Trade Bill

Debate between Baroness Burt of Solihull and Lord Hain

Committee stage & Committee: 1st sitting (Hansard) & Committee: 1st sitting (Hansard): House of Lords
Tuesday 29th September 2020 Grand Committee

[Baroness Burt of Solihull (LD)]

My Lords, I shall speak to Amendment 3 on small businesses, to which I have added my name. As we enter the post-transition and post-Covid world of international trade, we must ensure that the role of SMEs in procurement is fully protected so that it can help strengthen the UK’s economic playing card as we navigate the current turbulence and beyond.

At Second Reading, I asked the Minister, the noble Lord, Lord Grimstone, whether, given our new freedom from the EU, we should adopt the policy of the US, Canada, South Korea and Japan to put an annexe in our GPA schedules to allow them to set aside and disapply regulations on behalf of small businesses and other organisations to help bring parity of support for small businesses in accessing markets against larger firms. After all, is that not why the UK decided to leave the EU in the first place? The noble Lord informed me that non-discrimination is the core principle of procurement in the UK and we do not have set-asides for SMEs in international agreements. Okay—I hear him. But whether or not it is intended, it can be more difficult for small businesses to compete against larger firms by virtue of their size and the complexity and requirements of the procurement process.



I will not detain the Committee by going through them all, but when pitching for public contracts, I suggest that few small businesses would feel that the playing field was equal. Take late payment, the scourge of small businesses, particularly because of the relative power of the organisation doing the procuring. The Federation of Small Businesses has long been calling for bad payers to be barred from applying for government contracts. I know that this is something that the Government acknowledge, and this amendment would effectively help the Government to defend themselves against late payers on the trading stage. Why does the Minister feel confident that, when we are competing against the likes of the US, South Korea and Japan, UK small businesses will get fair access to public contracts? Nobody wants to see poor payment practices on the trading stage; this is about fairness and parliamentary accountability, so I would appreciate some commitments from the Minister today.

That brings me to the point of the amendment. It lays a duty on the Government to ensure that small businesses can compete fairly to get greater access to procurement contracts in countries to which the GPA applies. It makes sure that the Government fulfil this obligation by laying a Statement before Parliament reporting that this has been done, and the outcome. If the Minister is committed to a level playing field for small businesses, why not agree to put it into law?

[Lord Hain (Lab) [V]]

My Lords, I support Amendment 1, moved so ably by my noble friend Lord Lennie. I wish to speak specifically to Amendment 5 in the name of my noble friends Lord Hendy, Lady Blower and Lady Bryan. Why? One year ago, on the same day—24 September 2019—that the UK Supreme Court ruled the Government to have unlawfully sought to prorogue Parliament, the Prime Minister was in New York presenting his vision of a post-Brexit Britain to an audience of American business leaders. It involved undercutting European tax rates and adopting lower standards of environmental protection, consumer safety and labour rights than those set by the European Union. It foresaw a low-tax, lightly regulated haven on the European Union’s doorstep, not interested in competing on a level playing field but intent on winning any race to the bottom.

This Trade Bill seeks to take us one step closer to fulfilling the Prime Minister’s dream. It does so more by omission than by commission. As in Lena Horne’s “New Fangled Tango”,

“It’s not what you do do, it’s more what you don’t do”.


It does nothing to promote labour standards. It does not stop signatories to trade agreements seeking unfair competitive advantage by failing to comply with International Labour Organization conventions. It provides no powers for government bodies in the UK to impose public procurement conditions on contractors requiring them to abide by UK labour law or by ILO conventions ratified by the UK. Instead of levelling up labour standards, the Bill encourages shady employers who want to undercut their more responsible rivals by shafting their workforce. It does so by turning a blind eye to bad employment practice and pretending that unfair exploitation does not exist, despite ample evidence that it is widespread from employment tribunal cases and from the daily experience of trade union representatives in workplaces nationwide.

This amendment would put a stop to any regulations implementing the Agreement on Government Procurement if that agreement could in any way hinder the ability of UK state authorities—be they central Government or the devolved Governments—to set conditions on anyone tendering for a public contract. The power of the public purse should be used to raise labour standards and to encourage compliance with global standards such as those set in ILO conventions.