Trade Bill

Baroness Noakes Excerpts

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

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

My Lords, it is a pleasure to follow the noble Baroness, Lady Boycott. I speak to Amendments 20 and 22 in this group. The noble Baroness, Lady Jones of Moulsecoomb, moved Amendment 20, and I fully support her and others in ensuring that imports will meet the current principal standards on food safety, the environment and animal welfare.

We have had numerous direct debates about ensuring that these issues remain at the forefront of the Government’s commitments to the public. It is, however, vital that in order to trade with least developed countries and encourage their entrepreneurial skills, our standards do not act as a blockage to those countries. At the same time, it is important for public confidence that food safety standards are maintained and animal welfare is not compromised. We are, after all, a nation of animal lovers.

Cross-party Amendment 22, moved by the noble Lord, Lord Grantchester, also mirrors debates that took place during the passage of the Agriculture Bill. It is an extremely important amendment to ensure that Parliament is fully involved in ensuring that standards affected by international trade agreements are maintained at our current high levels.

Members of Parliament are elected to ensure the well-being of their constituents in a wide variety of areas, and it is simply unacceptable for them to be excluded from debating trade agreements that could have a dramatic impact on local businesses and their constituents. Similarly, the upper Chamber, while not currently elected, has a wealth of expertise and knowledge that can be brought to bear to enhance future trade agreements, where necessary.

Issues of food safety, quality, hygiene and traceability are essential not only to protect consumers but to ensure a level playing field for our farmers and food producers. It is important for human rights and equalities to be included, especially women’s and children’s rights along with other classifications under the Human Rights Act of 1998.

The devolved Administrations should not be an afterthought but should be consulted at an early stage and able to express their view on trade agreements that affect them. The relevant committees of both Houses, including the Secondary Legislation Scrutiny Committee, will also have a view.

As we move forward with the continuing process of separating ourselves from the rest of Europe and bringing the UK closer to other countries in the world, standards and scrutiny will be important to maintain the confidence of the public, business and our other partners, some remaining in the EU. This amendment gives the reassurance that is required for this to happen. I fully support these two amendments, and I will support Amendment 22 should the House vote in the virtual Lobby.

[Baroness Noakes (Con)]

My Lords, I expect that the noble Baroness, Lady Jones of Moulsecoomb, knows what I am about to say about her Amendment 20, which is yet another attempt to hardwire the maintenance of UK standards into statute.

Time and time again the Government have said that they have no intention of lowering standards. The noble Baroness has usually replied that she does not trust the Government. I hope she will accept that amendments to legislation are not customarily made in your Lordships’ House in order to confirm what is already government policy, especially when it has been repeated at the Dispatch Box numerous times.

I can levy the same criticism at Amendment 22, in the name of the noble Lord, Lord Grantchester, and others, but my main reason for putting my name down to speak on this group is because I think that Amendment 22 is quite extraordinary. There are certainly examples of codes of practice required by statute, and some also require approval by Parliament, but as far as I am aware, there is no precedent for an Act requiring one Minister to set out how that Minister or any other Minister must behave. The codes of practice that exist are usually intended to complement often complex legislation to guide those who need to implement it. I believe that they have never been used as instructions to Ministers on what to do, and I do not believe that we should start to do that now.

I also remind noble Lords that the negotiation of international treaties is firmly within the royal prerogative. I believe that Amendment 22 would fetter the royal prerogative, and apart from anything else it should not be pursued on those grounds

The Government have said that they will maintain standards, but Amendment 22 just tries to tie Ministers up in knots. We should just let them get on with their jobs. I hope that noble Lords will not support these amendments if the noble Baroness, Lady Bakewell of Hardington Mandeville, or the noble Lord, Lord Grantchester, choose to press them.

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

My Lords, my interests are as listed in the register. It is a privilege to follow the noble Baroness, Lady Noakes, who is extremely well informed. I speak to Amendment 22 in the name of the noble Lord, Lord Grantchester, and supported by the noble Lord, Lord Purvis of Tweed, and my noble friend Lady Boycott.

I will be brief and reserve most of my comments on the proposed trade and agriculture commission when we debate amendments in the group beginning with Amendment 26. However, I have a straightforward request for clarity, which is linked to this grouping of amendments. How do the Government plan to respond to the report that will be delivered by the existing Trade and Agriculture Commission within the next couple of months, when I assume it will report? We look forward to the conclusion of the crucially important task that the TAC was commissioned to undertake by the Secretary of State. It may well recommend a code of practice, as proposed in the amendment, and will certainly make recommendations that should influence the way we conduct future trade deals.

We must assume that the Trade Bill will have become law before the current TAC reports, so I am concerned that we will not be able to take its recommendations into account. I am interested in what the Minister has to say about how the Government will respond to the TAC’s recommendations retrospectively, having passed the Trade Bill before it delivers the report.

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[Baroness Noakes (Con)]

My Lords, it is a pleasure to follow the noble Lord, Lord Knight, who clearly has a much more exciting life on Twitter than I do.

In respect of the substance of the amendment moved by the noble Baroness, Lady Kidron, I again say that your Lordships’ House does not need to—and, indeed, should not—seek to write on to the face of legislation that to which the Government are already committed.

The noble Baroness and other noble Lords who have supported this amendment are aware that the Government have recently published their response to the online harms consultation and have announced that they will create a new regulatory framework, overseen by Ofcom, which will apply internationally. Once that is legislated for, it will be the law of the land, as is the Data Protection Act 2018, and cannot be overridden by any international trade agreement. The only way that the law can be overridden is if Parliament chooses to change it. I am sure that my noble friend Lord Grimstone of Boscobel will provide further reassurances in respect of the Government’s position.

I should like to concentrate my remarks on the drafting of the amendment. We all know that amendments for Committee can be somewhat rough and ready because they are often used as probing amendments and are rarely divided on—at least, that is the modern practice, although it was not like that when I first joined your Lordships’ House—but I hope that the House will agree that it is incumbent on those moving amendments at later stages of a Bill, including Report, to ensure that they are well drafted. With that background, I wish to offer three comments on Amendment 23.

First, subsection (1) of the proposed new clause has a misplaced modifier. The word “only” is incorrectly attached to becoming a signatory to trade agreements. I believe that the noble Baroness intended to say that the UK may become a signatory only if certain conditions are met, rather than that the only thing that the UK can do if the conditions are met is become a signatory to a trade agreement.

Secondly, subsection (1) refers to

“the conditions in subsection (2)”,

but subsection (2) is not drafted as conditions to be satisfied; rather, it is just one statement—that trade agreements must be “consistent with” three things. I also remind the noble Baroness, Lady Kidron, that her concerns are not addressed by whether or not international trade agreements are consistent, because trade agreements do not, and cannot, change UK law, as I have already said. If they were inconsistent, they would have no effect unless and until changes were made to UK law, which would of course require the agreement of Parliament.

Thirdly, proposed new subsection (2)(a) refers to consistency with the domestic law of England and Wales, which rather begs a question about Scotland and Northern Ireland. They may or may not have their own relevant child protection legislation at the moment—I am not an expert on that—but, even if they do not have relevant legislation now, they presumably could have in the future. I am mystified by why paragraph (a) is restricted to English and Welsh law.

I hope that the noble Baroness, Lady Kidron, will reflect on those points.

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

My Lords, there was some good debate on the TRA in Committee, and the amendments in this group largely follow up on those themes, about which there was quite a lot of agreement. The disagreement was about whether or not they should be included in the Bill. I will speak mainly in support of Amendment 27, which my noble friend Lady Kramer has already explained. I want to add more background to why it is proper to put a little more on the face of the Bill when a regulator is created.

We have a lot of independent regulatory bodies in the UK. We will have even more, such as the TRA, following Brexit. They become part of the system of unelected power. That system has its strengths and weaknesses. We seem to have been broadly free of corruption, but maybe we have had our fair share of ineptitude. Whatever the rights and wrongs of the system, there is really only one opportunity for Parliament to intervene in the objectives and formulation of the regulator in a way that is seen as benign and away from incidents, rather than threatening it or treading on its powers, as it may see it. That time is when it is being set up, as the TRA is now. If I recall correctly, the Minister, the noble Lord, Lord Grimstone, said that the TRA will have heard Parliament’s views and could take account of them. It is true that the TRA, once formed, may take note, especially if the Minister is supportive, despite wanting to keep amendments down.

However, in reality, reliance on kind words in debate is not enough, especially ones lost in the mists of time. The Government may get another go, whether through policy messages of a formal nature or otherwise, or through statutory instruments, which we all know that Parliament has no power to change. For Parliament, once the Bill is passed, it is down to how far Select Committees will manage to harangue a regulator when it goes wrong or to how many Members pose Parliamentary Questions and cause enough publicity and aggravation to force a review, usually after a dramatic failure. I have trodden that path, but how much better it would be to accept the benign influence of a few more words in legislation at the outset, so that slippages are prevented or can be reminded about and caught sooner. Maybe there will be some constructive sessions with Select Committees and regulators will say “I will take that idea back” but, in my experience with financial services regulators and the FRC, that rarely leads anywhere.

As has been pointed out, the TRA has some well-defined functions stemming from WTO rules already in legislation, but there is wriggle room left around the economic impact assessment and it is all happening at a time of great sensitivity. Although I acknowledge that the department is doing a good job in its current work and preparation for the TRA, there would be comfort for the future in having something in the Bill to remind it about engagement with stakeholders.

The other amendments in this group also have merit. Amendments from the noble Baroness, Lady McIntosh of Pickering, concerning the scope of advice, raise in my mind the question of whether the Government might at any stage wish to consult the TRA about state aid subsidies. What co-operation might there be between the CMA or other state aid control bodies given that the TRA has the other side of it? In a similar vein, I wonder whether the TRA will have the role of investigating infringement of state aid by the EU under the trade and co-operation agreement, as well as under WTO rules.

My plea to the Minister is that he put something on the face of the Bill so that there is at least something to point to concerning stakeholders.

[Baroness Noakes (Con)]

My Lords, I shall speak only to Amendment 27 in this group. I do not support it, mainly because I believe it is not necessary to tell a public body how to do its job. The TRA will be set up with a chief executive, staff and a board which will have a majority of non-executive directors and a chairman. It is being set up in a perfectly conventional way, which should allow it to ensure that it operates effectively.

A public body—or indeed any kind of body—does not need to be told to draw up a stakeholder engagement strategy. I also find it slightly bizarre that the amendment focuses on an engagement strategy. There will be far more important aspects of the TRA’s work—for example, on the kinds of information it seeks and the kind of analysis it carries out—but no strategy seems to be required for those. I also find no merit in the requirement to publish a strategy; I fail to see how that would add to the effectiveness of the TRA in providing advice.

Even if we need to specify that there must be an engagement strategy, it is quite unnecessary to specify a list of stakeholders with whom engagement must take place. I must say that the relevance of some in the list in this amendment is not entirely obvious. It seems to me that those proposing this amendment have forgotten that the TRA will focus on the kinds of things set out in Clause 6(3). It is a body focused on trade and traders, not on solving the problems of the world which are of interest to lobby groups.

[Lord Bassam of Brighton (Lab) [V]]

My Lords, now that the Brexit transition period has ended, the creation of the Trade Remedies Authority is obviously both necessary and very welcome. It should allow the UK to protect domestic industries, investigate allegations of unfair practices by overseas competitors and seek their resolution via the WTO’s dispute settlement mechanism. We must have a Trade Remedies Authority that has a broad membership from sectors and regions across the UK, conducts meaningful stakeholder engagement and, of course, is independent from the Government.

I do not buy the argument from the noble Baroness, Lady Noakes, that it is not the business of Parliament to give some guidance or ideas as to who those meaningful stakeholders might be in ensuring that we get this right. Only then, I argue, will it be transparent and fair when investigating and challenging practices that distort competition against UK producers. But the Bill appears not to secure this, as reflected by my Amendment 47 and the other amendments in this group, which are in their own way entirely benign. It is worth reminding ourselves that the Lords Constitution Committee said that it was not clear why the functions and powers of the Trade Remedies Authority could not be set out in more detail in this Bill. We cannot have an unbalanced TRA that simply supports the priorities and approach of this Government, or indeed any Government. We need a functioning TRA and a functioning trade remedies system, but its functioning will be undermined if there is no independence.

Amendment 47 is simple. It allows the Secretary of State to ensure that members of the TRA should have the

“skills, knowledge or experience relating to producers, trade unions, consumers and devolved administrations in different parts of the United Kingdom.”

The amendment clearly seeks to guarantee an appropriate balance of views at the TRA, not in favour of any party or sector but for the benefit of all regions, nations and businesses. In particular, I argue that we need trade union representation in the TRA. The TUC has said that, without it, there will be

“no guarantee provided that the non-executive members will represent the interests of workers in manufacturing sectors who will be severely affected by the dumping of cheap goods such as steel, tyres and ceramics.”

I hope that the Minister can explain in some detail how this balance can be achieved without the necessity of this and other amendments being in the Bill.

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Just to finish, in the recent past, we have had a number of occasions when matters of urgency have bypassed the normal scrutiny of this House. I hope we do not arrive at the point where matters that are sensitive should also escape scrutiny in this House. Matters which are important and, indeed, matters which are sensitive seem to me to deserve proper scrutiny. I beg to move Amendment 41.

[Baroness Noakes (Con)]

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

[Lord Purvis of Tweed (LD)]

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

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

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

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

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