Trade Bill

Lord Purvis of Tweed Excerpts

Report stage & Report: 3rd sitting (Hansard) & Report: 3rd sitting (Hansard): House of Lords
Wednesday 6th January 2021 Lords Chamber

I was singularly unpersuaded by the arguments of the noble Baroness, Lady Noakes, against Amendment 22. She described very fully the situations when codes of practice are generally used for guidance on the basis of complex legislation and in negotiations where the legislation needs to be explained by the code of practice, and that is the precisely the situation that we fall into as regards these trade negotiations and the maintenance of standards. I also find it rather staggering that she said that the Government have already promised to maintain the standards and therefore we should not fetter Ministers any further. My memory is that the Government promised us that Covid would be over by Christmastime, so I am not entirely convinced by government assurances on these standards. Let us have it in the legislation.

[Lord Purvis of Tweed (LD)]

My Lords, on my way in today I was reflecting on the fact that I started last year, at about this time, discussing a trade Bill on Report, so it is nice to see that some traditions in the House of Lords do not change.

I support Amendment 22, as the noble Lord, Lord Grantchester indicated. He moved it very well. I do not need to rehearse all the arguments because, as my noble friend indicated, we have had many debates on this issue.

I was grateful that the noble Baroness, Lady Jones, referred to what looks to be the news that the Senate of the United States may well be changing hands. That will bring about a direct consequence for the UK’s trade negotiations. This amendment refers to domestic standards, but it also links to who we trade with. Will there be pressure on our domestic standards by the country that we seek to have an agreement with? We know that the discussions with America are ongoing, and they are likely now to be impacted by a Democrat-controlled White House and full Congress—both Houses.

The consequence of that will mean that the Bipartisan Congressional Trade Priorities and Accountability Act 2015, which put in place conditions on the US trade representative in negotiations on agriculture, environmental standards and objectives, will be reformed, so the United States will have a new position when it comes to the ongoing discussions with the United Kingdom. That is now inevitable, which means that in our approach to the negotiations it is valid that we discuss what our equivalent legislation in this country will be that set our standards, and what the requirements on Ministers will be.

We know that the Government have accepted in part to enshrine standards obligations in a treaty. The European TCA, for example, has set a three-year standstill on organic standards. That is a guarantee, if ever there was one, that there would be no change over a period. Why three years? The noble Baroness, Lady Noakes, indicated that it would be a nonsense to put into any form of legislation a commitment that a Minister has given not to deviate from standards, but why then did we legislate for that exact thing last week in the Act for the European agreement? A standstill for three years on organic standards is a restriction on how this Parliament can now operate standards on organic farming. With that legislation, the Government have bound us for three years. I do not think there is any disagreement about that, because offering some degree of certainty to organic farmers on the standards that will be accepted for trading between the United Kingdom and the European Union is a positive thing. We suggest that under Amendment 22 there are other positive elements that should be highlighted regarding the way that we trade.

I was puzzled by the assertion that Amendment 22 will fetter the prerogative of Ministers and will limit their freedom to bring measures to Parliament for approval by indicating in effect instructions under statute of how they exercise their powers. What puzzles me is that the opposite side supported that with a government amendment to the Agriculture Act. I remind the House that Section 42 is a fettering of the prerogative power that limits the freedoms of Ministers, because it requires them, before they bring forward approval under CRaG, to carry out an exercise whereby they seek an independent body, now a statutory independent body—to emphasise the concern of the noble Baroness, Lady Noakes, about something that she has already supported—to report before Parliament acts. Therefore it is not we who do not necessarily trust the Government, because clearly the Government do not trust themselves if they brought forward an amendment to their own Bill that required an independent statutory body to report to Parliament before we even had a vote on it.

The noble Baroness’s point is even more reduced by the very quick search I was able to do on the legislation website for “Ministers must have regard to” before they carry out their duties. There are scores of examples in legislation where Ministers “must have regard to” before they exercise their ministerial functions on immigration, the health service, judicial appointments, inquiries. In most large areas where Ministers carry out their duties, such as negotiating trade or carrying out health duties, judicial appointments or whatever, there are many statutory expectations of what they must do before they carry out their functions. Amendment 22 is appropriate, because it puts in a slightly wider set of criteria on Section 42 of the Agriculture Act, which the Government themselves had put forward.

My final point is on standards in particular. I am glad that Amendment 22 references women’s rights. We debated the UK-Japan agreement at length, and there was consensus around the House that one of the deficiencies of that agreement was that it did not expand on the areas for supporting women’s rights and expanding women’s economic empowerment within that agreement. On human rights, we know that the Cotonou agreement is already out of date and has to be replaced, so the extra elements under proposed new subsection (3) of Amendment 22 are appropriate.

I will make one point on food rights that links to developments just three days ago with regard to food imports. We assume that food that comes into the United Kingdom is of the same standard that we would expect our own producers to sell elsewhere, and we have worked very hard through the Fairtrade Foundation, which we have supported, and other organisations to make sure that that is the case. I was very sad to learn that Brexit tariffs were imposed on a shipment of fair-trade goods from Africa that arrived into Portsmouth—£17,500 on shipments of bananas from Ghana—and that tariffs of 16.5% will be imposed on tuna.

I hope very much that the Government will recognise that this should not be the situation and that it can be rectified. As much as we want to promote other countries improving standards on labour rights, environmental standards and food standards, as we do here at home, we must work in partnership and we should not penalise those for whom we seek to have much higher standards. I am very happy to support Amendment 22.

[The Minister of State, Department for Business, Energy and Industrial Strategy and Department for International Trade (Lord Grimstone of Boscobel) (Con)]

My Lords, it seems very appropriate that we are beginning the new year by welcoming a familiar friend: a debate on standards in the Trade Bill. Yet again, there were most interesting comments from noble Lords in the debate.

I turn first to Amendment 20, so ably moved by the noble Baroness, Lady Jones of Moulsecoomb, which seeks to prevent the ratification of FTAs unless there are provisions that ensure that imports under those FTAs comply with the UK’s domestic standards for food safety, animal welfare and the environment.

As noble Lords know, the Bill is principally concerned with continuity agreements, which we have now signed with 63 partner countries. It is rather cheering that each time I speak from this Dispatch Box that number has crept up. I should emphasise to noble Lords that none of those agreements has led to a lowering of domestic standards. Cheap food is not flooding our market. Workers’ rights are not being undermined. All we have done is deliver on our central objective of providing continuity for businesses and consumers.

The amendment has unintended consequences that its signatories have not addressed. It could, I am afraid, jeopardise the UK’s ability to meet its WTO commitments. WTO rules constrain the ability of the UK to restrict imports based on criteria such as animal welfare and environmental protection. These WTO rules play an important and balanced role in containing disguised protectionism, but inevitably mean that there is a real risk of a WTO dispute if we do not handle these important matters with care.

Establishing the amendment as a negotiating objective has the potential to create great uncertainty and undermine continuity for businesses at an already critical time. I know that noble Lords would not wish this. It may of course jeopardise the implementation of continuity agreements, including those already signed but not yet ratified. Let us not forget that UK businesses have a long history of trading under these agreements and rely on them for stability and certainty. Any delay to implementation will impact the import of goods on which businesses and consumers are dependent. Furthermore, the noble Baroness’s amendment could result in similar measures being deployed by trade partners with regard to UK exports. That could prevent UK producers from being able to export goods overseas until they had demonstrated that they had met the domestic standards of our trade partners.

However, we of course understand the importance of this issue and the Government have established a number of initiatives to ensure that any concerns around agriculture and the environment are addressed at each stage of the negotiation processes. This includes: public consultations ahead of new trade negotiations; increased engagement with agriculture and agri-food stakeholders; establishing the trade advisory groups; and of course passing an amendment to this Bill, placing the Trade and Agriculture Commission on a statutory footing.

I now turn to Amendment 22, in the names of the noble Lords, Lord Grantchester and Lord Purvis, alongside the noble Baronesses, Lady Boycott and Lady Jones of Moulsecoomb. As I have explained, our continuity programme maintains high standards in areas including food standards, human rights and environmental obligations. Indeed, in many areas the UK goes much further than the EU. Like the noble Lord, Lord Grantchester, I am proud of our standards. Let me give some examples.

When discussing workers’ rights, the UK has led the way and the EU is significantly behind us. The statutory minimum wage in the UK for people aged 25 and over is £8.72 an hour, whereas the EU has no legal minimum. Furthermore, UK workers can get statutory sick pay for up to 28 weeks, whereas the EU has no minimum sick leave or sick pay legislation. Further still—this gets to the crux of our debate—the UK has world-leading standards for animal welfare, while food standards are overseen by the Food Standards Agency and Food Standards Scotland, which I am sure noble Lords agree are the most independent of experts.

The UK has a strong history of protecting human rights and promoting our values globally. We will continue to encourage all states to uphold international human rights obligations. It should also be said that there is no provision within the Trade Bill that could allow amendment of the Human Rights Act.

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[Lord Purvis of Tweed (LD)]

My Lords, I reserved my position on Amendment 25 when we debated it before Christmas. I will not divide the House on Amendment 25, which relates to trade with developing countries. In the previous group, I referred to the consequences of the tariffs now being charged. In the next few days, I hope that the Minister will add extra effort to ensure that this situation does not continue and that we see an agreement with Ghana, in particular, to resolve this issue. On that basis, I will not move Amendment 25.

Amendment 25 not moved.

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[Baroness Bakewell of Hardington Mandeville (LD) [V]]

My Lords, it is a pleasure to follow the noble Baroness, Lady Boycott. I am pleased to be able to make a short contribution to the debate on this group of amendments.

Amendment 26A, on the accurate labelling of products, as laid out so eloquently by the noble Baroness, is essential. I will not repeat the arguments that she has made, which I have made myself in debates. Consumers wish to know that the food they are buying is safe to eat, is of high quality and has been produced in hygienic conditions. Should there be a problem with any of the above, it is important that the produce is traceable, that both human and animal welfare have been protected during production and that the environment has not been damaged during growth and production. The latter is becoming more important by the day as we see the effects of climate change on our environment. Our agriculture and food industry produces the very best for human and animal consumption. Clarity on labelling provides the reassurance that both our farmers and the public expect.

Confidence in government is currently at a bit of a low ebb. It is necessary to repair that confidence, and detailed labelling is a step in the right direction for both farmers and food producers. Both Houses of Parliament must be reassured that this will take place at all stages, from inception—the planting of seeds—right through to harvesting and processing. This cannot be a back-door function of any trade deal.

Amendment 31A would ensure that public and human health came within the remit of the Trade and Agriculture Commission. Given the pandemic that we are living through, it is vital that we as a nation make every effort to ensure that such a situation does not happen in future. The TAC is the right place for this to be considered on a legal footing. Public health is an important element of maintaining confidence in all levels of government, from national level down to district and parish councils. All are interested in ensuring that inequalities are dealt with effectively and removed, and I hope the Minister is able to accept these amendments.

Amendment 34A would leave out the words

“except insofar as they relate to human life or health”.

The amendment would remove the Secretary of State’s ability to limit the advice which the Trade and Agriculture Commission can provide to him or her. For the TAC to be truly effective, it must be able to provide independent advice across a wide range of areas, many of which may not be obvious now. We have no way of telling with any accuracy what future world events may affect our trade and agriculture agreements and sectors, and I believe that it is wise not to be prescriptive at this stage. I support Amendment 31A and will vote in favour of it if a Division is called.

[Lord Purvis of Tweed (LD)]

My Lords, I am grateful for this amendment being moved, because it means that we can debate something that is now a reality: changes in the way that goods coming into the UK and those to be exported will have to be labelled. We know that changes are already under way because of the result of the European agreement, and this amendment would take it to the international stage when it comes to the implications of any goods coming into the UK from other markets beyond.

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[The Deputy Speaker (Baroness Henig) (Lab)]

I call the next speaker, the noble Lord, Lord Purvis of Tweed.

[Lord Purvis of Tweed (LD)]

My Lords, I apologise to the House; clearly the message that I had scratched from this group has not got through. I reflected on the fact that three Liberal speakers on this group would spoil the House too much, so I have nothing to add after the very able way in which my noble friend moved this amendment.

[Baroness Bennett of Manor Castle (GP) [V]]

My Lords, it is a pleasure to follow the very humble noble Lord, Lord Purvis of Tweed, and the noble Baroness, Lady Kramer. I shall speak to Amendment 27, which stands in their names and to which I have added mine. I shall also speak to Amendment 47, in the name of the noble Lord, Lord Bassam of Brighton, to which I have attached my name, and to Amendment 48, which I think might best be described as a friendly amendment to Amendment 47, as it makes just a small addition to it.

As the noble Baroness, Lady Kramer, said in introducing this group, these amendments very much fit together. Amendment 27 refers to the fact that the TRA should listen to a wide range of representative groups. That very much relates to the debate on the preceding group, where the noble Baroness, Lady Boycott, and many others made a powerful case for the importance of food standards and labelling standards. If consumers were listened to by the TRA, it would certainly be very helpful. As we are in a climate emergency and a nature crisis, we need to make sure that expert voices from that area are listened to as well. It is something that perhaps we do not always see traditionally as part of trade, but it is becoming very obvious that it is a crucial part of the whole issue.

On Amendments 47 and 48 in particular, we know that we have a huge problem with the bodies or organisations that are appointed, particularly by Westminster, being representative of all parts of the country in terms of region, background, knowledge and skills. As has just been highlighted by the appointment of the new chair of the BBC, it would seem that, under this Government, there are very few positions in UK society that a long career in the financial sector does not qualify you for. Crucially, we need our government institutions and bodies to be far more representative of our society as a whole. That means including different voices, genders, backgrounds, regions, educational backgrounds, et cetera. These three amendments taken as a package are a modest but important attempt to ensure that, when we formulate and make decisions about trade policy, a range of voices is heard.

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[Baroness Neville-Rolfe (Con) [V]]

My Lords, I welcome the government amendments, which are technical in nature but allow proper co-operation between HMRC and the devolved authorities. As I was not able to be in the House in person during debates on the Trade (Disclosure of Information) Act, I have probably not understood the purpose of Amendment 36A in the name of the noble Lord, Lord Stevenson of Balmacara—but I have a question that perhaps he or my noble friend the Minister could kindly respond to.

I always worry about the wisdom of giving a power to amend primary legislation by order, particularly on the collection or disclosure of information by HMRC, which seems to be the issue in Clause 7(4). As a former international retailer, I know how commercially sensitive such information is and how onerous ill-thought-out form-filling requirements can be. I want to make sure that the power could not be misused by the Executive—we have seen a certain amount of evasion of scrutiny during Covid. I want an assurance from the Minister, assuming that the power to amend primary legislation is retained in what is now being proposed, that the power would be used sensibly. If it disappears, then that would also meet my concern.

[Lord Purvis of Tweed (LD)]

My Lords, anybody seeking to follow this Trade Bill, including the Bill that we had before Christmas, will struggle to follow the three elements through a natural progression—but we are grateful to the noble Lord, Lord Lansley, for his forensic skill. He has been able to assist in the scrutiny of this, and the questions he asks are very valid. I am glad the noble Lord, Lord Stevenson, has brought forward his amendment, and I look forward to the response from the Government and the Minister. Like others, I welcome the Minister’s very full letter in response to the debate that we had on that fast-tracked piece of legislation.

There are a couple of areas that are still troubling me, and I hope the Minister will be able to explain those. I am happy with his explanation that it is purely a matter of parliamentary drafting, with the same legal effect. I will use this ad nauseam in my future career in this House, when it comes to any Ministers quibbling over the drafting of any amendments that I bring forward. I will say that it is purely drafting, with the same legal effect—so, speaking personally, I am very happy that that precedent has been set.

I am glad that the amendments to this Bill, which will effectively become the successor to the fast-tracked Bill, reference HMRC sharing information with the devolved Administrations. This goes back to the very first time we discussed these amendments, so I am happy and pleased that the Government have indicated their support for that.

However, I am interested in the language of Amendment 37, which I welcome, when it states:

“facilitating the exercise by a devolved authority of the authority’s functions relating to trade”.

Can the Minister outline what these are? In the previous group, on consulting the devolved Administrations on trade agreements, the noble Viscount, Lord Younger, was at pains to stress—and was accurate—that, under the Scotland Act and others, trade, as far as international relations are concerned, is a reserved matter.

However, we all know that there are “functions relating to trade” in the devolved Administrations; we know this for certain because it will be in the Bill. HMRC will facilitate the exercise of those functions by the powers under what will be this Act. I would be grateful if the Minister could outline what those “functions relating to trade” are; it would be helpful to us to know the extent of the Government’s position as regards what responsibilities for trade the devolved Administrations have.

Another thing still niggling me is referenced in the Minister’s letter. I have asked on a number of occasions why it was not more straightforward to put authorities that are linked with the ports and their access routes, in Scotland in particular, under those areas in the Bill. The Government have said that the powers were needed in England primarily, as the Minister’s letter stated, because those authorities were identified as the ones facing the greatest disruption at the end of the transition period, but this legislation is now for the long term and this data will also be shared with the WTO and other international bodies.

The Government have said that if it becomes necessary to add an authority in a devolved Administration country, they can use order-making powers to do it, but in subsection (4) there is a reference to an offence in Scotland for a non-existing authority breaching the disclosing information powers, and it carries a term not exceeding 12 months, so for a body that is not included in the legislation it is a 12-month prison sentence for disclosing information. That happens to be twice the length of time that it will now be in England, under government Amendment 40, which is six months. I do not know why that is the case, so perhaps the Minister can explain. There seems to be a ghost criminal offence created by this legislation that does not impact on anybody and is twice as much as it is in England. I just do not understand why.

I hope that the Minister can respond. I will certainly be supporting these amendments. The letter was very helpful and gave the process for indicating when the sunset clause will kick in for the legislation that we passed before Christmas, and given that this legislation is now for the very long term I hope that the Minister can respond to the points that have been raised.

[Lord Grimstone of Boscobel (Con)]

My Lords, I am perpetually grateful to the noble Lord, Lord Stevenson of Balmacara, for his contribution to the discussion of this Bill. Turning to Amendment 36A, in the noble Lord’s name, I am sure that noble Lords will agree that for the Government to grow and strengthen the UK’s export capability, we need a clear understanding of the UK’s exporters. This would ensure that the work we do is targeted and tailored to the businesses where it will deliver the maximum benefit.

Clause 7 sets out the powers needed for the Government to collect data to establish the number and identity of UK businesses exporting goods and services, particularly the smaller businesses and sole traders that may not be readily identifiable from existing data, and where the Government can provide a helping hand, something of course which the Government enjoy doing, so that they can reach new markets.

Amendment 36A to remove Clause 7(4) would restrict the ability of the Government to fully implement the new voluntary—I stress voluntary—exporter question. A similar amendment was discussed in Committee, when noble Lords raised concerns that secondary legislation should not have the power to change primary legislation. However, to include new questions within the relevant tax return—it is that very specified matter—an affirmative SI will be required to amend the relevant legislation. That is the purpose of Clause 7(4), which provides the necessary powers to do so. I repeat that Clause 7(4) is necessary to ensure that the relevant exporter questions are included, as intended on tax return forms. The practical implementation of this will be a tick box on tax returns which the person filling in the tax return can tick if he wishes to identify himself as an exporter; it is entirely voluntary. On that basis, I ask for the amendment to be withdrawn.

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[Baroness Noakes (Con)]

My Lords, I am sorry to have to say to my noble friend Lord Lansley that I believe that your Lordships’ House should have nothing to do with this amendment. When the Taxation (Cross-border Trade) Act 2018 was brought to this House, it arrived as a Supply Bill. There was much huffing and puffing by noble Lords on the Benches opposite at the time, but, of course, the House accepted it. The effect was that there was no Committee stage of the Bill and no opportunity to make any amendments. While the Companion is silent on the subject, it seems to me that if we were unable to amend a Bill during its passage through your Lordships’ House, that should also extend to any amendments to the resulting Act, as its nature relating to supply cannot have changed simply as the result of Royal Assent. I therefore hope that my noble friend Lord Lansley will withdraw his amendment.

[Lord Purvis of Tweed (LD)]

My Lords, I am less squeamish that the noble Baroness about the amendment of the noble Lord, Lord Lansley, and I am grateful to him for bringing it forward. As our discussion about the Trade Remedies Authority demonstrated, the framework for how the UK, now outside the European Union, will approach trade remedies on disputes where we believe that another country is acting beyond WTO standards and principles, is much more to do with public debate and full, wide parliamentary scrutiny than whether the parent legislation involved financial privilege. Our debates about the Trade Remedies Authority lead naturally to asking what is going to provide a framework of accountability for any decisions taken as a result of its recommendations.

I have only one issue to raise with the Minister. I was not satisfied with the response in Committee to a matter I raised. One of the justifications for not supporting the amendment was that, as the noble Lord, Lord Lansley, said, the Minister said that there is sensitivity to some of these aspects. Of course there is sensitivity: that is true by definition. In any trade dispute, there will be sensitive aspects; I do not think that is denied. The noble Lord, Lord Lansley, is absolutely right: we were discussing a previous version of this Bill on Report when the WTO authorised the United States to impose $7.5 billion-worth of tariffs on the EU. The WTO subsequently authorised the EU to impose countermeasures of $4 billion and, as the noble Lord said, from the United States’ point of view, the question whether to make a recalculation for the EU 27 is now being reviewed.

The most important element, to my mind, is that the WTO authorised it. I do not think anybody on any side of this House is proposing that the UK should act illegally in a trade dispute in which we are then seeking to be on the right side, inasmuch as we would not use WTO procedures. The WTO procedures are quite clear: you cannot put forward countermeasures which will include tariffs unless they have gone through the due process in the WTO.

Therefore, the notification of the WTO, with the tariff measures as part of the countermeasures, will be in the public domain. It will be debated. It is therefore nonsense to think that there will be scrutiny, transparency and a public debate regarding our measures to the WTO, but not in Parliament. Many sectors will be involved, as we saw with the US measures. I do not need to go into the detail, but be it whisky, textiles or the metal industry, these measures and potential countermeasures have an impact domestically on certain sectors, regions and nations of the UK. Therefore, it is right that, if we are to make a measured and targeted response to a third country that we believe has acted against its obligations, we ensure that we are not acting in self-defeating self-interest, and a degree of accountability is thus required.

I simply cannot understand why the Government believe that measures that have been made public cannot then be approved by Parliament. I continuously support the efforts of the noble Lord, Lord Lansley, in this regard.

[Lord Stevenson of Balmacara (Lab) [V]]

My Lords, the noble Lord, Lord Lansley, has raised a very interesting question. We need to think a bit harder about it than we did when we first looked at this in Committee.

The issue is not so much with the powers split between the Commons and Lords in relation to financial matters, which I think was the point made by the noble Baroness, Lady Noakes. It is more to do with—as the noble Lord, Lord Purvis, was trying to get us on to—the reality of the grounds on which we have to consider more widely and the relationship between a pure measure, such as tariffs, and the way in which it might be used in any trade dispute, or any day-to-day consideration of our trading relationships. Out of that comes a consideration about whether this is an executive issue or there are also parliamentary concerns.

Taking it from the other end, the fact that the powers enshrined in the original legislation are for a negative instrument suggests that the Government have taken the view that this needs the very lowest level of parliamentary scrutiny. As the noble Lord, Lord Purvis, pointed out very well, this cannot be right. These areas often deal with very important and quite meaty issues to do with industrial policy, employment and the whole economy. There seems to be a distortion being built up between the particular issue in hand, the remedies available and the role of Parliament in considering it.

Surely it would be wrong if we ended up in a situation where the only parliamentary process was consideration of a negative statutory instrument when, in truth, the effects it was trying to ameliorate were causing concern on quite a large scale in the country. I do not have a solution to this. I do not think this Bill is going to provide us with an outlet. I wonder whether the Minister might consider taking this away. Perhaps a more considered review is needed in a couple of years’ time, when we have had experience of how it works in practice.

Without wishing to put words in his mouth or ask him to commit to something he cannot commit to, can he give an assurance that this is something the Government will keep a close eye on? Should issues arise during the next year or so, an appropriate way forward would be to take this as an issue and see whether, as a result of the scale of the penalties, the style of the approach being taken through Parliament and the impact this is having on the economy more widely, it might be best dealt with through a review process.

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[The Deputy Speaker (Baroness Watkins of Tavistock) (CB)]

I have received a request to ask a short question from the noble Lord, Lord Purvis of Tweed. I call the noble Lord to ask a short question of elucidation.

[Lord Purvis of Tweed (LD)]

My Lords, I apologise for detaining the House; I know the hour is late. I am grateful to the Minister for outlining those examples. He gave the impression that Parliament should not necessarily have the ability to approve any of these measures, but that this should be Government to Government, prerogative to prerogative. However, the legislation provides for parliamentary approval if it is through a negative procedure. So Parliament could still annul this, which would bring about all the issues he warns against. He seems to be making the case that Parliament should not even have the ability to annul some of these measures. If Parliament ultimately has the ability to approve or not to approve, we are in a different realm. I hope that, as the noble Lord, Lord Stevenson, indicated, the Government could at least reflect on this debate and the points that have been made on the benefit of having a wider degree of scrutiny, or at least public debate, of some of these aspects.

[Lord Grimstone of Boscobel (Con)]

I thank the noble Lord for those comments. The Government will of course reflect on this debate. I perfectly understand the requirement for the annulment power, but I believe that both Houses of Parliament would wish to use that annulment power sensibly and sensitively, in light of the circumstances which might underlie it.

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[Lord Purvis of Tweed (LD)]

My Lords, I am grateful to the noble Lord, Lord Lennie, for allowing us to conclude at the place where we started: procurement. It is perhaps a sign—I agree with the noble Baroness—that there has been a creeping increase in executive power during this process. At least the scrutiny that this House has afforded the Bill has been thorough, even if the Government may think it has been too long. Nevertheless, we started discussions on this Bill with procurement. And then the United Kingdom Internal Market Bill was introduced, scrutinised and passed before we came to the conclusion of this.

Of interest, the question that I asked the Minister, the noble Lord, Lord Callanan, on the United Kingdom Internal Market Bill was how the regulations on procurement would interact with those that will come through our obligations under international procurement. Could the Minister give us a timeframe for when we expect to see the implementation of many of the Government’s policies on procurement that will now be authorised through our membership of the global arrangements? That interaction is going to be very important.

I have sympathy with the amendment on the basis that the extent of procurement goes far beyond what many people may think, which is simply about the Government purchasing goods. So much of our NHS, in both primary and mental health, is provided by contractors through procurement. The extent is really quite extensive—it is a considerable part of the UK economy—so this is not something that we should be shy about discussing in brief. It is of major importance to the UK economy, and indeed it will be a key part of our international relations.

So I ask the Minister to outline a little more detail. If he cannot give me that information today, I will be happy for him to write to me, because we will be needing to debate in full the Government’s procurement policies going forward, preferably through resolutions in both Houses. We wish to see the details of the Government’s intentions.

[Lord Grimstone of Boscobel (Con)]

My Lords, I will now address Amendment 46, tabled by the noble Lord, Lord Lennie, which seeks to apply the affirmative procedure for any regulations made using the powers under Clause 1.

Perhaps understandably, because this is the last amendment that we will be addressing on Report, noble Lords wished to get certain matters off their chest at the commencement of debate on this amendment, so perhaps they will understand if I do not respond specifically to those points but restrict my comments to the amendment. I will of course commit to the noble Lord, Lord Purvis, that I will write to him with details of the exact timetable, which I do not have available to me at the moment.

Turning to this amendment and, as I say, restricting my comments to the amendment, given the late hour, I first remind noble Lords that the UK will accede to the GPA on the basis of continuity. This means that the “coverage schedules” referenced by noble Lords today and in Committee will remain broadly the same as those that the UK has had under EU membership. I know that noble Lords have suspicious minds and I say “broadly” because the UK’s independent GPA schedules incorporate technical changes to reflect the fact that the UK is no longer an EU member state, and there are now successor government entities other than those listed in Annexes 1 to 3. I have provided more details of these changes in a written response to a question asked on this issue in Committee by the noble Lord, Lord Fox, which I am happy to outline to the House.

The UK’s independent coverage schedules were shared with the International Trade Committee in 2018, along with the text of the GPA and the schedules of other GPA parties. They were then laid before Parliament for scrutiny, in line with the Constitutional Reform and Governance Act, and were concluded without objection in 2019. Since then, Switzerland has agreed to implement the GPA, as revised in 2012. As such, to ensure appropriate parliamentary scrutiny and transparency, the new Swiss schedules were laid before Parliament in October 2020. So I hope noble Lords will agree that there has been ample opportunity to scrutinise the terms of the UK’s GPA accession.

With regard to the scrutiny of our future participation in the GPA as an independent party, I again reassure noble Lords that provisions under Clause 1 are limited to a very specific set of scenarios in the GPA. I stress that this does not include any broader renegotiation of the GPA or of the UK’s market access offer to the GPA.

In the short term, the powers are required to implement an update to the list of central government entities in Annexe 1 of the UK’s GPA schedule. The update will reflect the fact that many entities have merged, moved or changed name since the list was originally written. Given the limited nature of such changes, I believe it is not appropriate to apply the affirmative procedure to Clause 1. Moreover, it is important that these necessary regulations be made swiftly because, as I often find myself saying, if there are delays, the UK could be in breach of its obligations under international law. I draw noble Lords’ attention to the fact that the Delegated Powers and Regulatory Reform Committee of this House has twice considered the power in this clause and on neither occasion saw the need to comment on the use of the negative procedure.

As we are now reaching the end of Report, I will make some concluding remarks. I think that anybody who has witnessed the way our House has dealt with this Report stage can only admire the scrutiny noble Lords have given. That scrutiny has illustrated various aspects of the Bill which were not necessarily fully visible to people at the beginning, and it has drawn people’s attention to how important trade policy now is to the United Kingdom. The fact that the United Kingdom now has full control of its trade policy will lead in the years to come to some very positive developments, as we have already seen with the free trade agreements we are negotiating.

I very much thank noble Lords for the way they have approached Report stage. This is the first Bill that I have had the pleasure of taking through the House, other than our “son of Bill”, which we did before Christmas. I thank noble Lords for the way that they have assisted me and dealt with my inadequacies from time to time, no doubt, in the way that I have presented this Bill.

I thank your Lordships for the attention you have given to this Bill and I look forward to Third Reading. With that, I ask the noble Lord to withdraw his amendment.

Trade (Disclosure of Information) Bill

Lord Purvis of Tweed Excerpts

2nd reading & Committee negatived & 3rd reading & 2nd reading (Hansard) & 2nd reading (Hansard): House of Lords & 3rd reading (Hansard) & 3rd reading (Hansard): House of Lords & Committee negatived (Hansard) & Committee negatived (Hansard): House of Lords
Thursday 17th December 2020 Lords Chamber

[Lord Purvis of Tweed (LD)]

My Lords, it is a pleasure to follow the noble Lord, as always. I am glad he asked his questions because they are very pertinent. I slightly regret his reminding me that I have spent just about half of the time I have been in this House covering a Trade Bill. The gestation period of this Trade Bill seems extraordinarily long. It has even managed to spawn an offspring: a baby Bill that we now have to cover in a rushed way. It is quite extraordinary, really. As the noble Lord said, perhaps it may fly the nest by the end of January.

I read the Hansard from the debate in the Commons and in many respects the Minister rephrased what the Minister in the Commons, Greg Hands, indicated for it. I will turn to that, but our Minister made two interesting references that indicated that both the substantive areas had received substantial scrutiny in both Houses. A reader of Hansard would not have realised that the government amendments were withdrawn in Committee because of the very valid questions put. As the noble Lord, Lord Lansley, indicated, there are still some questions.

That said, if the Government believe very strongly that these powers will be absolutely necessary on 1 January, they should have them. However, I remind the House that these are powers that the Government did not realise they needed, and they could not even draft them properly when they did. Now they do know that they will need them at the end of the year, they are having to rush them through. They will then be superseded by the longer-term powers.

During the course of the Trade Bill, the Minister said that the whole Bill was necessary on 1 January. We now know in much clearer terms, from Greg Hands’s speech and the Minister’s contribution, exactly why they need that. To quote the Minister, it is

“to mitigate any temporary friction”.—[Official Report, 16/12/20; col. 312.]

We now know what that means. After months of warnings during the Trade Bill that the Government were not ready for its border operating model, and months of them saying, “We are ready and it will be ready”, we now know that it is not. The Minister said that we are regaining control of our borders. This Bill demonstrates that they are not in control. Only now, with four working days before the end of the year, have they realised that they need these powers.

It is valid that the Government will have the borders operation centre—what could be termed “a crisis centre”—ready; I do not deny that. We have been calling for such a centre for months, but the Minister has been saying that it was unnecessary because it was going to be smooth, businesses were prepared and there had been plenty of time. At the Dispatch Box, the noble Viscount, Lord Younger of Leckie, said that businesses had no excuse for not being ready because they had been given all the information. We now know that there is a crisis centre that must be operational. The Government did not even know that one member of this crisis operating centre from one agency did not have the legal power to share information with someone sitting next to them in the operating centre from another department. It is literally extraordinary.

The Government also said that it was, to quote Greg Hands,

“to identify and resolve the root cause of disruption.”—[Official Report, Commons, 16/12/20; col. 313.]

I think we know what the root cause of disruption is; nevertheless, if this is to ensure that there is not a crisis built on chaos at the border, then yes, and if it ensures that security is maintained and vital goods are processed, as the noble Lord indicated, then yes, this information should be authorised to be shared.

There is one outstanding issue. I thank the Minister for responding to the points raised in Committee, and some of the changes to the measures in this Bill reflect that the Government listened in Committee, especially regarding the consultation with the devolved authorities. I welcome that, and that yesterday the Welsh Senate, and now the Scottish Parliament, have provided approval, which I welcome.

The Minister said that Northern Ireland engagement is ongoing. As I understand it, the measures in the Bill are required for all United Kingdom ports for the operation of the border operating centre for the whole of the United Kingdom. Am I to understand that the measures in the Bill will not be operational for considering the impact of Northern Ireland ports? Can the Minister confirm that there is no legal authority for information to be shared with Northern Ireland Ministers or between Northern Ireland authorities and the UK Government on 1 January? The Minister must clarify that, not least because of all the debates that we have been having about the preparedness of businesses and what they need to know about the procedures in Northern Ireland. His clarity on that would be welcome.

One point still outstanding concerns Clause 2 and the public authorities sharing information. The Government have indicated that this is a vital reason why they want this legislation to go through. This is for strategic highway companies or port authorities to provide the information to the centre on the smooth operating of our ports. The point that I raised in Committee, which has not been addressed, is that under Clause 2(3)(c)

“a strategic highways company appointed under section 1 of the Infrastructure Act 2015”

covers only England and Wales. It does not cover Scottish highways. Similarly, in Clause 2(3)(d)

“a port health authority constituted under section 2 of the Public Health (Control of Disease) Act 1984”

does not cover Scotland. Does the duty that is now, as the Minister said, “vital”, cover Scottish highways to Scottish ports and, indeed, Scottish ports? I welcome that the information will be shared with the Scottish Government and the Welsh Government, but I am curious as to why that power does not enable Scottish highway operators or ports. If they are all under the aegis of Scottish Ministers, it would be helpful if the Government could clarify that.

Finally, it is a sad state of affairs that we are spending the last day before the recess, potentially before we are recalled to scrutinise a very large piece of rushed legislation, rushing through this legislation. The news yesterday and today that, of all companies, Hornby has halted exports from the United Kingdom because of the uncertainty and the mess at the borders, and that one of our premier clothing companies, Jigsaw, is halting exports to Europe, shows that the harm being done by the confusion, and the likely disruption, is not to foreign importers to the United Kingdom but to British exporters out of the United Kingdom.

I end by quoting Lyndon Davies, Hornby’s chief executive, in the Guardian:

“I’ve seen the Gulf war, Falklands war, three-day week, crashes on the stock market—after all these things there are issues. All we’re asking is, tell us what is going on. We’re forced into a position of saying, ‘what is the point of going through the pain of all these orders?’ What the world of business has to do is sort out the mess and the carnage of what’s left.”


That is one hell of an indictment of the position that we are in, for, as the Minister said, “regaining full control”. Before we come back and before we sunset this piece of legislation, to be covered in the next trade Bill, can the Minister clarify that our ports and borders are ready, because Hornby, Jigsaw and others are clearly indicating that they are not, and that the big cost is to British businesses?

Regional Comprehensive Economic Partnership

Lord Purvis of Tweed Excerpts

Tuesday 15th December 2020 Lords Chamber

[The Lord Speaker (Lord Fowler)]

I call the noble Lord, Lord Haskel. Lord Haskel? No? We will move on.

[Lord Purvis of Tweed (LD)]

My Lords, before looking to very long-term ambitions for joining regional economic partnerships, is it not better for the Government to focus absolutely on the trade agreements that we already have and are struggling to roll over? The update from the Government yesterday says that, for the first time that we know of, we will, from 1 January, be trading on WTO terms with countries that we had a trade agreement with before—a real failure of this Government. One of the RCEP countries is Vietnam; when will we see the details for the rollover agreement for Vietnam so that we can debate it in this Parliament and judge whether the Government are performing as they should be?

[Lord Grimstone of Boscobel (Con)]

My Lords, we have now concluded 27 agreements with 59 countries. There is a very small number of countries that we will not have completed agreements with before the end of this year, but I am pleased to say that the agreement in principle with Vietnam was concluded last week, during the Trade Secretary’s visit, and full details will be made available to the House in the normal way in due course.

Trade Bill

Lord Purvis of Tweed Excerpts

Report stage & Report: 2nd sitting (Hansard) & Report: 2nd sitting (Hansard): House of Lords
Tuesday 15th December 2020 Lords Chamber

[Baroness Jones of Moulsecoomb (GP) [V]]

My Lords, one of the things that has often been frustrating in your Lordships’ House in the seven years that I have been here is that we talk about incredibly important things, yet often our language is so obtuse and complex that, although we understand what we are talking about, other people outside do not. Therefore, a lot of these important issues do not get the sort of publicity that they ought to.

Following the noble Lord, Lord Hendy, is a mixed blessing. He gave a devastating outline of exactly why ISDS should not be any part of trade negotiations. At the same time, he has reduced my speech to ashes because that was exactly what I was going to argue. I honestly do not understand how any member of the Conservative Party can support the concept of not just countries but other corporations having any rights over our country. The mechanisms of ISDS are far worse than any charge that could be brought against the EU courts system. I do not understand how the Government think that it ISDS is reasonable.

The rule of law and the right to legal remedy are both important and are best served not by shady arbitration but openness and transparency and our legal court proceedings. The Minister should argue to everyone in his department that ISDS should not be any part of our trade negotiations. Your Lordships should now make it clear that we will reject any treaty that contains ISDS. The Government have made all sorts of promises about reclaiming sovereignty, but how on earth can they claim with straight faces that ISDS is an appropriate mechanism to put in any trade Bill.

While I have the Floor, I should like to say that the Minister in the previous group said something about the Bill being a useful mechanism for fighting climate change. The noble Viscount, Lord Trenchard, mentioned lifting other countries out of poverty through trade. Perhaps he could do something about that in Britain and start lifting out of poverty the millions of people who are on, below or close to the poverty line. There must be some mechanism that this Government could use. In any case, the whole concept of ISDS should be thrown out as fast as possible.

[Lord Purvis of Tweed (LD)]

My Lords, my noble friend Lady Kramer moved this amendment very ably and indicated that, because of the cross-party support and the degree of consistency with Amendment 19, she would be minded to test the opinion of the House. So I will be brief, because I suspect that the only service I could bring would be to undermine her arguments if I speak at length.

I want to pick up on one point. I agree with others that the noble Lord, Lord Lansley, provides us with a service to make sure that we are as on the ball as we can be with regard to making our case. My noble friend’s point about Canada is illustrative in trying to find out what the Government’s intention is for the long term for the replacement of ISDS.

We already know two things. The Minister said at Second Reading:

“ISDS is a subject which often causes excitement … I confirm that ISDS tribunals can never overrule the sovereignty of Parliament … There has never been a successful ISDS claim against the United Kingdom, but our investors operating overseas have often benefited from these agreements”.—[Official Report, 8/9/20; col. 749.]


He gave the impression that the Government’s position is that they are, at the very least, relaxed about ISDS being in agreements, and that they would not seek to move to a multilateral system as a replacement for ISDS.

The second thing we know is that, since 2008, after the European Council made the decision for the EU policy to move beyond ISDS, it has systematically sought to include provisions in agreements going forward; those can include changes to the ISDS mechanism and having a different form of tribunal process. Further, as the EU-Canada joint statement with the signing of CETA said:

“The EU and Canada commit to join efforts with other trading partners to set up a permanent multilateral investment court with a standing appellate mechanism.”


The issue then is: what was in CETA? We know that the changes to CETA included a right to regulate by both parties—the European Union and Canada—across all levels of government, regardless of investment protection; that there would be a clear break from an ad hoc arbitration system and a move to a permanent and institutionalised dispute settlement tribunal; and that members of the tribunal would no longer be appointed by the investor or the state but would instead be appointed in advance in a neutral manner.

My noble friend asked what the Government’s position is regarding the UK replacement for CETA; this is illustrative of where the Government are, going forward. Inevitably, the Minister was not able to share that information in Committee but, as the noble Lord, Lord Lansley, indicated, we have now seen the text of the agreement. It is very interesting. As has been referred to, page 103 of 109 lifted our hopes against the noble Lord’s fear that we would not be in a position to move to a multilateral system. It states:

“Therefore, the TCA represents an important and radical change in investment rules and dispute resolution. It lays the basis for a multilateral effort to develop further this new approach to investment dispute resolution into a Multilateral Investment Court. The United Kingdom and Canada will work expeditiously towards the creation of the Multilateral Investment Court. It should be set up once a minimum critical mass of participants is established, and immediately replace bilateral systems such as the one in TCA, and be fully open to accession by any country that subscribes to the principles underlying the Court.”


That was reassuring from our point of view and it gave a signal, but there is a sting in the tail: this is subject to a comprehensive review within three months. If the noble Lord, Lord Lansley, is correct—he often is—the Government will have acceded to what Canada wanted but are holding their position. They are holding their position for this review so that they are not in a position where, effectively, they will have their sovereignty restricted because they know that, in entering into the CPTPP or any agreement with America, their partners will not be in favour of moving to a multilateral system.

Perhaps this is just like some of the other discussions taking place now. There is what the Northern Ireland announcement called a grace period. There is a grace period for the agreement for moving to a multilateral system, as in our amendment, but the Government are trying to triangulate. The Government need to be clear, because this cannot go on for much longer. The amendment moved so ably by my noble friend Lady Kramer is an opportunity for the Government to be clear. This is such an important issue, which is why we want to press the amendment: to get clarity from the Government.

At this stage, if the Minister can respond clearly on Canada, that would be a reassurance, but it does not negate the issue. The noble Lord, Lord Lansley, made the point that this amendment is perhaps unnecessary; the text of the UK-Canada agreement and the review means that this amendment is even more necessary to replicate in this Bill what the Government indicated in the UK-Japan agreement.

--- Later in debate ---

Moved by

[Lord Purvis of Tweed]

16: After Clause 2, insert the following new Clause—
“Prohibition of tied aid in trade and procurement
(1) The United Kingdom may only become a signatory to an international trade agreement with a Least Developed Country or a Lower Middle Income Country and Territory if the conditions in subsection (3) are satisfied.(2) The Secretary of State may not lay a copy of an international trade agreement with a Least Developed Country or a Lower Middle Income Country and Territory before Parliament under section 20(1) of the Constitutional Reform and Governance Act 2010 unless the conditions in subsection (3) are satisfied.(3) The conditions are –(a) the United Kingdom commits in the agreement to complying with the Recommendation on Untying Official Development Assistance as adopted by the OECD Development Assistance Committee (DAC) on 25 April 2001, and as amended;(b) no provision of the agreement is subject to a condition restricting the state the United Kingdom has made the agreement with from receiving aid other than those as agreed under the principles of the Recommendation; and(c) the United Kingdom, so far as reasonably practicable, has committed that there will be no significant impediment in the purchasing process of goods or services from the United Kingdom which would have the effect of a narrower restriction than that on the states from which goods or services will be purchased by the United Kingdom using aid.(4) If the conditions in subsection (3) are not included in an international trade agreement made before this Act comes into effect, no regulations can be made under section 2(1) to implement the agreement.(5) The Secretary of State must include in the annual report required under section 1 of the International Development (Reporting and Transparency) Act 2006 (annual reports: general) a statement on how the UK has met its commitments under subsection (3).(6) The Secretary of State may not make regulations under section 1 which are inconsistent with the OECD DAC Good Procurement Practices for Official Development Assistance.(7) The requirements relating to trade and aid on the Secretary of State in this section are in addition to the duties as required in the International Development Act 2002, the International Development (Reporting and Transparency) Act 2006, the International Development (Gender Equality) Act 2014, and the International Development (Official Development Assistance Target) Act 2015.(8) In this section, the definition of aid includes support for—(a) balance of payments and structural adjustment support;(b) debt forgiveness;(c) sector and multi- sector programme assistance;(d) investment project aid;(e) import and commodity support;(f) commercial services contracts; and (g) overseas development assistance to Non-Governmental Organisations for procurement related activities.”

[Lord Purvis of Tweed (LD)]

My Lords, in moving Amendment 16 I will speak to Amendment 25. Before I do so, it would be churlish of me not to congratulate the Minister on a victory on Report. I half expected him to move to adjourn and quit while he was ahead.

I tabled these amendments with a degree of regret. They should be unnecessary, but I am grateful to noble Lords who indicated that they would participate in this group, including my noble friends Lady Sheehan and Lord Bruce. Amendment 16 would put on a statutory footing a prohibition on tied aid, and Amendment 25 seeks to prevent economic disruption for some of the least-developed countries should the UK fail to agree continuity agreements at the end of December.

I mention regret because one of the reasons for tabling Amendment 16 was to respond to some statements that the Chancellor and the Foreign Secretary made recently on what I believe is a shameful decision to breach the UK’s obligations under the 2015 overseas development target Act to meet its commitment to spend 0.7% of GNI on overseas development assistance. When that announcement was made, the Foreign Secretary also highlighted certain forthcoming reforms to assistance away from the legislative basis in the 2002 Act, under what is potentially a repeal of the 2015 Act.

My regret was also about the fact that we should not need to try to put into legislation commitments that Ministers have made. I am pleased that the noble Baroness, Lady Noakes, is following me because she has repeatedly made that argument. I think that we have a genuine disagreement on this—while not necessarily in principle then certainly in balance. We sometimes take Ministers’ statements, accept their word and believe their intentions, and that does not necessarily have to be reflected in legislation. But there are also times when we wish to restrict a Government, regardless of any individual incumbent Minister or position and regardless of which party forms the Treasury Bench in the Government.

However, commitments on ODA and on our trading relationships with the least developed countries have been made repeatedly this year in the teeth of the Covid crisis, both previously and more recently. The Minister for Africa, James Duddridge, said in June that it is the law for us to meet 0.7% and we—meaning the UK—will obey the law. In July, the Foreign Secretary said that we remain committed to 0.7%, and in September the noble Lord, Lord Ahmad, said to the global NGO community in Geneva that we reaffirm our commitment. However, we now know that the Government no longer take that position.

The UK has adopted a convention and approach regarding tied aid since the OECD Development Assistance Committee introduced the principles against tied aid in the early 2000s. A number of commitments are reflected in the amendment and I do not need to rehearse them—I hope that the amendment speaks for itself regarding the obligations that we feel the Government should be bound by. I am sure that my noble friends will give egregious examples of assistance which should have been directed towards the most vulnerable and the poorest in the world having been used to advance British commercial interests—indeed, tying the assistance to those commercial interests.

The UK has been, and still is, a leader in that approach. We represent the top tier within the OECD for not having tied aid. Repeatedly and consistently, more than 90% of our overseas aid is not tied in any way, shape or form, and indeed the remainder comes within a degree of justifiability, which the OECD DAC already allows for.

So that begs the question: why would we seek to put into legislation the commitments that we have made and honoured? I repeat that it is because, unfortunately, we have seen commitments given by this Government but not necessarily adhered to. I hope the Minister can reassure the House that there is an absolute commitment that the UK will not renege on any of the OECD standards on tied aid and that we will maintain our high standing. It would be a very retrograde step if, while cutting our overseas aid around the world by a third over the next year, we also attached conditionality to the remainder for commercial interests. I hope that the Minister can be categorical on this.

I give the Minister notice that for me, this is a very strong issue. We know that the Bill will come back to us in the first week of January, so I am aware that if I seek the opinion of the House on Amendment 25, it will be after the 31 December break point. On the issue that the amendment seeks to raise—the Minister knows that I sought to speak to him about it—I hope that the Government can be persuaded to act at this eleventh hour to avoid unnecessary, possibly devastating impacts on exporters from Ghana and Cameroon in particular. We have tried to frame the amendment so that it captures both. Regardless of the exact drafting of the amendment, I hope that the Minister can understand its thrust.

In Committee—I think in a debate that the noble Lord, Lord Lansley, and I took part in on the global scheme of preferences—concern was expressed about Kenya, Ghana and Cameroon in particular. An agreement in principle with Kenya, although problematic with its regional partners, has been made and I welcome that, but the concerns about Ghana and Cameroon remain. I am aware of certain developments since I tabled the amendment. We were looking at the very bleak situation of Ghana and Cameroon trading on the previous basis and then on a potentially worse set of tariff procedures than under the EPA relationship.

With regard to Ghana, I understand that the UK has now agreed to use a regional text as a basis for negotiations. I understand that that had not been the case prior to very recent developments. Therefore, the current focus on looking at a holding mechanism between the UK and Ghana that will allow for a regional trade framework to be put in place could well be the means of moving away from the precipice of 31 December. The aim for agreement by the end of this year will, I think, be encouraged by most Members of the House, but of course we will have to see the detail, particularly regarding the liberalisation commitments in Ghana, which had been a concern. Therefore, I hope that the Minister can make it clear that there will not be a cliff edge for Ghana.

Turning to Cameroon, I understand that on the outstanding rules of origin issues, there have been holding arrangements for four months rather than three, to allow for a resolution of final issues—perhaps similar to the compromise recently reached for Northern Ireland. Can the Minister confirm my understanding of that?

Therefore, it looks as though there has been progress, but I want to close by giving one brief example of why this issue is important, not only for those working within fair and open trade in Ghana and Cameroon but for British consumers. On a recent visit to my nearest Sainsbury’s in Kelso in the Scottish Borders, I looked at the fruit department and saw bananas from Ghana. Thursday of this week will be the deadline for exporters of bananas from Ghana. Shipments of bananas and pineapples have been processed and are ready to be shipped from Tema to the United Kingdom. Those exporters do not know the value of that cargo because they do not know what the tariff and border arrangements are for the following week. The deadline for them is Thursday of this week, so it is very important for the Minister to give a strong reassurance on that. Tuna exports have now ceased. They are cargoed and at Tema port, and there is also uncertainty regarding those exports.

At the very least, if any British consumers wish to buy fair trade bananas from their supermarkets or fruit and vegetable stores, or indeed fresh tuna, they might, through the example I have given, become aware of the dual consequence of a lack of government assurance. If the Minister is able to provide reassurance today, that will give exporters a degree of confidence. They will be able to proceed on the basis of the Minister’s commitments and then provide that information to customers in the UK so that there is no disruption. I hope that the Minister is able to provide that information. I beg to move.

--- Later in debate ---

[Lord Grimstone of Boscobel (Con)]

My Lords, I thank the noble Lord, Lord Purvis, for raising the important issues of trade and international development. I am well aware of his deep commitment to this topic, and I admire the integrity with which he pursues it. I am pleased to say that the Government share his commitment to supporting international trade, prosperity and poverty reduction, and I am happy to explain the Government’s policy on this topic.

The Government have a proud history of providing official development assistance in such a way as to achieve maximum impact on reducing poverty in developing countries, including through helping to build their capability to trade. The International Development Act 2002 requires that overseas development assistance is provided only for the purposes of furthering sustainable development of a country outside the UK or for improving the welfare of the population of such a country. I unequivocally assure all noble Lords who have raised the point that the Government are committed to providing international aid untied to commercial conditions. That ensures that international aid spending is procured through open competition to achieve best value for money. The UK’s approach in this area is published in the 2015 UK aid strategy and further set out in the UK Official Development Assistance: Value for Money Guidance. The Foreign Secretary reaffirmed this commitment in the other place on 26 November. Through these provisions, the Government’s approach to international aid is wholly consistent with both sets of OECD guidelines on official development assistance to which this amendment refers. I am happy to give the noble Lord, Lord Purvis, and other noble Lords a categoric reassurance that we have no plans or intent to change that.

I turn to Amendment 25. The Government, of course, share the desire of the noble Lord, Lord Purvis, to support trade with developing countries. We have engaged wholeheartedly with our developing country partners to secure economic partnership agreements that provide continuity of their market access. As has already been noted by noble Lords, I am pleased to inform the House that Kenya and the Ivory Coast have recently agreed economic partnership agreements with the UK, which will provide long-term certainty of their duty-free market access and provide a framework to develop our trade relationships in future.

We began discussing an economic partnership agreement with Ghana no less than three years ago, and we encourage Ghana to conclude those discussions to maintain our existing trade arrangements, including its duty-free access. I ask noble Lords to join me in that encouragement: we want to conclude an agreement with Ghana, and I give it that message loudly and clearly. On Cameroon, we are committed to securing an EPA. Further discussions continued as recently as last week and, again, I encourage that country to reach an agreement with us as soon as possible.

Further, I clarify that the Government’s long-stated policy is to replicate the effects of the EU’s generalised scheme of preferences, or GSP, and then in due course to go beyond it. This arrangement supports trade with around 70 developing countries; it increases global prosperity and reduces poverty while providing access to cheaper products for UK consumers. The most appropriate way in which to ensure continuity of this vital trade arrangement is to replicate the existing trade preference scheme, which is already known to be compatible with WTO rules, and regulations to create the GSP will be laid in Parliament shortly.

I absolutely took the point made by my noble friend Lord Lansley about the optimum arrangements for the future, and I will ensure that his comments are passed on. Transitioning the existing EPAs is absolutely not the limit of the Government’s ambition in the area, and in the future we will look at how we can improve on these structures. Regarding proposed new subsection (2) in Amendment 25, introducing any changes to the eligibility criteria of the UK GSP at this point creates risk and uncertainty for the remaining 70 countries of the UK GSP, which I am sure noble Lords wish to avoid.

Regarding proposed new subsection (3), which proposes removing the tariffs on bananas for countries in the UK GSP’s enhanced framework, I urge caution. Although this could provide a way to maintain Ghana’s duty-free access to bananas, it would also extend this preferential access to the other countries in the enhanced framework. Some of them are already competitive banana producers and could increase their exports of bananas to the UK at the expense of existing banana producers, many of which are Commonwealth partners in the Caribbean. Such a proposal cannot be rushed. It must be based on careful analysis. For that reason, it cannot be accepted now.

I hope that your Lordships agree that there is a balance to be struck. While of course I share the concerns of the noble Lord, Lord Purvis, about the impact of a potential loss of duty-free access for Ghana if the worst comes to the worst, this amendment to the UK’s generalised scheme of preferences could have negative consequence on other countries’ trade relationships with the UK. I reassure noble Lords that if Ghana does not agree an EPA—I sincerely hope that it will—it will still receive tariff reductions on two-thirds of its product lines through the general framework of the UK GSP. Ghana can also apply for the enhanced framework of the UK GSP, which provides further trade preferences.

I am genuinely grateful to the noble Lord, Lord Purvis, for raising these important issues. I hope that I have clarified for him and other noble Lords who have spoken the wider consequences of the amendment. I also hope that I have reassured him and other noble Lords on the Government’s policy to not tie overseas development assistance to procurement or trade from the UK, in line with international guidelines. I hope therefore that noble Lords agree that this amendment is unnecessary, and that the noble Lord agrees to withdraw it and not bring it forward on the later occasion.

[Lord Purvis of Tweed (LD)]

My Lords, I am grateful to noble Lords who have participated in this short debate, which has focused on longer-term issues rather than more immediate ones. I am very grateful for the Minister’s response, his kind remarks, and the courtesy with which he carries out his work. My noble friend Lord Bruce and the noble Earl, Lord Sandwich, addressed very clearly the point made by the noble Lord, Lord Lansley, and to some extent, that of the noble Baroness, Lady Noakes. I took the 2015 Act through this House on behalf of my then right honourable friend Michael Moore in the House of Commons. I refer to the subsequent Conservative Party manifesto, its 2017 and 2019 manifestos, and what has been said by every Conservative Minister from the passing of that commitment until three weeks ago. The noble Lord, Lord Lansley, asked whether the amendment was going to prevent the Government doing something that he said they were not going to do. Well, every statement from Ministers and three manifesto commitments has been breached.

Therefore, I hope that noble colleagues will forgive me for laying down a marker to indicate that the connection between trade and development is real. It may be that if, as the noble Baroness, Lady Noakes, has indicated, the Government bring forward repeal or significant amendments to the 2015 Act or, indeed, the 2002 Act, we will consider it then. I hope, of course, that they do not.

The noble Lord, Lord Lansley, made the point about blurring the lines, perhaps, between development priorities and trade priorities. He asked specifically about the drafting of the amendment. It is a fair question. I tried to blend the categories in the list at Part 3 of Schedule 3 to the Taxation (Cross-border Trade) Act 2018, which defines the countries that we will have, with what a trade agreement amendment would be—because as we know, the tied aid goes beyond trade agreements—but, of course, there are elements to be debated going forward. I hope we will not need to debate these. I think that the noble Baroness, Lady Noakes, is right. I hope that what the Government say about having no plans for change will be right. I believe that the Minister has a very high degree of integrity and I am very grateful for the explicit and categorical assurances, and therefore I shall not press Amendment 16.

On the most immediate point, I am grateful for the Minister’s response. I was hoping that he might be in a position to confirm the movement that I understand has been made, because while I freely admit that my amendment is only one option—the noble Baroness, Lady McIntosh, indicated other options and the Minister has indicated certain other areas; we might need to approach this in a different way—the principle is the same. Agreements have not been made. I hope that they will be, but if they are not within a week’s time, assurances need to be made for goods that are in port now, ready to come to the UK from some of the least developed countries in the world. I am glad that the Minister has given reassurance, and I hope very much that we will not need to come back to this after January, because this is now a real, live test that needs to be resolved so that the people paying the price for the end of the transition period are not the people working in some of the least developed countries in the world. However, I beg leave to withdraw the amendment.

Amendment 16 withdrawn.

Trade Bill

Lord Purvis of Tweed Excerpts

Report stage & Report stage (Hansard): House of Lords & Report: 1st sitting & Report: 1st sitting: House of Lords
Monday 7th December 2020 Lords Chamber

I entirely agree with the conclusions of the Constitution Committee. The purpose of these two amendments is to ask the Minister to explain, in his summing up, what the Government’s thinking is about why this is purely presumptive and what prevents them from putting this clearly on the face of the Bill. It may be appropriate to press this to a vote today. I would prefer that the Government agree with me, and the Constitution Committee of the House, and bring forward their own amendment at Third Reading. I beg to move.

[Lord Purvis of Tweed (LD)]

My Lords, it is a pleasure, as always, to follow the noble Baroness. I have a great deal of sympathy with the intention behind these amendments, which also relate to the fact that, from January onwards, the Bill will have to operate for agreements it was never intended to implement. The House does not need reminding that it was the Government’s categorical position in the past that there was no doubt that all continuity agreements would be signed by March 2019, then summer 2019, then the end of 2019—it goes on. The reality is that there are currently 13 countries outside the EU with which we will be trading on terms less favourable than we did before, because those agreements have not been rolled over. The status of those agreements, with regard to this Bill, is now in a degree of limbo. For example, we know that our agreement with Canada is a temporary continuity agreement because we expect the negotiations to roll on regarding an almost immediate successor agreement. It is justifiable for the Government to clarify what status that has with regard to these powers.

Some of the agreements that we did reach have run out of time for full ratification, so they will have to be provisionally applied. That means that the Bill will be used for implementing agreements as well as adjusting ones that are made and ratified, ones that have been made but not yet ratified, and ones to be made and to be ratified. This is a very broad scope for these delegated regulatory powers. In Committee, the Government said that these delegated powers had a purpose. The Minister was quite clear that they are simply for technical adjustments to things, such as the names of quangos or certain terminology, that you would not wish to reopen a treaty for. That has a degree of sense; they should be limited. However, we are in a different position now, even from where we were at the beginning of Committee, with the full knowledge that there will be very many agreements that have not been successfully rolled over and will have to be implemented, some of which will be initiating new agreements at the same time.

I am, therefore, glad that the noble Baroness has again asked the Government to be clear what the intended purpose of these powers is. We want to avoid them being used to implement agreements. We also want to completely avoid them being used for implementing part of a border operating model that we know the Government are not ready for. We want the reassurance that any implementation of a response to questions for our export procedures which are still outstanding will not be used under the Bill. It would reassure the House if the Minister gave the assurance that the intended purpose of these delegated powers remains technical and limited.

[Lord Stevenson of Balmacara (Lab) [V]]

My Lords, I am grateful to the noble Baroness, Lady McIntosh of Pickering, for raising this issue and, through her, to the Law Society of Scotland for reminding noble Lords of some of the detailed points which we often ignore when we put down amendments, particularly at this stage of a Bill’s progress. As the noble Baroness said, and as was picked up by the noble Lord, Lord Purvis of Tweed, some rather unforeseen issues are now arising, particularly in relation to the rollover agreements which were originally intended to be done and completed by 31 December but which, for a variety of reasons, are not going to be. Some of them are being done under emergency power provisions; some will not be done at all. We need to have on the record from the Minister where exactly these will fit in the structure of this Bill. I look forward to his response.

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Moved by

[Lord Purvis of Tweed]

6: After Clause 2, insert the following new Clause—
“Parliamentary approval of trade agreements
(1) Nothing in this section restricts the power conferred by Her Majesty’s prerogative to commence, conduct negotiations towards and then conclude a trade agreement.(2) If a decision has been made by the Secretary of State to commence negotiations towards a free trade agreement, a statement must be made to both Houses of Parliament.(3) Negotiations for that trade agreement may not proceed until the Secretary of State has laid draft negotiating objectives in respect of that agreement before Parliament, and a motion endorsing draft negotiating objectives has been approved by a resolution of each House of Parliament.(4) Prior to the draft negotiating objectives being laid, the Secretary of State must—(a) consult each devolved authority on the content of the draft negotiating objectives, and(b) produce a sustainability impact assessment including, but not limited to, an assessment of the impact of the proposed negotiating objectives on human, animal or plant life or health, animal welfare, environmental protection, human rights and equalities, and employment and labour.(5) A sustainability impact assessment under subsection (4)(b) must include—(a) a statement on how the proposed trade agreement will advance the meeting of the Sustainable Development Goals; and(b) a plan to maintain UK levels of statutory protection on the protection of human, animal or plant life or health, animal welfare, environmental protection, human rights and equalities, and employment and labour.(6) The Secretary of State must inform both Houses of Parliament, and any Select Committee charged by the relevant House with scrutinising trade negotiations in a manner and to an extent agreed with the Committee, of developments in the negotiations, but this does not affect the power of the Secretary of State to conduct negotiations as the Secretary of State considers appropriate.(7) For the purposes of subsection (6), “developments” means—(a) a pause in negotiations;(b) an ending of negotiations;(c) the conclusion of a negotiated round of discussions;(d) the decision to agree in principle an agreement; or(e) other necessary aspects of the negotiations of which the Secretary of State considers it necessary to inform Parliament.(8) The United Kingdom may not become a signatory to a free trade agreement to which this section applies unless a draft of the agreement in the terms in which it is to be presented for signature by parties to the agreement has been laid before, and approved by, a resolution of each House of Parliament.(9) Before a Minister of the Crown moves a resolution to approve the text of a proposed free trade agreement in either House of Parliament, the Secretary of State must— (a) consult each devolved authority on the text of the proposed agreement, and(b) lay before Parliament an independent impact assessment of the agreement including, but not limited to, the requirements in subsection (4).(10) In this section—“devolved authority” has the meaning given in section 4(1) of this Act;“free trade agreement” means any agreement which is—(a) within the definition given in section 4(1) of this Act, and(b) an agreement between the United Kingdom and one or more partners that includes components that facilitate the trade of goods, services or intellectual property;“UK levels of statutory protection” means levels of protection provided for by or under any—(a) primary legislation,(b) subordinate legislation, or(c) retained direct EU legislation,which has effect in the United Kingdom, or the relevant part of the United Kingdom, on the date on which the sustainability impact assessment is produced.”

[Lord Purvis of Tweed (LD)]

I rise to move Amendment 6, and I look forward to hearing the noble Lord, Lord Lansley, on Amendment 12, because these amendments concern an issue that has been a focus of Committee and a major part of today’s debate on Report. I listened carefully to the Minister’s response to the debates we had in Committee on scrutiny of agreements. There seemed to be some areas of agreement across the House, and I hope I am accurate in outlining what I consider them to be: it is the Government’s prerogative to make a decision to open, conduct and conclude negotiations; the Government believe the scrutiny powers of the European Parliament and the role of British MPs in agreements made by the European Union were effective; Parliament needed a greater role here at home; the Constitutional Reform and Governance Act process is insufficient in itself to allow for proper scrutiny and accountability. This last point has been agreed by everybody, including the Government, who have been at pains to say that they acted “above and beyond” the requirements of CRaG on the Japan EPA—in fact, the noble Viscount referred to that in an earlier group. It is fair to suggest that any Government who go above and beyond the legislative requirements they have to have regard to might point to those requirements being insufficient.

Outside groups as varied as the National Farmers’ Union and the BMA have been in touch with noble Lords asking them to support Amendment 6, and I am grateful for their support. It shows the breadth of interest in updating and improving parliamentary accountability for agreements that go far beyond tariffs and quotas, as we have stated repeatedly during the passage of the Bill.

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[Lord Grimstone of Boscobel (Con)]

I would like to thank noble Lords for the courteous way in which this debate has been conducted. I will begin with Amendment 6, in the name of the noble Lords, Lord Purvis of Tweed, Lord Stevenson of Balmacara, and Lord Curry of Kirkharle, and the right reverend Prelate the Bishop of St Albans. During the passage of this legislation, I believe there has been a general acceptance on all sides of the importance of Parliament’s being able to effectively scrutinise trade policy, including our new FTAs with the likes of the US, Australia and New Zealand. We have consistently ensured that there is sufficient scope for Parliament to do this.

The Government have taken a number of important steps, and it is pleasing that noble Lords recognise this and have supported us. For example, we have shared extensive and comprehensive information with Parliament ahead of negotiations with the US, Australia, New Zealand and Japan. On 12 October, I made a Written Ministerial Statement setting out the transparency and scrutiny arrangements for specific international trade deals, starting with Japan. Today, I have made a further comprehensive statement setting out arrangements for trade agreements with the United States, Australia and New Zealand and the UK’s proposed accession to the CPTPP. I believe this statement adds further weight to the enhanced procedures we have already outlined. I was pleased that the nobel Baroness, Lady Hayman, picked up on and welcomed the reference to environmental impacts, and grateful for the pragmatic comments about the statement from the noble Earl, Lord Sandwich. I was also grateful for the comments made about the statement by the noble and learned Lord, Lord Goldsmith, and the noble Lord, Lord Stevenson.

I believe that our approach to transparency, and openness to scrutiny by Parliament and stakeholders, is at least as strong as any other Westminster-style democracy, such as Canada, Australia and New Zealand. I can assure the noble Lord, Lord Purvis, that nothing should be read into the omission of South Africa from this list.

Your Lordships have drawn comparisons between our approach and those taken by the EU and US. They are more similar to each other with their federalised arrangements, than they are to the UK. The European Commission negotiates on behalf of the interests of the 27 member states and its scrutiny arrangements reflect the specific and unique structure of the EU. The same applies to the US. The role the US Congress plays in scrutinising international trade agreements is a product of the constitutional make-up of the United States. I suggest it would be wholly inappropriate for the UK, with our own unique constitutional framework, to import the regime of another country, particularly one where the constitutional circumstances differ so markedly.

We have frequently repeated our commitment to ensuring a transparent trade policy and we have delivered on this time and time again. We have made significant progress in this space. We have listened to concerns from parliamentarians and have taken actions to address them, including putting the Trade and Agriculture Commission tack on to a statutory footing, which will be discussed in the next group of amendments.

We have kept Parliament regularly updated on the negotiations as they have progressed. We have done this via Written Ministerial Statements to update Parliament on key milestones and we have held regular, open briefing sessions for all parliamentarians throughout the negotiations on our FTAs. We have engaged closely with the International Trade Committee and the International Agreements Sub-Committee, including writing to the chairs of both committees at every key stage and facilitating private briefings for them with Ministers and our chief negotiators. My noble friend Lord Lansley, as a member of the IASC, has seen us in action on this and has complimented us on it. We will continue to share confidential treaty text on the FTAs that are currently under negotiation, and on the CPTPP when it comes down the track, with the ITC and the IAS. We will ensure that they both have time to produce a report on any such concluded agreement before it is laid before Parliament under the CRaG procedure.

I hope noble Lords will also realise and accept that we have demonstrated this with the Japan agreement. I accept absolutely the importance of this, as described so cogently by the noble and learned Lord, Lord Goldsmith. Both of the committees’ reports on Japan have now been published, with, if I may say, both committees praising the engagement that they have had with my department. The IASC report notes that

“DIT has been a constructive partner in helping to determine the right processes by which parliamentary scrutiny of the Government’s new function of negotiating trade deals can be facilitated.”

In addition, the ITC and IASC reports congratulate the Government on their achievement in securing the Japan agreement, noting the warm welcome that it has had from witnesses in their inquiries.

I turn to the devolved Administrations. The Government have always been clear that we want to engage meaningfully with them on our trade policy. As Counsel General for Wales, Jeremy Miles MS, recently confirmed in his evidence on 19 November to the Welsh Affairs Committee, the DIT has listened to the devolved Administrations. We have established a new ministerial forum on trade and we have used it to consult the DAs on all of our trade agreements. The forum has met three times already this year and will meet for a fourth time later this week. I can assure the noble Baronesses, Lady Finlay of Llandaff and Lady Ritchie of Downpatrick, and the noble Lord, Lord Wigley, that our desire to engage with the devolved Administrations is both deep and sincere, and we will continue to do so. I believe that putting these arrangements into statute would upset this balance. While in practice, the Government engage with the devolved Administrations on international trade policy, it is important to remember that this has legal status as a reserved matter. We have to take care to preserve this status.

I turn to impact assessments. The Government are committed to an inclusive and transparent trade policy. Scoping assessments are published to assess analytically the impacts of new FTAs in advance of negotiations, and following the conclusion of negotiations currently in train, a full impact assessment will be published prior to implementation. This will be presented to Parliament, alongside the final treaty text, together with an explanatory memorandum to aid parliamentarians in their scrutiny role. Of course, this is in addition to the CRaG procedure. We will also ensure that the impact assessments are independently scrutinised by the Regulatory Policy Committee.

In drafting the amendment, I welcome the fact that the noble Lord has tried to address our point at previous stages of the Bill; namely, that the negotiation and making of treaties, including international trade agreements, is a function of the Executive held under the royal prerogative. However, despite the drafting of subsection (1), that

“Nothing in this section restricts the power conferred by Her Majesty’s prerogative to commence, conduct negotiations towards and then conclude a trade agreement”,


I am afraid that the amendment does exactly that because it places restrictions on the ability of the Government to enter into treaty negotiations and to ratify treaties. With all due respect to the drafters of the amendment, it starts by saying one thing and then it goes on to say another. I am grateful to my noble friends Lord Lansley and Lady Noakes for also spotting that and pointing it out to your Lordships.

Giving Parliament a veto over our negotiating objectives would curtail the royal prerogative, whatever the preamble to the proposed new clause says, and would limit our flexibility to negotiate in the best interests of the UK. I know that noble Lords are aware that the Constitution Committee of this House recommended in its 2019 report on the scrutiny of treaties that mandates for treaties should not be subject to parliamentary approval.

Ultimately, if Parliament is not content with a trade agreement that we have negotiated, it can—like for the majority of all other treaties—raise concerns by resolving against ratification under the statutory CRaG procedure. Under that, as noble Lords will know well, Parliament can delay ratification indefinitely, giving it, in effect, the power to block ratification. The Government are committed to a transparent trade policy with comprehensive engagement with Parliament. We have already demonstrated this and we will continue to do so. The Government have moved a long way in developing comprehensive scrutiny arrangements that are appropriate to our constitutional make-up.

I turn now to Amendment 12 in the name of my noble friend Lord Lansley. I thank him for the amendment. He and I have already had constructive discussions on the topic, and I think it is fair to say that we are in mutual agreement on the importance of strong parliamentary scrutiny and the transparency of our trade deals.

On implementing our trade deals, noble Lords will be aware that it has long been UK practice not to ratify international agreements until any necessary implementing legislation has been passed domestically. This is a well-established process that the FCDO has followed historically for treaties for centuries in order to ensure that the UK will not be in breach of the treaty when it enters into force. The Government have no intention of deviating from this process in relation to our new trade agreements. However, we believe that putting this on to a statutory footing would be inappropriate and would deprive and restrict the Government’s flexibility in the conclusion of our international trade agreements, as well as curtailing the treaty-making prerogative.

I know that my noble friend has expressed concerns about the level of detail in the explanatory memorandums that are laid alongside treaties. I agree with him that Parliament should know clearly how the Government intend to implement any commitments made in an FTA and what legislation Parliament will need to pass in order to implement it domestically. I would argue that, in part, we already do this. For example, in paragraph 5 of the Explanatory Memorandum to the recent Japan agreement, we outline how the agreement will be implemented in domestic legislation. It includes details on how commitments in specific policy areas, such as tariffs, procurement and technical barriers to trade, will be implemented, and where legislation will need to change. I can say without reservation that I would be more than happy to explore with my noble friend how we might make this clearer and more useful to parliamentarians. However, I do not believe that this is an issue which is best resolved in legislation.

In respect of facilitating debates on FTAs as part of CRaG, we have been clear that the Government will facilitate requests for debate on the agreement—including, of course, those from the relevant Select Committees—with the only caveat being that it is subject to available parliamentary time. As many noble Lords know far better than I, it would not be appropriate for the Government to guarantee debating time in the way suggested in this amendment. As I am sure my noble friend with his ministerial experience can appreciate, any Minister would like to be able to guarantee debating time. However, the pandemic and other matters have shown us the need to remain flexible in how we manage precious parliamentary time.

I assure noble Lords—I said this in Committee and willingly repeat it now—that it is not the Government’s intention to shy away from scrutiny. I believe that scrutiny gives us better free trade agreements; the Government want these agreements to be examined by parliamentarians and effectively scrutinised. I hope that noble Lords do not mind my saying that the Government’s practical record on this has been good. Requests for debates have been met, most recently on our FTA with Japan, which was debated in your Lordships’ House on 26 November. I am very pleased that 31 speakers participated in that debate, which followed on from the six earlier debates on our continuity agreements that we facilitated. I hope that these will be the first of many debates on our forthcoming agreements that the Government will facilitate, where—I repeat—parliamentary time allows.

This debate has allowed me to outline the extensive steps that the Government have taken to ensure that Parliament has an effective scrutiny role in the constitutional context of the UK. This includes our long-standing commitments to provide comprehensive information to Parliament in advance of starting negotiations—beyond what many other partner countries undertake—along with conducting thorough engagement throughout negotiations. In addition, we have further enhanced arrangements at the end of negotiations. On this point, I thank noble Lords for helping us to shape these arrangements; I am sure that we will continue to shape and improve them as we go forward. Noble Lords have helped to improve the process of FTA scrutiny and, frankly, persuaded the Government to bring forward their amendments on the Trade and Agriculture Commission. The EU International Agreements Sub-Committee of your Lordships’ House persuaded the Government to ensure that it is given time ahead of the start of the CRaG period to produce a report on the agreement. This will ensure that your Lordships are better informed and able to scrutinise our new agreements more effectively.

As many noble Lords have expressed over the course of this Bill, this is the first time in nearly 50 years that the UK has undertaken trade negotiations; I hope that noble Lords recognise that my officials are not doing a bad job of it. I believe that we should utilise the flexibilities afforded to us under our constitutional arrangements to ensure a robust scrutiny process. I repeat the Government’s commitment to continue to ensure that these arrangements remain fit for purpose, working in close collaboration with the relevant committees.

I hope that I have been able to address your Lordships’ concerns adequately. I therefore ask my noble friend Lord Lansley not to move his amendment and the noble Lord, Lord Purvis, to withdraw his amendment.

[Lord Purvis of Tweed (LD)]

My Lords, I am grateful to the Minister for a very thorough response; he will find out how persuasive I have found him in a moment after I draw out two or three points from the debate. I am grateful to all those who have taken part and, indeed, for the support that I have received, including from the noble Lord, Lord Stevenson of Balmacara.

I have been a Member of this House for seven years. While the noble Lord was making his remarks, I reflected on the fact that if the noble Earl, Lord Caithness, supports a liberal amendment and the noble Lord, Lord Lansley, persuades a Green Peer, it is pretty evident that there is some cross-party backing. We can rely on the noble Baroness, Lady Noakes, to be consistent in her position. I am grateful to her. She always makes me think in these debates, even though she does not often persuade me. I have a copy of the Written Ministerial Statement, which I can share with her if she likes; I am afraid that it is rather heavily annotated, which will not surprise her. I think the point that she made was ably addressed by the noble Earl. Yes, these are our first trade negotiations in 50 years, but almost by definition, as the noble Earl and the noble Baroness indicated, these agreements are very different in nature from those of 50 years ago. They are primarily concerned with non-tariff measures rather than tariff measures.

I agree with the Minister that our approach must suit our own unique constitutional arrangements. With regard to that, the Minister should reflect that the prerogative power is not a static thing as part of those constitutional arrangements. It has been demonstrated that there have been changes in the use of that prerogative power over many years. It used to be a prerogative power that Parliament had no say in the deployment of troops, for example; this is now recognised to be rather different. I assure the Minister as the drafter of this amendment that amendments do not get tabled in this House without the beady eye of the Public Bill Office ensuring that one clause does not contradict another. So I believe in the robustness of this amendment, but I am grateful for his advice.

If I were arguing that, if Parliament is not content with the Trade Bill, it can raise any concerns it may have over a trade deal by resolving against ratification and delaying any implementing legislation indefinitely, I think that the noble Baroness would be frustrated with me for proposing such an argument. What would it say if a sovereign entity—the sovereign Government—signed an agreement then Parliament used a mechanism to delay the implementing legislation indefinitely? That would massively undermine the sovereignty of the Government that had signed an international agreement—yet that is the Government’s position in the Written Ministerial Statement; I quoted from it. It is not a fit-for-purpose mechanism; it is not an appropriate way of considering how we approve trade agreements.

Secondly, I refer to the point made by the noble Lord, Lord Lansley. These procedures are not very good; I would love him to have a right of reply to the Minister too. I will not endeavour to speak for him, nor would he want me to, but the noble Lord’s question—with regard to the amendment—about the ability of Parliament to make a decision before the signature is deliberate. In trade agreements, we know that there is a finalisation process and then, often, an initialling process. The initialled text will then usually go to the Parliament before there is full signature by the sovereign country. It is no accident that, at that stage, in Japan, which went through the process on 24 November, the law then authorised the Japanese Government to put their formal signature on the agreement. If there are problems, the time to highlight them is not as we have it—after the event, where a treaty has basically been made—after which we have the power only to delay the implementation. The right time is at the time of signing. This allows a judgment to be made to avoid problems down the line if there is still a great deal of unease with the agreement that has been signed.

This brings me to my last point. I am glad that the Minister referenced the next group. One of the points that he was at pains to make—indeed the noble Lord, Lord Lansley, made a slight reference to this—concerned whether we are now putting a great deal of restriction on this power. As I mentioned before, the prerogative power has not been set in stone over the years, nor have the restrictions on any British Government over how they conduct or conclude negotiations. No British Government would go into any negotiations that would breach human rights agreements—the ECHR, for example. There are international obligations that we are bound to accept. We are a sovereign Parliament and the prerogative power, as the Minister would suggest, should be completely unfettered. Well, there is quite a high level of fettering about that.

--- Later in debate ---

I would also be very interested in hearing the Minister’s response to a number of queries about Amendment 36. It would be helpful if he could explain the reasons for the various issues that I have raised and, in particular, if he would reconsider the membership of the TAC as far as human life and health are concerned. I thank the Minister once again for his openness.

[Lord Purvis of Tweed (LD)]

My Lords, it is a pleasure to follow the noble Lord. It is clear that the government amendments the Minister is bringing forward today have had a long gestation period—over many years—and the noble Lord, Lord Curry, played a significant role in developing the higher standards which we now take for granted in many respects but which we cannot take for granted in our trading relationships. We still need the existing level of protection.

I commend noble Lords who have shown great endurance and persistence and, ultimately, a degree of success in their work. Among them, I include very much my noble friend Lady Bakewell. Like her, I feel that, having sat for many hours on the trade Bills and the Agriculture Bill, it is nice to see, finally, the Government accepting and then acting on a case that has been made powerfully. In that regard, I welcome the way in which the Minister brought forward the amendments and his openness in discussing them.

He will be aware of the response that I and my noble friend gave, which is reflected in our amendment. My noble friend outlined that in clear terms, and I will simply refer to it before I close. However, before doing so, I want to say that I agree with the point made by the noble Lord, Lord Grantchester, about the motives behind the Government putting this advisory body, but not others, on a statutory footing. We know that that is probably because of the strong campaigning that took place, and that is to the credit of the campaigners, who pressed hard for it. However, the Government have been slightly coy about saying why the agriculture advisory group will be put on a statutory footing but not the trade advisory groups that cover key sectors of the British economy: agri-food; automotive, aerospace and marine; British manufactured and consumer goods, telecoms and technology; chemicals; life sciences; the creative industries; investment; transport services; professional advisory services; and financial services. All those areas are covered by trade advisory groups. What interaction will there be when the trade agreement is being prepared but before it is laid before Parliament under the CRaG process? Why, uniquely, does a report on the elements in Section 42 of the Agriculture Act 2020 have to be received from the Trade and Agriculture Commission but not from the other trade advisory groups?

If the intention behind this is, as the Minister will surely say, to enhance scrutiny, how will we know the views of the trade advisory groups for those other sectors of the economy at exactly the same time as the report from the Trade and Agriculture Commission is presented to Parliament? Perhaps the Minister could make that clear. The situation could be resolved quite straightforwardly: he could state at the Dispatch Box that the Government intend to make sure that the other trade advisory groups are able to submit, and we are able to look at, their views on the impact assessments of an agreement.

I hope that the amendment eloquently outlined by my noble friend does not fall foul of the castigatory remarks from the Minister that my amendment received on the last occasion. In this amendment, I have simply used the Government’s wording. I quite liked the wording of their amendment to the internal market Bill—consulting the devolved authorities on appointments to the office of the internal market. In fact, I liked it so much that I thought it should be used in this Bill too. If the Government appoint members of an advisory body for internal United Kingdom trade and consult the devolved authorities, they should also consult the devolved Administrations when appointing members of an external trade advisory body. That would be quite straightforward, and for the Minister to accept that quickly when he winds up at the Dispatch Box would not create any great problems.

My wider question on the period of three years for the life of the Trade and Agriculture Commission is a good one to ask, as that period slightly jars with the five-year period in this Bill for the regulation-making powers. We have the slightly odd situation whereby, under the regulation-making powers in this legislation, the Government have five years but the Trade and Agriculture Commission has only three. Why there is that disjoint, I simply do not know. It would make sense if, at the very least, the lifetime of the regulation-making powers was the same as that of the Trade and Agriculture Commission.

The amendments on consultation should be straightforward. I am not being facetious but I hope the Minister can provide reassurance on the Government’s intention to consult before the appointments are made. I am not sure whether the amendment in my name and that of my noble friend will allow the noble Earl to have two or two and a half cheers. I think that they enhance this. I am grateful to him for allowing me to explain to my noble friend Lord Fox what peely-wally means. I hope that, with these amendments, the government amendments will be less peely-wally and that maybe there will be an improvement.

[Lord Grimstone of Boscobel (Con)]

My Lords, this group consists of government amendments, together with amendments from my noble friend Lady McIntosh of Pickering and the noble Lords, Lord Stevenson of Balmacara and Lord Purvis of Tweed. I will try to set a good example by keeping my comments tight and to the point, and I will of course write to noble Lords whose comments I do not do justice to in my response. I am convinced that one thing I have learned in taking this Bill through your Lordships’ House is that it is not possible to please all the people all the time in relation to the contents of the Bill.

I turn, first, to the amendments in the name of my noble friend Lady McIntosh. Although their purpose and intent are similar to those underpinning the government amendments before your Lordships—to ensure that high standards of imports into the UK are maintained—my noble friend’s amendments go further. They would create a body responsible for setting criteria for assessing whether provisions in trade agreements on UK imports meet or exceed domestic standards on a very wide range of issues. This would, as a result, set restrictions on what goods could be imported under trade agreements.

It is not appropriate for the UK to impose our standards on other countries and prohibit imports of goods that do not meet our standards where there is no basis to do so. Not only could doing so put us in breach of our WTO obligations but, as we spoke about in Committee on a similar amendment, such action has the potential to harm the economies of developing countries and some of the poorest people in society, and to increase protectionism.

The amendment is unnecessary as the standards that it seeks to protect are already enshrined in domestic statute and the Government will uphold them. Any changes to existing standards would, of course, require new legislation to be scrutinised by Parliament. I believe that the Government have taken decisive action to uphold our commitments to high standards. Extending the remit of the TAC to areas such as human rights would run the risk of duplicating the functions of trusted bodies such as the Equality and Human Rights Commission. I am sure that that is not something my noble friend would wish.

Similarly, my noble friend’s amendments apply to all trade agreements, including continuity agreements. Instead, the TAC should focus on only new free trade agreements and agreements signed with continuity partners from 2023 onwards. The UK’s continuity FTAs, as I have said previously, roll over existing EU arrangements that we now wish to hold on a bilateral basis. Those agreements were scrutinised under EU scrutiny procedures and simply replicate existing EU trade agreements, with necessary adjustments to reflect the UK context.

The Government have listened carefully to the concerns of the House with regard to independent scrutiny of FTAs. I am very pleased to bring forward Amendments 31, 34, 35, 36, 49 and 50, which will put the Trade and Agriculture Commission on a statutory footing. This step is integral to boost scrutiny of our new free trade agreements as we move on from continuity.

The current TAC had a different function. It was established as an independent advisory board in July 2020 to advise and inform the Government on their future trade policy. It aims to ensure that animal welfare and environmental standards in food production are not undermined, that consumer and developing country interests are represented and that new export opportunities are secured for producers in all parts of the UK. The amendments today will not impact the role of the current TAC, which will still produce a report by February 2021. I put on record that the Government are thankful for the commitment, time, investment and hard work that current TAC members and representatives of its working groups have put in, and we commend the success it has had to date. We believe that the action we are now taking to put the TAC on to a statutory footing will be an important development in boosting the scrutiny of the Government’s trade policy.

Amendment 34 places the Secretary of State under a duty to seek advice from the TAC on matters set out in Section 42 of the Agriculture Act 2020, excluding human life and health—I know that this point is of concern to a number of noble Lords; I will come back to it in a moment—in preparing a report to Parliament to accompany relevant free trade agreements laid under the Constitutional Reform and Governance Act procedures. I particularly reassure the noble Lord, Lord Grantchester, that the omission of human health from the remit of the TAC does not in any way diminish the importance that we will attach to it. It is just that, when we looked at the composition of the TAC and its range of duties, it seemed that expert advice relevant to human life and health would best be sourced separately from other, more expert bodies in that field. The report under the Agriculture Act will include both advice that comes from the TAC and advice that comes from other relevant bodies in relation to human life and health. The duty will be exercised, but not through the TAC.

Section 42 of the Agriculture Act places a duty on the Secretary of State to report on whether the measures in certain future FTAs applicable to trade in agricultural products are consistent with maintaining UK domestic statutory protections for human, animal or plant life or health, animal welfare and the environment. The TAC advice will inform that report. It will be laid separately before Parliament as an independent report, but it will not be the totality of the report under the Act.

The role of the statutory TAC will therefore represent an evolution of the current TAC. The statutory TAC’s purpose—to provide advice under Section 42 of the Agriculture Act—is set out in Amendment 31, and the TAC advice will ensure independent expert scrutiny of new free trade agreements. The request for advice by the Secretary of State and any guidelines will be published, and advice supplied by the TAC will be laid before Parliament. That is the role of the TAC. It is not a standing body producing advisory reports, as one might have deduced from the existing TAC; it is an independent expert body scrutinising new free trade agreements as and when they come along.

Amendment 31 creates a power for the Secretary of State to appoint members and, of course, a duty to have regard to the desirability of appointing members with expertise specific to the role of the TAC. The Government will work to ascertain the range of skills and knowledge required for the commission, noting that additional skills and expertise might be required and that the list in the amendment is not, of course, exclusive. The TAC must have those skills but the Secretary of State is free to decide that it might need additional skills other than those on the list.

I can absolutely affirm to your Lordships that the Secretary of State will make appointments in line with all the usual public law principles applicable to all ministerial decision-making and within the confines of the new statutory provisions. These will be direct appointments and will follow established protocols, demonstrating the department’s commitment to a robust process and eliminating any conflicts of interest. The steps required as part of this process will be reflected in the TAC’s terms of reference.

As a non-incorporated expert committee—I might just dwell on those words for a moment—the commission will provide the Government with independent external advice to deliver additional scrutiny of free trade agreements. It will comprise technical experts who can analyse complex treaty text and provide robust and balanced advice to Parliaments. Members of the TAC will be chosen to have knowledge of standards across the whole of the UK. To my noble friend Lady McIntosh, I say that what we are establishing is not a body with a CEO that produces annual reports; it is a group of experts who have a specified task to do, which is put in front of them every time a new FTA comes down the tracks.

Amendment 34 will require the TAC to be reviewed every three years. Of course, I can see from this debate that there is perhaps a misunderstanding among noble Lords about what exactly that means. In my experience, it is good practice for these bodies to be reviewed after a period of time, and three years is not an uncommon period. However, it in no way means that the body will be wound up after that time, because the TAC must stay in place unless the Government bring forward secondary legislation via the affirmative procedure to repeal the TAC’s provisions. There is a review every three years, but only if that review comes forward with recommendations that both Houses of Parliament accept can the TAC be discontinued.

I want completely to reassure noble Lords about the consequences of Amendment 36, which, I fear, has been misunderstood by Members. Amendment 36 is entirely dependent on Amendment 34. Only if the Amendment 34 process every three years resulted in a decision by Parliament that the TAC should be wound up would the provisions of Amendment 36 come into effect to pass the necessary statutory instruments to repeal the TAC. Amendment 36 does not stand alone so it could not be used for the Secretary of State to wind up the TAC on a whim; that would be a ludicrous proposition. I apologise if noble Lords have found the drafting of the amendment confusing in that respect, but I can give them complete reassurance on that matter.

I believe that the role of the statutory TAC complements other measures that the Government have taken to further enhance scrutiny of new FTAs and ensure that the views of the agricultural sector are taken into account during the negotiations process. Indeed, this will not be the only independent scrutiny that our new free trade agreement will receive: the International Trade Committee in the other place and our own IAC will also, of course, provide critical scrutiny and advice on our negotiated deals, just as this took place with the Japan agreement. I reassure noble Lords that the Government remain committed to listening to and engaging with consumers, farmers and industry in negotiating our free trade agreements, and we value the input that they provide in this process.

It is important to remember that our expert trade and advisory groups, representing businesses, consumers and civil society, already provide advice during free trade agreement negotiations—this is an essential difference from the TAC—and we will not seek to duplicate that important work. In particular, there is a dedicated agri-food trade advisory group, in which the agri-foods sector is represented; it does an excellent job of representing that sector.

I believe that these amendments will help the UK safeguard our current standards of agricultural products, put British farming at the heart of our trade policy and ensure that our agricultural sector is among the most competitive and innovative in the world. I hope that noble Lords will be able to support the amendments brought forward by the Government.

On the amendment tabled by the noble Lord, Lord Purvis of Tweed, as I have already mentioned, the TAC will be an expert committee; members will be independent experts, appointed as individuals, not as representatives of academia, business or other organisations for which many of them may work. As I said before, the Secretary of State will make appointments in line with established protocols, following the usual public law principles applicable to all ministerial decision-making. The statutory TAC will represent an evolution of the current TAC to reflect its purpose as set out in Amendment 33. Of course, the membership will be considered accordingly. We are committed to ensuring that only expertise will drive the appointment of new members. It is critical for the success of the TAC that the advice is independent and underpinned by the expertise listed in the amendment.

As I have said before, the central purpose of the TAC is to improve scrutiny of FTAs prior to their ratification. Therefore, as I said earlier, it is related to a reserved matter: the ratification of free trade agreements. As such, the TAC amendment does not engage the legislative consent process under the Sewel convention. While we acknowledge, of course, that the work of the TAC will touch on the devolved matter of agriculture, this does not alter the fact that its function relates to a reserved matter.

However, the UK Government recognise that, as agriculture is a devolved matter, the devolved Administrations, of course, have a legitimate interest in the TAC’s work. Therefore, the Minister of State for Trade Policy has written to them, seeking their views on the statutory TAC, and he will discuss it with them at the ministerial forum for trade later this week. I hope that noble Lords understand that the commitments that we have made, when pulled together, create a further commitment to produce a report on standards in FTAs in relation to specific concerns, as outlined in Section 42 of the Agriculture Act. Through our amendment, we are proposing to put the Trade and Agriculture Commission on a statutory footing—I sense that noble Lords welcome this—and to provide advice in relation to this. I therefore ask my noble friend to withdraw Amendment 7.

--- Later in debate ---

The extraterritoriality of our human rights legislation is part of the terms of reference of that independent review of our Human Rights Act. In the months ahead, this should be the subject of that independent review and we will come back to it. Inevitably, I suspect, we will have legislation on human rights, and that is the time when we should consider precisely how this Parliament should take that responsibility forward.

[Lord Purvis of Tweed (LD)]

My Lords, it is a pleasure to follow the noble Lord. I remember very clearly the debate that he led in Committee. I think it was just the two of us and the Minister in the Chamber, shortly before midnight, when we debated a framework for human rights and trade. That is the point that he was trying to make, and I agree with him very strongly. That is why I commend the noble Lord, Lord Collins, for tabling this amendment to try to persuade the Government that there will be support if they bring forward a trade and human rights policy that we can engage in and work on with them. That is an appeal. I commend the noble Lord for bringing the amendment forward and I am delighted to have added my name to it.

With regard to a list of countries, we are yet to roll over an agreement with Algeria, which Freedom House has classified as “not free” or similarly with Cameroon, Egypt or Eswatini, which are also classified “not free”. We would not engage in this with Syria—although if we were rolling over all agreements, that could include an agreement that did exist but is not in place because the country is under sanction. We have arrangements with the Palestinian Authority, which Freedom House indicates is “not free”; Zimbabwe again is “not free”.

We have separate debates over Turkey and Vietnam. When it comes to Serbia and Bosnia-Herzegovina, we know that those two countries have had year-long disputes over the definition of genocide within the international tribunals. I agree to an extent that, as the noble Baroness, Lady Noakes, indicated, this is a grey area. That is not, however, a reason not to progress into a framework to continue to seek improvements.

I hope the Minister does not mind if I remind him that he has twice been referred to in this way as a private citizen and business leader. As chair of a British financial company he commended the authoritarianism of President Xi over protests in Hong Kong, stating that this ensured economic continuity in Hong Kong and was in the UK’s interest. He has now migrated from business leader to political leader. In many respects, that is illustrative of the challenges that we all face about choices that we make in the business community as well as the political community—it is illustrative of this wider debate.

I serve on the International Relations Committee, as does the noble Lord, Lord Alton. We said in our report on the Middle East that the British Government were on the wrong side of international human rights law in continuing to sell arms to Saudi Arabia as the Yemen tragedy ensued. We have high standards in this country and I believe we are a force for good around the world, but we should not delude ourselves about how others see us: inventor of concentration camps, holder of weapons of mass destruction and declarer of illegal wars. I love my country, but I am not totally rose-tinted about our history.

Still, we have had a proud record post war as the noble and learned Lord, Lord Hope, said. We have helped to shape international norms on human rights, in which we can take particular pride. One of the theatres where we have done so was in the European context when we were a member of the European Union. The noble Lord, Lord Collins, quite rightly said that a common approach on the use of political clauses was agreed in the European Union in 2009, to ensure that there would be systematic references of human rights clauses in all agreements going forward. I will come back to that.

I want to make it very clear what I am calling for, so that the Minister understands that there is no equivocation: a human rights and trade policy which has proper indicative measures and triggering mechanisms, so that we can replace what we had within the European context and have a distinct United Kingdom approach for all trade. The noble Lord, Lord Lansley, referred to proposed new subsection (6). I am pleased that the amendment outlined the breadth of the type of agreements that we have. I hope that the noble Lord, Lord Alton, does not mind me saying that Amendment 9 would have been strengthened if it had been more specific about the areas which we will be covering.

The noble Baroness, Lady Noakes, asked about what proposed new subsection (5)(d) means by some of those

“other … violations of human rights … including … the International Covenant on Civil and Political Rights.”

One example is that we hold strongly to the view that countries should not have the death sentence for people who have a mental illness, or for children. That is within the ICCPR and there should be no disagreement that it is a serious human rights violation. If such a violation is being practised, the question is what impact that should have on our trading relationships.

This is all about the trade relationships that we have through agreements, whether it is a full free trade policy or one of the other agreements outlined in proposed new subsection (6). Those all invariably involve preferential access for that third country to our economy: preferential either because there is less tax or because they have access to our markets or partnerships which we would deny to others except, in general, the WTO. As my noble friend Lady Smith asked: what value do we put on that preferential access? One part is economic; the second part is the value that we have for our wider rights.

I return to the common approach in the European Union and the use of political clauses. The agreements with third countries included human rights and they were all under what was termed “essential elements clauses”. Free trade agreements would be linked to the political framework agreements with that country, encapsulating all the agreements that we have. If they did not exist in the framework, this would be included specifically in a free trade agreement. I would be interested to know whether the Government believe that this is of merit too. Should we include our human rights element in our trading agreements, linked with the other partnership agreements that we have with that country? Labour rights have been included in specific trade and sustainable development chapters. I tried my hardest in Committee to get the Government to state their position on the inclusion and sustainable chapters in future agreements. They did not do so; I hope that the Minister can be clear about it today.

The fact that there has been a standard approach since 2009 meant that, during negotiations on agreements with countries, the EU was able to proactively assess the overall positive and negative impacts on trade agreements, including human rights, and the totality of the human rights record and domestic legal frameworks of that country. That informed the negotiations with those countries. It is not necessarily a case of seeking to impose a legislative framework on that country, but we assess what it is. At the very least, we determine how many international obligations, from labour rights to a whole set of legislative requirements on human rights, they have domesticated into their law. In the European context, it is interesting how many countries revised their domestic legislation during the process of negotiations with the EU, and domesticated international obligations—something they had not done up until then.

Up until that point, most of the agreements had the ability to either pause or suspend. It is only in the recent EU-Canada agreement that, for the first time, there is a specific mechanism where, if there is a gross violation of human rights, or non-proliferation, that could serve as grounds for termination of the entire agreement. We will get into this in the next group, but given that this is the first time, I would like to know from the Minister whether that element has been replicated in the UK-Canada agreement? If it has, it would be the first time that the UK has done this. If the Government have not replicated it, that is, in my mind, a very clear signal that they are departing from the approach that we had led up until now.

I hope that the Government will listen carefully to calls from across the Chambers. We need a UK Government impact assessment tool for the UK that is cross-departmental, including the Department of International Trade, the FCDO and BEIS, so that we can take a considered approach to human rights clauses in our trade agreements, sanctions regimes on human rights from our Foreign Office, and, potentially, remedial acts from the Department for Business. Without a proper impact assessment tool, it is very hard for us to consider this. We need mechanisms and we need frameworks. I hope noble Lords do not mind me saying so, but I believe that this is more important at this stage in this Bill than simply referring to individual examples of human rights abuses around the world that we know, to our shame, have existed.

I hope that the Government will respond positively to Amendment 8 and, before Third Reading, set out clear draft human rights clauses for future trade agreements, draft trade and sustainability chapters, and the mechanisms for escalating concerns around the implications of human rights, and the mechanisms that will then be triggered for us to judge not only whether we believe that the relationship should be questioned but what mechanisms can be put in place. At the end of the day, all of this is about the people and the victims. Unless we have a clear framework and a clear position from the Government, we are letting those people down in the countries with which we trade.

[Lord Grimstone of Boscobel (Con)]

My Lords, I thank the noble Lord, Lord Collins of Highbury, for his Amendment 8. It touches on an important issue that, as noble Lords know, this Government take very seriously and to which I would like to assure the House I am personally committed.

Before I address the amendment specifically, I want to emphasise that the Government share the concerns underpinning the amendments before us today. The UK has long supported the promotion of our values globally and remains committed to our international obligations. We are clear that more trade does not have to come at the expense of human rights. I can confirm to the noble Lord, Lord Collins, that in rolling over continuity agreements we are seeking to deliver continuity of effect for agreements with all our partners. I can confirm that we are not seeking a continuity agreement with South Sudan.

In answer to the noble Earl, Lord Sandwich, I am sure he appreciates that I cannot comment on agreements presently still under negotiation. I have noted the point of my noble friend Lord Lansley on the ongoing human rights review, and I will make sure it is considered. I can assure the noble Lord, Lord Purvis, that we seek to ensure that human rights are recognised and protected in all our free trade agreements. This includes clauses in our trade agreements with many developing and emerging markets, suspensive powers in our trade preferences regime, and recourse to trade levers through our sanction policy.

Turning to the amendment in hand, tabled by the noble Lord, Lord Collins, I am sure the noble Lord will be pleased to hear that the Government are already delivering on some of the commitments that his amendment seeks. For instance, the amendment seeks publication of an annual report. My department has already committed to publish an annual report on our programme of trade activity, and we can certainly explore whether that report could be used for the purposes envisaged here.

However, there are a number of concerns and legal risks raised by the amendment from the noble Lord, Lord Collins, which means that we are unable to support it. It would constrain the royal prerogative powers to negotiate, ratify and withdraw from treaties. Of course, curtailing the royal prerogative is not something that the Government would do lightly.

--- Later in debate ---

[Lord Purvis of Tweed (LD)]

My Lords, this has been a powerful debate and rightly so, given the seriousness of the issue. This Wednesday, 9 December, is the day that the United Nations will mark the adoption of the genocide convention. It is also the International Day of Commemoration and Dignity of the Victims of the Crime of Genocide and of the Prevention of this Crime. I wish to declare an interest in that I chair the UK board of Search for Common Ground, an international peacebuilding charity. Just before the lockdown I was in northern Iraq, where I have been more than 20 times, and Sudan, to which I have gone on many occasions. I have met the victims of the egregious crimes that have taken place in those two countries. Just last night, I was on an online video call with people in Baghdad who are still living with the situation from the north of Iraq which the noble Lord, Lord Alton, introduced. I commend his work in this House and the way that he introduced this group of amendments.

My noble friends Lady Northover and Lady Smith have indicated our support from these Benches and I need not repeat any of their arguments. We will work with the noble Lord and others, as indicated by the noble Lord, Lord Collins, in the previous group, to address some of the areas that have been referred to in the debate. For example, if it is a matter of the courts, which courts, and how do they interact with our treaties and agreements, both domestic and international? Would there have to be clauses and agreements, as the noble Baroness, Lady Kennedy, said, or is the noble and learned Lord, Lord Hope, correct in saying that mechanisms are already in place? This can be discussed and identified.

Also, is this to be linked purely with preferential terms, which the noble Lord, Lord Cormack, indicated, or is it for all trade, as has also been indicated? There are consequences for both of those issues, and yes, they have to be agreed—as well as the interaction between our domestic courts and the mechanisms, which has not been raised so much. Genocide is of course one of the crimes under the International Criminal Court, which is different from those which can be triggered by the genocide convention. How do they interact with each other? These are all issues that I agree can and should be resolved through discussions.

Finally, I want to repeat to the Government from these Benches a clear call for a trade and human rights policy statement where a UK framework of atrocity analysis which can be integrated into our trade policy is agreed. It should be something where officials in the DIT, the Foreign and Commonwealth and Development Office and BEIS should be able to see proper links between judicial measures, human rights measures, trade agreements and our trading relationships. In the absence of a proper framework with atrocity analysis, we will not be doing what I believe that all in this House want the UK to be, which is a leader in the world, not for deciding on the hierarchy of suffering but on preventing the worst excesses of human rights abuses. We need the structures and the frameworks in our legal and trading methods to allow us to do that and I hope that the Government will finally respond positively to this debate.

[Lord Collins of Highbury (Lab)]

My Lords, I will not detain the House for too long because I made my comments in the previous debate about my support and that of the Opposition for this amendment. I thank the noble Lord, Lord Alton, and particularly my noble friend Lady Kennedy of The Shaws for their interventions.

I will single out two contributions. One is that of the noble and learned Lord, Lord Hope, who has presented us with very clear arguments about why this argument should go to the Commons and why the Commons should consider it. The other is that of the noble Lord, Lord Forsyth, because he is right: we have to respond to the government mantra that we have heard so many times: “It has to go to a competent court”. If that is the response, then, as the noble Lord, Lord Forsyth, said, let the Commons decide. That is what this House can do tonight.

Export Control (Amendment) (EU Exit) Regulations 2020

Lord Purvis of Tweed Excerpts

Wednesday 2nd December 2020 Grand Committee

[Lord Purvis of Tweed (LD)]

My Lords, this is a short debate on necessary measures, as the Minister indicated, and I am grateful for the clarity with which he outlined them. We cannot have gaps, uncertainties or confusions in the issuing of export licences and in the interaction between UK law and European law. I need not refer to the 32nd report, because the noble Baroness, Lady McIntosh of Pickering, outlined the issue so clearly; I look forward to the Minister’s response to her questions.

As the Minister indicated, we have debated dual use and export control in the past—I took part in some of those debates. Given that dual use potentially applies to the civil and military use of goods and intermediary goods, this could be a delicate and controversial area. It is delicate because sometimes it is not easy to draw lines for component goods that can be exported for civil purposes but where the recipient country does not share the same high standards in its approach to human rights as the United Kingdom and can use those goods for different ends. It is not always easy for the Government, when issuing licences, to have a clear understanding of all the potential uses of some of these goods. I sit on the International Relations and Defence Committee, where we have debated areas of controversy around export licences. We know that the Government have changed their position on certain export licences and have paused licences when human rights abuses have been raised. Ensuring that there are no gaps or uncertainties is vital, as the Minister said.

This is even more complex because, for the first time in our country’s history, I think, the licensing system will operate under two systems of law: European Union law and United Kingdom law. That adds a greater burden on those businesses that are seeking a licence for export from the United Kingdom, whether from GB or from Northern Ireland. We know that there is a huge amount of trade between Northern Ireland and GB in intermediary goods, so there is complexity around component parts.

That leads to the wider issue that I wish to raise with the Minister, with which he will be familiar from our discussions on the Trade Bill and other measures. The noble Lord, Lord Empey, and others have also raised this issue. Businesses and people in Northern Ireland will be operating under continuing EU law, without democratic accountability for those who are making the decisions, while the United Kingdom Government will operate for GB, so in this area there will need to be good communication between the European Union and the United Kingdom and clear ways of working between the Minister’s department and the European Commission.

A situation that will almost inevitably arise in the future, although not necessarily under the measures that the Minister has indicated are being reformed, is when there are differences of approach between the United Kingdom and the European Union. Almost by definition that will happen, because one of the motives for leaving the European Union is for the United Kingdom to be able to make its own decisions. I would like the agreement with the European Union, which we hope will be signed this weekend, to ensure close working on how the licensing system will operate and on definitions for goods relating to torture or execution or goods with a civil or military use. I hope that there will be specific ways of working between the European Union and the United Kingdom so that a situation does not arise where the Government are operating a licensing system in which there are two different sets of policy purpose. As the Explanatory Notes indicate, some of these measures fall under UN obligations that we have adopted, so I hope that that will not arise, but I would be grateful if the Minister could offer that reassurance.

My second question is linked to the movement of goods—they could be component parts or intermediary goods under the licensing regime—between Northern Ireland and GB before they are then exported. We do not need in this short debate to rehearse the export procedures from Northern Ireland to GB, but it is likely that some of the goods for which export licences will be sought for export from Northern Ireland and/or Great Britain will contain components manufactured in different parts of the United Kingdom. The original source of a component could be Northern Ireland; when that component is moved to GB, it would be exported from there under UK law—or, vice versa, it would be exported under a licence under EU law. If we are to have unfettered access, which is the Government’s policy, and there are no checks, will the Minister say whether specific mechanisms are in place to ensure that there is no unintended loophole with regard to component parts?

My final question is on a point of clarity. If the Minister cannot answer it today, I would be happy for him to write to me. We still do not know what the border operating model for Northern Ireland will be. We hope that we will get a degree of clarity from the European trade agreement. We know what the border operating model is for Great Britain, but we are still waiting for that information for Northern Ireland. What role will the European Union have in checks on goods leaving exit ports in Northern Ireland? We need clarity so that exporters know with a high degree of certainty what the procedures will be. What has been beneficial in the past is that NGOs, human rights organisations and others have been able to observe and monitor the trade and know that proper rules are being followed and that there is a degree of accountability. I am aware that that is probably broader than what these proposals aim to correct and amend, but if the Minister can reassure me that there will not be loopholes in this area, I would be most grateful.

There may be a period after January next year when we can review the relationship between the European Union and the United Kingdom in the interaction of legislation on export licensing. We have raised these questions in the past, so I know that the Government always say that they keep the licensing regime under constant review—that is the terminology the Government always use. I hope that part of that constant review will be an ability to come back to Parliament within a set period to ensure that this is one area where there is no benefit for either the European Union or the UK in not having close working relationships. I do not need to remind colleagues that the licensing of these goods is to protect people from the worst excesses of human rights abuses from Governments in countries that we do not wish to have these products. If the Minister could respond to those points, I would be grateful.

Comprehensive Economic Partnership (EUC Report)

Lord Purvis of Tweed Excerpts

Thursday 26th November 2020 Grand Committee

[Lord Purvis of Tweed (LD)]

My Lords, as is the case in many of these trade debates, it is a continuing pleasure to follow the noble Baroness, Lady McIntosh, and I agree with much of what she said. I am sorry to see the Minister’s discomfort with his eye and I admire his resilience during this debate. I wish him a speedy recovery. I also commend the able way in which the noble and learned Lord, Lord Goldsmith, introduced the committee’s report. I commend all the members of the committee who have contributed to the debate today, including my noble friends Lord Oates and Lord Foster. I also agree with the noble Baroness, Lady Henig, that not only is this a thorough report, it is a very readable one. On many aspects, for those of us who are not steeped in the language of negotiation, readable reports on the consequences of trade agreements are of the utmost importance. I also welcome the maiden speech of the noble Lord, Lord Darroch. I serve on the international relations Select Committee. When we visited Washington, he hosted us for a great visit to the embassy and gave us valuable insights into American politics then under the Trump Administration. To our great benefit, everything that he says now will be on the record, and we will value his ongoing contributions.

In Committee on the Trade Bill, I think that the Minister felt that sometimes I was being rather churlish and a bit dour in some of my remarks. He challenged me to welcome signed trade agreements, and I do so; I welcome this agreement. However, not to disappoint him, I regret that we will be starting next year with fewer free trade agreements than we had prior to leaving the EU. I regret that businesses are facing more costs, more complicated red tape, more bureaucratic government processes and export procedures that are still confusing. I did reflect that page 9 of the scoping document for the UK-Japan agreement states:

“We will ensure that processes are predictable at, and away from, the border.”


Unfortunately, at the beginning of 2021, we will have anything but that.

This is a rollover agreement with some elements of addition which have been debated. I have said on a number of occasions during the passage of the Trade Bill and before it that my party has as one of its founding principles free, fair and open trade. We have been a champion of that for over a century. But we also believe in proper parliamentary scrutiny and accountability. For us to judge the benefits of agreements such as this, the scrutiny as set out in the report of the committee is both welcome and necessary. We will require ever deeper analysis to be able to come to a balanced view of the relative benefits to the UK, as the noble Lord, Lord Liddle, and others have indicated, compared with our trading competitors.

However friendly our trading competitors are, they are still competitors to the UK economy. It is my view that the scrutiny processes need to be enhanced, and we will debate that on the Trade Bill over the coming weeks. The reality for trade agreements, which I have learned during my time in this House, is that a Government who need the agreement the most will concede the most. Fundamentally, therefore, we have two questions today: is this deal good for Britain and is it a negotiated deal that provides comparative advantage for the UK as compared with Japan? We have had a lot of references to the Government selling this, but I think that we often operate a John Lewis trade policy—never knowingly undersold. There has certainly been no shortage of hyperbole. The Daily Express, in response to the announcement by Liz Truss of the signature for this deal, shouted

“Brexit Britain makes history as staggering £15 billion Japan trade deal secured.”


If grandiosity was an exportable commodity, our economic woes would be over, and I think that most Daily Express readers would be staggered to learn that, of that £15 billion, only £2.6 billion is to the benefit of the UK and the remainder is to the benefit of Japan. Therefore, parliamentary oversight and the ability for us to approve the mandates and then the agreements signed is vital. It should not be lost on Members of the Grand Committee that while we do not have a say on the setting of the mandate, and nor do we have a say on the final deal, the Japanese Diet will be voting for ratification on an up and down vote.

It is fair to compare the objectives set by the Government with what has then been realised. The Government published their strategic approach document in May 2020, which said that we would see a growth in exports of 21.3% over 15 years, but the final impact assessment states that we will see an increase of 17.2%, falling short of their ambition by nearly 25%, as the committee has alerted us. Can the Minister explain why we have fallen so short?

I want to look a little more closely at the comparative benefit, notwithstanding the remarks of the noble Lord, Lord Lansley, who knows that I hold him in high regard on these issues. The Government’s impact assessment for the UK on the EU-Japan agreement was published in May 2018. It stated that

“The economic assessment is carried out against a baseline”


where the EU-Japan EPA has not been implemented. This was the same for the scoping assessment for the UK-Japan agreement published in May 2020 and the same for the impact assessment published by the Government in October, so the same baseline makes for interesting reading. The Government’s impact assessment for the UK component of the EU-Japan agreement said:

“Compared to a baseline in which the EPA is not in force, we estimate that the beneficial impact of the EPA on UK GDP could range from between £2.1 billion to £3.0 billion per annum in the long run.”


The impact assessment of this agreement suggests that it is just £1.5 billion. The impact assessment for the EU went on to say:

“We estimate that because of the EPA, UK bilateral exports to Japan could increase in the range of £3.3 billion to £5.6 billion.”


The reality set out in the assessment in October this year is £2.6 billion. So even in the estimates of the UK impact on the EU agreement, we fall short. Let us remember that this uses the same baseline as if there had been no agreement in the first place.

Let us look at the sectors. My noble friend Lord Shipley referred to the motor industry in the north, which is absolutely vital to the area. The impact assessment of the EU agreement for the UK would see an increase for the motor vehicle industry of £1 billion, while the impact assessment for this shows no change. The UK is not at any comparative benefit from where we were with the European agreement. I accept that it can sometimes be difficult to compare baseline data when looking at the different circumstances—that is fair—but we are looking at comparisons between 2018, 2019 and 2020 from the same Government. Therefore, if there are differences, the Minister should say in his response that it is difficult to draw direct parallels, and it is incumbent on the Government to give us tracking data showing why the baseline indications are different.

I have a great deal of sympathy with the contribution made by the noble Lord, Lord Lilley. Having sparred quite consistently with him during the trade negotiations on this, I hope that it will not offend him or make him feel uncomfortable if I say that I agree with every single thing he said in his speech today. I am not sure if that helps at all with our relationship, but I do. To try to get a balanced view, I did something I have not done before, which was to read the report of the Regulatory Policy Committee, the existence of which I admit I was not thoroughly au fait with before. It has reviewed the impact assessment well. Page 5 of the report indicates something quite interesting when looking at the baseline data:

“The uncertainty around the use of the ‘do nothing’ baseline should be made clearer in the IA and set in context with the existing EU-Japan FTA.”


I agree. In judging the long-term versus the short-term benefits, in a wonderful understatement it also states on page 5 that:

“There is a noticeable tendency towards highlighting and exploring the beneficial sides of CEPA.”


It goes on to say:

“The motor industry will see a contraction as a result of this.”


The Regulatory Policy Committee goes on to talk about there being no information about the comparative people movement, as the noble Lord, Lord Lansley, indicated. I shall conclude on the element of the UK-Japan balance of trade. On the key element of what our strategic comparison of benefit would be and the impact on our balance of trade, page 43 states that UK exports would increase by 17.2%, as we have heard, but that:

“The paragraph focuses on the increase in the overall trade between the UK and Japan, but does not discuss the UK’s balance of trade, which according to these figures would weaken by £10.4 billion.”


If we are to judge the merits of a trade agreement, we have to look at the comparative benefits for each of the two signatories. We have to compare accurately what the Government said it would be, and the reality. On the overselling of the agreement, I agree with noble Lords: it will put at risk the reputation of all trade agreements going forward if the Government actively oversell the agreement. We are in debt to the committee for bringing many of these points to our attention and I hope the Minister will respond positively to many of the contributions made in this debate. If he can do anything, perhaps he can persuade the Secretary of State to sell a little less and to deliver a little more.

United Kingdom Internal Market Bill

Lord Purvis of Tweed Excerpts

Report stage & Report: 3rd sitting (Hansard) & Report: 3rd sitting (Hansard): House of Lords
Wednesday 25th November 2020 Lords Chamber

[The Deputy Speaker (Lord Lexden) (Con)]

I should inform the House that if Amendment 64 is agreed to, Amendments 66 and 67 cannot be called.

[Lord Purvis of Tweed (LD)]

My Lords, it is a genuine pleasure to follow the noble and learned Lord. I admire how thoroughly he outlined his amendment, to which I have added my name. I inform the House that I believe Amendment 68 in my name is consequential to Amendment 64, so if Amendment 64 is agreed to by the House then I will move Amendment 68.

As the noble and learned Lord concluded his remarks, he hit on a fundamentally important point, about which we raised concerns in Committee and earlier, which have been reinforced by the Chancellor’s Statement today. Both before and during Committee, the concern was that the Government sought these financial powers to override one of the core elements of devolution: that expenditure on devolved areas in our devolved nations should be taken by the bodies accountable to them for those policy areas. As a member of five years’ standing of the Finance Committee in the Scottish Parliament, I know that that spending would come with agreed policy platforms, financial strategies and a degree of accountability.

The Government, I think, believe that the people owe loyalty to those who spend the money, and therefore the main priority is to identify the source of the money—not how it is delivered and not the accountability for it. However, as the noble and learned Lord raised, can the Minister clarify whether that is the case as she responds to the debate on these amendments?

If the Government have indeed announced their intention to override the devolution settlement and to use this Bill to deliver spending on devolved areas without the agreement of the devolved Administrations, that will indeed confirm the fears that we outlined, both at Second Reading and in Committee. I hope that the Minister will be able to say clearly that that is not the case, but I fear from the announcement that has been made today that it is.

The concern started because we had seen very little consultation with the devolved Administrations—or indeed English local authorities—on the spending powers that were to be in this Bill, and we had not been given any indication that these powers had been the result of consultation. There had been consultation on the replacement of EU structural funds, and that consideration was fairly extensive. But there was a mismatch between the consultation on how to repatriate the structural funds and the powers under this Bill, which are catch-all. Not only that, there surely could not have been consultation based on the manifesto commitment of the Government, which was to replace those funds with a skills fund—that was in the Conservative Party manifesto. So the powers that seem to be indicated go far beyond what the manifesto itself said, and indeed the results of the consultation on what the structural funds should be.

There is no reference in the Bill to what the delivery mechanism would be. The noble and learned Lord indicated quite clearly that, under the previous scheme—where, I remind the House, 76% of all European investment had been allocated to the member states—it was to be managed through the devolution settlement, and that management was through our existing frameworks. The current multiannual financial framework, from 2014 to 2020, which is coming to an end, was a UK partnership agreement. It gave granular detail—373 pages of it—of the fund: where it was going, the administration of it, how it was administered and how complementarity would be secured between the legitimate devolved policy areas. The Government have indicated that that approach is no longer fit for purpose because that was the European structural funds. Before we see announcements at a political level about the political intention, surely it is right that the Government publish the respective replacement process.

My party on these Benches and I, as a former Member of the Scottish Parliament, have never been opposed, since devolution, to the UK Government supporting schemes within Scotland. But that was under a recognition that it was linked to the correct competences of the UK Government. For example, in 2018, the UK Government supported the Edinburgh Fringe Festival in supporting artists to promote the United Kingdom around the world in one of the world’s premier cultural events. Local to home in my area, the wonderful Common Ridings used to be very familiar with receiving support from the local authority, the Scottish Government and the UK Government.

The point is not that the UK Government should be restricted from supporting reserved areas in the devolved countries, but that the policies for delivery of the replacement of the structural funds should be done under an agreed process. That agreed process seems to be set on its head now, with the Government believing that they will deliver the programmes, regardless of consultation, regardless of agreement and, more worryingly, regardless of an agreed framework for how these funds can be delivered.

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[Baroness Penn (Con)]

The noble Lord will probably be unsurprised to know that the advice I have received has not changed in the short time since he asked his further question. I will commit to reviewing that advice; if any part of it was not accurate, I will write to the noble Lord. My understanding is that those reviews do not refer to the powers in this Bill, and whether the devolved Administrations or others can refer matters to the CMA for review relates to other parts of this Bill.

[Lord Purvis of Tweed (LD)]

The Minister gave a number of examples of how the UK Government are currently able, under their powers, to fund UK priorities across all parts of the United Kingdom. The Government do not have the legislative powers to spend on devolved areas within devolved competencies. What powers are the Government seeking to have by January next year for them to spend on devolved policy areas in our devolved nations?

[Baroness Penn (Con)]

The Government are seeking the power under this Bill to spend across the whole of the United Kingdom in the areas set out in the Bill. The operation of the £220 million announced at the spending review will start from the next financial year and the full shared prosperity fund will begin the year after. More detail on how that will operate will be set out in due course.

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Moved by

[Lord Purvis of Tweed]

68: Clause 43, leave out Clause 43

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There is, as noble Lords have explained in some detail, an offer from the devolved Administrations to work positively together to establish a UK-wide structure in which the devolved nations can participate fully. I hope that the Minister will accept this offer with grace because, otherwise, they are on course for a constitutional stand-off.

[Lord Purvis of Tweed (LD)]

My Lords, it is a great pleasure to follow my noble friend, with the very great experience and knowledge that she has on this issue. Given the fact that all four speakers so far in this group have been from Wales, I thought that, to avoid a degree of market distortion across the United Kingdom, there should be a little bit of northern balance. All I wish to do is to endorse the points that they have so ably made.

I put my name to this amendment, and if the noble and learned Lord, Lord Thomas of Cwmgiedd, presses it and the House agrees, the Government have an opportunity now to bring back a more considered proposal as a result of some consultation. None of the speakers in this group has indicated that it is easy. If it was easy, agreement would have been reached at the outset. It is about being aware that the frameworks update highlighted that one of the four areas of dispute around where the competences lie with this power being repatriated is state aid. It is obvious that it was not a straightforward situation of saying that this had been uniquely a United Kingdom responsibility—so by definition, it is an issue.

It is also perfectly clear from all speakers that, without there being an understanding about the tests, de minimis levels, the administration and the type of ministerial direction that has existed up to now—without clarity as to how all that will go forward—any Minister in a devolved Administration will quite rightly be concerned about what impact this will have on the economies of the powers that they do have under the devolved competences.

I just wish to reinforce the point that the letter from Jeremy Miles to Alok Sharma, which I read, made a very fair offer. We share the concern that, without there being a further set of discussions to seek a degree of common ground on a framework agreement about how this will operate in the future—which there is time to do, because the Government have indicated that they are seeking to effectively have a window under the WTO approach, and there is consensus that that will be respected—this is potentially the way forward.

I hope that, although often it may not seem so, the Minister will see defeat as a bit of a silver lining in order for him to come back with a more considered approach, to take the Welsh offer and to allow us to consider the Government’s position from a degree of consensus and agreement. I support the noble Lords who have spoken on this group so far.

[Lord Stevenson of Balmacara (Lab) [V]]

My Lords, like the noble Lord, Lord Purvis, I agree with the case that has been made so well by the previous speakers. I put my name to the amendment put forward by the noble and learned Lord, Lord Thomas, and we would support him if he chooses to divide the House.

It is very simple: we agree that there has to be a UK-wide policy on state aid—or subsidy, if that is what it is to be called. The question that hangs around but never seems to get answered is: why has it not yet been articulated what this policy would be? It cannot be a question of timing. This suggests yet another shroud of mystery that surrounds this increasingly perplexing Bill.

It is certainly a novel way of developing policy for a Government to remove policy that is in force and that everybody knows and understands, increasing the uncertainty and making it more difficult for businesses. However, as the noble and learned Lord, Lord Thomas, said in his opening speech, the statutory instrument removing the current rules—taking us out of the current system that has been operating for a great number of years—has already been laid and will be debated next week, and we will not be able to stop it.

We therefore seem to be heading towards WTO rules, which are not well respected and do not seem to be applied properly, and there is no policing or organisational structure in which they can be dealt with properly. If that is where we are, we would at least have a period of stability during which we can sort out how we want to set up the rules that will apply to the internal market and how, if necessary, they are to be policed. This could all be part of the yet-to-be-announced deal with the EU—and it may be that is the case, because it is clear that this is a significant area of interest within the negotiations. But without any further detail on that, it is hard for us to speculate.

However, as others have said, the Welsh Government have come forward with an extraordinarily generous offer to expedite work on a common framework that relates to state aid and make a voluntary agreement to pause any legislation that would impinge on that in the intervening period. That is almost too good an offer, and I hope that the Minister has an adequate response to it.

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[Lord Mackay of Clashfern (Con) [V]]

My Lords, I am happy to move Amendment 73. It is the same sort of amendment that I moved in Committee, when my noble friend Lord True was kind enough to say that it was a unionist type of amendment and, therefore, could be considered. Since then, the Government have accepted a number of situations covered by my amendment. It has therefore probably served its purpose and I do not propose to put it to a Division.

However, it illustrates what I am anxious to achieve: a degree of co-operation between the devolved Administrations and the Government of the United Kingdom, which will put the Bill in a much happier situation than it appeared to be in at first sight. A good deal has happened already. I just hope that they will go a little further.

I am under a certain restraint, because my computer has decided to restart without giving me any notice. I may not be able to speak at all when my turn comes at the end of this group but, if not, I end in that spirit.

[Lord Purvis of Tweed (LD)]

It is a pleasure to follow the noble and learned Lord and we are grateful that he is more reliable that his technology. In Committee and with this amendment, he has suggested to—and sought to persuade—the Government that there is merit in them thinking again about further consultations on developing the frameworks to the extent that, where they can reach their limit, there would then be the legislative requirement within this Bill.

I will speak to Amendment 75, in my noble friend Lord Fox’s name, which tries to put forward a structure for these discussions and, in effect, to codify it within this legislation—providing that framework, as it were, for the talks that should happen. In so doing, I will display what some colleagues in the House consider my usual characteristic of being rather pernickety—to which I say mea culpa. In our amendment, we reference the “Joint Ministerial Council”; it should refer to the Joint Ministerial Committee, so I admit that that was an error in the drafting.

When we started Committee, we had heard reflections at Second Reading and the concerns of the devolved Administrations about this Bill. At this stage, there is no need to rehearse the concerns; we have done so in Committee and on Report. Ministers—the noble Lords, Lord True and Lord Callanan, and the noble Baroness, Lady Bloomfield, in particular—have been very willing to meet with us and discuss this. We have not always been in agreement; nevertheless, personally speaking, I am grateful for the opportunities to discuss some of these issues with the Ministers.

Ultimately, the House has made the decision that we have not been persuaded by many of the Government’s arguments. Even today, key elements of the legislation have been excised, such as those on spending and subsidy powers. From the government Benches, the noble Baronesses, Lady Noakes and Lady Neville-Rolfe, indicated that it was not appropriate for the OIM to be in the CMA. In a whole series of areas, this House has taken a view that we are concerned about how the Bill had been drafted.

Fundamentally, one of the themes has been a genuine ongoing concern, not fully addressed by government amendments on consultation, that the powers which the Government are taking under this legislation will damage, rather than strengthen, devolution. In particular, they will put at risk one of the areas where we have seen consensus not only within the parties in this House but within the nations and the UK Government: namely, that the frameworks process has been positive, notwithstanding a pause and a disagreement. The amendment of the noble Lord, Lord True, which this House passed with a large majority, the reference that the noble and learned Lord, Lord Mackay of Clashfern, indicated with his amendments and our amendment show that we also wish for that process to see its natural conclusion.

At this stage, we believe there is merit in seeking support for a further set of discussions at a plenary session of the Joint Ministerial Committee, which can agree the principles of the market access and an intergovernmental relationship that will put this on a sound footing for many years to come. That is why we are asking the House to consider a proposal that we believe will allow there to be agreement and consensus, but not a veto.

This is the final thing that I will say. We accept that the operation of the UK market is a shared UK aspect, but it will be a complex set of discussions and potentially contentious. That is why in this amendment we have sought a mechanism to prevent a veto but to allow consensus to be brought about. I know that my noble friends Lord Bruce of Bennachie and Lord Fox will cover the details. Personally, having gone through all the stages of the Bill, I will say that while we recognise Ministers’ willingness to be open, as I have indicated, there is still a case to be made for one further opportunity to seek consensus.

United Kingdom Internal Market Bill

Lord Purvis of Tweed Excerpts

Report stage & Report: 2nd sitting (Hansard) & Report: 2nd sitting (Hansard): House of Lords
Monday 23rd November 2020 Lords Chamber

[The Deputy Speaker (Lord Lexden) (Con)]

I have received requests to ask short questions from the noble Lords, Lord Purvis of Tweed and Lord Randall of Uxbridge. I call the noble Lord, Lord Purvis.

[Lord Purvis of Tweed (LD)]

My Lords, I am grateful for what the Minister said in referring to the noble Baroness, Lady Boycott, and to his correspondence with my noble friend Lord Fox and me.

I consulted the House of Lords Library on how the Minister’s letter referring to the sale of coal—not its use—interacts with the Air Quality (Domestic Solid Fuels Standards) (England) Regulations, which this House passed on 7 October and which are the governing legislation. The regulations specifically ban the supply and sale of coal and wet logs in England. One concern is that the Bill would not ban such sales if the goods originated in Wales, Scotland or Northern Ireland, where bans are not in place. That is clear; in fact, the Minister’s letter confirmed that this issue falls within the scope of mutual recognition. In addition, the other terms of the regulations bring this issue within the scope of indirect discrimination.

However, more concerning is that the regulations have been made but are not yet in effect—they come into effect on 1 May 2021—so the Bill will take effect before them. That is a requirement under this legislation, so the regulations the House passed banning the sale of coal and wet logs in England will have no effect because they are now within the scope of the Bill. Clause 5(3) states:

“A relevant requirement … is of no effect”.


Can the Minister clarify that, regardless of whether this is allowed or not, the ban in England will have no effect because of this legislation?

[Lord Callanan (Con)]

Again, it is about the difference between sale and use. England can proceed to ban a sale in England but if the sale is allowed in Wales, it could still take place under the mutual recognition principle; but, presumably, use would be prohibited. My letter explains this in great detail.

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[Lord Naseby (Con)]

My Lords, I think the House should be very grateful to my noble friend for putting this probing amendment down. All of us who have worked in the services industry, as I did before going to the other place, understand it very well. However, despite this, it is very difficult to comply with this part of the Bill.

The underlying problems I have are that, first, the services industry is a real growth market for the UK and shows every sign of continuing to be so. We must be very careful not to undermine it. I note my noble friend’s mention of consultation, which I am a great believer in; I have probably spoken about it on more amendments than anybody else. At any rate, consultation of only one month is not acceptable in any industry, particularly not at this crucial point.

I have two technical questions, having read and thought about this. First, what happens to those service industries that have no regulator, which would be a fair number of them? Sometimes they are in a licensed area, and sometimes they are not in any particular area, so it is not clear to me what happens to them. Secondly, will the register, when it appears, automatically approve every existing business in the services industry and transfer them across? If not, is there to be an appeal mechanism? Again, I ask these questions on a probing basis and look forward to my noble friend giving us some guidance.

[Lord Purvis of Tweed (LD)]

My Lords, it is very telling that three of the Minister’s noble friends were seeking clarification as to the purpose of this part of the Bill. The fact that answers are still being sought on Report in the House of Lords should be quite worrying for the Government. The noble Baroness, Lady Neville-Rolfe, is clearly an optimistic person. She believes that there are good reasons and it is just that, at this late stage of the legislation, the Government have not said what they are. We will give the Minister another chance to explain, in clear terms, what these good reasons are, and I wish the noble Baroness luck in trying to find out.

I also agree with the comments made about the grey area of businesses and people who are service providers and sellers of goods in the 21st-century economy. As the noble Baroness said, the previous reports of her committee show that a colossal part of the UK economy now sells goods and associated services. As my noble friend said, it is now commonplace for a huge enterprise such as Rolls-Royce to provide engine services but to retain the good and sell the service of providing that engine to many other markets; or, in effect, to provide generators on leasehold for UK engineering. That is just one example; there are many others, such as the sale of cars to many different households.

If a good is sold but the service is provided by the business enterprise, which part of this legislation will take precedence? If there is a dispute regarding a person who is selling a good that can be sold only if it is part of a service provision, what takes priority in this legislation? Is it the service component or the good component? Regarding those operating in other areas, be it creative services or other key areas, what legislative requirement would be considered first if there is going to be a restriction? We already know that there have been problems within the part of the legislation dealing with services. The next group of amendments, on teaching, illustrates that—the Government have had to clarify the position on education services. I am glad they have, to an extent; that is welcome.

The provision of water services brought into sharp focus the distinction between goods and services. When we raised in Committee the fact that Wales and Scotland operate under a different legislative model for the provision of water services, the Minister kindly wrote to me saying that the distinction in the legislation is between water services that are connected with an infrastructure and those that are not. How does that distinction come about in reality under Part 2? If Scottish Water, a service company that has one shareholder—the Minister—and the infrastructure of which is owned by the Minister, seeks to deliver different services in the future, that will come under the scope of this legislation. It is exactly the same enterprise and the same entity, but if he wanted to sell the infrastructure, that is excluded. I simply do not understand that. The Minister said in his correspondence to me that the question of whether the process needs to be extended is being looked at actively. The question is: when the Government have finished the process of looking at the areas to exempt, what will be left? That was the point made by the noble Baroness, Lady Noakes. What are the problem areas the Government are seeking to identify?

I turn to an issue that has not been addressed sufficiently in Committee. I asked the Minister why the legislation excluded the Isle of Man from consideration as part of the UK for goods but not services. Under the Bill, any services provided from the Isle of Man are considered to be within the United Kingdom; goods sold from the Isle of Man are not. We all know that service provision from the Isle of Man is huge—financial services, et cetera. That is no surprise, because if you are a service provider who wants to operate in a part of these islands that has no corporation tax and a wholly different set of beneficial conditions for your business, why would you not want to be based in the Isle of Man? If the Isle of Man is considered to be covered by this legislation, why have the Government brought forward amendments for consultation that do not include the Government of the Isle of Man? If services being provided from the Isle of Man fall within the scope of this legislation, there is a clear gap. Why would you not consult the Manx Government regarding any regulations that are going to be put in place?

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[Lord Flight (Con)]

My Lords, I am not clear what being “excluded” means. I do not know whether other territories are excluded or how far they go up and down the range of teachers. More particularly, what is the reason for having excluded groups? Why should lawyers be excluded? Are any other groups excluded? This area wants a bit of tidying up and further explanation.

[Lord Purvis of Tweed (LD)]

My Lords, I am grateful to those who have spoken in this debate, because we have all narrowed into one area on which we are seeking some clarification: the distinction between the language in the Minister’s email referring to the teaching profession and that in this amendment, which are not the same.

If the Government’s intention with the amendment is that they wish to exclude the teaching profession from the provisions, that will be universally welcomed. At this stage, therefore, from these Benches I thank the Government for listening to the debate in Committee and for acting, and also for engaging with the various stakeholders, primarily in Scotland and Wales. I am also grateful to the Ministers, the noble Lords, Lord Callanan and Lord True, for listening and acting on meetings that I and my noble friend Lord Fox had with them, at which we raised these matters, on which we had been in correspondence.

That said, some further clarification on specific points would be helpful. As my noble friend Lord German indicated, the reference in the government amendment to the profession of “school teaching” is not really language that is used. It is certainly not used by the General Teaching Council for Scotland in registering teachers, and clearly it is not used in England, although I thought that perhaps it was. I searched “school teaching” on legislation.gov.uk, but, to my knowledge, it is not used in any legislation, although I am sure that officials in the Box can clarify that for the Minister. It does not seem to be a term, so we might find ourselves inadvertently creating a new term or definition in this legislation. I am sure that this can be tidied up but, if we agree to this amendment, as we will, I will be grateful to know how the Minister intends to do so.

To give an illustration, the General Teaching Council for Scotland registers those who seek to be teachers in primary or secondary education, those who want to be registered as teachers for additional support needs or in named schools only, and, since 2017, college lecturers and those who teach in independent schools. Therefore, in the categories of teaching within the overall teaching profession, at no stage does the term “school teaching” apply.

I will give the Minister an example of why “school teaching” is problematic within the context of Scotland. Innovations that the Scottish Parliament brought in when I served on the Education Committee meant that there is now much more blended learning in Scottish secondary schools. Students who are nearing the end of their time in secondary school can now start to study for further education qualifications on practical courses provided by college lecturers within the school setting. That is very progressive and is working. An inadvertent difficulty might be that we create a false distinction between those who simply teach within a school setting and those who are in the profession of school teaching.

I hope that the Minister will be able to clarify the points that have been raised about the difference between the categories and that she will set out the intention behind the amendment. If it is the intention that the registry bodies—in their functions of carrying out the registration of teachers and in setting standards and qualifications—are excluded, that will be reassuring. I think that that is the intention behind the amendment. I hope that it is, and if the Minister is able to confirm it, that will be reassuring for many of us.

[Lord Stevenson of Balmacara (Lab) [V]]

My Lords, the key word of this debate has been “clarity” and the fact that clarity is required. I think that the Minister needs to get to the Dispatch Box and answer as many of the questions as she can, but I assume that government Amendment 51A is intended to answer the points raised by the noble Baroness, Lady Bennett of Manor Castle. But questions have been raised that do not seem to point in the same direction, so I look forward to hearing from the Dispatch Box that the amendment does what it is required to do. If not, perhaps the Minister will confirm that she will come back at Third Reading with a better version of it, to make sure that the doubt is removed.

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[The Deputy Speaker (Baroness McIntosh of Hudnall) (Lab)]

My Lords, I have one request to ask a question of the Minister, from the noble Lord, Lord Purvis of Tweed.

[Lord Purvis of Tweed (LD)]

My Lords, I am grateful to the Minister for her thorough response. When she comes to read Hansard, perhaps she could reflect on the point that the General Teaching Council for Scotland, the regulatory body, now also includes college lecturers. Perhaps she would reflect on the point that it is the regulatory body, rather than the type of teaching that the registers are responsible for. I am sure that there is no intention to have an anomaly, but I would be most grateful if she could look at this.

[Baroness Bloomfield of Hinton Waldrist (Con)]

I will of course be delighted to do that and I will take the point back to the department.

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[Baroness Bowles of Berkhamsted (LD) [V]]

My Lords, I do not have a great deal to add to what has been said by the previous speakers. It is an unfortunate circumstance that the word “regulation” appears in multi-use in legislative and indeed non-legislative meaning; it can be a set of regulations or an individual regulation in a set. So I understand the concerns raised that it might be possible for regulation, or regulatory requirements, to span both a discriminatory measure and a non-discriminatory measure. Therefore, I think it would be helpful for the wording in Clauses 19(1) and 20(1), which use the slightly ambiguous term “regulatory requirement”, to refine it down, so as to disapply only the discriminatory part. There could be other ways to rework that wording to give the same effect, but it would be useful to put it beyond doubt because the word “regulation” is really rather confusing.

[Lord Purvis of Tweed (LD)]

My Lords, I have only one element to ask the Minister about; it refers to some questions that were asked in Committee with regards to regulations that have no effect. Is it the entire regulation or the component part of that regulation that would be considered to have no effect? As my noble friend indicated, many regulations are fairly extensive and will have many component parts to them; the Government or the legislation may consider that the direct discrimination part could be only one part. Is it the Government’s intention that the entire regulation would have no effect? Indeed, how would the process be carried out to identify the specific element of that? The questions raised by the Law Society of Scotland and put forward so well by the noble Baroness, Lady McIntosh, justify a very clear response. As we have said previously in Committee, the scope for those seeking legal redress within this legislation is huge, so ensuring as much clarification on this element as possible would be very helpful.

[Lord Stevenson of Balmacara (Lab) [V]]

My Lords, the general theme here, I suggest, is that we need the Minister to respond very clearly and precisely on this matter. My noble friend Lord Foulkes used the rather nice and elegant Scottish word “fankle” to describe where we are at, suggesting that this needs to be undone. I was going to use the Gaelic word “bùrach”. I suddenly thought that Hansard might have difficulty with it, so I checked it on a handy electronic device close to me—and came up with a rather interesting extension, which I leave with the Minister. You can use the word “bùrach”, which in Gaelic means a “right mess”, but I think a more appropriate term in this case is a “clusterbùrach” which, as the article on my device goes on to say, is

“a Scottish term for a hopelessly intractable mess made by hapless politicians.”

Continuity Trade Agreements: Parliamentary Scrutiny

Lord Purvis of Tweed Excerpts

Wednesday 18th November 2020 Lords Chamber

[The Minister of State, Department for Business, Energy and Industrial Strategy and Department for International Trade (Lord Grimstone of Boscobel) (Con)]

My Lords, I welcome the constructive exchanges which the noble Lord and I have had on this matter. We have a mutual interest in ensuring that Parliament is able to carry out its scrutiny processes effectively. I look forward to continuing our debate on this important topic during Report on the Trade Bill.

[Lord Purvis of Tweed (LD)]

My Lords, the Government’s statement on the potential benefits of the Japan agreement indicated growth of £15 billion. Any reasonable observer would have assumed that that meant growth of £15 billion for the British economy. As the impact assessment has shown, only 17.2%—£2.6 billion of exports—is UK growth. A massive 79.9%—£13 billion—is growth in Japanese exports to the UK. Scrutiny of any trade agreement must be full and allow Parliament a proper vote at the outset and at the end. I welcome the ongoing cross-party discussions with the Minister. Will he consider the amendment I have tabled to the Trade Bill, arguing the case for Parliament to have a vote on the agreement, as the Japanese Diet has done?

[Lord Grimstone of Boscobel (Con)]

My Lords, I always consider carefully the points made by the noble Lord. Cheaper imports to the UK benefit the UK economy, so the FTA is not entirely one-sided. I agree that Parliament has to have the information available to allow its scrutiny processes to work effectively.