Trade Bill
Lord Purvis of Tweed ExcerptsTuesday 6th October 2020
(3 years, 7 months ago)
Grand CommitteeRead Full debate Trade Bill 2019-21 View all Trade Bill 2019-21 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 128-IV(Rev) Revised fourth marshalled list for Grand Committee - (6 Oct 2020)
Lord Purvis of Tweed (LD)
My Lords, I am very pleased to follow the noble Earl, because of his dogged approach on this issue, not only on this Bill but on the predecessor Bill and the Agriculture Bill. I commend him on his work and I will be referring to some of the points he raised, because I was reflecting on them as he spoke.
I shall primarily address Amendments 43 and 44, in my name and that of my noble friend Lady Kramer, and also reflect on what I thought was a very comprehensive speech by the noble Lord, Lord Lansley, and some of the points he raised within it. I have supported Amendment 91 in his name. This was raised at Second Reading by the noble Lords, Lord Hendy and Lord Freyberg, and the noble Earl, Lord Caithness. I commend the noble Lord, Lord Hendy, on the way he introduced this group and on allowing us to have this important debate: it is extremely important for the Bill and for UK trade going forward.
The Minister said, in summing up on 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.]
I do not know about “excitement”, but there is genuine concern, which primarily comes down to two areas. One is that it is not clear yet what the Government’s position is on the agreements that are yet to be made, which will be continuity agreements, primarily with Vietnam, Canada, Singapore and Mexico, where, as we have heard in this debate, the European Union agreements have moved beyond ISDS. Can the Minister confirm that, in our negotiations with them, we will have follow-on from the European Union position? The second area of concern is what the Government’s position will be in the longer term. Are we moving away from the position we held when we were in the EU and towards a multilateral system?
I think it is helpful to remember the scale of this issue. It is not a minor issue. Across the European Union member states, more than 1,300 investment treaties have been signed with third countries, in addition to some 200 between EU member states. Non-EU states within Europe are party to more than 500, and we will now be in this category. This is just part of the 3,000 that exist worldwide. Most of these include ISDS provisions and often, as we have heard from UNCTAD—I shall refer to UNCTAD in a moment—it is very clear from the annual reports on the use of ISDS that companies have a view that public policy choices made by Governments will have an impact on their profits, and therefore they will use that ISDS.
The Minister seemed to suggest that the Government are in favour of ISDS because it disproportionately benefits British investors around the world. Statistically, that is true about the use of ISDS, so UNCTAD’s data is interesting. The United Kingdom is the third-highest home state of claimants of ISDS around the world. From 1987 to 2018, in the number of known cases, the UK was third, with 78. As the respondent state, we have had only one. So there have been 78 where we have been the home state and one where we have been the respondent state—so, on one reading, the Minister could be correct that this has been of benefit to British-based operations. But a bit more analysis is required as to what “British-based” means when it comes to some of the commercial operations, and where some of those cases have primarily concerned developing countries.
On the second aspect, it was helpful that the noble Earl raised some of the consequences of Covid-19, because it is not just America lining up. We have had reports that law firms have been studying decisions made by British authorities, including the London Mayor’s decision to close Crossrail construction during the pandemic, during the lockdown. While this was not underpinned by a statutory requirement, it is potentially vulnerable to those seeking compensation under the investment treaty. Will the Minister respond to the noble Earl’s question on how vulnerable the UK is at the moment?
The issue moving forward, as my noble friend Lady Kramer indicated, is that the EU has ratified four agreements with an ISDS mechanism: the Energy Charter Treaty, to which 53 European and central Asian countries are party; CETA, with Canada; and agreements with Vietnam and Singapore. Only the ECT is fully in force; the ISDS provisions in the three others will be implemented after all member states have ratified them. More importantly, those agreements include investment court systems and, last year, the Commission presented procedural proposals for the more transparent ICS for CETA. Can the Minister say what approach we will be adopting in our discussions with Canada? Are we seeking, in our agreement with Canada, an investment court system? These new transparent approaches will allow for mediation, which ISDS has largely overlooked, and an appeal mechanism that will then be binding on the parties. All of this has a public interest test, because they are party to the agreements with regards to the making of public policy, so what is our position on Canada, Vietnam, Singapore and Mexico?
It would, for many, be a fully retrograde step if we were not to seek continuity in those new agreements: it would negate the progress that has been made by the EU moving away from the ISDS system. Why is it progress? Well, as many in this Committee have indicated, it is not just the fact that Parliament remains sovereign—of course it does—but what use is sovereignty if the constraints on using that sovereignty are so significant? It is the chilling effect, as the noble Earl said, that is potentially blocking. We have seen attempts against France, Australia and Canada, all attempts under ISDS and intellectual property disputes, seeking either policy change from the Government, or compensation. Some of those could mean that regulations would have to be changed. This is the point: public policy should be made in the public interest, not in the shareholder interest.
The noble Lord, Lord Lansley, made the point about moving towards the long term. We have included that in our Amendment 43. He may refer to it as “heroic”, but that has never stopped the Lib Dems seeking those aims in the past. However, I think we have some strong supporters in the European Union with this approach, and we had strong support in the United Kingdom. The United Kingdom took part in the Council giving the mandate to the Commission for the negotiations towards a multilateral court system for trade. On 1 March 2008, the Council approved negotiating directives for a convention establishing a multilateral court for the settlement of investment disputes. That was a unanimous decision. The Minister will have to remind me, because I have slightly lost track of which Councils the Government refused to attend after we voted out of the European Union, but I am going on the basis—and he can correct me if I am wrong—that we were part of the unanimity in the European Union to move towards a multilateral court for the settlement of investment disputes. After that mandate was secured with United Kingdom support, discussions started on existing agreements, which we have rolled over, for moving towards an ICS approach rather than an ISDS one. We have rolled over 20 agreements so far. Where there have been elements of ISDS provision, the European Union is looking at them again to move towards a court system. Can the Minister say whether we will do the same?
The benefit of moving towards this is that we will be able to be part of an aligned movement of countries looking towards a more open and transparent approach, and that approach has been taken squarely from the European Union with regard to our colleagues in TTIP. The noble Lord, Lord Lansley, is right to ask this question. This will be a choice for the Government. Because of the transparency in the European Union, we know what the position is. We know what the mandate was. We know what the Government’s position was up until the end of December. We need to know their position now with the agreements yet to come.
Finally, I support Amendment 91 and will be brief on this. The noble Lord, Lord Lansley, is right. Any consequence of taking retaliatory action or imposing sanctions under the WTO—which we will be able to do under our membership of it—will, by definition, and inevitably, be serious and impact our country-to-country relations. As I understand it, we would be able to bring these forward only if we had the previous authorisation of the dispute settlement body at the WTO, having made a public case to it. It seems incongruous to me that we would have made a public case to the dispute settlement body of the WTO for approval but will not be doing the same to our own Parliament to make a decision on the ongoing consequences of the implementation of those regulations. I hope the Minister can clarify that the Government would be open to supporting that aspect.
Lord Stevenson of Balmacara (Lab) [V]
My Lords, I thank all the speakers in this debate. I also echo the thanks from the noble Baroness, Lady Chakrabarti, to the staff for allowing us to get to where we are. We might have had a rocky ride and have missed a few words here and there, particularly the exchange between the noble Baroness and the noble Lord, Lord Lansley, but we are here and we are making progress and we owe them a vote of thanks for keeping us going.
The debate has been rich and the issue has been given a good going over. As the noble Baroness, Lady Chakrabarti, and others have said, my noble friend Lord Hendy spoke powerfully on the key amendment with a huge amount of knowledge. He confirmed that we took the right decision to hold his speech over from last Thursday. It would not have done well to have had the first part last week and the second part today. I am glad we were able to hear it—some of us got it twice, but it was still jolly good—and I congratulate him on that.
The Deputy Chairman of Committees (Baroness Fookes) (Con)
I have received a request from the noble Lord, Lord Purvis, to speak after the Minister.
Lord Purvis of Tweed (LD)
My Lords, I thank the Minister for his comprehensive response to the debate on this group of amendments. I am grateful for that; it shows the seriousness of this issue. I and other noble Lords will reflect on his remarks.
I have two questions. The first relates to the amendment in the name of the noble Lord, Lord Lansley, which I support. As I understood it, if we were to bring retaliatory measures or sanctions, they would have to have been authorised by the dispute settlement body at the WTO, so by the time they came to Parliament, either under the negative procedure or the affirmative procedure, they would be public anyway. Therefore, Parliament’s ability to use the affirmative procedure would be based on what was already in the public domain.
Secondly, I am still not sure why the Government have not indicated that they will continue with their support for moving towards an investment court system in our continuity agreements with Singapore, Vietnam and Mexico, which are yet be signed, given that the European Union has stated categorically that moving towards such a system is the approach for those countries and is now, to quote the Commission in October 2019, “on the table” in all ongoing investment negotiations. I simply do not understand why the Government, who supported moving to a multilateral system, now say that they are fully engaged and cannot say what their position is yet. Why can the Government not simply say that they support this in principle and are working with others to bring it about?
Lord Grimstone of Boscobel (Con)
The noble Lord raises two good points. On the first point, I will, if I may, write to him setting out in more detail the disadvantages and advantages that I see of the negative as opposed to the affirmative process. On the court, I make it clear that we welcome changes in the ISDS mechanism and potentially the formation of an MIC if, once the details are worked out, it seems that nations will sign up to it and it will be workable and in the best interests of the UK. We do not have our head in the sand in these matters. Like the noble Lord, I recognise that, if improvements can be made to the ISDS process, it is incumbent on us to do that. The point that I was trying to get across was that these are still early days in the discussions at the UN on this and it did not seem right to put our weight firmly behind it until we see how the discussions move forward. But I assure the noble Lord that we are open-minded about this and we will see where it gets to.
Lord Purvis of Tweed (LD)
My Lords, it is a pleasure to follow the noble Viscount. I agree with one point he made in his speech: it is for Parliament to seek guarantees on our standards. In essence, that is what we are seeking to do: to have a statutory underpinning to ensure that our trading relationships and trade agreements do not undermine them through various different mechanisms which can be beyond amending primary legislation.
It is certainly not uncommon for there to be duties in law on Ministers that frame how they carry out their duties. Most legislation that comes before Parliament has such duties. We are seeking the equivalent for the new approach we have for Ministers and the Department of International Trade when carrying out their trade negotiating duties. There should not be any great surprise about that. This legislation has restrictions in Clause 8 on the new powers for HMRC. There are duties in Schedule 1 about how Ministers carry out their duties on consultation. There is no great surprise that this legislation has restrictions and duties. We are simply arguing that, when it comes to the elements within our amendment, we are expanding the scope of those restrictions and those duties. The noble Baroness, Lady Noakes, might consider that to be appeasement, which I will refer to a little further on, but I disagree with her.
I wish to move government Amendment 23. I want to use those words because I doubt I will ever be able to move a government amendment, but a government amendment was moved on the previous Bill and, without wishing to be facetious, I shall go a little further and quote:
“My Lords, I am bringing forward amendments designed to maintain UK levels of statutory protection when implementing continuity trade agreements … The fact that I am able to do so is testament to the cross-party working that makes this House so valuable, and I have no doubt that this process has enhanced the legislation.”
That was the Minister, the noble Baroness, Lady Fairhead. Later, she said it was
“an improvement to the Bill”.—[Official Report, 20/3/19; cols. 1439-40.]
That is testament to cross-party working. It is not déjà vu or Groundhog Day, and I say to the noble Baroness, Lady McIntosh, that it is not a race or sprint in which we got there first because she is a dogged campaigner on these areas. I think this is more of a relay race between legislation and different individuals. I hope the Minister feels from knowing and seeing the Agriculture Bill and this Bill that it is the settled will of a cross-party consensus that the Trade Bill should be strengthened by the reinsertion of what the Government themselves had considered a strengthening of it.
I want to refer back to the Agriculture Bill, as other noble Lords have indicated. When the noble Lord, Lord Gardiner of Kimble, summed up, he referred to me and the noble Lord, Lord Rooker. In rejecting what we had argued for at that time—although the House did not agree with the Government and passed the amendment—he said that
“none of the 20 continuity trade agreements signed to date would undermine domestic standards.”
He then set us a challenge, saying:
“I look forward to those noble Lords who are determined that this is not the case at least having the courtesy to say, ‘Actually, our fears have been allayed’. I set that as a challenge.”—[Official Report, 22/9/20; col. 1755.]
In around five years’ time, if I am still here, I will say to whoever the Minister is that allays have been feared. The powers under this legislation are for five years and the Government have indicated that some of these continuity agreements are likely to change. Countries that we have signed continuity agreements with will have changed their agreements with the European Union over that period because many of them are discussing changes. The UK will have to choose how it changes its agreements. We are saying that any changes being brought forward must comply with our statutory standards.
The Government have indicated that that is not really necessary because they have pretty much got all the agreements done anyway, so it is purely an academic exercise. We have signed 20 agreements and there are 18 to go. Half is not all of them done and dusted. Given the fact that the Government had this amendment in the legislation when 18 were signed, not 20, what has changed? The noble Lord, Lord Gardiner, did not give a proper response. I look forward to the Minister giving one. The noble Baroness, Lady Noakes, said it was because the previous Government appeased those who wanted to keep our statutory functions. I would be grateful if the Minister can indicate why the Government have changed their position.
I turn to the issue of whether we should be completely reassured that, as the Minister has said before, no trade agreement can ever change statutory provision. The noble Viscount, Lord Younger—who is now back in his place—indicated in the previous group that that would be the case. On the face of it, that is correct. Any trade agreement would require statutory changes, if necessary, to change the primary legislation. However, we have already seen decisions made, for example, on quotas on imported sugar. Decisions have been made over the summer that will have a big and damaging impact on our domestic agricultural market because we will be giving a competitive advantage to those who are operating without the environmental or labour standards that we find acceptable. They also undermine commitments that we have given to the least developed countries.
It also comes back to the issue of chicken. I have been struck by the Government’s language about chicken and the use of chlorine washing. It was helpful that the NFU gave us the details of some of the concerns about this. It comes back to the specific food hygiene regulation. We are carrying this regulation over but the Government have said that it will change on completion of the implementation period. I shall quote from it:
“Food business operators must not use any substance other than potable water—or, when”
a regulation
“permits its use, clean water—to remove surface contamination”.
That is what the Minister has quoted to us in the past, and that is correct, but I found it really interesting, because the Minister did not finish the quote. It goes on to say
“unless use of the substance has been prescribed by the appropriate authority”.
So materials can be used—in a trade agreement that we can accept from America, for washing any of their products—if we simply prescribe that by an approved authority, and that can be done by negative resolution.
My suspicions always grow when Ministers, when they want to give us reassurance, give us half the situation. The record of the Government this year up to now is, I am afraid to say, that they say they have no intention of doing something just before they do it. The Government say “Trust us, because we have no intention in our future trading relationships of undermining any environmental standards” in the same week as they appoint a trade commissioner, Tony Abbott. I remind the Committee that the week he was appointed, when we were raising concerns on standards in previous proceedings on this Bill and on the Agriculture Bill, he told a conference in London, when he was giving his top tip on how to achieve success in trade negotiations, that they needed,
“not to be held up by things that are not all that important, and not be distracted by things that are not really issues of trade but might be, for argument’s sake, issues of the environment”.
I think the House believes that those aspects are issues of trade. Therefore, the current legislation lacks the enhancements that had been made by the previous Government in their amendment.
In conclusion, the Government’s previous position was:
“A key aspect of that continuity is to ensure that UK statutory protections are maintained. These protections are highly valued by our businesses and consumers and are an important component of the UK’s offer to the world”.
That is correct, and our offer to the world should be the highest standards. The Minister, the noble Baroness, Lady Fairhead, continued:
“It makes it clear that the power can be used only in a way that is consistent with the maintenance of UK levels of statutory protection in the listed areas”—[Official Report, 20/3/19; col. 1439.]
but the agreements, some now very old, will need to be updated, and, in updating them or replacing them, we will have to ensure that any of those changes will be upholding our current standards.
The noble Viscount, Lord Trenchard, suggested that some of this may restrict our negotiators or put extra burdens on them. I do not agree, for an historical reason. The noble Lord, Lord Lilley, said on Second Reading that the party of free trade should not be imposing restrictions. That was half the story. We got rid of the Corn Laws and introduced free trade at the same time as we got rid of adulterated bread, beer and milk and put in place public food standards against them and against counterfeiting.
The Sale of Food and Drugs Act 1875 was a major precursor of the Food Safety Act 1990, itself the precursor of the standards that we are now inheriting. Upholding them is the strongest tradition of Britain, where we have led since Victorian times and other countries have followed. Reinserting this amendment, with the addition of food standards, by the noble Baroness, Lady Bennett, and others and the support of the noble Lord, Lord Grantchester, would be a very strong signal to our trading partners in the world that we will be upholding our standards—British standards.
Lord Grimstone of Boscobel (Con)
My Lords, no one listening to this debate today could be in any doubt about the importance that noble Lords attach to the maintenance of the highest standards in the areas that we have been discussing. To make the Government’s position clear, we entirely concur.
I turn to the amendments, starting with Amendment 20 in the names of the noble Lord, Lord Grantchester, and the noble Baroness, Lady Bennett of Manor Castle. It is intended to ensure that regulations can be made under the Clause 2 power only if they adhere to UK standards of food production and safety and that partner country products are in line with our domestic health policies and policy targets.
I was grateful to my noble friend Lady Noakes for reminding us that Clause 2, to which many of the amendments that we considering today relate, relates to continuity agreements, not to new free trade agreements. As your Lordships are aware from the many debates that we have had on this issue in both this Bill and the Agriculture Bill, the UK already has extremely high import standards of food safety enshrined in domestic law. I say again that we have no intention of lowering these; I completely reassure my noble friend Lady McIntosh of Pickering on this point.
Trade Bill
Lord Purvis of Tweed ExcerptsThursday 1st October 2020
(3 years, 7 months ago)
Grand CommitteeRead Full debate Trade Bill 2019-21 View all Trade Bill 2019-21 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 128-III Third marshalled list for Grand Committee - (1 Oct 2020)
The Deputy Chairman of Committees (Lord Lexden) (Con)
I call the next speaker, the noble Lord, Lord Inglewood. He is not available at the moment. We will move on to the noble Lord, Lord Purvis of Tweed.
Lord Purvis of Tweed (LD)
My Lords, it is a sobering fact that, as we discuss this important group of amendments with regard to the UK adhering to international obligations, the European Union has today issued a letter of formal notice on a potential infraction where we have breached an international agreement. That is the backcloth against which we must consider all the groups of amendments to come: how we as a country want to be seen around the world as a nation that adheres to its national obligations. Those on climate change and the environment, as the noble Lord, Lord Grantchester, indicated in opening the debate on this group so well, are obligations that the UK is a party to.
I want to speak first to Amendment 21 in the name of my noble friend Lord Oates who, as my noble friend Lady Northover has said, cannot be here today because he is at a funeral. The amendment is also signed by my noble friends Lord Fox and Lady Sheehan. I shall also address the cross-party Amendment 40 which is also in the name of my noble friend Lord Oates but has been spoken to very eloquently by the noble Baroness, Lady Boycott. I am sure that if the noble Lords, Lord Duncan of Springbank and the noble Lord, Lord Browne, had been able to take part in the debate on this group, they would have done so. I am grateful for their support.
I turn first to Amendment 21, which should be looked at in the context of other amendments to Clause 2 to expand the provisions of the Bill to agreements that have been signed as part of the EU and now, going forward, to new agreements. As such, the amendments limit the scope of the use of implementing powers to all agreements only with countries that are party to the Paris agreement. The United Nations Framework Convention on Climate Change deals with greenhouse gas emissions, adaptation, mitigation and finance. As my noble friend Lady Sheehan indicated, the Paris agreement was signed in 2016. As of this year, it has been signed by 196 states, while 189 have become a party to it, with the only significant omissions being Iran and Turkey. As the noble Lord, Lord Lansley, and others have said, in June 2017, the US President, Donald Trump, announced his intention to withdraw from the agreement. However, reassuringly for some of us, Joe Biden the Democrat candidate, signalled as recently as Tuesday night that if he is successful in the election, he will seek for the US to rejoin.
Our amendment is perfectly clear and I will show how to some extent it links with Amendment 40. The Paris agreement is now a foundation block for the global effort at reducing greenhouse gas emissions. It is simply impossible to strip out the efforts to tackle climate change without also adapting trading practices. As the noble Baroness, Lady Noakes, has indicated, this is an area where these can be seen in separate lights. It is worth reminding the Committee that low-carbon exports alone in goods and services from the UK in 2018 were worth £5.3 billion. If you add on top of that UK legal consulting, investment products and the UK’s global leadership in arbitration and the City of London with the financial options it offers for sustainability products, we are a world leader in global trade on the environment and sustainability. It is, I think, a simple fact that for the UK to be an independent global trading nation, any deep and comprehensive free trade agreement that we would be willing to enter into should be part of and consistent with our Paris climate agreement.
We have taken this approach as a result of being a member of the EU. If the Government do not consider that we should continue with this, can they explain why not? In essence, the Government seem to be seeking continuity in our trading relationships, but not continuity in the legal framework for climate that we have helped to shape and were a part of in the European Union.
I have in my notes a reminder to reference the fact that Ministers will probably say that they can be trusted, given the continuity agreements that we have signed already, and that it is government policy not to move away from those. But every time the Government say that, in my view it strengthens the argument that if that is the consensus across the political parties, there is merit in making it a statutory function. At a time when the Minister is telling the Committee that we need have no concern about climate change commitments, Liz Truss appointed Tony Abbott as the UK trade commissioner. I shall remind the Committee what I said at Second Reading: in 2017, he told the Global Warming Policy Foundation that
“it’s climate change policy that’s doing harm. Climate change itself is probably doing good.”
I think that the UK approach should be stronger than that.
Until now, the approach has been that, as I have mentioned, the European Union has had in its free trade agreements so far a trade and sustainable development chapter. I want to address the point made by the noble Lord, Lord Lansley. He seemed to suggest that this approach, which is set down in European Union law, should no longer be the British approach and that British trade agreements should not have a trade and sustainable development chapter in them. I believe strongly that they should and that it is in our interests that they should. Why will the Government not replicate the approach of maintaining agreements with trade and sustainable development chapters in them? As the noble Baroness, Lady Noakes, and the noble Viscount, Lord Trenchard, said, if it comes to the opportunity to enhance agreements, this is the chance to do so because it is the trade and sustainability chapters in the agreements, especially with the least developed countries and those with which we have EPAs, that are the mechanism of dialogue in order to enhance them.
I turn to the United States. I have reflected on what was said by the noble Lord, Lord Lansley. He seemed to suggest that these amendments would be restrictive. He may be aware of the Bipartisan Congressional Trade Priorities and Accountability Act 2015 which sets the parameters of US trade policy. Section 2 sets the trade negotiating objectives of which subsections (5) and (7) are
“mutually supportive and to seek to protect and preserve the environment and enhance the international means of doing so.”
That legislation by Congress, which the noble Lord says restricts the trade representative of the United States—I think it empowers them—states, as far as Congress is concerned, the remit of what the United States will negotiate. The consequence of what President Trump has said with regard to those international agreements has been significant, because the United States’ legislation states that it can agree a free trade agreement with a country only where both are party to the same international obligations.
Lord Purvis of Tweed (LD)
My Lords, I am very grateful to the noble Lord, Lord Lansley, for stating in very clear terms the benefit of putting into statute some of the restrictions on some of the activities of our political leaders, so that we do not need to trust them, because these are in the law. I hope that when it comes to future groups in this debate, the noble Baroness, Lady Noakes, and others will remember those very wise words of counsel that it is important to have things in writing in our statutes to protect our valued principles and institutions. I am grateful to the noble Lord for doing that.
As my noble friend Lord Fox pointed out—this is at the heart of the debate on this group—the NHS is not just a greatly valued health and social service for our nation but is seen by many as a great economic asset. The noble Lord, Lord Lansley, is right that, when it comes to procurement and the provision of services, there is a great deal that is provided by the private sector. In the debate on the first group, I highlighted that about half the public procurement of the entire UK Government relates to health and that around one-quarter of the beds in the mental health service in the north-west of England are operated by an American health operator. I made no judgment about the good or bad side of that, but simply stated it as a fact. And it is a fact that the United States wants to expand market access to the provision. The question that then comes is: what is the limit and, as my noble friend Lord Fox indicated, what is the right balance? That is a question for the Government.
The Government have stated, as they would say, “categorically”, that the NHS is not for sale. Michael Gove was in the Scottish Parliament just this week, and he said to MSPs:
“The NHS is not for sale under any circumstances.”
My question is: what does he mean by the NHS? For many people, intellectual property and pharmaceuticals, the access to and price of medicines, the delivery of services, the buildings that people are in, and the employers of the people providing those services, are the NHS. We can outline concerns about some of the risks of a trade agreement facilitating greater market access for the provision of the private service situation from America, but what is the Government’s view about the limits of that? This is a genuine and legitimate question that Members speaking on this group have asked.
Before I move on to Amendment 75, in the name of my noble friend Lady Sheehan, reference was given to the potential American deal. The noble Lord, Lord Lansley, is absolutely correct that much of the Bill is about how the continuity agreements are in operation; he cited the existing agreements that we have and he cited CETA. On IP and ISDS, which we will come to later, there is a different approach, which we want to explore further.
One of the things that gave us a degree of reassurance —there was of course debate on CETA and the health service; I remember that very clearly—and one of the differences was that British parliamentarians were able to take part in discussions agreeing the mandate for CETA when it came to the remit and extent to which health and pharmaceuticals and intellectual property would be within the agreement. The INTA committee in the European Parliament would have seen the text of the mandate and the negotiation position, the offer from the European Union and a draft text before it was signed, and it would have seen the final text before it went for a final review. None of us in this Committee will have any opportunity to have any of the equivalent for the American deal. It is therefore right to ask probing questions, especially since the question asked—I think by the noble Baroness, Lady McIntosh—was: what do the Americans want? I agree with the noble Baroness, Lady Noakes, that wanting something is not getting it. However, knowing what they want, and asking the Government what their position is on whether we are offering it, is correct scrutiny.
What do the Americans want? As we have heard, on intellectual property they refer to TRIPS, and page 8 of its negotiating mandate says it wants to
“ensure that the Agreement fosters innovation and promotes access to medicines, reflecting a standard similar to that found in U.S. law”.
When it comes to procedural fairness for pharmaceutical and medical devices, it wants to:
“Seek standards to ensure that government regulatory reimbursement regimes are transparent, provide procedural fairness, are nondiscriminatory, and provide full market access for U.S. products.”
We know what the American request is. We have not seen any of the negotiating offer from the UK—any counter-offer or any draft text—and the committee of the noble Lord, Lord Lansley, has not been provided with any draft text, as far as I am aware. Therefore, it is right to have in this Bill, at this time, proper questions along those lines. If the Government do not say what they mean by the NHS and the extent to which market access is open to new American providers then we must have the continuation of scrutiny.
On Amendment 75, I think my noble friend did the Committee a great service in bringing this amendment forward. My noble friend Baroness Northover has given the international context, as part of the debate on this group is around the international considerations. I am a member of the International Relations and Defence Select Committee, and we published a report in July this year which highlighted some of the truly drastic impacts of Covid-19 on Africa. We looked not just purely at the health elements but at the economic impacts. Of course, any economic impacts on the continent of Africa are also trade impacts for the United Kingdom’s relationship with those countries.
The African Trade Policy Centre of the UN Economic Commission for Africa has seen a 40% fall in African exports and GDP has effectively halved. The worst-case scenario looks like GDP falling by $120 billion, and UN ECA estimates point to Covid-19 pushing 27 million people into extreme poverty while imposing £44 billion to £46 billion in additional health costs. We know that those additional health costs will also incorporate what is likely to be a huge burden on many countries to provide vaccines and other medical support for a long-term, sustainable recovery from Covid-19.
It is right that my noble friend has raised the issue of the TRIPS Agreement and the Doha Declaration and whether the United Kingdom should activate, under that TRIPS Agreement, the ability of taking products over patents and then making them accessible. They would be accessible not just here in the United Kingdom but through a trading relationship. It is absolutely right that she has made that case. The noble Lord, Lord Lansley, has pointed to the Government’s capability to do that. My question to the Minister is: is it the Government’s intention to do it?
Canada did it in March. Canada Bill C-13—
“An Act respecting certain measures in response to COVID-19”—
authorised the Government of Canada to supply
“a patented invention to the extent necessary to respond to a public health emergency that is a matter of national concern.”
The Prime Minister indicated that Canada’s role within that is not just at home but abroad. If Canada was able to do that in March, knowing what the likely global impact would be not only on Canada but on the least-developed countries in the world, what is the UK’s position? If we have not activated that agreement, why not? If it is the Government’s intention to do it, how will they implement it?
Lord Grimstone of Boscobel (Con)
My Lords, I am sure noble Lords remember that when they first entered your Lordships’ House, they would occasionally find it hard to remember how to get from A to B. There have been times during this debate, echoing the words of my noble friend Lord Lansley, when I thought perhaps I had wandered into the wrong Committee Room by mistake, because a lot of what we have discussed—in what has been a most stimulating debate—did not seem to relate to the purpose of the Bill, which is the rollover of continuity trade agreements. Leaving that to one side, I turn first to the amendment proposed by the noble Lord, Lord Bassam of Brighton, and the noble Baroness, Lady Bennett of Manor Castle, which would mean that the Clause 2 power could not be used to implement agreements that restrict the delivery of public services through public monopolies, exclusive rights or nationalisation.
As noble Lords know, we need the powers in the Bill to ensure continuity of trading relationships with existing partners. To date—I say yet again—we have signed 20 agreements with 48 countries, accounting, I am pleased to say, for £110 billion of trade in 2018 numbers. I can confirm that none of these signed agreements have impacted our ability to deliver public services effectively. We have always protected our right to choose how we deliver public services in trade agreements and will continue to do so. No trade agreement has ever affected our ability to keep public services public and that will not change. I am happy to give the noble Lord, Lord Bassam, a complete reassurance on that. I also reassure the noble Baroness, Lady Bennett of Manor Castle, that we will not do anything that impugns the democratic control of these matters.
Noble Lords will observe from our record of signed agreements that the continuity programme is seeking to preserve current trading relationships, not alter the way in which our public services are designed or delivered. If this is not an unparliamentary term, I think it is a red herring to suggest otherwise.
Amendment 51, tabled by the noble Baroness, Lady Thornton, the noble Lords, Lord Patel and Lord Fox, and the noble Baroness, Lady Bennett of Manor Castle, seeks to stipulate that regulations can be made using Clause 2 of the Trade Bill only if the agreement does not undermine the way in which the NHS is delivered as a public good, universal and free at the point of service.
No one listening to the debate could be in any doubt of the important place that the NHS has in the nation’s heart. I am pleased to put on record that I and the Government share the sentiment behind the noble Baroness’s amendment. We have been consistently clear about our commitment to the guiding principles of the NHS: that it is universal and free at the point of need. I tell the Committee the same thing that my colleague, the Minister for Trade Policy, told the other place, that
“the NHS is not and never will be for sale to the private sector, whether overseas or domestic.”—[Official Report, Commons, Trade Bill Committee, 25/6/20; col. 315.]
The Government will ensure that no trade agreements will affect our ability to keep public services public.
The Deputy Chairman of Committees (Lord Haskel) (Lab)
I have also received a request to speak after the Minister from the noble Lord, Lord Purvis of Tweed. I call the noble Lord, Lord Purvis of Tweed.
Lord Purvis of Tweed (LD)
My Lords, in his remarks, the Minister referred twice to the mandate that the negotiators have for a future trade deal with America and stated that the mandate excludes the NHS. The language that the Government have always used is that they do not have a “mandate” for these negotiations, but “negotiating objectives”. If there is a mandate, as the Minister referred to, will he write to me about what it is? If he would prefer that to be confidential, he can write just to me, but it would also be beneficial and helpful if he wrote to the International Agreements Sub-Committee about it.
Secondly, the Minister must have been briefed before the debate on this group of amendments on both the consequences and the global implications of my noble friend Lady Sheehan’s very proper amendment, which raises these questions. My question to him—on the Government’s policy on utilising the TRIPS flexibilities that exist for medicines patents, which could then be available through our trading relationship with the least developed countries—could not have been more specific. He did not respond to it in his winding-up speech, so what is the Government’s position there? If they have not implemented legislation, as Canada did in March, why not?
Lord Grimstone of Boscobel (Con)
I thank the noble Lord for that question. I draw no distinction between our negotiating objectives, which were made public before we started the US FTA negotiations, and the mandate. When I used “mandate”, I was referring to our negotiating objectives. I apologise if that caused the noble Lord any confusion. I will write to him on his point about TRIPS.
Trade Bill
Lord Purvis of Tweed ExcerptsTuesday 29th September 2020
(3 years, 7 months ago)
Grand CommitteeRead Full debate Trade Bill 2019-21 View all Trade Bill 2019-21 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 128-II(Rev) Revised second marshalled list for Grand Committee - (29 Sep 2020)
Lord Balfe (Con) [V]
My concerns are rather general. I have been associated with the European Union for a very long time, as many people know: since 1979. I was at the TUC when Jacques Delors came and won the TUC over to the fact that the European Union could lay down standards which would benefit working people all over Europe, not just in Britain. I am very concerned that the Bill should not weaken any of those standards.
I am not going to point a finger at the Government and say, “Oh, that's what they are trying to”, but I would welcome a clear statement from the Minister that the Bill does not aim to give British working people lower standards or enable people to work around the standards that have been laid down and enjoyed for a long period. That is a fundamental matter.
When we look at where those standards come from—I follow the noble Lord, Lord Judd, in this—we see that the International Labour Organization has played an historic and noble role in working people’s standards for the past 100 years. It is the only part of the League of Nations that is still in being in its original state. The ILO and its conventions must be at the centre of any trade agreement negotiated by the British Government. If we are to have trade agreements, we cannot ignore the ILO’s standards or the basic standards of human and workers’ rights, and this is one way in which we can do it.
We heard a lot in the referendum, after the referendum and in the election about taking back control, but I hope that we are not going to be taking back control in order to weaken standards which have been hard won over the years. One of those standards is the democratic participation of Parliament in lawmaking and the making of trade agreements. This is highlighted in Amendment 100, and I share the sentiments of the noble Lord, Lord Rooker, who said how important it is that each House of Parliament has a say. We cannot delegate democracy. If we are a two-part Parliament, this House must also have an input.
What concerns me about the whole approach is that we are not taking back control to Parliament; we are taking back control from a Parliament, the European Parliament, and seem to be putting it quite firmly into Whitehall—largely, it would seem, in an unaccountable manner. I hope that the Minister will be able to assure us that there will be a central role for both Houses of Parliament in how the trade agreements to be negotiated under the many clauses of this Bill are implemented.
The final point I want to make is this. The noble Lord, Lord Lennie, mentioned the TUC. I have not heard a word from the TUC so I put it to its representatives, who I presume will be monitoring this debate, that if they want to protect workers’ rights, they should remember that a third of all workers do not vote for the Labour Party, they vote for the Conservative Party, a good number of them vote for Plaid Cymru and a fair number vote for the Green Party, the SNP or the parties in the north of Ireland. I would say to the TUC, “If you are issuing briefs, please issue them to everyone. If you’re not, please wake up”, because this Bill has enormous import for the future of workers in Britain and they deserve the TUC to be a little more proactive than it has been up to now.
Lord Purvis of Tweed (LD)
My Lords, I wish to address Amendment 6, referred to my noble friend Lord Fox, and to support Amendment 3, spoken to by my noble friend Lady Birt and to which she has put her name. In so doing, I thank the noble Baroness, Lady Noakes, for supporting in principle the idea that we are asking the Government to outline how they will be supporting British business to take advantage of the GPA agreement of which we are now a member in our own right as agreed by the other members. I reassure her that this Bill will never be long enough to address all the fears that me and my colleagues may have of this Government, but the amendment is practical, sensible and simply asks the Government to be clear. We will not rely on the Minister’s winding-up speech in this short debate in Grand Committee; rather, as my noble friend Lord Fox has indicated, we are asking for a proper report from the Government setting out how they will support our businesses.
We want the UK to prosper and our businesses to benefit from any new opportunities while also not being burdened if trading relations with our biggest market in Europe are harder. Procurement is one area where our businesses can seek contracting opportunities across all the GPA members, but there are practical barriers to those, whether it is language, knowledge of that country’s government procurement system, having local partners or legal protections. These are just some of the factors among many and it is a complex area in which to do business.
According to the OECD, taxpayers’ money that is spent by the Government on goods, services and infrastructure such as roads, hospitals and schools accounts for over 13% of gross domestic product, so there is a huge market. I can reference Amendment 51 in a later group, but let me refer to the NHS here at home. My noble friend Lord Fox gave the figure of £67 billion of UK procurement. NHS England spends around £27 billion on goods and services every year. Ward consumables are delivered through the American-founded and German-owned DHL. Mental health beds are operated by American companies providing about 13% of in-patient beds in England. In some areas, the proportion of US-owned mental healthcare facilities is much higher. In Manchester, patients have a 50:50 chance of being admitted to a privately owned hospital and a one in four chance of that bed being provided by an American-owned company. Patients think that the NHS is purely British from beginning to end, but services are being provided by an American-owned company. There is thus no question about the need for the British Government to provide more support for British companies to take up opportunities abroad. The Government strategy is for the NHS supply chain to be expanded and to make it easier for companies around the world both to bid for and to secure NHS services within this country. Of course, they will assist British businesses in doing the same but—I am not necessarily critical of this—the Government operate a level playing field.
The US sees this market as a valuable one because it is colossal, so it is no surprise that it has within its negotiating mandate with the United Kingdom to ease barriers so that its companies can benefit from greater market access to provide over £30 billion-worth of basics and consumables in addition to £7 billion in deals for capital contracts. It has been interesting to note that procurement opportunities within the UK have expanded and that that is positive. It opens up the UK to more international co-operation, but as my noble friend Lady Birt, has said, we want to see greater support for British businesses to enable them to take up some of these opportunities too.
It is interesting to note that the European Union has emphasised that the final market access offer presented by the UK for membership of the GPA was
“commercially credible and viable, replicating the UK’s current coverage under the EU schedule with minor technical adjustments.”
The EU was a fairly enthusiastic supporter of the UK application, and why would it not be? It replicates the same basis as it has at the moment.
I note that the noble Baroness, Lady McIntosh of Pickering, asked the Minister about the thresholds. She referred to $130,000 being the threshold. That is the threshold of every single GPA member other than Japan and Aruba, which have it set at $100,000. Can the Minister say, if we are to have opportunities in our own right, why that threshold is the same as what we had within the European Union?
The reason the WTO and the EU were enthusiastic about replicating what we have at the moment is because the WTO said when it approved our GPA membership in our own right
“It was underlined that the United Kingdom accounts for over a quarter of the EU’s total procurements covered by the GPA and that, when taking into account just central government entities, the UK accounts for nearly half of the EU’s covered procurements.”
There is no doubt that the EU is happy because it has retained market access to nearly half of all of that covered within the EU.
We were led to believe that the Government would negotiate nothing without using British leverage to get a better deal for Britain. Can the Minister explain what we have done with that? The Government did not include procurement in their mandate for a future relationship with the EU, while the EU’s mandate did. It wanted to go beyond the GPA, including utilities and supplementing the GPA with additional areas of coverage which would have opened up the European market for British businesses under procurement. But, no, the Government wish to go on the GPA model, which means that the European Union has in effect preferential access to UK procurement where we have not sought to open up some of the barriers to the European market.
I have a final question to ask the Minister regarding what is happening here at home. The 1998 devolution settlement means that public procurement is an area of responsibility for devolved government in Scotland and Wales. The Government have indicated that they wish to seek divergence in our current approach to procurement. How would this be seen in the devolved areas? I know this as a former constituency Member in the Scottish borders who fought many campaigns on the issue of being against centralisation and the Government centralising procurement policy and bundling up contracts, which makes it harder for smaller, local businesses, as my noble friend Lady Birt has indicated. The White Paper states
“For both goods and services, these provisions will be supplemented by the non-discrimination principle. For goods, non-discrimination will apply within certain excluded areas such as procurement.”
Paragraph 145 goes on to say that the Government are considering
“whether and to what extent it should apply to public procurement, in particular for above-threshold procurements.”
That means that, in effect, the UK Government for England can decide what the threshold levels and the policies for procurement would be for the devolved Administrations. No reference is made to procurement in the Bill, so can the Minister clarify the position on procurement within the internal market?
The Minister of State, Department for Business, Energy and Industrial Strategy and Department for International Trade (Lord Grimstone of Boscobel) (Con)
My Lords, it is a pleasure to speak for only the second time in a debate and my first time in Committee, but as with my maiden speech, it is on matters of great importance to the businesses and consumers of the United Kingdom as we prepare to take our first steps as an independent trading nation for the first time in over half a century. I look forward to working with your Lordships to bring this Bill on to the statute book. I listened to the vast experience of Members of the House when we debated the Bill at Second Reading, an experience which I have already heard repeated in this Committee, and I know that noble Lords will take great care to scrutinise the provisions of the Bill thoroughly.
As I said at Second Reading, the intention of the Bill is to ensure continuity and certainty for the UK and our trading partners once the transition period ends. It will establish an independent body to protect UK producers from injury caused by unfair trading practices. It will enable better use of data to facilitate and improve trade. It will also ensure—the subject of this group of amendments—that UK businesses continue to have access to £1.3 trillion a year of government procurement contracts globally through our independent membership of the WTO’s Agreement on Government Procurement, or GPA. What the Bill will not do is lower our standards in any area.
Baroness McIntosh of Pickering (Con) [V]
My Lords, I am grateful. I was muted, so I apologise for any inconvenience.
I support Amendment 7 and would like to explain to my noble friend Lord Lansley that this is more than just semantics. “Necessary” has a specific meaning in law, as has been identified by the Law Society of Scotland. Perhaps I should state for the record that I am a non-practising Scottish advocate. Against the background expressed by the Constitution Committee of the House on numerous occasions, in particular on this Bill but also on others, we are seeing an extensive scope of delegated ministerial powers, so it is incumbent on my noble friend the Minister to explain why they are required. By adding “necessary” as well as “appropriate”, we are flagging up to the Government that, in scrutinising the Bill and subsequent regulations, the objective of this legislation will go only so far as is necessary to implement the agreement in question. I hope that the Minister will see fit to accept this amendment.
I also wonder whether there has been an oversight in Clause 2(2)(b). The Explanatory Notes define international agreements as follows:
“International trade agreements are agreements between two or more countries aimed at reducing the barriers to trade in goods or services between them.”
For the sake of trade agreements relating to services, not least the right of people to trade services such as legal services, I wonder whether that was an oversight and whether it should be amended to read “free trade agreements and services”.
I also support Amendment 9, which I have signed, because, as stated in the Explanatory Notes, a trade agreement would need to be ratified before regulations could be made to implement it. In most other jurisdictions it is certainly the case that Parliament, and the devolved Assemblies and Parliaments, would ratify the agreement. Would my noble friend put my mind at rest that this amendment is not required because that is the legal situation? If it is not, I would see some argument for the need for Amendment 9.
Amendment 10 seeks to apply the provisions of the Bill to trade agreements other than EU rollover trade agreements, allowing it to act as a framework for future trade policy. If the Bill is not to be the framework, it would be helpful if my noble friend took the chance to explain to the Committee what framework the Government intend to use.
Lord Purvis of Tweed (LD)
My Lords, I will primarily address Amendment 10, to which I have put my name, and then Amendment 7. In doing so, I will reflect on a couple of very good points made by the noble Lord, Lord Lansley, and other noble Lords during this short but useful debate. I agree with the noble Lord, Lord Stevenson, that this debate frames the context for many of the later groups.
There is now no disagreement between the Government and the Opposition that trade agreements are now, by definition, deeper and more comprehensive than they were before we joined the European Union. The transformation of trade agreements from the mid-1970s to now has been significant. They touch on wide domestic policy, far beyond simply tariff rates or quotas for goods. Many will now include provisions on the service-sector economy, which trade agreements never touched on in the past. Therefore, seemingly innocuous technicalities in a trade agreement can sometimes have far-reaching consequences for domestic policy. Later on, the Committee will address additional chapters on climate, development and human rights that never used to exist in trade agreements. In the last group, the Minister referred to impacts on modern slavery and supply chains. These are now all within wider, deeper and more comprehensive trade agreements. It is also the case—admitted by the Government—that trade agreements in the UK in the 21st century impact on the devolution settlements that did not even exist before we joined the European Union. Therefore, there are wider consequences, and the Committee will be discussing those later.
Lord Grimstone of Boscobel (Con)
I thank my noble friend Lord Lansley for giving me the chance to clarify my comments. We have already said, and I am happy to say again, that we will bring forward primary legislation as necessary for future FTAs with new trade partners. As my noble friend quite appropriately spotted, we could not implement those free trade agreements without bringing forward primary legislation. The CRaG process does not do that—it ratifies the treaty but cannot, in itself, alter domestic legislation.
Lord Purvis of Tweed (LD)
My Lords, I listened carefully to the Minister. He said two things, one with regard to the scope of this Bill. We have heard Ministers many times state their desire for this Bill to be very limited in scope and look only at continuity of trade. The Government have brought amendments to this Bill to widen the scope quite significantly, for example on data sharing. The debates we will be having fall squarely within the spirit of what the Government have done to open up the scope.
We will be returning to this valid debate area, but I want to ask the Minister a specific question. I listened carefully to what he said. In objecting to some of the amendments, he referred to the fact that some of the agreements did not require scrutiny within this Parliament because, he said, they had already undergone the EU scrutiny process, mandate, negotiation and ratification stages. That was by the European Parliament, where British MEPs sat and were able to take part. For new agreements, we will have no equivalent. To be clear, is the Government’s position that the EU scrutiny process—when it comes to the agreements that have been approved by the European Union and gone through it but not yet been put into domestic legislation—is equivalent to the CRaG process the Government are asking to use going forward?
Lord Grimstone of Boscobel (Con)
My Lords, I thank the noble Lord, Lord Purvis, for his comments. The continuity agreements were those that were in force before 1 January or had been agreed to by the EU, even if not fully ratified, before then. We were fully participating members of the European Union then. The committees of this House and the other place that scrutinise European legislation—the noble Lord knows much more about that than I do, being a new boy—scrutinised these agreements and did that satisfactorily.
Lord Purvis of Tweed (LD)
My Lords, I remain be-seated to beseech the noble Baroness, Lady Noakes, and others to support Amendment 45 in this group. I shall try to address some of her specific points about that amendment a bit later.
It was very helpful that the noble Lord, Lord Hunt of Kings Heath, was able to take part in the debate on this group, and it is a pleasure to follow him. What he outlined very clearly, in many respects adding to what my noble friends Lady Kramer and Lady Northover said, is that it is now almost impossible to strip out human rights considerations from global trade. We require a degree of pragmatism from our Government in the scope of how much extra global trade we can have. Over the last couple of years, there has been a huge narrative saying that, once we are free of the shackles of the European Union, there will be massive growth potential in untapped markets around the world. Of course, there are constraints on that: in opening up those markets, there can be unfair access to our country that puts us at a disadvantage, or we can reduce standards or set them aside. That means setting aside new international norms on human rights and sustainability, inasmuch as they are a legitimate restriction on total and unlimited free trade.
The narrative therefore needs a degree of adjustment. I wish to address Amendment 45, which I hope is a reasonable addition to this debate but should also be seen within the package of Amendments 23 and 39, which are not in this group. It is about an overall framework of what the restrictions should be on our entering into trade agreements, the level of scrutiny that should exist and how we report on their impact. I hope that together they might allay some of the concerns of the noble Lord, Lord Lansley, given what he said in the previous group about the need for a proper level of scrutiny.
Every year the Government publish a human rights and democracy report. This year, Human Rights and Democracy: the 2019 Foreign and Commonwealth Office Report ran to nearly 70 pages. The noble Lord, Lord Ahmad of Wimbledon, prefaced it, after the Foreign Secretary, by saying:
“Every day, across the globe, UK Ministers and officials stand up for a set of universal rights that, if fully realised, would afford everyone, everywhere, dignity and allow people to flourish.”
I agree with him, and I am not sure that anybody would disagree with that. It is now inevitable, since we have an independent trading policy, that the impact of our trading relationships will have to be incorporated into our reporting. I am fairly open-minded as to how that is done, as long as it is done, and I am very happy to develop the idea further along the lines of the discussions suggested by the noble Lord, Lord Lansley. But I want to give a reason why it is also important and raise some questions for the Minister.
As we have said, it has become the practice for human rights to be part of the political and social chapters of trade deals. That has been the case over recent years and it has been the case in the EU common approach to the use of political clauses agreed in 2009. According to EU practice, in trade agreements human rights are to be included in EU political framework agreements under “essential elements clauses”. EU FTAs are to be linked to those political framework agreements. If no political framework agreement exists, essential elements clauses are to be included, and serious breaches of those clauses may trigger the suspension, in whole or in part, of the overall framework agreements. All the agreements, including the trade agreements, are linked. Are we seeking to continue this approach to future trade agreements? Will we deviate from an approach that we helped design in 2009?
My second point relates to Clause 2 powers, which we have already referred to this afternoon. I remind the Committee that it provides the authority to make regulations considered
“appropriate for the purpose of implementing an international trade agreement”,
including those that make provision for modifying primary legislation that is retained EU law. The Minister referred to that during debate on the first group. I remind the Committee that retained EU law includes primary legislation such as the Equality Act 2010, the Energy Act 2013 and the Modern Slavery Act 2015, as referred to. Therefore, it is important to know that the implication of the regulation-making power in this Bill is an ability to change primary legislation on human rights. For example, the Equality Act gives effect to four EU law mandates: the race equality directive, the equal treatment directive, the equal treatment in goods and services directive and the equal treatment recast directive. Therefore, to allay many of the concerns, can the Minister tell us whether the Government will rule out using this regulatory power to amend primary human rights legislation? If he cannot give that commitment, I am afraid that he will have to appreciate that concerns about the Government’s intentions will remain, because the Bill has insufficient safeguards to ensure that human rights legislation, debated and voted on in primary legislation, cannot be amended by regulations.
Coming back to international trade, my final point concerns continuity and pragmatism. It is not the case that there has been no consideration of human rights in continuity agreements so far. I am a member of the International Relations and Defence Select Committee, which has written to the Government and the Minister about human rights considerations regarding trade and continuity agreements with Israel and the Palestinian Authority. We have agreements, that have been EU agreements, with Algeria, Cuba, Egypt, Eswatini, Iraq, Kazakhstan and the Palestinian Authority. They are all classified by Freedom House as not free, but all those agreements have human rights components within them. I will be the first to say that this is not a panacea and that some—with Vietnam, for example—are fairly problematic, but they all exist. Therefore, if the Government are seeking powers over the next five years to amend those agreements by regulations, what are their intentions for the human rights clauses of those continuity agreements? If the Minister can clarify that, it will be very helpful.
Canada has been referred to in debate on this group and it is a very interesting example. The approach for Canada has developed beyond simply those that we have had for other continuity agreements. A European Parliament briefing on the CETA says that
“a particularly serious and substantial violation of human rights or non-proliferation, as defined in paragraph 3, could also serve as grounds for the termination of the EU-Canada Comprehensive Economic and Trade Agreement.”
Therefore, for the first time, what is envisaged is not simply the suspension of trading relationships but the termination of those relationships—a nuclear option, as it were. One would imagine that that would never become the situation between Canada and the EU, but the possibility exists.
Given that it is government policy to have a Canada-style agreement, there is no reference in the draft text from the Government to the EU that they published over the summer to any equivalence for human rights. There is none at all. The only reference to human rights in the draft text would be to deny most favoured nation status to other third countries if they violate human rights. If we are to trust the Government, which the Minister says repeatedly for us to do, why is it that in their draft text for the EU agreement, they have not put in any draft text for any human rights clauses as far as we operate with the European Union? The very least we can do is to have the ability to ask the Government to report on its impacts.
With reference to the comments by the noble Baroness, Lady Noakes—and I will conclude on this point—the Government publish a comprehensive human rights and democracy report every year. That is not onerous; that is what the Government do. As they say, it underpins their foreign policy. With regard to sectors in our amendment, they are sectors linked to all of the sections within the agreement. That is fairly straightforward. When it refers to our commitments, and the countries we have signed commitments with, yes, it is the whole lot, because that also covers what we currently have within the Commission.
The only reference to human rights, in what the Government are proposing with future trade agreements, is other countries not adhering to them. We do not believe this is sufficient. I am very happy to speak to the Minister, and to the noble Lord, Lord Lansley, and others, if there is a better way of having this. Given the fact that trade is going to be a fundamental part of our foreign policy and our foreign relationships, we will require a reporting mechanism of the impact of trade on human rights for the United Kingdom and those we trade with.
Lord Grimstone of Boscobel (Con)
My Lords, before I come to Amendments 11, 18, 33 and 45, I want to put on record that we have heard some very powerful views on human rights expressed by noble Lords in the Committee today. I deeply respect those views and when I say, with all due respect, they are not relevant to this Bill, which is about continuity agreements, I hope that is not in any way taken as me belittling those views that have been expressed. I would also like to put on record that we do not see it as a choice between securing growth and investment for the UK, and raising human rights. There is not a trade-off here that we are looking to make.
The UK is active in raising human rights concerns. In the case of China, it raises those concerns both directly with the Chinese authorities and in multilateral fora. For example, on 30 June the UK delivered a statement on behalf of 28 countries at the UN Human Rights Council, highlighting some of the matters that noble Lords have raised today—that is, highlighting arbitrary detention, widespread surveillance and restrictions, particularly those targeting Uighurs and other minorities, and urging China to allow the UN high commissioner for human rights meaningful access to Xinjiang. When I say these concerns are not relevant to the Bill, I am in no way say these concerns are not relevant in a wider context and deeply felt.
Coming to the amendments we have been debating today and turning first to Amendment 11, I am proud to say the UK has a strong history of protecting human rights and promoting our values globally. This will not change once we leave the EU. We have always been clear that we have no intention of lowering protections in these areas, as the Prime Minister set out in his Greenwich speech earlier this year. We are not engaged, as the noble Lord, Lord Hain, said or feared, in a race to the bottom. The bottom would not be an appropriate place for the United Kingdom to find itself.
It should come as no surprise that our continuity programme is consistent with existing international obligations as it seeks to replicate existing EU agreements which, of course, are fully compliant with such obligations. By transitioning these agreements, we are reaffirming the UK’s commitment to international obligations on labour and human rights. As noble Lords know, we are seeking to provide certainty and stability in trading relationships for UK businesses and consumers through our trade agreement continuity programme.
Trade: Trans-Pacific Partnership
Lord Purvis of Tweed Excerpts(3 years, 7 months ago)
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Lord Grimstone of Boscobel (Con)
My Lords, the UK will ensure that any future accession talks with the CPTPP are consistent with the UK’s interests and the Government’s stated policies and priorities. We will not make changes to our intellectual property regime that are in any way detrimental to ourselves.
Lord Purvis of Tweed (LD)
My Lords, we on these Benches are enthusiastic for UK businesses to utilise any expanded opportunities to export to the CPTPP countries in future, but this is the future, and what we face over the next couple of months, according to the DIT website this morning, is the fact that the UK will be trading on a free trade basis with only 8% of all UK trade—the worst record for the UK since the 1930s. Does the Minister agree that that will be disastrous for British exporters in the current economic climate and a very weak basis to look for further opportunities around the world?
Lord Grimstone of Boscobel (Con)
My Lords, the Government are very keen to reach agreement with the European Union because of the importance that the noble Lord refers to; we are still working very hard on that. We have plenty of other trading partners around the world. If that agreement is not reached, we will trade on WTO terms with the EU. I think that there will be a bright future for this country in any event.
Japan Free Trade Agreement
Lord Purvis of Tweed Excerpts(3 years, 8 months ago)
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Lord Stevenson of Balmacara (Lab) [V]
My Lords, I congratulate the department and its officials on reaching this agreement in principle with Japan. It is a much-needed relief for all those UK companies that would have seen their trade with Japan reverted to WTO terms if the agreement had not been reached by the end of the transition period.
It is also a welcome benefit at a time of great economic uncertainty for the UK’s digital and tech sectors and for other key exporters which, we assume, will benefit from greater access, faster tariff reductions and stronger GI protections under this agreement than they enjoyed under the previous EU-Japan agreement. However, I hope the Minister will accept that in the absence of sight of the actual treaty text, and a full updated impact assessment, there is much about the UK-Japan agreement that we still do not know until these documents are published.
I welcome what is said in the Statement about the extensive scrutiny of the deal itself that will be offered to the International Trade Committee. I also note that there is a reference to an independently scrutinised impact assessment that the department will produce, so that
“parliamentarians are able to interrogate the deal and prepare a report that is debated in Parliament.”
I ask the Minister to confirm that this offer is also available to the International Agreements Committee of your Lordships’ House, and to confirm also that the timing of these releases of documentation will be such that the necessary scrutiny can be done well before the ratification processes of the CRaG Act are triggered—as of course will be the case in Japan, whose Parliament has to ratify the deal before it can be signed.
I have four other questions. The Statement says there will be a tariff reduction on British exports of food and agriculture, which is welcome. However, presumably this is contingent on sorting out the shared quotas we currently have under the existing EU FTA. For example, does this mean that exports will continue to be restricted unless and until other EU countries fail to use them?
The Statement talks up a new area of co-operation with Japan in the automotive and electronic sectors and suggests there will be considerable growth in new areas such as aeronautics. But, as we discussed in an Oral Question earlier this week, is this not likely to be heavily contingent on final decisions on accumulation and rules of origin after the transition period ends? Can the Minister update us on progress in this area?
I ask the Minister what ISDS clauses are contained in the final agreement. If there are any, how can the Minister justify such secretive and unwelcome provisions when there are ample opportunities for agreed parties to use the normal legal processes operating in both our countries?
Finally, can we get behind the headline comparisons that were fed to the press about the benefits this agreement will produce for the UK? Would the Minister agree with me that the correct comparison is what would have happened if we had simply rolled over the existing EU-Japan deal? To put it another way, can the Minister say what we will be able to do after this FTA is ratified that we cannot do now under the existing EU-Japan FTA—and can he quantify that?
As welcome and necessary as this deal with Japan is, it is still nothing like as important, in terms of our global trade, as reaching a deal to maintain free trade with the European Union. Our trade with Japan is worth 2.2% of our current global trade, which does not come anywhere near the 47% that we have with Europe. That is why commentary on this deal from Japan suggests that the deal that will determine the future of the investment and jobs that Japanese companies bring to UK communities is not the FTA we have just signed, but the one we hope to sign shortly with Europe.
Lord Purvis of Tweed (LD)
My Lords, because these Benches want the UK to prosper, we welcome the agreement. However, rather like industry groups, we do so not by hailing it but by sighing a collective sigh of relief that we have secured simple continuity of the benefits we secured as part of the EU. It has come to this—simply securing the trading terms that we had as a member of the EU now that we are out of it was described as “heroic” by a Conservative MP in the Commons on Monday.
It is customary to thank the Government for advance notice of a Statement’s accompanying published documents. However, as referred to, in this case it would have been good to have notice of the text of the agreement—which has yet to be signed—so that we could offer proper scrutiny. In Japan, both Houses of the Diet will need to approve the Cabinet’s decision to endorse the treaty. That is not afforded to our Parliament; we will not have an opportunity to do so. British parliamentarians did with the EU agreement. However, as I said last week on the Trade Bill, the Government seek continuity on most things but not on parliamentary accountability. Can the Government Whips indicate that we will have a substantive debate on this agreement in this House before the Government indicate that they seek ratification?
The Minister gave specific details of the agreement when answering questions on Monday, but we have had no sight of the agreement in order to consider the context and scale of what the Minister said. Like the noble Lord, Lord Stevenson, I welcome what Liz Truss said on Monday in the House of Commons, with regard to a copy being given to the International Trade Committee. I also would like to know whether that will be afforded to our committee, the International Agreements Committee, and when this will be done. Will the text also be made available, as is common in other Parliaments, to Front-Bench spokespeople on a private briefing basis at the same time as it is sent to the committees? What will be the timeframe between it being sent to the committees and a debate in this House?
We have to reserve judgment on the wider benefits the Government claim for the agreement until we have seen them. Over recent months, we have seen the enormous capacity of the Government to oversell and then underdeliver. For example, there was massive fanfare over securing tariff-rate quotas for British agricultural products in this agreement, but then reports suggest that we have actually secured access to any non-utilised quota for EU goods.
With even greater heralding activity, the press release announced:
“New protection for more iconic UK goods … from just seven … to potentially over 70 under our new agreement”.
Understandably, MPs in the Commons lined up to welcome this, but can the Minister confirm that the agreement has no new protections creating GIs, as Japan is under no obligation to expand further its recognition in the future to beyond what we have in the EU deal? Rather, it will simply be able to consider further requests from the EU to a limit of 70.
If it transpires that this spin—which has also described the agreement as “gold standard”—is actually just a commitment to talk about further potential agreements, such as geographical indicators, the Government are building up a huge amount of expectation for very limited benefit. Given the fact that Japanese company Hitachi’s agreement for nuclear power on Anglesey is likely to have a bigger negative economic impact on the United Kingdom than any benefits of this trade agreement, context is all.
On state aid, the Minister referred to a Question I asked on Monday, and he said clearly that this a perpetuation of EU rules which we will be bound by. Can the Minister be clear and tell the House whether it will require domestic state aid legislation to implement this and, if so, will it be a continuation of the EU regime? When will that be brought forward? On tariffs, what will the overall average Japanese import tariff on UK goods be under this agreement, compared to what we have at the moment?
Finally, the Government said that the benefits are likely to yield £15 billion to the UK economy, but they have not given a timeframe. I looked at the Government’s scoping paper, and it said that that source simply stated over “the long term”. The source for that, in the footnote, was internal DIT analysis from 2018. Will the Government publish that? What is the timeframe for that £15 billion—with no caveat—the Government have announced, overselling and underdelivering again? What is the figure? The Government did not quote from that scoping exercise that that figure does not take into consideration the economic impacts of Covid-19, so what is the real likely benefit?
If we are to see the benefits from this agreement, which we wish to, the Government have to be open and transparent. So far, that transparency is lacking. I hope that the Government will be far more open in the coming weeks.
The Minister of State, Department for Business, Energy and Industrial Strategy and Department for International Trade (Lord Grimstone of Boscobel) (Con)
I thank both noble Lords from the Front Benches opposite for welcoming the agreement. I share their view that this is a good agreement for the United Kingdom.
I will do all I can to answer the questions put to me. First, I can confirm that the IAC—our committee which scrutinises agreements—will be treated on all fours with the ITC, and anything that goes to the ITC will also go to the IAC. The next stage, which is going on at the moment, is that the agreement is being “legally scrubbed”, or put into a good state. When that is done, which will probably be sometime in early October, that agreement in the first instance will be presented in its entirety to the two committees. It will be presented to them in good time for them to report on the agreement at the same time as the whole agreement is laid before your Lordships’ House.
At the same time as we present the agreement, we will present an impact assessment, which will set out the impact of this agreement in various environmental and other matters and, critically, we will publish another assessment which shows where this agreement differs from the previous EU agreement. Therefore, if noble Lords do not mind waiting, when that final package appears in front of the committees, and through the committees to themselves, it will answer the questions that have been asked.
I repeat that we have no desire at all not to be transparent and open with your Lordships’ House. It will be of great benefit to us if these agreements are well understood. They are important in themselves but they will be even more important once our businesses throughout the land understand them and are able to operationalise them to their own benefit.
On some of the specific questions that were raised, I can confirm that there is no ISDS clause in this agreement, so that should not be a matter of concern. Rules of origin are the same as in the previous EU-Japan agreement but with three improvements: our coats, knitwear and biscuits industries have extended rules of origin, so will be able to bring in ingredients from a wider range of places than they could under the previous agreement. Therefore, noble Lords who enjoy their shortbread can be assured that it will now be sold on even better terms into Japan.
The noble Lord, Lord Stevenson, mentioned quotas, which are a very small part of this. Out of £150 million of agricultural trade between the UK and Japan, only £1 million is covered by quotas. As mentioned, our producers will be able to take advantage of the unused quotas in that, and for products such as Stilton cheese, that will certainly be of benefit to its producers.
The state aid references in the agreement are de minimis and the kind of state aid arrangements which we regularly find in agreements of this sort. This in no way creates a new state aid regime for the UK.
The noble Lord, Lord Purvis, mentioned GIs. Japan has agreed that we can put up to 70 further GIs in front of them and the tone of that discussion was very warm. Those GIs will go through a challenge process, but my right honourable friend the Trade Secretary and I are very confident that they, or at least the vast bulk of them, will be approved by the Japanese.
If noble Lords on the Front Benches opposite wish to see any further points of detail covered, I will be happy to deal with them separately. However, if noble Lords do not mind waiting for the next few weeks, until these agreements are out in the open, things will be very clear then, and I hope that will lead to people understanding and further welcoming a very important agreement.
Motor Sector: Export Markets
Lord Purvis of Tweed Excerpts(3 years, 8 months ago)
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Lord Grimstone of Boscobel (Con)
My Lords, the noble Baroness makes a very good point and I am aware of the great enjoyment that these vehicles give to people throughout the United Kingdom. I do not have the details of those matters, but I will write to the noble Baroness with them.
Lord Purvis of Tweed (LD)
My Lords, after everything that the Government have said over recent days and recent years about the need to retain or gain complete autonomy and freedom over state aid rules, would it not be inconceivable that the deal with Japan that the Minister referred to would in effect put into a treaty—which we would have to put into domestic law—the EU regime of restrictions that the Government say they need freedom from in perpetuity? Surely that cannot be the case, so can the Minister reassure all those Brexit supporters in the north-east and elsewhere that the reports in the press about this action by the Government potentially replicating it are surely inaccurate?
Lord Grimstone of Boscobel (Con)
My Lords, the UK-Japan agreement contains standard FTA provisions on subsidies. Motor manufacturers, including those in the north-east, and their representative organisation have strongly welcomed the UK-Japan deal. These subsidy chapters in trade agreements help ensure that fair and open competition exists for both parties by working to limit the effects of trade-distortive industrial subsidies. The subsidies chapter in this UK-Japan FTA rolls over the provisions from the EU-Japan EPA.
Trade Bill
Lord Purvis of Tweed ExcerptsTuesday 8th September 2020
(3 years, 8 months ago)
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Lord Purvis of Tweed (LD)
My Lords, with neat symmetry, it is two years to the week that we again have a trade Bill before us. The Minister has been engaging and proactive since his appointment in the spring, and I personally appreciate his way of doing this. I can tell that he was a very successful member of a private office, because his own private office is supremely efficient and helpful in its engagement. He is the third Lords Minister during the passage of the Bill and its predecessor—it will be third time lucky for him, I am certain. Having been at the Dispatch Box a few times before his maiden speech, he is a rather experienced maiden already in this House, but his maiden speech and that of the right reverend Prelate were greatly welcomed, and justifiably so.
We on these Benches want the UK to prosper. We want free, open and fair trade based on rules around the world, to allow, as my noble friend Lady Burt said, our businesses to take advantage of opportunities to export, whether across the Channel or around the world. We want our consumers to have access to the fairest-priced and best-quality goods from anywhere, and we want the UK to lead an ethical trade, helping to implement the sustainable development goals and support human rights and supply change, ever driving up standards and supporting the least developed countries in the world so that they can develop and trade with us on an equal basis. I disagree respectfully with the noble Baroness, Lady Bennett of Manor Castle, who said that fair trade is antiquated. I do not agree, and I think many people will be disappointed to hear her say that. As Winston Churchill summed it up—when he was a Liberal:
“We want to have free competition upwards; we decline to allow free competition to run downwards.”
It is a pleasure to follow the noble Baroness, Lady Hayman. Reflecting on her speech, it is sad to see that the Government have removed from the Bill their amendment to the predecessor Bill, which was new Clause 2, on guaranteeing standards. Can the Minister explain why they have done that?
Our support for free and open trade is a founding principle to our cause, as my noble friend Lady Kramer said. We ensured the repeal of the corn laws and the benefit for poorer consumers, and we opposed the protectionist tariff reform campaign of 1903 and split from the national Government in 1932 when the Conservatives introduced the Import Duties Act, with 10% tariffs all around. We supported the common trading market in Europe as a vehicle to advance global freer trade, and we saw the average UK import tariff rate fall from 7.9% in 1972 to part of the average EU tariff this year of 2.8%. It was the biggest and most continuous fall in British import tariff rates in a century.
Because Liberals believe in free, open and fair trade, we are anxious about the prospect of starting 2021 with the highest rates of trade barriers, tariffs and burdensome customs procedures for our businesses. The massive and unavoidable new friction on our trade with new customs red tape will, as HMRC itself has estimated, cost UK exporters £7 billion a year and those importing £7 billion a year. We know our borders will not be ready in January, so the Government have deferred export processes by six months to buy time. Why the need to buy time? It could be the reason contained in an email from HMRC on 30 July:
“To date, HMRC has made a total investment of £34 million available to support the sector, which has supported more than 20,000 training courses, nearly 15,000 units of IT and the recruitment of over 600 new customs agents.”
At a cold reading of that your Lordships may be impressed, but Michael Gove said that we needed 50,000 customs agents by January next year. Spending £34 million has given us 600, a figure that is rather short of 50,000. If the Minister could say how many we have currently recruited, that would be welcome.
However, this was of course part of an indication that we would already have all our continuity trade agreements in place by March—March 2019, that is. Information on the Department for International Trade website today shows that the countries where we have continuity agreements, referred to by the Minister, represent £111 billion of UK trade in 2019. Total UK trade in goods and services in 2019 was £1.5 trillion. To put that into context, as we finish this Second Reading debate today, the UK is currently placed to trade on a free trade agreement basis that represents only 8% of our overall trade. This would be the worst trading relationship for the UK since 1932.
Some tout themselves as free-traders, but are happy to see a massive reduction in UK free-trading relationships and a massive increase in trading bureaucracy and costs. It is an irony that some Conservatives, who for three-quarters of a century proposed protectionism, were finally persuaded of reducing tariffs by entering the common market—our largest market—and now think that by leaving it, they can grow trade.
As referred to by my noble friend Lord Oates in his very lucid speech, some conservatives, such as Tony Abbott, think that the solution to this is to shed environmental and climate standards and to allow competition to run downwards, as Churchill put it. As a global ambassador for the UK approach to trade, his credentials make perfectly clear what he thinks. As the EU-Australia trade talks themselves show, the Australian Government have rebuffed Tony Abbott’s call to leave the Paris Agreement because a deal with the EU would be impossible without it. However, Abbott told a global policy foundation in conference in London, in October 2017, that
“it’s climate change policy that’s doing harm; climate change itself is probably doing good”.
Is that the attitude for a British adviser for 21st-century UK trade? I think he will probably be doing our country harm, not good.
We on these Benches were concerned that leaving the single market for services would potentially bring about capital flight and reduce competitiveness in our services sector. We were told by some that we were simply moaning and had basically no idea what we were talking about. The Government’s slogan that we see at the moment—“Let’s get going”—could have been used to describe what Barclays did last year, for example. A Reuters report notes that Barclays
“spent 100 to 200 million pounds… moving operations and staff out of Britain to prepare for Brexit, its UK chairman Gerry Grimstone said on Wednesday… Barclays has moved its European headquarters and almost 200 billion euros in assets to Dublin and last year began shifting 40 to 50 investment banking jobs to Frankfurt from London.”
Mr Grimstone then said:
“We believe this will give us a competitive advantage on the continent”.
Would the Minister please explain what the competitive advantage is from leaving London for Dublin or Frankfurt?
When it comes to scrutiny, much has been said. I simply want to give one example, because I thought the radical saboteur speech of the noble Lord, Lord Lansley, about wanting to improve this Bill was very constructive. On scrutiny and accountability, I will give one example of a measure that we ratified: the Japanese agreement. The simple fact is that for the Japanese agreement, which we ratified in Parliament, British parliamentarians sitting in the European Parliament had a greater say in the setting of the mandate for it, had access to materials through the negotiating rounds and had a say on its approval. British parliamentarians sitting in this Parliament for the new Japan agreement will not have the same say as those who sat in on the agreement that we have ratified ourselves. This cannot be right. Surely the Government, who want continuity on everything but not parliamentary accountability, have to make some movements. I hope that the Government will see sense and respond constructively to those requests.
We also want to see the wider aims of trade enveloped in our overall approach. That is why we believe very strongly in supporting the least developed countries to develop and in ethical trade, and we want to see improvements. My noble friend Lord Chidgey asked this question, but can the Minister explain why, for example, Kenya and the east African states have now been dropped from the list of those that are likely to see ratification? Why have the Government cut support to help countries implement continuity agreements that we ourselves asked them to put in place? Why has the Department for International Trade said that it has no responsibility for aid for trade and that that responsibility lies purely with the new Foreign, Commonwealth and Development Office?
We want to link our trade policy with an ambitious international strategy, but fundamentally this is about us and British businesses prospering. Therefore, we need to link our trade policy with an ambitious export strategy, so that British businesses can take advantage of new trading opportunities, whether with the US or Japan. The Government’s paper itself said that with an American or Japanese trade deal, we would likely see only 0.16% growth.
I want to give a brief example before I conclude. The noble Lord, Lord Lilley, and others have indicated that we can now see great opportunities because we are out of the European Union. US trade census data shows that UK exports to the United States grew from $39 billion in 1999 to $63 billion in 2019. That is a 61% increase, which is great. French exports to America grew from $25 billion to $57 billion—a 123% increase. Over the same period, German exports to America grew by 131%. It has not been membership of the European Union that has held us back. Will the Government therefore link our trade policy with an export policy, because nowhere in the Japan or American deal was the word “deficit” included? We have a deficit with America of £5.9 billion in goods; France has a surplus of £18 billion and Germany has a surplus of £67 billion.
To address these points, we will seek to persuade noble Lords on sensible and proactive amendments to improve the Bill and to make it a better vehicle to support UK business and exports, to meet our international ambitions and to continuously reduce barriers. In his very welcome letter to me on 9 April, on his appointment, the Minister said that he believes in cross-party working and working as collaboratively as possible with noble Lords across the House. We agree with that: that is how we will conduct the Committee and Report stages of this Bill to make it better.
Russia: Trade
Lord Purvis of Tweed Excerpts(3 years, 9 months ago)
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Lord Grimstone of Boscobel
My Lords, I thought that I had made it clear that there are no trade negotiations going on at the moment with Russia. I resent the assumption that Ministers would in any way be influenced by the matters to which the noble Lord refers.
Lord Purvis of Tweed (LD)
There have been strict sanctions on trade with Russia because of the Putin Government’s authoritarian actions and human rights abuses since 2014. Now, as mentioned, China could be added to that category. In April 2018, the Minister told Bloomberg News, regarding China:
“The fact that Xi is prepared to give such strong authoritarian guidance within the context of a market economy is great for companies like mine”.
What assurances can the Minister give that he does not similarly admire the Putin regime and its approach to repression and human rights abuses and that UK trade should not be blind to this?
Lord Grimstone of Boscobel
My Lords, the quotation to which the noble Lord refers was a selective quotation picked up by Chinese newspapers from a much longer speech. I hold no candle for any authoritarian regime and I am pleased to confirm that in front of the House.
Trade Agreements
Lord Purvis of Tweed Excerpts(3 years, 10 months ago)
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Lord Grimstone of Boscobel
My Lords, the noble Lord makes a good point. We work closely with our colleagues in other departments to ensure that those matters are fully taken into account. My belief is that the new changes to the machinery of government will make our voice even more effective in these matters at the country level.
Lord Purvis of Tweed (LD) [V]
Rights and standards were a part of the human rights clauses that we insisted were in our trade agreements when we were a member of the EU. We are negotiating with the US, a country which has ratified only two out of the eight core fundamental ILO conventions, whereas we have ratified them all. On climate, the US has refused to include a climate chapter in its negotiations with us. Can the Government allay fears by giving a simple undertaking: that no EU-retained law on human rights, labour standards, climate or environment will be amended or repealed by any trade agreement or partnership agreement?
Lord Grimstone of Boscobel
My Lords, the series of trade agreements in effect at the moment—to which we were bound by our membership of the EU—are being rolled over into various continuity agreements. I can confirm that all those continuity agreements will contain within them the appropriate provisions in relation to human rights and environmental standards.
Electricity Capacity (Amendment etc.) (Coronavirus) Regulations 2020
Lord Purvis of Tweed Excerpts(3 years, 10 months ago)
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Lord Purvis of Tweed (LD)
In introducing this measure, the Minister said that it is necessary for the UK to remain compliant with the EU regulations. Is it the Government’s intention that we will continue to stay compliant with state aid regulations? If so, and the Minister is bringing this measure forward now to remain compliant, what is the timeframe for that compliance? Is it for the duration of this temporary measure only, or do the Government’s intend that we will remain compliant and able to continue operating seamlessly with the European market? Given that the Government have not carried out an impact assessment, what is the likelihood of this supporting smaller operators? What is the impact on bigger operators? There are many references to these powers possibly enabling operators, but what is the assessment of the likelihood of that? If it is an EU-based energy supplier, will it be able to benefit from this measure?
I want to quote to the Minister some remarks made in the House of Commons during the debate on this measure:
“I am very concerned about the regulation, its provenance and whether it will limit our freedom of manoeuvre in ways we do not wish from the beginning of next year … I therefore find it extremely worrying that we have responded to a state aid challenge upon us in the dying days of our membership of the single market, or its rules, when we are no longer a member of the European Union which sponsors it.”—[Official Report, Commons, 15/6/20; col. 566.]
That was Sir John Redwood. I have never doubted the Minister’s credentials as a Brexiteer. He has reminded us of that on far too many occasions over the past of couple of years. So, can he explain why Sir John Redwood is so wrong and why we need this measure urgently in order to continue to be compliant with EU state aid regulations?
The Minister said that the measure will end on a specified date. What is the process for deciding that specified date? As we know, the impact of coronavirus, and potentially other waves, is an unknown situation. I think there is common ground across the House about the benefits of reforming the electricity market and the capacity market, and of paying for reliable sources of capacity alongside electricity revenue. I do not think there is any doubt about that. Sir John Redwood also said,
“we are talking about whether this country is now going to have its own energy policy, or whether we are hastily legislating so that we can, for the foreseeable future, still be effectively under EU state aid rules, edging ever closer to integration with EU energy policy”—[Official Report, Commons, 15/6/20; col. 568.]
Will the Minister say why Sir John may be wrong on that point? Bearing in mind that we are likely to get up to 10% of our energy from the European market, given the way the state aid rules operate, for how long will we be compliant with those rules?