One Hundred Year Partnership Agreement between the United Kingdom of Great Britain and Northern Ireland and Ukraine

Baroness Lawlor Excerpts

Tuesday 22nd April 2025 Grand Committee

[Baroness Lawlor (Con)]

My Lords, I thank the noble Lord, Lord Fox, for his excellent standing in as our chairman when the noble and learned Lord, Lord Goldsmith, was not around. I pay tribute to both chairmen and colleagues on the committee for their dispassionate and open approach to this agreement. It was everything a committee should be. I also thank the officials, who were quite terrific in getting us through the business.

I echo what the noble Lord, Lord Anderson of Swansea, said about the lack of substance and the curious nature of a 100-year agreement that has a six-month period of notice. It has defence and security provisions at a time when the position is very volatile. It includes territorial boundaries, the Sea of Azov and NATO membership. All these defence questions, which the noble Lord, Lord Fox, has taken us through, are very much in the air.

I would like to ask the Minister about the background to the agreement and the timing. The 100-year partnership was signed in January this year, in the same month that the new US President Donald Trump was inaugurated on a manifesto that included ending the Ukraine war rapidly—I think at one stage it was in a day—and stopping the dispatch of what he called US treasure. Thus, when this agreement was signed, the context was that the current and future circumstances were and would continue to be fluid. A peace agreement between Ukraine and Russia would potentially render parts of the UK-Ukraine 100-year partnership out of date. Therefore, I would like to probe the Government further on whether the timing of the agreement may add to the doubts about the agreement’s value lying primarily in its signalling rather than its substance, to which the noble Lords, Lord Fox and Lord Anderson, have already alluded.

Our report welcomes the

“efforts to contribute to a secure and peaceful Ukraine”

but notes that the value of the agreement

“appears to lie primarily in its signalling function, and we are concerned by the lack of detail on the substance of the Agreement”.

We add, in paragraph 21, that

“we heard from witnesses that the title is rather meaningless, and risks distracting attention from the substance of the Partnership”—

the stated aim being

“to provide stability and structure to an enduring … relationship”.

Can the Minister therefore explain the Government’s thinking as they went ahead to sign a 100-year agreement, parts of which might need immediate revision in the event of peace being reached? I know that these conversations are secret, but it would be very helpful for Parliament to know whether the Cabinet considered these rapidly changing circumstances at the outset. Did it discuss the wisdom of proceeding with the agreement we now have? Were there reasons to do so? If so, what were they? Can the Minister explain whether there was a desire to rush things through and, if so, why? Did the Government take into account the implications for Britain’s international standing of making commitments to Ukraine under an international agreement parts of which were potentially unlikely to prove durable in the short or long term?

I turn to the economy and the economic implications of this agreement, on which our report has some things to say. One matter highlighted by the IAC report is the lack of detail on the potential economic implications. The Explanatory Memorandum is not short on aspiration. It says that the agreement

“provides a framework to build enduring links in support of the UK’s growth, development, and security objectives”.

That was confirmed by the Minister, to whom I am very grateful for being so generous with his time, coming along to discuss the Government’s position. Giving evidence, he said that his main priorities, beyond the immediate security of Ukraine, lay in the “growth and economic space” to build “business-to-business links” and investment, to create a “better climate” in Ukraine for UK investment and joint ventures.

Our report, however, addresses the articles on the economy and trade. Paragraph 44 refers to

“articles … which deal with economic and trade cooperation (Article 4), cooperation on energy and climate (Article 5) and on science, innovation and technology (Article 8)”.

Our committee stressed that

“there is a need for further work to ensure that the necessary legal and commercial architecture is in place to support these activities”.

Can the Minister tell us what steps are being taken, or have been taken, to ensure that the legal and commercial architecture needed is in place to support these activities, as the report asks in paragraph 44? What do the Government believe should be tackled exactly, and what would make things better?

I refer now to the three articles. Article 4 of the agreement, to summarise what we say in the report, requires that the parties strengthen conditions for investment and co-operation across a range of sectors. The report indicates that this will involve improving the use of the 2020 treaty and the digital trade agreement that came into force last September, which is for free trade, without duty,

“removing barriers to trade, establishing business-to-business partnerships and supporting the development of Ukraine’s financial centre and business environment through sustained … business access”.

The political declaration also

“proposes using UK Export Finance to support priority infrastructure and defence projects”,

such as building bridges in the capital, co-operating on food security and agricultural development, as well as co-operating to develop a database to verify grain shipments

“to identify grain theft by Russia”.

That is in paragraph 46 of the report.

The report outlines that Article 5 of the agreement says that

“the Parties will co-operate on clean energy transition”.

The suggestion in the political declaration is that there will be collaboration on renewables to attract UK investment, and it explores collaboration on low carbon and supporting critical minerals.

Article 8 refers to co-operation in the field of science, technology and innovation—and here the explanation in the political declaration is that this will involve

“developing capabilities in the use of critical technologies”

such as the digital infrastructure, communications and so on, building on Ukraine’s expertise in the area of AI activities, which the report records

“are to be supported … in the field of research and innovation … delivering ‘mutually beneficial’ joint programmes between commercial bodies, universities and research centres”.

That is all very aspirational. We have here a commitment on economic and trade co-operation that sounds very aspirational. If there is evidence that it will work, it is something that we would wholeheartedly support. However, our report stresses that a stable environment for mutually beneficial innovation and growth is contingent on good governance and the rule of law, as well as well-policed public procurement. Although the Minister’s reassurance that work on governance reforms and strengthening the rule of law was encouraging, more detail is needed on how the Government intend to continue the work and whether initiatives will depend on progress. Our report suggests that aid and co-operation under this should be subject to the strengthening of the rule of law and good governance, which is a recommendation that I strongly support and emphasise.

The partnership agreement raises a number of very serious questions, some of which have already been raised by the noble Lords, Lord Anderson and Lord Fox. I close by emphasising the questions about the economic and fiscal implications for the UK economy and for taxpayers who will foot the bill of government commitments; as well as for businesses that may be encouraged to invest in what so far seems to be a one-way agreement in which the UK gives and Ukraine takes, without there being in place the legal, economic and commercial structures to guarantee any return for those footing the bill and investing. Therefore, I probe further on the evidence for any benefits to the UK economically and fiscally.

Since 2022, the UK has given £12.8 billion to Ukraine, £7.8 billion of which is in military support since the invasion and £5 billion in non-military support. The political declaration indicates a further UK commitment of £3 billion a year in military aid until 2030-31 and for as “long as it takes”. That commitment was announced on 10 July last year. I echo the noble Lord, Lord Fox, in saying that this is a very significant commitment.

The political declaration also proposes using UK Export Finance to support priority infrastructure and defence projects. The Government explain that UK Export Finance has already committed £3.5 billion of financial support for critical reconstruction. This, we hear from the Government, has enabled bridges et cetera around the capital to be rebuilt and mine countermeasure vessels to be provided. What evidence is there that there will be a return from this finance to a war-torn country, which as yet does not have the basic legal, commercial and other building blocks in place for sound business, contracts and investment? In respect of UK Export Finance, the Government say quite clearly on their website that this finance will help businesses that could not get private sector money. I am concerned that there will be pressure by Ukraine and businesses to get hold of this UK Export Finance for projects that have not been considered sound by the commercial sector and that we will be indebting the country unnecessarily with projects that, as yet, have no evidence of any return.

I welcome the committee’s thorough examination of this treaty. Like it, I support the Government’s general aim and their proposals, but I am concerned about commitments made in a 100-year partnership that may not be able to be met. Indeed, they may not be able to be met because of circumstances beyond our control, not least the fluid and volatile situation.