnall
Forgive me if it sounds trite to say that I worry about mission creep, but if we did that on this, might we not also do it for the World Health Organisation, or for any other body that might be under suspicion of having some adverse state actor involved in it? I worry about how we go about this. I worry about Parliament always trying to have a say and slowing the process of how our trade agreements are signed and ratified. We need to be efficient and quick in the way we do it, but we must also ensure that we have the opportunity for debate, as we have today in this debate on the merits of the three chapters in the Bill.
I want to end with a parting shot. As has been mentioned by the Chair of the Business and Trade Committee, the right hon. Member for Birmingham, Hodge Hill (Liam Byrne), we were told that we would have the opportunity to debate the full 30 chapters of the CPTPP within CRaG, and it is disappointing that we do not have that. The Government—the Secretary of State and the Minister—have done an amazing job in engaging with the Committee, but this is a serious disappointment. It lessens the progress that has been made to date on signing new trade agreements and ensuring that this place has a say on our future.
Sarah Green (Chesham and Amersham) (LD)
I stand to speak to new clause 12, which stands in my name, and also to new clauses 11 and 13. I would like to begin by stating once again that the Liberal Democrats want to see an ambitious trade policy aimed at creating opportunities for British firms around the world and new jobs here in our country. The Bill and our accession to the CPTPP are a step in that direction. The point has been well made, in this House and in the other place, that the projections in the Government’s own impact assessment are for GDP growth of just 0.06% by 2040, so although the UK’s accession to the trading bloc can and should be welcomed, the cause for celebration is limited.
I would like to speak to three new clauses that aim to address some key issues with the Bill and the UK’s accession. New clause 12 would require the Government to publish an assessment of the impact of the CPTPP’s performers’ rights provisions. We know the worries of our creative industries surrounding the Bill. The lack of reciprocal agreements for UK artists in CPTPP countries leaves our creatives exposed. The UK is rightly proud of our world-leading creative industries and we should also be proud of a world-leading intellectual property regime. We must be sure that this Bill and this trade deal do nothing to jeopardise that. There is a need for clarity and certainty in this area, and that is why I tabled new clause 12, which I hope Members will support.
New clause 13 would require the Government to conduct a review examining how the implementation of the treaty affects the costs faced by exporting and importing businesses in the UK. That report would have to consider the existing costs that those businesses were already facing as a result of trade regulations. We know that the stated ambition of the Government is that the deal will minimise red tape and trade regulations when trading with other CPTPP countries, which is a welcome goal. However, the British Chambers of Commerce has found that almost two fifths of businesses list regulations and red tape as a significant barrier to exporting. We need to be assured that our businesses will be supported to trade and flourish. With that in mind, it will be worth while, after our accession, to take the time to assess how the deal and the wider trade regulation landscape are affecting British businesses. That is the purpose of new clause 13.
It is clear that the CPTPP will likely grow over time as new countries join and accede to the deal, which will bring new opportunities but may also pose risks. The potential accession of China is one example, and the concerns regarding that possibility have been well discussed by colleagues in this Chamber and the other place. New clause 11 would require the Government to provide an impact assessment on the accession of countries that have made, and will make, a formal request to join the CPTPP. This will allow us to have a clear and informed vision of what the accession of each new country would mean for the UK. I believe this would be a reasonable and common-sense measure.
I finish by echoing what has already been said about parliamentary scrutiny. It is welcome that we are having this debate today but, in reality, we are debating a very limited and narrow Bill. We need proper parliamentary scrutiny of trade deals, and I ask the Government to ensure that it happens in future.
John McDonnell
I congratulate my hon. Friend the Member for Kingswood (Damien Egan) on his excellent speech. He mentioned that he has been elected at the tail-end of a Government and that an election is coming soon. I reassure him that the diligence he has already demonstrated in this House and his constituency should secure his re-election. It is wonderful to hear a Member speaking for a constituency with its accent.
I will address amendment 2 and new clause 8, although I support virtually every amendment that has been tabled, which shows the weakness of the process by which we have examined this treaty. I have been involved in discussions with the Secretary of State and the Minister over a number of months on ISDS, and I am concerned about the contradiction between their refusal to secure a side letter with regard to this treaty and what happened with regard to Australia and New Zealand. The negotiating brief for the Canadian free trade agreement also had a specific remit to prevent an ISDS process. I have never got to the bottom of that contradiction.
Amendment 2 follows our lengthy debate about the scrutiny of treaties. I have not given notice to the hon. Member for Hazel Grove (Mr Wragg) that I will be referring to him in the Chamber, although I am not sure that we have to give notice ahead of praising, rather than criticising, another Member. I am a member of the Public Administration and Constitutional Affairs Committee, which he chairs, and he has become the 21st-century Walter Bagehot, with a solid mixture of Trollope. He steered our discussions on the formal process for examining treaties with immense skill, drawing on a range of evidence that led to consensus—there is almost consensus in the Chamber at the moment—and this is what our report says:
“CRAG has been an insufficient legislative tool to facilitate meaningful Parliamentary scrutiny of treaties… the current legislation provides only a passive role for Parliament and as such there is no opportunity for Parliament to express its explicit approval or disapproval of a treaty.”
That is a common theme of all the debates. We have to do better than this.
Having read the report, the worry is that the Government have not responded positively by trying to get some order, particularly on the early negotiating processes and the debates that should take place. The Committee’s general view on this treaty, like the others, is that Parliament has been largely bypassed. We were offered no say on the Government’s negotiating objectives at the earliest stage, which is important, and no oversight of the negotiations as they progressed. Now we are refused a vote on the final terms of accession. This is not acceptable as a democratic process. The formal CRaG period, under which we can nominally have a say on the agreement, concludes this Friday, after a 21-day period. We are offered no vote or even a debate on the substantive terms of the CPTPP during this period, and accession is likely to receive our consent without any of us being given a single vote.
As I mentioned to the right hon. Member for Chingford and Woodford Green (Sir Iain Duncan Smith), I have tabled a prayer to try to secure a time extension to enable the Government to bring forward time for a debate. My view is exactly the same as his: we are debating a narrow, technical, implementing Bill and that is no substitute for a confirmatory debate and vote on the accession itself. I agree with the Chair of the Business and Trade Committee, who has raised this issue with the Government in correspondence over the past two weeks. It is preposterous for the Government then to say with a straight face that there is not parliamentary time to have such a debate, given our current sitting arrangements. Those who have been here for as long as me, or perhaps even longer, will know that there has not been a problem on parliamentary time in the past, as we have simply found the time and sat and gone through the business when it is so important.
My amendment 2 seeks to address that wrong by formalising a requirement for the Government to ask for Parliament’s consent for the UK’s accession to the CPTPP. That is a basic democratic point of principle. If the Government do not accept that, I come back to the urgings of Members from across the House and say that I hope the Government will take seriously the recommendations of the PACAC report for reform of the process overall. We are dealing with an undemocratic structure. The PACAC report’s incredibly practical proposals are for a sifting process, a sifting Committee, the identification of treaties that require longer consideration and giving the House itself a proper process of democratic scrutiny and democratic decision.
I shall deal briefly with new clause 8, which stands in my name and deals with the labour chapter of the CPTPP. I have raised this issue before, and the point has been made by a number of colleagues, the TUC, in particular, and various other campaigning organisations throughout this ratification process. The labour provisions of the CPTPP are outdated and inadequate. This treaty will include a number of countries, some of which have been mentioned, with the prospect of others joining, where abuses of labour rights are widespread. Putting in place effective labour provisions is therefore vital in any treaty we undertake.
That view has been expressed across the House for a number of years now, but let me give some examples. In Brunei and Vietnam, independent trade unions are banned—they are not allowed legally to operate. In Malaysia, which has been mentioned in our previous debates, forced labour has been documented extensively. That issue has been raised in this House time and again.
In that context, it is crucial that the CPTPP’s labour provisions are readily enforceable and are linked to the removal of trade preferences, to ensure that membership does not lead to a race to the bottom on labour standards, exactly as the right hon. Gentleman said. I agree with him on the fear about China, because union colleagues of mine from Hong Kong, whom I have worked with for decades, are in prison at the moment purely and simply because they are trade unionists and have stood up for democratic rights.
Sir Iain Duncan Smith
The point I was trying to make is that there is also an economic issue here. If China practises slave or forced labour, as it does on a wide scale, it undercuts all the reasonable labour. One good example is that the UK is desperately trying to get more solar arrays, but the polysilicon that is critical to those is mined in Xinjiang under slave labour conditions. No wonder everybody else is undercut, but we still pay for this.
John McDonnell
It is a point of economic principle that such things will occur if we do not have proper rights or regulations installed, or the appropriate sanctions when anything takes place. At the moment, those are not contained in the treaty. One member state can challenge another for failing to uphold labour rights, but, as we have seen time and again across various treaties, it is notoriously difficult to prove that such failure has affected trade. To challenge those labour practices, we have to demonstrate the effect on trade, but, under current provisions, that is almost impossible to do.
The International Trade Union Confederation has rightly pointed to the ability of states to buy their way out of issues via dispute settlement, as the amount of compensation has been calculated time and again as a fraction of the violation’s impact on trade. So the sanctions do not work, and they will not work under this treaty.
Lloyd Russell-Moyle
It is a pleasure to follow the maiden speech of my hon. Friend the Member for Kingswood (Damien Egan). What a great way of upstaging his sister a week after her wedding—after a by-election is forced, he goes on to win it. But I suspect that it was a happy moment for all the family, and it is a delight to have him here.
I have tabled two new clauses. I have sat on the Public Administration and Constitutional Affairs Committee and, in its previous iteration, the International Trade Committee, when we scrutinised the Bill almost, I felt, to death. The problem with scrutiny without any teeth is that words produced in Parliament all the time are lost in the ether. The reality is that, unless there is debate in the main Chamber, there is not the right body of weight behind those words and those concerns.
It is clear to me that we need to change constitutional make-up of how we do trade deals. I support everything that PACAC has said, of course, but personally I would go further. I think we do need legislative changes to CRaG, despite the fact that we could make some changes through trust—that would be a good start. The reality is that, since we left the European Union—I know we are not meant to go on about that—this House has had less scrutiny over trade deals than we did before. It used to be that consent was required, which would go via the European Scrutiny Committee. That consent was required to be sent to the European Union before a trade deal could be signed off.
We know that in other places around Europe, legislators did hold back inappropriate trade deals. The EU-Canada free trade deal, for example, was held back by the Wallonian Parliament because it failed to address things such as workers’ rights, which my right hon. Friend the Member for Hayes and Harlington (John McDonnell) mentioned. The deal was renegotiated and the Europeans got a better deal. We could have done that at any step of the way when we were in Europe, but now we are out of the EU, we are less able to do so and less able to hold our negotiating person to account. Our negotiating person at that point was the European Commission. Our negotiating people now are our Ministers and civil servants, but we are less able to hold them to account. We cannot set their negotiating mandate or stop a trade deal, as we were able to do before. Yes, we can delay it, and yes, this Minister is fantastic in coming to be held to account through questioning, but the hard stop that means that people listen to you rather than just having a nice debating club with you has now been lost. We need to reflect that changing world.
Mark Garnier
I thank the hon. Gentleman for giving way. He and I have discussed this at great length in two Committees that we have both sat on. I am hugely sympathetic to every point that he is making, but there is one counter-argument that has not yet been put forward. The position of our negotiators in striking these deals in the first place could be slightly weakened by the fact that they would then have to check back with the legislature on whether or not it will ratify. Were we to take the final decision away from our negotiators, they would not be able to negotiate such a strong deal. I put that forward not necessarily as a definitive answer, but as a counter-argument.
Lloyd Russell-Moyle
The hon. Gentleman is quite right. Some people claim that that would happen, but others claim that it would strengthen our position. When the EU says, “This is our backstop,” we know that it is not bluffing because the backstop has been set by the EU Parliament. Now, negotiators can say, “Well, we know that that is not really the backstop, because you can go away and cajole your Back Benchers to vote this through anyway,” whereas in other systems, they can say, “I’m sorry, but the Senate will not approve this because the committee is holding my feet to the fire.”
However, there are other ways of doing it. As other Members have mentioned, we could allow the matter to have Privy Council status and meet in camera, to allow involvement in negotiations. In multilateral processes, other Governments embed parliamentarians in their negotiating teams. The Norwegians, for example, embed parliamentarians in their WTO negotiating teams in the day-to-day back and forth. Of course, in Norway, the WTO is dealt with by a different department from bilateral treaties, so there is a slightly different way of negotiating different kinds of deals. We can determine what kind of deal it is from the level of negotiation and whether Parliament is involved. If Norway were dealing with the CPTPP, parliamentarians would be embedded in that process, but if it were dealing with the Japan deal, they would not.
There are granularities of parliamentary overview and scrutiny, but almost all systems have developed them over the past 50 years as trade deals have basically become international lawmaking processes rather than dealing just with trade—they deal with all aspects of our life. However, we effectively paused our processes when we joined the European Union, and we have now reverted to where we were before joining. Although I accept that our process are now in the CRaG law, they have not evolved properly.
Let me address my new clause 2. Around 90% of the world’s oil palm trees are grown in just a few islands in Malaysia and Indonesia. Currently, less than 20% of that palm oil has received certification for sustainable palm oil forestry. The CPTPP will remove tariffs from palm oil. Of course, the aim of removing tariffs is to increase trade, so it seems implausible to say that we do not think it will increase the amount of palm oil in the UK that comes from unsustainable forests. The same could be true of tropical woods. Two of the 11 forests that supply our tropical woods and are identified as in danger are in the CPTPP region, but they have no additional protection.
Anthony Mangnall
First, Indonesia is not part of CPTPP. It is also important to note that the Malaysians have introduced a certification and standard for more sustainable palm oil plantation. I am not saying that that is perfection—it certainly is not, there is a lot further to go—but it is a good example of how, by forming a trade agreement through CPTPP, we can raise standards, not lower them.
Lloyd Russell-Moyle
The hon. Gentleman makes a perfectly sound point. That is why my amendment does not say that we should not join the CPTPP, or that we should disallow it for those purposes. It would require the Secretary of State to lay before Parliament a monitoring report on the level of unsustainable palm oil and forest products that are entering this country before we join the CPTPP, and to report regularly on those imports. If and when this House, or Ministers themselves, believe that action is needed, the data will be there to prove it. If we do not collect that data, we will not know, and we will be blind to the problem.
The same is true of our obligations on climate change and biodiversity. Personally, I would prefer a stronger environmental section in the Bill, but it is what it is. However, it should be noted that 119 pesticides that are permitted in CPTPP countries are not permitted in this country, 56 of which are considered to be highly harmful to human beings. Yes, we have standards for food, but there are no production standards, and there are no standards for pesticides that are not food-based. The problems with some of those pesticides—the killing of bees and other wildlife—are not just about human consumption: sometimes, those pesticides are banned not because they harm human beings, but because they harm the fauna and flora around us. When we import goods that contain them, they can enter the food chain; even worse, they can enter the animal food chain, which is not regulated by the same food standards and therefore causes huge problems. We need Government oversight of those points to ensure that we do not end up damaging some of our crops through pesticides that we ourselves have banned.
Turning to new clause 3, I am particularly concerned about ISDS. At long last, the Government have agreed that we should withdraw from the energy charter treaty, primarily because in a changing world, we need to make changes to our energy policy to make it more green. Our continual inclusion in the energy charter treaty would bind us to ISDS agreements, which we have seen targeted at a number of European states that have made moves to increase their environmentally friendly sources of energy. That is now a danger to us: even though we have not lost an ISDS case, it is a danger to our future and to policymaking. If we have made that case for energy, I think the same case could be made for almost all our arrangements.
It is useful to note that our agreements with Australia, New Zealand and Japan—all of which are part of the CPTPP—did not include ISDS. In fact, the agreement with Japan included a clause to say that we would not enact ISDS unless we signed or entered into another agreement that includes it, so the very fact that this agreement includes ISDS triggers a number of ISDS courts in other agreements that we have signed, which I think is risky and dangerous. We need a report on the risks that ISDS poses to the UK, because we could have rogue investors who end up taking us to court even if it is against the national interest of the two respective states. Of course, citizens cannot access ISDS—it is not a global court where citizens who have been harmed can seek redress from a Government. Only corporations that have invested in a particular country can do so.
ISDS actually means that corporations that invest into Britain from outside have higher protections than a British corporation that invests in plants here. I think it is totally wrong that a British corporation is more vulnerable to changing policy than a foreign one. It should be a level playing field, but at the moment, a British corporation that has invested here has no recourse to ISDS if policy changes in Britain, but corporations from outside do—the Minister is frowning a bit, so I was just trying to explain the difference. There is also a well recorded chilling effect from ISDS that we must be particularly aware of.
Fundamentally—again, I go back to the thing that we are not meant to mention—under the European Union, at least there were open courts to which we appointed judges. ISDS means secret tribunals that do not always have British judges, so there is a problem there. If we are meant to be taking back control, surely we should be taking power away from secret courts and allowing sunlight to be the justice that we seek.
Apart from the matters covered by the two new clauses I have tabled, I think this treaty is a step in the right direction. We should support it, but I wish the Government had negotiated as well as New Zealand and other countries that sought and won protections that, I am afraid, our Ministers failed to even bother seeking.
Stella Creasy (Walthamstow) (Lab/Co-op)
Like everybody else, let me start with a moment of consensus. It was a privilege to be present for the maiden speech of my hon. Friend the Member for Kingswood (Damien Egan). On my visit to his constituency, I did not get to see the beacon that he mentioned, but that is clearly an oversight on my part and I hope to rectify it at some point. May I be the first to congratulate his sister on her wedding? Brothers who usurp their sisters are brave men, and only being elected to this place is a justifiable reason for doing so.
I am going to contradict my hon. Friend the Member for Brighton, Kemptown (Lloyd Russell-Moyle) in that I think we have to talk about Brexit in this debate, not least because the Government have talked about Brexit in promoting the benefits of the CPTPP, and the people of the UK deserve better. They need to understand what is being offered to them and what is being done to reflect their growing recognition of the severe damage that this Tory hard Brexit has done to the British economy and to British businesses.
I rise to support not only the amendments tabled by my Front-Bench colleagues, but the concerns that have been raised about democratic oversight and scrutiny of those who might join the CPTPP. I will also speak to new clause 9, which I have tabled. I am pleased to say that it has support from across the House, including among people who disagree on whether Brexit has been a good idea. When so much fantasy has dominated the debate, it is about time we had some facts.
New clause 9 refers to the very real experience of British business right now of the damage that Brexit has done. Research suggests that £140 billion has already been drained from the economy; those trading opportunities and business opportunities have gone. The average Briton is £2,000 worse off, and in my London constituency people are £3,500 worse off. British businesses are crying out for support and help with trade. Research from the University of Sussex last year showed that only 6% were positive about Brexit, and seven in 10 manufacturers reported problems with their supply chain. That is why it matters that we look at the CPTPP.
For the avoidance of doubt, I am here not to oppose joining the CPTPP, but to hold the Government to account. It is Government Ministers, as well as their chums and various right-wing think-tanks, who promoted the idea that we should not worry about the damage that Brexit under their watch has done to our economy, because programmes such as the CPTPP were going to replace all those trading opportunities and be the hallowed ground that British business could look to.
The Trade Secretary herself said:
“Our accession to CPTPP sends a powerful signal that the UK is open for business and using our post-Brexit freedoms to reach out to new markets around the world”.
She is one of the milder advocates for the idea that not only has Brexit been a roaring success, but that the CPTPP will add to those trading opportunities.
“It’s no exaggeration to say that CPTPP+UK is an equivalent economic power to the EU-28”,
said Shanker Singham of the Institute of Economic Affairs. Goodness me, what a claim to be making. I tabled new clause 9 because I think British business and this place deserve to know the truth about the relative merits of such partnerships and the challenges to our businesses and communities, particularly small and medium-sized businesses struggling with the impact of Brexit, as well as whether help is indeed coming.
The honest truth is that nobody wants to name consistently the impact of this partnership deal, not even the Secretary of State herself. Mark Littlewood, who is also from the Institute of Economic Affairs, has claimed:
“The benefits to Britain will likely be significantly greater than some official estimates driven by static economic models.”
The challenge to that argument is that, when we ask anybody who promotes it what the actual data might be—where the evidence is that this will be the help needed by British businesses that are being clobbered by Brexit, with all the rules, regulations and tariffs they are now facing—we get the Facebook setting response of “It’s complicated”. That is not good enough for British business.
Even the Secretary of State tried that model with the Business and Trade Committee, telling it that she disputed the idea that the results or the benefits to British businesses of joining the CPTPP would be small, but she could not give an alternative model or an alternative number to give people some crumb of hope that they might actually solve the problems in their supply chain.
All we are left with are the claims of greatness—claims that disintegrate on hard contact with the here and now about what is actually being proposed and what actual damage has been done by Brexit. Here and now, British businesses find that Brexit border taxes are increasing, although I note that today in a written ministerial statement the Government have decided to rewrite some of those Brexit border taxes, which are due to come in at the end of April. So that is great for British businesses! That is stability and planning, when even the Government do not know how much they are going to charge people. The CPTPP is supposed to reduce the tariffs and non-tariff barriers we now face as a direct result of having left the European Union, because after all it is about reducing tariff barriers.
Let us look at the data we have to hand and whether we can really judge this partnership as offering that salvation. It has been claimed again, this time by The Daily Telegraph, that the bloc will represent 16% of global GDP, “leap-frogging the combined EU.” It is currently 10% of global GDP—but you know the Telegraph and figures—compared with 14% for the European Union. It is said that the CPTPP member countries have a combined population of 500 million and a GDP of £9 trillion. That is fantastic; we can be part of trading with them—nobody would dispute that that would be helpful to British businesses. There is a small reference point to take into account, however. Although the EU is of a similar size with a GDP of £11 trillion, the total value of our trade with the EU is £557 billion. That is 45% of our total trade, but that trade is falling as a direct result of Brexit, because it used to account for 55% of UK exports.
That is because, for all the smoke and mirrors and all the bluster about the CPTPP, there is a simple fact: geography matters. We can fight many things in life but air miles and transportation costs are not among them. Our ability to trade with our nearest neighbours easily and freely matters to British business far more than anything we could do with those further away. That is why the Government’s own impact assessment tells us that the CPTPP might only make 0.06% of difference to our GDP, or £2 billion. That is in part because we already have trade deals with most of the countries from when we had them as part of the EU. So only a further 0.33%—not 33%—of total UK trade will come under the new trade agreements.
The reality in all this and the conundrum we face is that this trade partnership will only really be a big deal if more countries join. I am sorry the right hon. Member for North Somerset (Sir Liam Fox) is no longer in his place. He was disappointed that the United States of America were not part of the CPTPP. It will only be the game changer that people talk it up to be if more countries join. Then we would be looking at the Indo-Pacific region. Right here, right now, that is not what we are signing up to and that is not what is being offered to British business. That is why scrutiny and looking at who else might join matters, but it is also why new clause 9 matters. It is not fair to British business to suggest that help is coming when help there is none.
Membership of the CPTPP bears no comparison to EU membership. The sum it will generate is just one fiftieth of what the Office for Budget Responsibility estimates Brexit has already cost the UK economy. Indeed, it estimates that leaving the single market means that our GDP will be 4% less over the next 15 years, and some have estimated that GDP has already reduced by 5% as a result.
In 2022, the UK exported £340 billion-worth of goods and services to the EU. By way of comparison, we exported £64 billion-worth of goods and services to the CPTPP countries. New clause 9 is about being honest with British businesses about where those markets lie and where they should invest their time. It is also about understanding that free trade is not just about tariffs; it is also about regulations and the non-tariff changes we face. It is about understanding that this deal could lead to a lowering of food standards and problems with our food supply chain. It could affect our ability to sign a sanitary and phytosanitary deal with Europe that might help remove those silly Brexit border taxes which mean that in a couple of weeks our constituents are going to be asking us why there are food shortages and food inflation and loads of lorries queued up at Dover trying to get to Sevington. It could lead to challenges for our environment, too: my hon. Friend the Member for Brighton, Kemptown (Lloyd Russell-Moyle) rightly raised questions about palm oil and deforestation. There is an absolute irony in those who championed Brexit and who now champion the CPTPP not seeming to understand what the investor-state dispute settlement provisions are and the lack of democratic accountability and lack of control we might have. I do not know who is taking back control under those circumstances, because it is behind closed doors.
Clearly, we could have been working on other deals as a country that would have made a bigger difference to British business. That is why the amendments and new clause are so important. Our constituents demand that we ask those questions and get those answers from Government about the tariffs that are being retained and the impact that they will have, such as for British cheese producers. After all, Canada’s dairy industry is being protected—no Wensleydale for Winnipeg. The Trade and Agriculture Commission has warned of the potential increased costs of products due to tariff reductions, because UK producers will be held legally to higher sustainable standards. It is also about the rules of origin and details around what content is allowed.
Nobody is disputing that it is helpful to have content accumulation, because it helps with those difficulties within supply chains. Ministers have made much about that, but the reality is that had they spent as much time on the pan-Euro-Mediterranean convention, we would have far greater benefits for British business. That convention binds together more than 60 bilateral trade agreements within the Euro-Mediterranean area. It is not just the EU; it is much broader than that. There are 23 contracting parties, each with free trade agreements between them and a single rules-based origin protocol.
British businesses and those struggling supply chains could have got much more help, had we looked at what would really benefit them and just admitted the geography at stake in all this. We have short-changed ourselves and we are short-changing the British public if we try to claim that the CPTPP is in any way compensation for the damage that Brexit is doing.
In challenging those on the right who claim that the benefits of CPTPP will far outweigh the problems of Brexit—their hope and intention is that UK accession will kill off any likelihood that we will ever be part of the EU customs union or single market, as in that article in The Daily Telegraph—and that we could not have dynamic alignment, we have to recognise that that is just not true. There is plenty of evidence that whatever we did, we could rethink, and thank goodness for that. When things are at stake for British business, it is only right that we ask those questions. There is a process for changing regulations as we join the CPTPP that can be reversed if we can do a deal with Europe and work out what is in the best interests of British business. The only way we can do that is if we have the facts, and that is what new clause 9 is about.
Whether Members agreed with Brexit or opposed it, they should support new clause 9 and that ethos of having the data. If I am wrong and the CPTPP is the light at the end of the tunnel for British business, let us prove it, stand behind it and celebrate it. Nobody wants to see British business struggling as a result of Brexit with no help in sight. Every Member in this House should get behind the idea that we need good economic modelling. We should understand the extent of alignment, what new trade regulations on carbon pricing might do for British business and what is happening to trade volumes as a result of these partnerships. Without the new clause, we will not get that data. We will still get the Facebook answer of, “It’s complicated. We cannot really tell you.” All the while, global Britain is going-broke Britain—it is gutted Britain, with businesses across the country facing reams and reams of paperwork because of Brexit, with no end in sight, because this Government will not put British business first and renegotiate with Europe for a closer deal.
I am sorry that new clause 9 has not been selected for decision. I understand why, but I hope that Members will join me in demanding better for British business when it comes not just to trade deals, but to our relationship with Europe, because every manager of a small business in this country right now will be looking at all the paperwork, all the complications, all the further regulations and excessive costs and frankly the fact that the Government cannot even tell them what they will charge them on the Brexit border tax, and they will be coming to our constituency surgeries asking for help. We owe them the respect of having an answer.
Richard Thomson (Gordon) (SNP)
May I say what a pleasure it is to follow the hon. Member for Walthamstow (Stella Creasy)? She makes an excellent case for rejoining the European Union. I could have scarcely put it better myself, and I hope her leader is listening. She makes some important points, any teasing aside, about the importance of economic data and of being able to model the impacts of the Government’s decisions.
I rise to speak to new clause 10, which is in my name, but first I would echo a number of voices from various parts of the Chamber that have expressed regret that we have before us a narrow Bill to ensure compliance with the requirements of the CPTPP, rather than a debate on the substance and fundamental principle. That is something on which, collectively, we could do much better.
Gareth Thomas (Harrow West) (Lab/Co-op)
I rise to speak to new clauses 4 to 7 and amendment 1. I draw the attention of the House to my entry in the Register of Members’ Financial Interests in relation to BPI. Let me at the outset say what a particular pleasure it was to listen to the maiden speech of my new hon. Friend, the hon. Member for Kingswood (Damien Egan). His description of his constituents’ comments to him during the by-election will chime with all on the Opposition side of the House. It is clear that he will be an asset to the House, and I think it is fair to say that south London’s loss is undoubtedly Kingswood’s gain.
We support accession to the CPTPP because of its geopolitical benefits and the benefits to trade, relatively limited thought they are set to be. Given that the Conservative party has delivered a recession, a cost of living crisis and the worst growth rate in the G7, any uptick in trade and ultimately growth, however limited, would be welcome. There remain, however, a series of concerns about the Government’s approach to the CPTPP and trade deals. Our amendments and new clauses seek to address the weak arrangements for parliamentary scrutiny of trade deals; the growing concern about the investor-state dispute settlement; and issues around performers’ rights, environmental, animal welfare and food standards, and the help that businesses will be offered to exploit the benefits, however limited, of this deal.
On new clause 1, I recognise the concerns articulated by the right hon. Member for Chingford and Woodford Green (Sir Iain Duncan Smith), which were echoed by the right hon. Member for North Somerset (Sir Liam Fox), and I am sympathetic to the former’s call for an enhanced role for Parliament. I am also sympathetic to new clause 11 from the hon. Member for Chesham and Amersham (Sarah Green), under which Parliament would require an assessment of the impact of any new country’s joining the CPTPP. However, I think we need to go further than both those new clauses do. Labour’s new clause 4 would require Ministers to publish such an impact assessment in Parliament and to give the House a vote on any new country joining the CPTPP. Given the security issues, the impact on particular sectors of the economy and on jobs in the UK, as well as the opportunities that an accession could bring, the British people surely have a right to expect this House to consider the merits, or lack of merit, of any new accessions to the CPTPP.
During the Lords debate, the Minister said that he thought that a new state joining CPTPP would trigger the CRaG process in the UK, but the CRaG process, as increasing numbers of Members across the House have largely come to agree, is clearly not fit for purpose; PACAC is the latest Committee to make that clear, in its recent report. New clause 4 provides the opportunity to reform part of that process. Let me refer to what was said by the Chair of the Business and Trade Committee, my right hon. Friend the Member for Birmingham, Hodge Hill (Liam Byrne), and by the hon. Member for Totnes (Anthony Mangnall) and my hon. Friend the Member for Walthamstow (Stella Creasy). We were promised by the Secretary of State and by the Minister in Committee that there would be a debate under the CRaG process, as opposed to there being just this small implementing Bill. We now know that the debate will not happen, so that is another broken promise on trade.
The impact of new countries joining the CPTPP will vary, but could be considerable in certain situations. It is only right that this country expects the House to consider those impacts carefully. I hope that the right hon. Member for Chingford and Woodford Green, and the hon. Members for Totnes, and for Chesham and Amersham, can be persuaded to support our new clause. It would achieve what they want in practice and go further. With the leave of the House, we will press our new clause to a vote.
On new clause 5, I hesitate to damage the reputation of my hon. Friend the Member for Brighton, Kemptown (Lloyd Russell-Moyle) and my right hon. Friend the Member for Hayes and Harlington (John McDonnell), who made excellent speeches on the ISDS. Over the past 10 years, the marked acceleration in usage of the ISDS by large, litigious corporations to challenge Governments’ climate-related or other environmental decisions has prompted concern at the highest levels in the US, in European capitals and at the UN, so much so that Governments across the world are increasingly excluding or revoking the ISDS provisions.
The problem with the ISDS is that it is secretive; it avoids perfectly effective domestic public legal systems; it discriminates against small and medium-sized businesses; it often prevents the voice of those with a genuine interest in the decisions from being heard; and it holds back environmental and other progressive public policy changes. Strikingly, the OECD could find no sustained evidence that the ISDS was key to securing and maintaining business investment. The Nuffield Trust’s briefing for today’s debate stated that the ISDS could enable companies to challenge some health regulations and NHS policies.
The US, Canada and the European Union have all taken steps to revoke the ISDS provisions in some of their major treaties. The average amount—this is just the published cases—that Governments have been forced to pay, from taxpayers’ money, is about $600 million for climate cases. It seems even more noteworthy that the UN Secretary-General’s special rapporteur on environment and human rights expressed concern just last September that the ISDS was a significant threat to the net zero transition, the Paris agreement and tackling climate change.
Some in government clearly share some of those concerns, as they wanted to exclude the ISDS from the bilateral trade deal with Canada, and supported its abolition from trade with the European Union. The Minister was somewhat evasive in Committee. Initially, he tried to duck questions on why the Government wanted to exclude the ISDS from a bilateral trade agreement with Canada but were quite happy to leave it in the CPTPP for Canadian investors to use. Given that Ministers have signed side letters with Australia and New Zealand to disapply the ISDS between our countries in the CPTPP, it seems bizarre that they have not attempted a similar approach with Canada.
Just after Committee, the Government confirmed that they were pulling out of the energy charter treaty, in which ISDS arrangements play a major role, saying that it does not fit with net zero ambitions. The Minister might want to try again to explain why it is essential that we remain committed to the ISDS elements of the CPTPP. It is time for a clear-eyed assessment of the risk that the ISDS poses to our interests. With the leave of the House, the Opposition will press new clause 5 to a vote.
There continue to be significant concerns about the environmental impact of accession to the CPTPP, and the impact on food standards and on animal welfare. The CPTPP covers two of the 11 deforestation fronts expected to account for 80% of deforestation by 2030. A range of environmental groups are very concerned that when the UK joins the CPTPP, preferential access to our markets will be created as a result of the removal of tariffs on palm oil. That could increase demand for products from threatened zones and exacerbate the risk of further deforestation. Ministers still have not published —never mind presented to this House—deforestation due diligence legislation under section 17 of the Environment Act 2021, so it is difficult to accept Ministers’ claims that they are fully committed to our climate change targets, and to protecting important sources of global biodiversity.
On food standards, deep concerns remain that, despite their protestations, the deals that Ministers have negotiated, including the CPTPP, will allow into the UK ever more food produced to lower standards, particularly animal welfare standards. The whole House will remember the words of the former Environment Secretary, the right hon. Member for Camborne and Redruth (George Eustice), who told the House that the Minister and his colleagues had given away
“far too much for far too little”.—[Official Report, 14 November 2022; Vol. 722, c. 424.]
when they negotiated the UK-Australia free trade agreement. The Royal Society for the Prevention of Cruelty to Animals and the National Farmers Union, in particular, have raised concerns that new tariffs negotiated with Mexico and Canada will leave farmers in the UK much more vulnerable to imported eggs, pork and chicken that are produced to standards that would be illegal in the UK. The Pesticide Action Network UK raised concerns acknowledged by the Trade and Agriculture Commission—concerns also raised by an hon. Friend behind me—that more food produced using pesticides banned in the UK will be imported into the UK
Lloyd Russell-Moyle
My hon. Friend is making an excellent, excellent speech. [Interruption.] Well, he knows it anyway, but there is nothing wrong with praising. Is it not also a sign of how the Government, time and again, let down our creative industries? If it were steel or farming, Conservative Members would be in the ear of Ministers through their trade partnership committees, but creative industries are locked out of many of them and ignored. That is why Labour has put forward a plan to put creative industries at the heart of our economic development.
Gareth Thomas
My hon. Friend is generous in his description of my speech—I am grateful to him—and absolutely right about the importance of Labour’s plan for the creative sector.
Reform of the UK’s copyright framework should not be taken lightly, and it should only follow proper and well-considered consultation. Otherwise, we risk endangering our gold standard of protection for our vital creative sector. I gently suggest to the House that the reforms allowed for under clause 5 should not have been shoehorned into this Bill, and certainly not without a thorough consultation having taken place first. In that regard we are sympathetic to the merits of new clause 12, tabled by the hon. Member for Chesham and Amersham. We will continue to scrutinise developments in this area, and we hope that Ministers will reach a final decision, after the consultation, that will not have the adverse impact that is feared by some outside the House.
As I have said, I share the concerns expressed by my hon. Friend the Member for Brighton, Kemptown in new clauses 2 and 3, and I therefore hope he will join us with enthusiasm in the Lobby later today. Similarly, I share the desire of my right hon. Friend the Member for Hayes and Harlington for much greater adherence to the conventions of the International Labour Organisation. We raised this issue in Committee, and as I said earlier, I share his frustration—and that of other Members—that Ministers have not allowed the House a substantive debate under the CRaG process.
Liam Byrne
My hon. Friend, who is making an excellent speech, is right to underline the point about ILO obligations. In the 2022 Queen’s Speech we were promised an updating of the Modern Slavery Act 2015 that would have required much stronger action and transparency on supply chains in order to eliminate forced labour. That measure seems to have disappeared, so we must insist on more robust action in our trade agreements if we are to wipe out the scandal of modern slavery.
Gareth Thomas
My right hon. Friend is absolutely right. Ministers will have heard his point; whether they will act on it remains to be seen, but I certainly hope they do. If we are lucky enough to be elected at the next general election, we will certainly work with the ILO to try to drive better adherence to its conventions.
Last but not least, I share the ambition of my hon. Friend the Member for Walthamstow, who made a powerful speech, for a much more open dialogue on trade and the axing of more of the red tape, bureaucracy and barriers to trade with European markets thrown up by the poor negotiating skills of the last Prime Minister but two.
There remain, in particular, serious concerns about scrutiny of trade agreements and about the damage that ISDS provisions could do, so we will, with the leave of the House, press new clauses 4 and 5 to a vote.
The Minister for Trade Policy (Greg Hands)
I thank colleagues for their contributions to the debates on this important Bill. Let me begin with the new clauses relating to new accessions to the CPTPP: new clause 1, tabled by my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith)—who always demonstrates his passion on this important matter—new clause 4, tabled by the hon. Member for Harrow West (Gareth Thomas), and new clause 11, tabled by the hon. Member for Chesham and Amersham (Sarah Green).
As the House may know, there is no rule within the CPTPP that requires new applicants to be dealt with on a “first come, first served” basis. Rather, it has been agreed within the group that applicant economies must meet three important criteria—called the Auckland principles—and it is on those key principles that applications will be assessed. Applicants must: first, be willing and able to meet the high standards of the agreement; secondly, have a demonstrated pattern of complying with their trade commitments; and thirdly, be able to command consensus of the CPTPP parties. Those strong criteria will be applied to each accession application. It is right that we in the United Kingdom, as a new member of the CPTPP group, work within the principles of the group to achieve a consensus decision.
I remind the House that while the UK rightly participates in discussions on this topic with CPTPP parties, we will only have a formal say over an application post-ratification and entry into force of the agreement. It is therefore crucial that we ratify the agreement and become a party, so that we can work with CPTPP members decisively on each current and future application. With that in mind, it would not be appropriate for the Government to give a running commentary on individual applicants, not least because to be drawn on individual applicants now, ahead of the UK becoming a party to the agreement, could have an impact on our ability to achieve that important goal of ensuring that the CPTPP enters into force. I should also make it clear that our own accession process has set a strong precedent. The robust experience that the UK has undergone has reinforced the high standards and proved that the bar is not easy to meet for any aspirant.
Regarding the scrutiny of any hypothetical future accession, I can assure the House that any accession of a new party to the CPTPP would require an amendment to the terms of the CPTPP. Therefore, as with the UK’s accession protocol, our firm intention is that such a future accession would be subject to the terms of the Constitutional Reform and Governance Act 2010—the CRaG process. I assure the House that CRaG is applicable to plurilateral agreements such as the CPTPP. The Act makes no distinction between bilateral, plurilateral or multilateral treaties as outlined in section 25 of CRaG.
Liam Byrne
The Minister is being characteristically generous in giving way. We obviously sought a debate under CRaG for this treaty. The Secretary of State, who is now in her place, told our Committee that she supported that, but the Leader of the House then refused to make Government time available for that debate. What further assurances can the Minister give us that there would indeed be a debate if the treaty was changed in the way that he described?
Greg Hands
The Government’s position is unchanged. It is always the desire of the Government, as expressed by the Secretary of State in writing to the House and to the right hon. Gentleman as Chair of the Select Committee, to urge and to ask for there to be a debate, but that will always be subject to the availability of parliamentary time. In a little bit, I will discuss the opportunities that there have been to scrutinise the CPTPP, which have been manifold in recent years.
Greg Hands
I will give way a little later.
The Act makes no distinction between bilateral, plurilateral and multilateral treaties. In addition to Parliament being able to make its views clear through the CRaG process, let me remind the House that, as a dualist state, any legislation necessary to implement the treaty—such as alterations to tariffs legislation, to take a hypothetical example—would need to be fully scrutinised and passed by Parliament in the usual way. It is the long-standing policy of His Majesty’s Government not to ratify international agreements before all relevant domestic legislation is in place. Were Parliament to refuse to pass any necessary implementing legislation, ratification of an agreement would be delayed.
I thank my right hon. Friends the Members for Chingford and Woodford Green and for North Somerset (Sir Liam Fox) for their opening speeches. Both are strong supporters of the UK joining the CPTPP. Indeed, my right hon. Friend the Member for North Somerset, who is the former Secretary of State, initiated these talks back in 2017 with me at his side, and successive Secretaries of State have given maximum priority to doing so. I am now in my fourth stint in this role, and it is fantastic to see his and my vision in 2017 now nearing fruition and being very close to UK ratification.
My right hon. Friend the Member for Chingford and Woodford Green and I know that Parliament is perfectly capable of expressing a view on an international agreement and whether a country might join it, and the Government of the day would be very likely to take notice. In debates in this House over some years now, he has made clear his views on trade with China, has gained support and attention, and been effective in doing so. Indeed, he has helped to achieve changes in policy in relation to supply chains in Xinjiang, and I agree with his support for Taiwan —a full member of the World Trade Organisation—as an important trade partner for the UK. We are positive about this kind of debate in the House.
The right hon. Member for Birmingham, Hodge Hill (Liam Byrne), who chairs the Select Committee, mentioned the scrutiny that there has been in this House for the CPTPP agreement, and he doubted whether there had been four debates. I had a slightly nagging feeling that I may actually remember each of the four debates, so I went back and checked the four debates, which started with the very first one that I responded to in April 2021. There have been four debates in this House and in the other House on the CPTPP. There have also been two oral ministerial statements and 16 written ministerial statements, and five separate Select Committees have taken evidence from Ministers and senior officials on the matter. There has been a Trade and Agriculture Commission report and a section 42 report. This is not an under-scrutinised trade agreement—rather the opposite. As has always been clear, we want the CPTPP to expand to fast-growing Asia-Pacific economies. I also agree with the Auckland principles.
Greg Hands
Of course I will give way—if the right hon. Gentleman first concedes that this has been a well-scrutinised trade deal.
Liam Byrne
Not quite. I am grateful to the Minister for setting out the full history, but will he accept that the Secretary of State believed that we should have had a debate, under the CRaG principles, on the full treaty? This Bill covers only three of 30 treaties. It is a matter of disappointment to many of us in the House that even though the Secretary of State no doubt argued vigorously and passionately for the debate, the Leader of the House was unable to grant us time. That is not necessarily the precedent that we want to establish for further trade treaty scrutiny.
Greg Hands
Of course, the right hon. Gentleman was a Minister in the last Labour Government, and he will remember that there are the vagaries of time available. Making an application to say that we would like there to be a debate is not the same as those who run the parliamentary timetable agreeing to there being one.
Let me move on to the new hon. Member for Kingswood (Damien Egan), who made a very accomplished and well delivered maiden speech. He spoke fondly of predecessors whom I know and like, such as Roger Berry and Rob Hayward. He won a keenly contested by-election—I have been to a few by-elections in recent years, and I was grateful to be given a bit of time off and to not go to Kingswood. None the less, I have great admiration for those who win by-elections. I have seen at close hand that they are a different kind of contest.
The hon. Gentleman spoke of his support for free trade and for rewarding hard work, and expressed sympathy for the Government, who have faced the challenges of covid and Ukraine. I agree with him on all of those issues, and the Government do too. I look forward to his continuing the tradition of an independent-minded Member for Kingswood—but please do not tell the Labour Whips Office.
As ever, my hon. Friend the Member for Totnes (Anthony Mangnall) spoke passionately about trade and CPTPP. He is always probing on those issues.
Various amendments and new clauses that have been tabled ask for additional impact assessments. Before addressing some of those amendments directly, I would like to reassure the House that the Government will publish a biennial monitoring report and a comprehensive evaluation report of the agreement within five years of our accession.
Amendment 1 and new clause 12 would introduce commitments to publish impact assessments on the performers’ rights provisions in this Bill, and I will set out why we consider them to be unnecessary. The impacts of the rules depend in large part on how they are applied in particular cases through secondary legislation made under the Copyright, Designs and Patents Act 1988. That secondary legislation may restrict or extend particular rights to particular countries. Wherever the Government intend to make significant changes to the secondary legislation, we will engage with affected industries and carry out an impact assessment. The Intellectual Property Office has done that recently with its consultation and its assessment of the impact of potential secondary legislation on the broadcasting and public playing of recorded music. A commitment to assess the impacts of the measures in this Bill is therefore unnecessary, and risks overlooking the effects of the secondary legislation.
I will now turn to new clauses 2 and 6, which broadly focus on environmental and other standards. I can provide assurance that the UK will continue to uphold our high environmental standards in respect of all our trade agreements, including CPTPP. As I have previously mentioned, the Government intend to publish a comprehensive ex post evaluation of the agreement within five years of the UK’s accession, and I can confirm that this evaluation will include an assessment of the environmental impacts of our accession. In addition, the independent Trade and Agriculture Commission was asked to scrutinise the UK’s accession protocol and produce a report. The TAC concluded in its advice, published on 7 December 2023, that
“CPTPP does not require the UK to change its levels of statutory protection”
in relation to the aforementioned areas.
Lloyd Russell-Moyle
It is very welcome that there will be a five-year report. Will it include numbers on unsustainable palm oil and rainforest wood to ensure that we are not exploiting more than we are at the moment?
Greg Hands
That is exactly the sort of thing that I would expect the report to do. I must say that I am delighted that the hon. Gentleman has mentioned the Government’s record when it comes to palm oil, because 86% of UK imports of palm oil were certified as sustainable in 2022—up from 16% under the last Labour Government in 2010, when we took office. Deforestation related to palm oil in Malaysia has fallen by 60% since 2012, according to the latest available figures, and we will keep working with countries such as Malaysia to build on that work.
As soon as parliamentary time allows, the Government will be tabling their forest risk commodities legislation under the Environment Act 2021, which will make it illegal for larger businesses operating in the UK to use key forest risk commodities produced on land illegally occupied or used. The Government have confirmed that palm oil products would be included under the regulated commodities. Additionally, I once again refer to the report of the independent Trade and Agriculture Commission, which concluded that
“it is unlikely that CPTPP will lead to an increase in palm oil being grown on deforested land”.
Moving on to new clauses 3 and 5, relating to ISDS, the UK’s accession to CPTPP will benefit UK investors. I do not think the Opposition understand how business works. We support British businesses operating overseas. They create jobs in this country—jobs that the Labour party does not seem to like.
Dominic Raab (Esher and Walton) (Con)
I thank my right hon. Friend for progressing CPTPP with all his usual energy, because it will boost trade and be of huge strategic significance. It is an opportunity of Brexit that must be grasped. On investor-state dispute resolution, he is absolutely right that we must not give way to the naysayers. It will be overwhelmingly in the UK’s interest, given the protections for UK businesses and exporters and the certainty it will provide in the massive growth region of the Indo-Pacific.
Greg Hands
My right hon. Friend also played a really important role in getting CPTPP through. I remember our joint visit to Vietnam in 2021, when we argued for Vietnamese support. He is right to say that it is important to remember that the UK has never lost an ISDS case. Equally, it is important for us to protect UK businesses operating abroad. They provide jobs and secure livelihoods at home. I find it astonishing that the Opposition, as they lurch ever leftwards, seem to forget that the whole time.
I can assure the House that the UK already has investment agreements containing ISDS provisions with around 90 trading partners, including seven of the 11 CPTPP parties. The UK provides a welcoming investment environment with a non-discriminatory regime, strong rule of law and good governance. We are clear that, where we negotiate ISDS, we will not hinder our inherent right to regulate in the public interest, including in areas such as the environment and labour standards.
I turn to new clauses 7, 9, 10 and 13, which focus on the impacts that this deal will have on our businesses and our economy. The Government want UK businesses to benefit from the ambitious provisions in the CPTPP as far as possible after we accede, and we are working to raise awareness of the agreement and ensure that businesses have the knowledge they need to take advantage of the opportunities that CPTPP will present when it enters into force for the UK.
New clause 8, tabled by the right hon. Member for Hayes and Harlington (John McDonnell), focuses on labour standards. I notice that there is no official Labour amendment focusing on labour standards. Maybe Labour does not care about labour any more, but I know that the right hon. Gentleman does. The CPTPP labour chapter includes binding provisions on fundamental labour rights and on hours of work, health and safety, and minimum wages. It reaffirms CPTPP parties’ obligations as members of the International Labour Organisation and requires that parties do not waive or derogate from their domestic labour laws in order to encourage trade or investment.
Amendment 2, also tabled by the right hon. Member for Hayes and Harlington, relates to the conformity assessment regulations referenced in the Bill. The amendment would allow changes to the conformity assessment regulations only following a motion to resolve against the ratification of the UK accession protocol first. I just think it would be unwise for us to pass an amendment to resolve against the ratification of UK accession in advance.
This has been a wide-ranging debate, and we have debated important issues. I particularly want to minute my thanks to my right hon. Friend the Member for Chingford and Woodford Green, who has rightly raised important questions about our trade with China, and to other right hon. and hon. Friends who have supported the process of the UK acceding to CPTPP.
I do not want to tempt fate, but this might be my last chance to speak on our accession in this House before the UK formally ratifies joining CPTPP. I and, I believe, the whole Government passionately believe that CPTPP offers a great future for the UK, and I have seen our accession through from being a novel idea in 2017 to ratification, and hopefully accession, in 2024. Not many of us in this place have been able to do that over a seven-year period, and I am grateful to all my ministerial colleagues, successive Prime Ministers who have supported CPTPP and my excellent Department for International Trade and Department for Business and Trade officials for being with me on this very exciting journey.
Sir Iain Duncan Smith
I beg to ask leave to withdraw the clause.
Clause, by leave, withdrawn.
New Clause 4
Report: accession of new states to the CPTPP
“(1) Before any decision is made by the Government on the accession of a new state to CPTPP under Chapter 30 of the CPTPP, the Secretary of State must publish a report assessing the potential benefits and impact of the accession of that candidate state on the United Kingdom.
(2) Both Houses of Parliament must be presented with a motion for resolution on the report under subsection (1).”—(Gareth Thomas.)
Brought up, and read the First time.
Question put, That the clause be read a Second time.
The Secretary of State for Business and Trade (Kemi Badenoch)
I beg to move, That the Bill be now read the Third time.
I would like to thank Members across the House and noble Lords in the other place for the interest they have shown in this legislation throughout its passage. The Bill may be narrow in scope, but the underlying agreement it relates to and the benefits it could bring for British business, the economy and the British people are wide-ranging. By acceding to the comprehensive and progressive agreement for trans-Pacific partnership, we will strengthen our ties with some of the world’s most dynamic economies and gain greater access to the Indo-Pacific region, which will account for the majority of global growth and around half of the world’s middle-class consumers in the decades to come.
Crucially, acceding to the CPTPP will mean improved market access for UK exporters in existing CPTPP parties, including Malaysia and Brunei—our very first free trade deal with these fast-growing economies. In turn, the partnership will simplify supply chains and cut costs for innovative firms based here in the UK, such as Wrightbus, a long-established family-owned Northern Ireland bus manufacturer, which will benefit from opportunities to import parts at lower tariffs from Malaysia. We have also agreed more liberal rules of origin with Malaysia, making it simpler for British brands such as Jaguar Land Rover to export British-designed, British-made vehicles to that market at lower tariffs.
However, our future accession will be good not just for British businesses selling their goods abroad but for consumers here at home. It could provide consumers with wider choice and cheaper prices at the supermarket checkout, on everything from Chilean and Peruvian fruit juices to honey and chocolate from Mexico. Inward investment in the UK by CPTPP parties will be encouraged when we accede, building on some £182 billion-worth of investment in job-creating projects in 2021 alone.
As hon. Members will know, the Bill affects the whole of the UK. Clause 3 and the parts of the schedule relating to Government procurement engage the Sewel convention, so we have sought legislative consent from the Scottish Parliament, the Senedd and the Northern Ireland Assembly. Let me reassure hon. Members that there has been regular engagement with the devolved Administrations before the Bill was introduced and throughout its passage at both Ministerial and official level. I thank the devolved Administrations’ Ministers and their teams for working so constructively with us. It is in part thanks to their efforts that the Scottish Parliament passed a legislative consent motion in February. The Welsh Government published a legislative consent motion on 5 March and recommended that consent be granted to clause 3 and relevant parts of the schedule. Due to a mis-step during the moving and consideration of the motion, that legislative consent was not granted. I understand there are plans for a further Senedd vote on legislative consent for clause 3 and relevant parts of the schedule. However, in the event that a further vote is not scheduled in the Senedd before Royal Assent, the UK Government will proceed with the Bill without consent from Wales.
Members will know that the Northern Ireland Assembly was suspended when the Bill was introduced last November, which prevented us from seeking legislative consent at that time. However, my Department has engaged with Northern Ireland officials throughout this period, providing them with updates as the Bill has progressed through Parliament.
Jim Shannon (Strangford) (DUP)
I thank the Secretary of State for her positive remarks about all the regions of the United Kingdom, which is good to hear. In her discussions with the Northern Ireland Assembly, has there been an opportunity to engage with the businesses in Northern Ireland that have been holding things together, and the Ulster Farmers’ Union? The Secretary of State is always energetic when it comes to pursuing those matters, but it is important to have that reassurance.
Kemi Badenoch
The hon. Gentleman raises a good point, and he is quite right. My right hon. Friend Minister for Trade Policy has engaged with them. In fact, upon the return of the Northern Ireland Assembly, he wrote to the Minister for Finance at the earliest opportunity to request legislative consent. I am grateful that the Minister agreed with the Bill’s devolution analysis and, in principle, to begin the legislative consent process. Nevertheless, we still face a challenging timeline and a pressing need for the Bill to complete its passage. That is vital to allow for secondary legislation to be made and for ratification of the UK’s accession protocol. As such, we cannot delay passage of the Bill to allow the Northern Ireland Executive and Assembly greater time to consider legislative consent. That would jeopardise all the current ratification timelines. I recognise that the legislative consent process is normally concluded before the last amending stage in the second House. Given the timing of the return of the Northern Ireland Assembly, that has been extremely challenging, but I believe it is still right that we allow the Northern Ireland Executive and Assembly as much time as we can to consider our request. In the event that legislative consent is not granted by the Northern Ireland Assembly before the deadline for Royal Assent, we will still have to proceed. Failing to do so would compromise the commitments we have made in our accession protocol.
On Second Reading, I outlined the wealth of benefits that will come with the UK’s accession to the CPTPP: the growth-spurring and business-boosting effect it will have on our economy. Since that time, we have had some spirited and worthwhile debates. I would particularly like to thank the hon. Members for Harrow West (Gareth Thomas) and for Gordon (Richard Thomson) for the constructive manner in which they scrutinised the legislation. I commend those Members who sat on the Public Bill Committee, including my hon. Friend the Member for Shipley (Philip Davies) and the hon. Member for Ealing Central and Acton (Rupa Huq), who showed their great expertise as Chairs. I also thank the Minister for Trade Policy, my right hon. Friend the Member for Chelsea and Fulham (Greg Hands) for expertly shepherding this legislation through the House with his consummate skill and good humour, and for delivering what appears to be a clean Bill. I will let Members review Hansard to see how many times my right hon. Friend reminded the hon. Member for Harrow West that he voted for CRaG. I think I heard that quite a lot throughout the debate.
It would be remiss of me not to mention a number of other Members by name for their valued input throughout the Bill’s passage, including my hon. Friend the Member for Totnes (Anthony Mangnall), whose Second Reading speech and interventions made an excellent case not just for UK accession to CPTPP, but for the benefits of free trade more generally. I am also grateful to him for highlighting the scrutiny provided by the recent Trade and Agriculture Commission report on the UK’s agreement to accede to the CPTPP—a report that stated that the CPTPP does not require the UK to change its levels of statutory protection in relation to animal or plant life, health, animal welfare or environmental protection.
On Second Reading, we also heard useful insights from several of the Prime Minister’s trade envoys, notably my hon. Friends the Members for Wyre Forest (Mark Garnier), for Gloucester (Richard Graham) and for Cleethorpes (Martin Vickers), as well as from the hon. Member for Liverpool, Walton (Dan Carden). The right hon. Member for Birmingham, Hodge Hill (Liam Byrne), as Chair of the Business and Trade Committee, brought a critical eye to bear on aspects of the underlying agreement, on which I hope he has now been reassured. My hon. Friend the Member for Penrith and The Border (Dr Hudson) rightly championed the UK’s high food and animal welfare standards that the Government will continue to protect, and my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith) demonstrated his well-honed ability to probe legislation with regards to the future potential accessions of economies to the CPTPP. The Business and Trade Committee more broadly has my thanks for its engagement with, and scrutiny of, this important Bill.
This legislation will help to ensure that the UK meets its international obligations upon accession to the CPTPP. When the Bill achieves Royal Assent, it will mean that we have put the UK at the heart of a dynamic group of countries in the Indo-Pacific, providing new opportunities for British companies to sell more of their high-quality goods and services to a market of over 500 million people and a combined GDP of £9 trillion. With that in mind, and in the hope that it will therefore garner support from all hon. and right hon. Members, I am pleased to commend the Bill to the House.
Gareth Thomas
We support the UK’s accession to the CPTPP. Despite the concerns we raised during the Bill’s stages, we have not stood in the way of its passage through this House thus far and we do not intend to divide the House on Third Reading. We recognise the geopolitical benefits and the economic benefits, limited none the less as they are likely to be in the near future.
In Committee, we outlined a series of concerns about the inclusion of provisions on the investor-state dispute settlement, and its implications for the NHS, the environment and workers’ rights. We raised concerns about performer’s rights and why on earth the Government chose to launch a consultation on the provisions after the Bill had already begun making its way through Parliament—talk about putting the cart before the horse. We also raised environmental concerns, probing Ministers about deforestation, palm oil, increased carbon emissions, the use of pesticides, threats to indigenous wildlife, and the undermining of the UK’s commitment to combating climate change and preserving biodiversity.
The Secretary of State promised a debate on CPTPP under the CRaG process to the Business and Trade Committee. In Committee, we were also promised a debate on CPTPP by the Minister under CRaG, which has not happened. I say it gently to them both: sadly, it is one more example of Ministers ducking scrutiny of the trade deals they sign. It is almost as if they have something to hide.
We have been grateful in particular to the TUC, Chester Zoo, the World Wildlife Fund, the Trade Justice Movement, Transform Trade, the National Farmers Union, the Royal Society for the Prevention of Cruelty to Animals and the Alliance for Intellectual Property for their help in ensuring that we fully understood the implications of the Bill. I am grateful for their generosity with their time and expertise.
One cannot help feeling that had the Government initiated a thorough consultation exercise much earlier in the proceedings, before the CPTPP was a done deal, we might have come out of the negotiations as less of a rule-taker and with a better deal for the UK. Better consultation with the nations and regions could have happened throughout the whole CPTPP process, but both the Scottish and the Welsh Governments lamented poor communication at key stages from Ministers. Hopefully lessons have been learnt, and we will all have to take the opportunity of the CPTPP review in 2026 to look at what more can be achieved.
I thank all the members of the Public Bill Committee. I particularly thank my fellow shadow Minister, my hon. Friend the Member for Slough (Mr Dhesi), for his invaluable contributions, help and support during the Bill’s passage, but I also thank my hon. Friends the Members for City of Chester (Samantha Dixon), for Cardiff North (Anna McMorrin), for Reading East (Matt Rodda) and for Hammersmith (Andy Slaughter) for their time and commitment to that part of the scrutiny process. I thank Members on both sides of the House, and those in the Lords, who—on Second Reading, in Committee and on Report—have joined in the hard yards, the necessary work, of scrutinising what is a key trade arrangement. I thank the Minister of State, too, for his particularly generous description of me in Committee as a “serial rebel”—which might surprise one or two—and I thank both him and the Secretary of State for their other contributions, some of which have been helpful. [Laughter.] I hope that the dialogue, especially that on the International Union for the Protection of New Varieties of Plants and on performers’ rights, will continue, and I thank the Ministers for their letters to me on those issues.
The UK’s joining the CPTPP will not make up for the Government’s failure to deliver a good trade deal with Europe, or the Conservatives’ broken manifesto commitment that 80% of the world would be covered by new trade agreements—including a trade deal with India, which the Secretary of State herself said this month was highly unlikely to happen any time soon. We remain in the dark as to whether we will ever be tasked with scrutinising a UK-Canada trade deal, or whether negotiations are indeed ongoing, as the Minister says, or they are not, as the Canadians say. What we do know is that, while the Government have made some outlandish claims about the benefits of the UK’s joining the CPTPP, it is likely, as the Office for Budget Responsibility has said, to lead to just a slight increase in GDP “in the long run”. With exports having dropped last year and set to drop further this year, and given the three following years of anaemic growth in exports, even the smallest opportunity for growth is welcome.
The Bill is needed to incorporate the CPTPP agreement in domestic legislation, and that is something that we do not oppose. There are benefits to joining, and despite reservations, we certainly welcome the opportunities that will be opened up for some British businesses. For those reasons, as I have said, we will not stand in the way of the Bill’s completing its passage tonight.
Dr Thérèse Coffey (Suffolk Coastal) (Con)
It is a pleasure to speak on Third Reading. I must admit that I had hoped we would be closer to the moment of interruption at this stage, because there is further business on the Order Paper relating to energy strategy, which I spoke about earlier in the Delegated Legislation Committee; but even I do not want to test the patience of the House by speaking for the best part of an hour.
This is a truly monumental moment for the United Kingdom. Having left the European Union, we are planting our flag around the world and making sure that we drive free trade. It is right to believe, on the basis of all the evidence, that free trade is good for this country, and good for prosperity throughout the world.
I feel an element of sadness about some of the trade agreements made when we were in the European Union, as it seemed that some of the poorest countries in the world were being deprived of a proper trading relationship. I refer to the trend whereby it is still only sub-Saharan African nations that truly are exceptionally poor; unfortunately, at times it felt as though those countries were being deprived of a lot of prosperity due to EU protectionism, but we now have the opportunity to branch out on our own in that regard. We should remember that a lot of African nations are our brothers and sisters in the Commonwealth. Of course I understand that World Trade Organisation regulations apply to everybody, but it is important that we try to factor in what we can do to get wealth to as many nations as possible, because that would be good for this country and for others around the world.
The hon. Member for Harrow West (Gareth Thomas) said that there was no consultation. Actually, the consultation journey started in 2018. I think it was initiated when my right hon. Friend the Member for North Somerset (Sir Liam Fox) was the Trade Secretary. My right hon. Friends the Members for South West Norfolk (Elizabeth Truss), and for Berwick-upon-Tweed (Anne-Marie Trevelyan), and the person who really cemented the deal—the Secretary of State for Business and Trade, my right hon. Friend the Member for Saffron Walden (Kemi Badenoch)—have really taken us on that journey.
We should give the Prime Minister credit for his proactive approach to trade, and the red lines that he was prepared to draw for our farmers, recognising that we have some of the best farming and food production in the world. Those red lines are not about trying to be protectionist, but reasonable standards, the prosperity of our nation and ensuring a two-way street.
In my time as Secretary of State for Environment, Food and Rural Affairs, this work really mattered. I am conscious of the discussions that have taken place, and I appreciate that it can seem frustrating that we are only involved after the trade negotiations, in ratifying the agreement, but I can assure the House that it was imperative that we got the balance right when it came to values and red lines. I again pay tribute to the Secretary of State and the Prime Minister for securing a really good deal.
It is important that we take advantage of this treaty. There are certainly far more agricultural attachés now. It is important that people do not just focus on what might be imported into this country and what that means for standards, because we have been very strong on the standards agreed in this treaty. In fact, we have more problem with the fact that there are not the same animal welfare standards across the European Union; we need to work on that as part of our ongoing relationship, and as part of our free trade agreement with the EU.
There are other factors of concern; for example, there is the fact that production costs are a lot lower in some of the 11 other member states of the treaty. We have the living wage, but we also have access to grants and things like robotic milking machines—something I never thought I would see, but which, as I saw at the Great Yorkshire Show last year, works exceptionally well. One of the key measures in the Agriculture Act 2020 was brought in to validate people’s concerns. That is why I want to pay tribute to the Trade and Agriculture Commission, which produced a pretty hefty report after establishing its initial terms of reference. The process started in July 2023 and the report was published in December 2023, and was designed to cover issues of environmental protection, animal and plant life or health, and animal welfare. It is worth reading.
The key question that my right hon. Friend the Secretary of State asked the commission was:
“Does CPTPP require the UK to change its levels of statutory protection”
in all those areas? The report basically said, “No, we don’t need to. In fact, WTO rules mean that we can keep our statutory protections in all these areas, and there is no impact on our ability to adopt statutory protections in the future and to maintain the ones we have.” That really matters, because at the time, other nations—and, dare I say it, environmental groups here—were trying to bring lots of different elements into the discussion. As I said, I will not keep the House as long as I had originally intended, but I should like to mention Malaysian palm oil, and hormone-treated beef and similar; absolutely no way will the United Kingdom allow that sort of product into this country. We certainly made sure that was a red line.
I am conscious that Third Reading will be agreed, but I want to say a few extra things on issues raised by the National Farmers Union. It is really important that we take them seriously. We said that we would look at all the standards when we went into new trade deals, and the Trade and Agriculture Commission did a very thorough job, for which I commend it. The NFU would like us to go even further on domestic production standards. Importantly, we are now part of this global treaty, and we did not seek to require others to re-ratify the laws in their countries by adding elements. All the member states are already party to various international conventions on the environment, and it is important to note that we have new allies. As we take this step forward and try to increase trade, we need to make sure that we can share our learning and understanding, and show how it adds value. I genuinely believe that when we start to increase significantly the number of agricultural products that we send to other parts of the world through this treaty, it will show that those foods can be sold at a premium.
I was fortunate enough in my time in government to visit some of the countries in the CPTPP. Most recently, I visited Vietnam. Such visits are important for making sure that good standards are in place, and that those countries are our friends in the future. Several of the countries are already in the G20 or the Commonwealth, and we also have some new friends. It is important that we continue to respect that, because at times it feels as though we diminish what other countries do to take trade forward.
I did say that I was not planning to speak for an hour, much to the joy of people in this Chamber, I am sure. I fully endorse this treaty. It is good for our farmers and our country, because it means that we can reduce tariffs on a number of products, including those that can be onshored and put into our freeports, so that we can increase the value of our manufacturing. I wish this treaty well and, as I say, look forward to all the trade and prosperity that will come for the United Kingdom, but also for people around the world.
Richard Thomson
May I take this opportunity to thank the Clerks for all the assistance that they have given throughout the scrutiny process, and to offer heartfelt thanks to the researchers who support my group for the help that they have given me throughout the passage of this Bill?
Those on the Treasury Bench will no doubt be delighted to hear that the SNP will not seek to divide the House on this Bill. We have never said that there could not be advantage from the CPTPP, but we could not be clearer that it offers a poor substitute for the trade deals that were left behind as a result of our leaving the European Union. Let us remind ourselves that, with the CPTPP, we have essentially swapped the four freedoms of the European single market—a market of half a billion consumers, right on our doorstep—for an agreement with a combined economy of almost half the size on the opposite side of the world, which takes only 8% of our exports. It seems to be a bit like putting an Elastoplast on an amputation.
The Government’s impact assessment, which I know is highly contested, even by the Government themselves, indicated that the long-term increase in trade will be worth £2 billion a year, or 0.06% of GDP. We are all aware of the parable of the hare and the tortoise, but I am not sure that many tortoises could live long enough to make up that ground. Whatever benefits do arise—at this point in time, they look distant and minimal at best—they will always and forever be less than we could have had in different circumstances.
Along with others, throughout the passage of the Bill, I have sought to warn the Government that they should find a way to quantify the impacts of CPTPP, and the risks right across a range of sectors that will be affected by it. We will remain vigilant, and will hold the Government to account, where the outcomes justify it. I suppose that I should not disturb the bonhomie that there has been, but one big question remains: will all those on the Front Bench be reunited to discuss any further trade deals before the Prime Minister has to call an election? I await the answer with bated breath.
Question put and agreed to.
Bill accordingly read the Third time and passed.