Trade (Australia and New Zealand) Bill

Lord Inglewood Excerpts

2nd reading
Monday 9th January 2023 Lords Chamber

[Lord Inglewood (Non-Afl)]

My Lords, I have enjoyed listening to this debate, with its splendid opening from the Minister and the maiden speech of the noble Lord, Lord Swire. I have learned a lot about things I did not know much about before. But, since we are declaring interests rather like throwing confetti at a wedding, I ought to say that my cousin is married to a very senior New Zealand diplomat. I assure your Lordships that, when we meet on social occasions, we do not talk about the Trade (Australia and New Zealand) Bill but plenty of other more amusing topics. I should also declare that I am a Cumbrian farmer and we have a hill farming enterprise. I am also patron of the United Kingdom Livestock Auctioneers’ Association, president of the National Sheep Association and chairman of the Cumbria local enterprise partnership.

I will divide my comments into three parts: scrutiny; free trade agreements; and the impact on farming. I am not sure that I have a lot more to say about Parliament’s role and the wider public scrutiny of trade deals. In the world we are in now, even if the letter of the law is followed, the wider process is inadequate and needs root and branch reform. The royal prerogative should not be used as a fig leaf to cover up important political and legislative initiatives, which have far-reaching domestic implications. In many ways, the process is worse than the criticisms of the workings of the EU. We need to revisit the whole thing, from the basis of not what happened in the past but what is necessary in the future.

On free trade agreements, which I understand are being proposed as a replacement for the EU single market, the underlying problem is that they may be a replacement but they are not a complete substitute. Much of the criticism of the single market and its rules came from those who do not have supply chains of the kind many businesses have, in particular much advanced manufacturing. These supply chains are extremely complicated and often very long. Physical proximity is, on many occasions, very important. For example, someone in London must be more likely from choice to do business in Newcastle upon Tyne than with Newcastle, New South Wales. It is a reality. In this context, geography matters. Fine-tuning and dispute resolution are much easier when you are close to hand.

Indeed, I had an example of this kind of problem only this autumn. My farm is replacing its dairy parlour. For the new system we are adopting, we decided that the best product was a New Zealand parlour, which we organised. It was due to be in the boat for three months—this is the kind of point that the noble Baroness, Lady Bennett, made. Bad weather got in the way and after about four months we were getting really very worried about the whole progress of our contract.

In any event, free trade areas and single markets are distinctly different. Free trade areas do not of themselves permit goods allowed through the tariff wall of another country to be traded on an equivalent basis as domestically produced goods. Non-tariff barriers can be and are at least as significant as tariffs in inhibiting trade, as has been pointed out. In short, the point of a single market is frictionless trade. The purpose of the European single market, devised, as we know, principally by Lord Cockfield, a Conservative Cabinet Minister and European Commissioner, through the 1992 programme, was to achieve that. That was the purpose of the whole exercise, because the then European internal market was not delivering the benefits to the public which were hoped for and which it was felt capable of delivering, which had been advocated in perhaps too sanguine and hyperbolic terms—possibly, dare I say it, slightly along the lines of some of the Minister’s opening remarks.

The evidence of trade in the 1990s clearly showed that this worked, which was endorsed by the Government’s helpful The UK and the Single Market topic paper of 2011, which predicted a similar trajectory along the lines of household income gains of 2% to 6% per annum. Clearly, this has gone into reverse. Interestingly, the recent statistics that I have seen for the Cumbrian economy, where, as I said, I chair the local enterprise partnership, suggest the general accuracy of that assessment from 2011. The new good things—let us not overlook the fact that there are good things—do not begin to off-set the damage that has been done.

Clearly, although any free trade agreement with our friends—as has been said, Australia and New Zealand are our friends—is unlikely to damage our prosperity, it cannot recapture all that is lost. We have now left the European Union. There is a tabula rasa in front of us. The single market is not the same as the European Union, be it in whole or in part. As a matter of urgency, we have to try to seek a better trading relationship with our neighbours for the reasons that I have touched on.

Finally, I turn to farming. As I explained, I am a farmer in the red wall area. I am a hill farmer; part of my business is hill sheep. I have done that for a lot of years—if I am allowed to give people some financial advice, if you want to make money, do not try that. The crucial point from the Cumbrian perspective is that farming is an important and significant part of the local economy, which together in harness with the visitor economy becomes a very important part of our economy, which is struggling under all the obvious and various difficulties these things face. This sector has to be a focus of the levelling-up agenda. It is just as important as some of those that have been specifically targeted. I am afraid that the Government have been extremely quiet about their approach to this important sector of the economy in a part of the country that is in need of all the help it can get at present. That is not to say that nothing good is happening; good things are happening, but there are still enormous problems.

Against that background, I ask myself: what then are the Government doing even contemplating allowing agricultural products into our market which are produced to lower welfare and environmental standards than those stipulated here? I am not complaining, and I do not think anyone else can complain, about competition on a fair and even-handed basis in the marketplace, but this is not. It looks potentially positively discriminatory against the UK producer. I do not think we should forget quite how clear it was made in the debates in this Chamber on the then Agriculture Bill how strongly the country as a whole wants high environmental and welfare standards. The noble Baroness, Lady Bennett, made a point about mulesing. I just do not think it is an acceptable practice for farmers selling meat into this country. The public would not entertain it.

What is more, there is the question of extraterritoriality. Here we are trying to stipulate certain conditions on trade which will have a direct impact on another country. That is something that is completely accepted. If we look back at the Ivory Bill, which we discussed in this Chamber not that long ago, we will recall that its whole point was to change a series of environmental activities and actions somewhere completely outside the jurisdiction. That is something that we are familiar with, and I do not think we should be concerned about taking steps to do so if it is right in the circumstances.

The Government have said that all these animal welfare and environmental things are basically de minimis and we do not need to worry about them, but we all know that this is what Governments always say when they are skating on thin ice and cannot think of anything better. However, if that really is the case, why are the provisions there at all? If they actually do not matter, surely the counterparties will be only too happy to clarify things and to agree. I say to the Government: reassure the public and the farming community about this because if you do not, given what I am afraid to say is the mess of the current agricultural policy, it is kicking a man while he is down. I was told many years ago that one of the significant differences between France and Britain was that in France the ministry of agriculture was on the side of farmers and rural communities. Does this state of affairs not suggest that this may still be the case now? Like a number of other speakers in this debate, I have real reservations about a number of aspects of the Bill. However it is achieved, the outcome should be not as projected by the Government. Amendments are necessary, be they in this Bill or in the Procurement Bill.

Skills and Post-16 Education Bill [HL]

Lord Inglewood Excerpts

Committee stage
Tuesday 6th July 2021 Lords Chamber

Local authorities and elected mayors are in many respects problematic. The former are elected through the undemocratic first past the post system in England, the latter by putting a single person into an essentially impossible position to represent a whole region. However, they are what we have, and they have hugely more knowledge and representativeness than a handful of large local employers which will surely dominate employer-representative bodies or far-off Westminster. On which point, in the interests of balance, I must applaud what we have been hearing from the Minister about the importance of local decision-making, but if we are going to have that local decision-making it must be democratic.

[Lord Inglewood (Non-Afl) [V]]

My Lords, I was unable to speak at Second Reading, so I must now declare my interests as set out in the register, particularly that I am chair of the Cumbria Local Enterprise Partnership, which provides me with a particular and, I believe, helpful perspective on the Bill. Having heard the noble Baroness, Lady Bennett, while I recognise some aspects of what she said, it bears no relationship to the work that is going on in Cumbria.

My remarks around this group of amendments are probing, so I trust that the Minister can straightforwardly and candidly clarify my concerns. While my comments are mine alone, they echo many of my LEP and mayoral combined authorities colleagues’ concerns. We welcome the key principles underlying the ambitions of the Bill and the desire to bring business closer to the process of curriculum development and delivery. Like the noble Lord, Lord Baker, I suggest that this is exactly what LEPs have been doing for some considerable time: ensuring that the needs of the economy and businesses inform the skills system locally, particularly to ensure that these real needs can be met in a useful and constructive way. LEPs command respect, and I know that they are impartial, so businesses and providers equally trust them. To lose this would be a backward step.

The draft legislation which we are considering proposes that employer representative bodies are reasonably representative of employers operating within the specified area, and I do not think that anybody could reasonably object to that, but it excludes local enterprise partnerships. Therefore, I seriously question and thereby challenge the exclusion of LEPs. How can LEPs not be employer-representative bodies, given that each LEP is created specifically to be the voice of business and consistently to represent, not least at the Government’s specific request, hundreds of businesses in our local areas, including on skills-related issues?

Importantly, LEPs do this for all businesses across all sectors and geographies, not just for those who are part of a membership organisation. This is important. We do not do this just for particular constituencies. We have no further specific axe to grind in the matter. Unfortunately, the White Paper and the Bill appear to ignore this excellent long-term business engagement which has been in place for some considerable time. From my perspective, the absence of any role for LEPs in this legislation strikes me as lacking any rationale based on the evidence and the scale of the work that has been done in the past. It is not a matter of reinventing the wheel, but of the Government disinventing the wheel.

The skills advisory panels, funded by the DfE and led by LEPs, have been assured that there is a deep, evidence-based understanding of the needs of their local economy, their sectors, their businesses and, importantly, the skills required in their locality. In my own LEP in Cumbria, we have a comprehensive governance structure, specifically endorsed by the Government, that ensures that the skills system is demand-led, with our business-led sector panels articulating what is needed and our people, employment and skills strategy group bringing together the skills systems to respond to this. That is the skills advisory panel in action. It matches the claims of that well-known brand of beer that reaches the parts others cannot get to.

The current lack of clarity on the future role of the skills advisory panels is accelerating uncertainty, making it extremely difficult to make any medium- to long-term plans. This has left many members—a number of them volunteers—questioning whether there is any future role for them. We therefore risk losing both momentum and expertise at precisely the point when it is most needed, as the nation recovers from Covid-19 and grapples with the now known challenges posed by moving away from the EU.

As we debate the Bill, LEPs are working in their localities to address the immediate needs of businesses as they come out of the pandemic and respond to the significant changes in the labour market. For example, in Cumbria, we are seeing chronic labour shortages—as the noble Lord, Lord Storey, pointed out in an earlier group—which are not merely inhibiting business but actually stalling recovery; we are working directly with our businesses to help address these.

Simultaneously, we continue to make sure that we focus on the medium- and longer-term skills needs to ensure that we have a pipeline for the future, and we are focusing on supporting the priorities identified by the business community itself. It is in this context that the focus on the pipeline is in the forefront of our thinking and where our work with the careers and advisory company comes in to ensure that all our young people understand the economy and the career opportunities available. We are committed to this in Cumbria, and we and other LEPs provide matched funding to underpin the role of enterprise co-ordinators.

In conclusion, I ask the Minister to respond directly to my points and to a number of other powerful points raised in this group to clarify how the Government see matters in these regards so that, based on her remarks, the House will be able to know whether and, if so, in what way this matter will need further consideration on Report.

[Lord Curry of Kirkharle (CB) [V]]

My Lords, it is a great honour to follow the noble Lord, Lord Inglewood, whose experience of chairing a LEP is extremely valuable; I believe that he has a lot to offer to the consideration of the Bill.

I will comment briefly on Amendments 13, 16, 32 and 35 in this grouping. Much has been said already during this debate that overlaps with other amendments, so I want to reinforce some of the messages that have already been made very strongly by other Peers. To reinforce what I said at Second Reading, I still think that there is a risk of confusion between the various bodies involved and a potential overlap between the agencies. Clarity is essential, and I hope that the Minister will take that on board.

I have two overriding concerns, one of which has been stressed a number of times already this afternoon; that is, in devolving responsibility at a local level to local groups, there is consistency with the national skills strategy and regional priorities. It seems obvious that there should be a very strong conduit between the regional bodies, the LEPs, the combined authorities and the mayoral authorities. I hope that the Minister has recognised the strength of feeling there is on this now. As reinforced by the noble Lord, Lord Inglewood, to leave out the mayoral authorities and not work with the LEPs, with the experience they have and the networks they have established—to throw that away and not build on it—would seem foolish. So I hope that the Government will take those messages into account.

I am also slightly concerned that if this does not happen, we will see a patchwork of disconnected skills groups paddling their own independent canoes. Co-ordination is vital for skills providers to develop appropriate courses to meet regional and local demand. The Minister was reassuring on that point earlier this afternoon, so I hope that is the case.

The critical balance is to achieve local ownership within a framework of national and regional priorities. I restate that regional involvement is essential. My second concern with this grouping is highlighted in Amendment 32, and in Amendment 35 from the noble Lord, Lord Patel. Too often, SMEs and, in particular, rural interests are ignored in designing skills strategies. The SME sector has a weak voice.

Large industrial employers have the resources to engage in consultation exercises. They can devote personnel to sit on boards and, in doing so, influence outcomes. It is a good thing that they do. However, SMEs have difficulty in devoting the time to engage in what, to them, seems like numerous consultations and time-consuming exercises. They do not have the time to sit on boards but their voice is essential. Too often, one has a willing volunteer within an area or region; they get overloaded and do not necessarily represent the SME sector. I am really concerned about the influence of the SME sector in helping to design policies that will work for all.

I conclude by highlighting the importance of the rural sector, which has been mentioned once or twice. There is clear evidence that economic success in rural areas has been hampered, held back and constrained by skills gaps. This will be perpetuated if it is not addressed. The gap between rural and urban will continue to grow. Skills provision is critical, if levelling up is to be achieved even in a modest way, to reduce this rural/urban divide. Too often, government policy has been focused on cities. The large industrial areas are the ones that influence skills strategies. The SME sector, and particularly the rural sector, are the ones that get neglected. As was said by the noble Lord, Lord Baker, the Government are going to have to work really hard to engage with this sector and make sure that the local skills bodies embrace this challenge, and do not once more neglect the rural sector.