European Union (Withdrawal) Act

Barry Gardiner Excerpts

Monday 14th January 2019 Commons Chamber

[Barry Gardiner (Brent North) (Lab)]

For many months, we have been confronted with a series of choices and a series of false choices. The country had to choose whether to leave or remain. Those in the Cabinet had to choose whether to leave or remain in the Cabinet. For many Government Members, the choice has become whether to leave with or without a deal. For many Opposition Members, the choice has been whether to call for a second referendum or to accept the first.

Many famous figures have been quoted since we started our debate back at the beginning of December, but these are the words that keep coming back to me: it is not our abilities in life but our choices that define who we truly are. For all the heart searching and the division that these questions have caused, I am convinced more than ever that the real divide in our country is not between those who voted to remain and those who voted to leave but, as the leader of my party said last week, between the many who do the work, create the wealth and pay the taxes, and the few who set the rules, reap the rewards and so often dodge paying the taxes. The real choice is choosing whose side we are on when we see injustice, unfairness and inequality. In answer to that question, my party—the Labour party—has always throughout its history had one and only one answer. As the party of the many, we seek to heal the appalling divide that we now see in our society.

The speeches that have moved me in the long course of our debate since December were those like that of my hon. Friend the Member for Stoke-on-Trent Central (Gareth Snell), who explained that his constituents were not interested in the processes and the amendments. He said:

“They want to know how they will feed their kids and heat their house, and how they will get to work if there is no bus. How will they make ends meet if they have to move from their current benefit on to universal credit?”

That view was intriguingly echoed from the Government Benches by the hon. Member for Plymouth, Moor View (Johnny Mercer), who said:

“The vote to leave was in no small part a cri de coeur from millions of people who feel that the powers that be in Westminster no longer know, let alone care, what it feels like to walk in their shoes…At every level, there was a direct correlation between household income and the likelihood to vote for leaving the EU.”—[Official Report, 6 December 2018; Vol. 650, c. 1144-1159.]

The social divide in our country is real. I agree with my colleagues who say, “That was not caused by the European Union.” That is true, but nor did the European Union provide a shield against it. It will not be solved if we become poorer by leaving the EU, but while our country has been a member of the EU, the experience of those millions of people has been the loss of secure jobs, the hollowing out of their communities, and years of austerity and harsh social policy. That is why remaining in the EU does not appear to them to be a solution to the inequality we face.

Cri de coeur it may have been, but those people will feel nothing but anger and disgust for us as politicians if we turn around now and patronise them by ignoring and reversing on the message they gave us in the referendum. My good friend the hon. Member for Newcastle upon Tyne Central (Chi Onwurah) expressed that with an eloquence we rarely hear in the Chamber when she said:

“The right to be heard is a key battleground in the history of our country, and it is at the heart of the age-old division between those who labour in silence and those who speak from a gilded platform.”—[Official Report, 4 December 2018; Vol. 650, c. 832.]

My God, I wish I had said that.

When the referendum result came in, those who voted to leave finally felt that their voices had been heard. The House has to understand that despite the social chapter and the good will of our MEPs, the EU did not present itself as a champion of the voiceless. It was against that backdrop that the Prime Minister had an opportunity to put together a future that met the aspirations of those voters. She could and should have recognised that when our fellow citizens are divided 52% to 48%, it is the time not to go back in the political bunker but to reach out. She should have reached out and tried to build a consensus across Parliament that would have united our country. That would have been leadership, but instead she doubled down, put her party interests before the country and tried to appease the European Research Group.

I do not deny that the Prime Minister has shown steel and determination, but there is a point at which steel and determination become obstinacy and recklessness, and she has gone far beyond it. The Labour party consistently argued that before triggering article 50, Parliament must be properly consulted on, and fully involved in, the impact assessments, the right to a meaningful vote, the deal and the financial modelling. We argued that Parliament had the right to see the full legal opinion prepared by the Attorney General. The Prime Minister’s refusal at every stage was a blunder that resulted in an achievement unique in 1,000 years of our history in this place: a Government being held to be in contempt of Parliament. That is ironic, given that Brexit was supposed to be about restoring the sovereignty of Parliament.

[Charlie Elphicke]

The hon. Gentleman talks about the importance of uniting the House. Will he unite with me in rejecting the idea of a second referendum? We need to honour the referendum mandate and leave the European Union.

[Barry Gardiner]

I will conclude on exactly the point that the hon. Gentleman raises, because it is at the heart of the conundrum facing the House and the country. If he gives me time, I will get there.

[Dr Fox]

I am grateful for how the hon. Gentleman is setting out his arguments, but if he feels that he was ill informed when article 50 was triggered, why did he vote for it?

[Barry Gardiner]

The Secretary of State makes a bewildering point, because I did not talk about being ill informed about the triggering of article 50, but he makes his own point and perhaps he understands what he means.

Now that the Prime Minister has finally brought her deal back to the House of Commons, it is hardly surprising that Members on both sides do not believe it to be in the best interests of our country. I know that she is now reaching out to her rather unlikely new-found friends in Unite and the GMB, and even to Opposition Members, but colleagues will recognise that this is a paradigm of too little, too late. Workers’ rights and environmental standards and protections are a vital part of Labour’s concern about the future relationship. We cannot agree that the UK should be in a situation in which we might fall behind our EU counterparts. The principle of non-regression from current levels makes it almost impossible to take action against the loss of a specific right but, as the TUC has made clear, what is required is not vague assurances but the binding long-term guarantees that working people need. These are not, even now, being offered.

On 10 December, the Prime Minister called a halt to the first part of the debate. She acknowledged that the package of the withdrawal agreement and the future political framework, as it stood, would not gain the support of the House. She undertook to change it and to come back with legally binding assurances on the backstop after listening to Members’ objections. Indeed, the Secretary of State for International Trade went as far as to say:

“I think it is very difficult to support the deal if we don’t get changes to the backstop… I’m not even sure if the cabinet will agree for it to be put to the House of Commons.”

Well, here it is, and here he is, but the only thing that has changed is that the Prime Minister has lost yet more votes, and more of the confidence of Members and of the country. The letter from the EU that she has brought back is a long way from the significant and legally effective commitment she promised last month. It is a reiteration of the EU’s existing position. She has delayed proceedings in a futile bid to run down the clock but, once again, nothing has changed.

Before the intermission in our debate, when the Prime Minister was trying to press her Back Benchers to support her, she claimed repeatedly that there was no possibility of renegotiation, but then, when defeat seemed inevitable, she scrambled back to Europe in a vain attempt to do precisely that.

[Mr Jacob Rees-Mogg (North East Somerset) (Con)]

You are criticising—[Interruption.] I do apologise, Mr Speaker; Even Homer nods. The hon. Gentleman said that the Prime Minister told us that she could not renegotiate, but now criticises her for coming back saying she could not renegotiate, as she said. That seems a little unfair.

[Barry Gardiner]

The hon. Gentleman is extremely courteous and always punctilious about the truth of what is said in this Chamber. I simply stated the fact that the Prime Minister had said it was impossible to renegotiate but that, when she faced defeat, she tried to do what she herself had said was impossible.

The Government could have used some of this time to respond to the Treasury Committee by providing proper economic assessments containing an analysis of the Northern Ireland backstop and setting out the short-term economic impact of the Prime Minister’s proposed deal. On 11 December, the Committee published its report on the withdrawal agreement and the political declaration. It concluded:

“The White Paper scenario, which is akin to the Chequers proposal, represents the most optimistic and generous reading of the Political Declaration, insofar as it is consistent with it at all. It does not represent the central or most likely outcome under the Political Declaration. Therefore, it cannot be used to inform Parliament’s meaningful vote on the Withdrawal Agreement. The information provided includes no analysis of the Backstop, and there is no short-term analysis of any of the scenarios, including on public finances and on regional and sectoral job losses and gains. The Government has only provided long-term analysis, which does not show how the economy will transition to a new trading relationship, or the path taken by inflation and unemployment”.

The Chair of the Committee, the right hon. Member for Loughborough (Nicky Morgan), commented:

“The aim of this report is not to recommend how MPs should vote, but to ensure that MPs are as informed as possible when it comes to choosing a division lobby. Yet the Government has made this difficult to achieve. The Committee is disappointed that the Government has modelled its White Paper, which represents the most optimistic reading of the Political Declaration, rather than a more realistic scenario. The Committee is also disappointed that the Treasury has not analysed the backstop and fails to include short-term analysis of any of the scenarios, including impacts on public finances and on regional and sectoral job losses or gains.”

In the Chancellor’s letter responding to the Committee, he revealed that

“there is not yet sufficient specificity on detailed arrangements for modelling purposes, and therefore the provisions of the backstop have not been included in the analysis.”

Indeed! Members are being asked to take one of the most important decisions for our country on the basis of inadequate financial information, and it is precisely this lack of specificity that has left Members across the House unable to have confidence in the Prime Minister’s deal.

[The Chancellor of the Exchequer (Mr Philip Hammond)]

Will the hon. Gentleman acknowledge that the cross-Government modelling to which he refers looked at the situation 15 years out? Of course it does not reflect the inclusion of the backstop. The backstop, if it were used, would be a temporary arrangement, so it is completely irrelevant to the stable state 15 years out.

[Barry Gardiner]

Of course it was right to look at the 15-year long-term assessment. Nobody is disputing that. Indeed, I will quote later from precisely that analysis. The problem is—and this is not just my criticism but the all-party Treasury Select Committee’s criticism—that these crucial elements of how we will transition to the future relationship have not been analysed or presented to the House.

[Charlie Elphicke]

As a member of that Committee, I share the hon. Gentleman’s concerns about the modelling, and I do believe that the Treasury needs to get better at listening, but would he agree that Labour’s various Brexit tests are not worth the paper they are written on? Indeed, I believe one member of the shadow Cabinet used a profanity in describing Labour’s Brexit policy not so long ago.

[Barry Gardiner]

Oh dear, Mr Speaker!

It is precisely this lack of specificity that has left Members across the House unable to have confidence in the Prime Minister’s deal. I probably should not call it a deal, because the future political framework document is no more than a placeholder for the future trade and security agreements that the Government hope eventually to conclude. It is both this lack of detail and the fact that the Prime Minister has wound down the clock that have significantly reduced the ability of Parliament to be properly involved in the most important decision facing our country.

When my right hon. and learned Friend the Member for Holborn and St Pancras (Keir Starmer), the shadow Brexit Secretary, fought and won the battle for a meaningful vote, which is now scheduled for tomorrow, he made it clear that the word “meaningful” must imply both a level of detail and clarity about what was proposed and a timeliness that would enable Parliament to amend the proposal and the Government to respond appropriately. We should not forget that originally the Government quite correctly wished to pursue the negotiations on the withdrawal agreement and the political framework side by side, but they agreed the chronology set out by the European Union.

That, I believe, was a mistake, but it made it all the more important that the negotiations on phase one be concluded expeditiously. The Government failed to do that. As a consequence, they ended up agreeing to everything that was vital to the EU in the withdrawal agreement and leaving everything about the future trade, security and political agreement that is vital to the UK to fall into a thin wish list, with words such as “the parties envisage”, “the parties will explore”, “the parties will use their best endeavours”.

The truth is that the real negotiations that will affect our economic life and our citizens’ future security have not yet properly begun. Look at the provisions for data protection: we have lost our place on the European Data Protection Board. The Prime Minister said in Munich that staying on it was one of her objectives so that we could continue to influence the rules and development of the general data protection regulation regime that we had been so influential in setting up. We will still have to comply with the scheme, but under the political declaration the EU will “start the assessments” of whether it should recognise the UK as a fit regime and will endeavour to reach a decision by 2020.

It is the same with REACH and the chemicals regulations: these are areas in which the EU is leading the world and in which we were leading the EU. No longer—our chemicals industry has spent more than half a billion pounds registering more than 6,000 chemicals with the EU’s database. The Government are now asking it to re-register every single one with our own Health and Safety Executive because we will no longer have access to that EU database. It is the same for financial services, where we are talking about equivalence, not even mutual recognition: the EU will start assessing whether it can declare our regulatory and supervisory regime is equivalent only after the withdrawal date. Then it says that it will try to reach a decision before the end of June 2020. Well, how very good of it.

The hon. Member for East Surrey (Mr Gyimah) spoke with great clarity and from his own bitter experience of negotiating with the EU when he advised the House:

“We must be clear-eyed as we go into these negotiations because they have been set up for failure. The EU will manage the timetable, it will manage the sequencing of the negotiations, it will set the hurdles and it will tell us when we can progress to the next stage. That is what happened in the first phase of the negotiations and that is what will happen in the second phase. We will always be in a position in which we have to walk away or fold”.

The hon. Gentleman was clear about what he thought would happen, from his own experience of negotiating Galileo. He said:

“we will always fold because the clock will be ticking.”—[Official Report, 5 December 2018; Vol. 650, c. 920.]

I agree. If we give the green light to the Prime Minister’s proposals tomorrow, we will end up not with the unique agreement that the future framework dangles before us, but with a free trade agreement dictated to us by the EU. We will have a long and difficult road to a future trade agreement that will not solve the economic problems we face or heal the divisions in our society. In the weeks since the Government called a halt to this debate, the US ambassador put to bed any idea of a quick and massive trade deal with the Americans. I do not usually find myself in agreement with the Trump Administration, but the assessment made in Washington that there will be little scope for a major trade deal with the United States is one with which I wholly concur.

The future political framework sets out that

“the United Kingdom’s commitments on customs and regulatory cooperation, including with regard to alignment of rules, would be taken into account in the application of related checks and controls”.

There is nothing remarkable there, really—it is what we in the Opposition have been pointing out for a very long time. If we want a strong trade relationship, the facility of market access must be proportionate to regulatory alignment.

[Ruth George]

Does my hon. Friend agree that the problems of regulatory alignment with very different actors such as the United States of America and the EU, with which we will both seek to do a free trade agreement, will make it extremely difficult for us to conclude agreements with both? We will have to prioritise one over the other. The USA has asked for access to our internal health markets and says that we will have to align our food standards down to theirs, so our having to choose might be a very good thing.

[Barry Gardiner]

I am pleased that I gave way to my hon. Friend, who has said what it is critical to understand on both sides of the House: we cannot simply have deals with everybody that are as good with everybody. We will have to pick and choose.

For my own part, I have never been star-struck by the prospect of a trade agreement with the USA; even under President Obama, it wanted us to weaken our food standards so that it could increase access for American agri-foods to the UK.

[Boris Johnson]

rose—

[Barry Gardiner]

I will give way to the right hon. Gentleman in a minute—and quicker than his right hon. Friend the Secretary of State for International Development did.

Ten days ago, I had the pleasure of attending the Oxford farming conference. It was clear that the Secretary of State for Environment, Food and Rural Affairs, who had spoken to them the day before, had got farmers seriously concerned. They were pleased that he confirmed that our food production standards in the UK would not be reduced, but incensed by his refusal to deny that food from the USA and elsewhere, which had been produced to lower standards, would be allowed access into the UK to undercut them in our domestic market. That, according to the Government, of course, is not a lowering of our standards in the UK but simply consumer choice and the pursuit of free trade. I now give way to the former Foreign Secretary.

[Boris Johnson]

I admire the tone in which the hon. Gentleman is making his remarks. May I ask him about the free trade deals that he says Labour would like to pursue? I am puzzled to hear that. It was my impression that Labour had abandoned its policy of coming out of the customs union and was instead preparing for us to remain in it as a paying, participating member, setting the same tariffs. Will he explain exactly how that is supposed to work?

[Barry Gardiner]

I am delighted to say that the rest of my speech will be doing precisely that; I hope it will satisfy the right hon. Gentleman.

Alignment of standards is key to trade. That was properly recognised by the Minister for Trade Policy himself—sadly, he is not in his place at the moment—when he said:

“If we come out of alignment with EU regulations in this area, then there is a penalty to be paid in terms of frictionless trade with Europe.”

Of course, the idea that this particular American President is not going to demand greater access for American healthcare businesses into our NHS is simply a fantasy. So yes—I would love to do more business with the USA. It is already our major bilateral trading partner as a country rather than a bloc, but whatever benefits a trade agreement with it may bring must be weighed against the corresponding losses in our existing or any future trade agreement with the EU.

[Lucy Powell]

Is my hon. Friend aware that, before the referendum, the right hon. Member for Uxbridge and South Ruislip (Boris Johnson) said that staying in the single market was “essential and deliverable”?

[Barry Gardiner]

I am glad to say that the one thing that I can honestly claim I have no responsibility for are the words of the right hon. Gentleman.

When listening to some of the more extreme proponents of Brexit, it has often amused me to hear them say that trading with the European Union on World Trade Organisation terms would not be the slightest problem for us; in the same breath, they insist that to achieve our destiny we cannot possibly trade on WTO terms with the United States—and that that is why we need to break free from the EU.

The simple truth is this—I hope it answers the right hon. Gentleman’s question: it makes good sense to have good trade agreements with everyone, but to have the best trade agreements with our closest trading partners. For us, that is the EU, with which we do 53% of our trade and which takes 44% of our exports.

[Boris Johnson]

rose—

[Barry Gardiner]

No, I will not give way again to the right hon. Gentleman.

I move on to immigration, which was a key part of the referendum debate. Like many Members, I was outraged by the dog-whistle politics of the Vote Leave campaign’s very own “Project Fear”: that millions of Turkish citizens would be queueing up for entry into the UK. That was a lie, and those Members who associated themselves with that campaign should feel ashamed.

I also want to express my disgust at those who have sought to paint leave voters as ignorant racists; it is that sort of demonisation of our fellow citizens that is so damaging to the discourse around Brexit. It precisely obscures some of the real concerns that leave voters did express, and had every right to. Their concerns were about the lack of housing, the strains on the NHS, and being undercut in the workplace by unscrupulous employers who often exploited migrants and paid them less than the minimum wage. All those issues are about public services and domestic enforcement. They will not be solved by our leaving the EU, but they will also not be solved by our remaining. What is needed is a change of Government policy, or, better still, a change of Government.

Immigration is a vital element of our economic growth, and of our trade and trade negotiations. We need migration. The Government’s own economic assessment shows that European migration contributes 2% of GDP to the UK. The Government’s proposed £30,000 salary threshold would actually preclude three quarters of EU migrants. I am not referring simply to seasonal agricultural workers or careworkers; even some junior doctors do not earn more than £30,000 a year. The Government’s supposed skills threshold is really a salary threshold, and it would do serious damage to our economy.

The irony is, of course, that EU net migration is coming down. Statistics published just last month record the number as 74,000. The Government have been complaining that free movement gives them no control over those people. Presumably they mean the sort of control that they have always been able to exercise over migrants coming from the rest of the world. Is it not strange, then, that the figure recorded for net migration from the rest of the world is 248,000?

This is why politicians are not trusted. They tell people that we need to abolish freedom of movement to bring migration down to the tens of thousands when our own rules, over which the EU has never had any say, are allowing three times that number. What we should be explaining to people is that net migration should go both up and down in line with the needs of our economy. As long as we have fair rules and competent and reasonable management of migration, this country will be better off. The trouble is that we have had lies, arbitrary targets that bear no relation to our economy’s requirements, and, frankly, administrative incompetence.

As with regulatory alignment, so with the exchange of people. The deeper the trade deal we want, the greater the need for an exchange of people. Foreign companies that invest in the UK want and need their indigenous workers to get visas, and the harder we make that process, the less investment we will secure. When the Prime Minister went to India two years ago to secure a trade deal, she was rebuffed on precisely that issue. The Times of India summed it up on its front page with the headline “You want our business. But you do not want our People”.

[David T. C. Davies (Monmouth) (Con)]

Will the hon. Gentleman give way?

[Barry Gardiner]

No. I have not spoken for as long as the Secretary of State and I do not intend to, but 80 Members wish to speak, so I will make some progress.

Our universities and colleges represent one of the greatest exports that our country has: education, which contributes hugely to our economy, not just through fees but through the industrial spin-offs from our world-leading research. That depends on our bringing top brains from all over the globe, and encouraging them to see the UK as their intellectual home. However, the bogus colleges scandal, and the way in which we have treated students whose colleges are closed down or go into receivership, has been a disgrace. They are victims of fraud because our system of certification has been so poor, but we treat them as if they were the criminals. They are given just 60 days to find another college, often in the middle of an academic year, and then to pay another full year’s fees before they are classed as illegal overstayers. No wonder students from key future trading partners in China and India are now turning to Australia, Canada and the US as their first choices for higher education and research. [Interruption.]

The Under-Secretary of State for International Trade, the hon. Member for Beverley and Holderness (Graham Stuart), asks why I am running down our education service. If he had listened carefully, he would have heard me talk about our world-leading research and our top-quality universities. What I ran down was the incompetent administration of the certification of bogus colleges, and the incompetent administration of the immigration rules thereafter.

[Mr Mark Prisk (Hertford and Stortford) (Con)]

Give way.

[Barry Gardiner]

The hon. Gentleman may not have noticed, but I did give way.

Students should never have been part of our net migration figures, and immigration should be proclaimed loudly by every Member to be an important and hugely beneficial resource for our economy. Yes, free movement of people will end when we leave the EU, because it is a function of the treaties of the EU, but that does not mean that we should not operate a system of immigration controls with the EU that allows broad and reciprocal access to all our citizens in a way that maximises the benefits to all our economies. That is what our businesses need: access to skills.

For all that, however, some businesses are willing to accept the Prime Minister’s deal. They have expressed grudging acceptance of it, and some have even written to their Members of Parliament asking them to support it. Well, there is the proof that “Project Fear” works both ways. The Government are holding a gun to business’s head with the threat of no deal, and, given this Hobson’s choice, some have been blackmailed into acquiescing in the Prime Minister’s proposal. I am sure that their acquiescence will have been cemented by the cheery words of the Secretary of State this morning, when he advised the nation that he did not regard no deal as “national suicide”, and that, although he grudgingly accepted that it would “damage our economy”, he thought that it was “survivable”—and this from the man who once said that a trade deal with the EU would be

“the easiest in human history”.

It is so good that the Secretary of State and the Chancellor are sharing the debate. I had some little hope that the Chancellor might have sat with him and taken him through the economic analyses. With no change in migration, no deal would see the UK’s GDP 7.7% lower than it would otherwise be. According to the estimates of the Office for Budget Responsibility, that is £164 billion if translated into the current fiscal year. With zero net EEA worker inflows, no deal would see the UK’s GDP 9.3%, or £198 billion, lower than otherwise. That is a heck of a lot of Brexit buses for the NHS: 565.

Unfortunately, during the first part of the debate, the Secretary of State told the House effectively to ignore all the Chancellor’s carefully prepared scenarios and analyses. Back in December, he said:

“It is not realistic to expect that there would be no potential shift, if necessary, in Government fiscal policy, or in the Bank of England’s monetary policy, or changes to what the Government will be able to do on tariffs. We have to be realistic and try to understand what those things are. To try to confuse forecasts and scenarios, intentionally or otherwise, is not helpful to the debate. ”—[Official Report, 6 December 2018; Vol. 650, c. 1203-4.]

[Conor Burns (Bournemouth West) (Con)]

Will the hon. Gentleman give way?

[Barry Gardiner]

No.

Actually, what is not helpful to the debate is to dismiss the existing economic modelling without presenting any credible alternative, to fail to provide any analyses of the short-term consequences of the Prime Minister’s deal, and to fail to carry out any analysis at all of the Northern Irish backstop arrangements—and then to have the audacity to expect the nation to blindly trust that no deal is not “national suicide”.

[Conor Burns]

Will the hon. Gentleman give way?

[Barry Gardiner]

I will.

[Conor Burns]

Will the hon. Gentleman concede that it is entirely possible that the current Treasury forecasts will prove to be as accurate as the ones that it made before the referendum?

[Barry Gardiner]

I think we should look at what actually happened, and it is relevant to the point that the Secretary of State was trying to make back in December. People are very fond of saying, “There were predictions of disaster and financial meltdown, but nothing happened.” Well, actually, something did happen: I think it was called “£70 billion of quantitative easing”, which the Treasury put into the economy in order to stop the problems.

Of course the Secretary of State once believed that his friends in the Anglosphere would be queuing up to do new trade agreements that would replace any lost GDP growth. The Bank of England has quantified the potential value of those deals at just 0.2%—not 2%, but 0.2%, or one fifth of 1%, or £4.25 billion. Nice to have, but by my reckoning the Secretary of State would still owe me about 533 Brexit buses.

The Prime Minister is fond of saying that her deal is the only one on the table. Well, of course it is; she is the Government, and only the Government are able to negotiate with the EU. That does not mean that there could not be a different deal. The Brexit negotiations have been constrained by the Prime Minister’s red lines. We know that had the red lines been different then the deal would have been different also.

The Father of the House, the right hon. and learned Member for Rushcliffe (Mr Clarke), reminded us in his admonishment of the Home Secretary that

“if we are maintaining an open border where there is a land border, it can only be done in a modern economy by having some form of customs union applying to both sides of the border”.—[Official Report, 5 December 2018; Vol. 650, c. 900.]

That is why we on the Labour Benches have been calling for a new permanent customs union with the EU in which we would have a say over future trade agreements.

When the shadow Chancellor mentioned this previously in our debate the Secretary of State was really rather rude and he reinforced that disparagement today. He reminded the House that under article 3 of the treaty on the functioning of the European Union the EU shall have exclusive competence with regard to the customs union. Of course it does: the treaty binds the member states of the EU and gives the Commission that right to negotiate the terms of any agreement with third-party countries. It does not stop the EU concluding agreements with third-party countries where there is joint control.

[Greg Hands (Chelsea and Fulham) (Con)]

Will the hon. Gentleman give way?

[Barry Gardiner]

No.

Perhaps I can read from article 8 of the TFEU:

“The Union shall develop a special relationship with neighbouring countries, aiming to establish an area of prosperity and good neighbourliness, founded on the values of the Union and characterised by close and peaceful relations based on cooperation.

2. For the purposes of paragraph 1, the Union may conclude specific agreements with the countries concerned. These agreements may contain reciprocal rights and obligations as well as the possibility of undertaking activities jointly.”

[Several hon. Members rose—]

[Barry Gardiner]

I will not give way as I am moving to my conclusion.

A new customs union in which the UK would be able to reject any agreement it believed was concluded to its disadvantage—however advantageous it might be for the 27 EU member states—is a vital way of securing the open trade border, avoiding the problems of the backstop and respecting the referendum mantra of taking back control. It should have been part of our negotiating mandate from the beginning.

So often it has seemed, on both sides of the Brexit divide, that the point of listening has been to prepare one’s counter-arguments and rebut what the other person is saying, rather than any genuine attempt to understand their fears and concerns, so I want to conclude by sharing with colleagues my own fears and concerns about the position we are in. It seems to me that we are caught between two competing and equally important principles: our responsibility to protect the economic wellbeing and livelihoods of our constituents; and our democratic responsibility to accept the result of a referendum where we promised to respect the result. The first principle is often invoked by colleagues who say, “Nobody voted to make themselves poorer or put themselves out of a job,” and that is true. The second principle is often invoked by colleagues who say that we will damage our democracy and increase cynicism about politics if we turn round and pat the electorate on the head and basically say “There, there! You didn’t understand. You were lied to. We will give you another chance to see it our way.”

I have found myself genuinely torn apart by these competing claims, as I know many colleagues have. It seems to me that it is simply not good enough to insist either that we remain or that we leave no matter the cost. Both these positions are absolutes, and while we may campaign in black and white, we must govern in shades of grey. Each absolute side of the debate must be able to have a credible explanation for the roughly 50% of their fellow citizens who profoundly disagree with them as to why they should not be taken into account.

I know what I promised my constituents at the last general election. It is right here in our manifesto:

“Labour accepts the referendum result”—

not that we would respect it, but that we would accept it.

“We will prioritise jobs and living standards, build a close new relationship with the EU, protect workers’ rights and environmental standards, provide certainty to EU nationals and give a meaningful role to Parliament throughout negotiations.”

That is the rejoinder to those who pretend that our Brexit position has not been clear. It has been there, consistent and unchanged in black and white, since the general election. That is what this Government should have done; it is what we—[Interruption.] That is what this Government should have done; it is what we would have done and what a new Government now need to do.

And one thing more. We said that we would

“seek to unite the country around a Brexit deal that works for every community in Britain.”

The Prime Minister’s deal does not, and that is why Parliament must reject it.

Oral Answers to Questions

Barry Gardiner Excerpts

Thursday 20th December 2018 Commons Chamber

[Dr Fox]

I am grateful to my hon. Friend for his usual patriotic and optimistic tone. He is right that the country is in the middle of an export boom; our exports are at an all-time high. In the first six months of the year, according to the United Nations Conference on Trade and Development, the United Kingdom was second only to China in inward investment. It is truly a very positive picture, and we will be able to build on that, whatever our relationship with the European Union.

[Barry Gardiner (Brent North) (Lab)]

On behalf of our Front Benchers, may I extend Christmas greetings, particularly to the Secretary of State and his team? Mr Speaker, in Prayers this morning, your chaplain referred to the perseverance of the wise men; I think we all need that.

What assessment has the Secretary of State made of potential trade partners being unwilling to conclude new roll-over agreements with the UK because of most favoured nation clauses in agreements that they have concluded with other countries, to which they are unwilling to give the same trade preferences as they do to the EU? I am thinking of countries such as Singapore, which might be unwilling to give other Trans-Pacific Partnership countries the same access to their telecoms market that the EU has enjoyed.

[Dr Fox]

We discuss matters with other countries on a case-by-case basis. None of them has said to us that they do not want to continue to have an agreement with the United Kingdom; that is entirely understandable, as we are the world’s fifth biggest economy. Where we are able to translate elements into a bilateral context, we are doing so. We are working through those agreements. We are making good progress, and I will report to the House as and when each of them is signed.

Oral Answers to Questions

Barry Gardiner Excerpts

Thursday 15th November 2018 Commons Chamber

[Graham Stuart]

I am glad to confirm to my hon. Friend that our stock of foreign direct investment has gone up. We remain the No. 1 destination in Europe and are seeing companies in so many sectors coming here. Investors have some concerns about Brexit but, as I have said, what they are really alarmed about is the prospect of Labour seizing their assets and destroying the job creation that investment brings.

[Barry Gardiner (Brent North) (Lab)]

May I associate myself with the Secretary of State’s remarks about Sir Jeremy Heywood?

I was delighted, if somewhat surprised, to see the Secretary of State at the Dispatch Box this morning. He and his Ministers have talked about a record number of FDI investments in the last full year, 2017, but he knows that, in value, it was actually the worst year for inward investment since 1994. Complacently, he celebrates the forecast by the United Nations Conference on Trade and Development for the first half of 2018, but he knows that the UNCTAD report states that this reflects

“a surge in intra-firm loans”.

These are loans that are often used to minimise tax by creating an artificial debt shield and they create no new jobs in the UK. How many such intra-firm loans are in the FDI statistics, and what assessment has the Minister made of the reduction in tax receipts to the Exchequer as a result?

[Graham Stuart]

The UNCTAD figures that measure foreign direct investment showed the UK moving above the United States into third in the first six months of this year, but the hon. Gentleman is entirely right to say that they include intra-company loans. Any figures around flow should be treated with caution; the most important thing is the stock of foreign direct investment in this country. As my hon. Friend the Member for Kettering (Mr Hollobone) said, if we had listened to some, we would have expected divestment. There was no divestment; there were increases in investment. In the last year, if I may deal with what is most important to me and my constituents, there were 75,000 new jobs created by foreign direct investment.

Oral Answers to Questions

Barry Gardiner Excerpts

Thursday 13th September 2018 Commons Chamber

[Barry Gardiner (Brent North) (Lab)]

What proposals has the Secretary of State made to his counterparts ahead of this weekend’s G20 ministerial meeting to avert the threat by the President of the United States to pull the United States out of the World Trade Organisation, and to ensure that the WTO can continue to function despite America’s refusal to approve appointments to the WTO’s appellate body—or has he made no proposals?

[Dr Fox]

I have had conversations with a number of my trade colleagues from Japan, Mexico and Canada all ahead of the G20 meeting. That is a very good opportunity for us to recommit ourselves to the concept and practice of free and open trade and the rules-based system based on the WTO in Geneva. We should be pointing out that protectionism has never ended well, and that the benefits that we have introduced in terms of the elimination of poverty and the support for our global security agenda are based on free trade. It is also worth saying that the alternative to a rules-based system is a deals-based system, which would upset the balance of global trade. Incidentally, let me point out to the hon. Gentleman that he will find that the power to withdraw from the WTO is not a presidential power, but one that would require approval by Congress in law.

EU-Singapore Free Trade Agreement (FTA) AND INVESTMENT PROTECTION AGREEMENT (IPA)

Barry Gardiner Excerpts

Monday 10th September 2018 General Committees

[Barry Gardiner (Brent North) (Lab)]

It is always a pleasure to serve under your chairmanship, Sir Henry. I congratulate the hon. Member for Mid Dorset and North Poole and his Committee on the estimable questions that they put to the Minister, and I am grateful to follow him. This is another important debate that sets out, in part, our post-Brexit future.

However, we are again here at the behest not of the Government but of the European Scrutiny Committee, which has directed that the House be afforded an opportunity to debate this trade agreement, which may well define our future relationship with Singapore after we leave the EU—if the Government succeed in rolling over the trade agreements that we currently have by virtue of being an EU member state.

The European Scrutiny Committee refused to clear the Government to sign these trade agreements precisely because it considered that

“both proposed agreements…have significant legal and policy implications for the UK, both whilst a member of the EU and after its exit”.

While the debate is therefore welcome, let us be clear that this opportunity does not give Members the capacity to properly scrutinise the agreements, nor does it give Parliament any capacity to shape this or any future trade agreement between the UK and Singapore. Parliament should have had this debate prior to negotiations on these agreements commencing in 2010.

The agreements initially formed a single agreement, concluded in 2014, but they were split out and presented as separate agreements in 2018 as a result of widespread public opposition to the European Union’s approach to mixed trade agreements and particularly, of course, to the controversial inclusion of investor-state dispute settlement mechanisms. I note in passing that the Minister said that the ICS was the Commission’s preferred method of dealing with those. If he were to read the European Scrutiny Committee’s “Thirty-fourth Report of Session 2017-19”, he would see at paragraph 1.38 that in fact

“the Commission considers that the ICS fails to deal with the need to maintain consistency of case law and will also become a financial and human resource drain on the EU as the number of individual investment courts established under each new FTA multiplies.”

That is why, in September 2017,

“the Commission put forward a proposal for the opening of negotiations”

on “a multilateral investment court”. Therefore, I do not think it is correct to say that the ICS was the preferred model; the Minister may care to reflect on that.

To fast-track components of the initial agreement, we now have these two separate but interrelated agreements before us today. It would therefore be sensible, logical and transparent if this Committee were empowered to consider them separately, but the Government have not organised the business to facilitate that end, and the controversial aspects of the initial agreement remain as they were. Were it possible to vote separately on the free trade agreement, it is highly probable that that element would sail through the Committee unopposed. The investment protection agreement, however, is bedevilled with both the policy and the legal problems that even those not inveterately opposed to ISDS mechanisms as such might still consider so potentially injurious as to persuade them to reject the IPA as a whole.

Singapore has historically been an important trading partner for the United Kingdom. The strait of Singapore is one of the world’s most important shipping channels, and its deep waters and safe harbour have seen Singapore become the world’s second busiest maritime port, accounting for one fifth of the world’s shipping container traffic. And as one of the region’s few Commonwealth members, with English being one of the country’s four official languages and with a legal system largely based on common law, it is no surprise that it remains an important trading partner for the UK.

More than half our exports to south-east Asia—specifically, the ASEAN countries—are shipped through Singapore. They were worth about £5.6 billion in 2014, with our top exports consisting of machinery and transport equipment, business services, financial and insurance services, miscellaneous manufactured articles, transport services, chemicals, food and beverages and so on. Singapore is our 16th largest export partner country—it is the eighth, if the EU is counted as a single export market—and accounted for 1.6% of all our exports last year.

The UK has maintained a healthy trade surplus with Singapore, with our exports doubling imports in 2017, according to figures from the Office for National Statistics. Furthermore, the UK is currently the largest EU investor in Singapore and the fifth largest total source of foreign direct investment in Singapore, with investments worth more than £30 billion at the end of 2014. Conversely, half of Singapore’s FDI in the EU goes into the UK.

Labour Members want to see the UK’s trade with the rest of the world growing. We want to help British businesses to take advantage of opportunities to export overseas, and to encourage investment in our domestic industries. We want to see free trade agreements that open up market access for British businesses, that protect and elevate rights and standards and that do not inhibit or erode the capacity of Governments to legislate in the public interest. We are pro-trade and pro-investment and believe that protecting, preserving and promoting the UK economy and jobs should be key priorities for any and all of our trade negotiations. However, those are criteria to be evaluated and applied; they are not just labels to be stuck on to any and every trade agreement available, on the false assumption that a rise in GDP per se will increase the wealth and wellbeing of the country as a whole. It is perfectly possible for GDP to rise in a country and for equality to be diminished, so it is incumbent on us to properly scrutinise the deal, as we are supposed to be doing.

British businesses already export freely and substantially to Singapore where the legal system, regulations and standards are similar to ours. Singapore is often listed at the top of the World Bank rankings as the easiest place to do business—it is currently second. According to the Department for International Trade, more than 1,000 British businesses have an established presence in Singapore and more than 30,000 British nationals reside in the city state. In his response letter to the European Scrutiny Committee, the Minister says:

“The EUSFTA will enable businesses to trade under preferences and as a result benefit from a reduction in tariffs and Non-Tariff Measure…costs, making it cheaper to export to Singapore. Businesses will also benefit from cheaper imports from Singapore. The elimination of tariffs and NTMs will make UK businesses more competitive in the Singaporean market.”

Singapore has famously long since taken an open approach to trade with very few tariffs on imports. In fact, well over 99% of imports to Singapore are tariff-free. According to the Department for International Trade, only six product lines are subject to tariffs, and they are alcoholic drinks. The Government’s impact assessment recognises that:

“UK exports of goods to Singapore face few tariffs. Most of the gain to GDP is from the removal of regulatory non-tariff measures in services and goods that can impede trade.”

However, what those non-tariff measures are and the extent to which they might impede trade for British businesses is not analysed in any further detail.

What we do know is that the UK and Singapore have a common history, shared language, common law and legal system and, according to the DIT, similar technical standards. Although it is acknowledged that an FTA with Singapore might offer some insurance in the extremely unlikely scenario that Singapore decides to impose tariffs at the upper end of its WTO bound schedules, the extent to which the trade agreement removes tariffs and non-tariff barriers might be more benefit to Singaporean goods exporters to the EU and other businesses across the EU, which do not already enjoy the same volume of trade with Singapore that British businesses do.

Clearly, our burgeoning exports of Scotch whisky will benefit from the removal of the only tariffs imposed by Singapore on our goods, which is most welcome, but the obvious question is, who benefits and how? The Government have suggested that there will be an increase in UK exports to Singapore of £296 million, but have not conducted a proper calculation or carried out any assessment as to what sectors stand to benefit. Paragraph 7.6 of the impact assessment admits that no proper assessment has been carried out of the benefits of the trade agreement to the United Kingdom.

Instead, the Government have conducted an arbitrary calculation on the basis of our existing share of EU trade with Singapore, which has declined over the past decade. The Government have simply looked to the EU-wide impact assessment conducted by the European Commission and said, “That’ll do,” and apportioned the same to the UK without any proper analysis of their own about the future. On the same basis, they have suggested that there will be an increase in imports of some £607 million, which will have a substantial impact on our current trade surplus with Singapore. By their analysis, our balance of trade is projected to worsen.

Will the Minister tell us which sectors he anticipates will be most affected? Paragraph 7.32 of the impact assessment notes:

“Due to increased competition from Singaporean firms it is possible that some less efficient UK firms may have to exit the market”,

as he reiterated in his response to the European Scrutiny Committee. Does he not believe that it would be proper and prudent to consider which sectors are at risk? A cursory glance at Singapore’s top exports suggests that the country’s primary goods exports include machinery and equipment, petroleum, chemicals and miscellaneous manufactured articles. However, Singapore has positioned itself as Asia’s leading wealth management centre and a burgeoning financial services centre. While the Government’s impact assessment gives no indication of how many jobs might be lost or in which sectors and firms—although it says that some may be—we might expect this impact to be felt most keenly in those sectors of our economy. I would be grateful if the Minister commented on that in his reply.

Those points are not mere Opposition cavilling. In fact, the Regulatory Policy Committee, in its report of 29 June, made trenchant criticisms in precisely this area, saying:

“The assessment should provide a more balanced analysis on the effects of competition resulting from trade liberalisation. For example, the Department states that UK firms will benefit from being able to bid for Singapore public procurement contracts but does not mention the increased competition for UK public procurement contracts resulting from EUSFTA. The Department outlines the impacts of greater market access between the UK and Singapore but does not mention the impacts on the UK of greater market access between the EU and Singapore. The assessment should provide a discussion of how the EUSFTA could lead to Singapore competing with the UK for EU business. In the RPC’s initial review notice, the Department was asked to consider possible costs to the UK of greater market access such as skilled labour migration and/or greater competition for EU public procurement contracts. The Department did not include a discussion of these costs. The assessment would have benefited from providing a more balanced perspective on the costs and benefits of greater market access.”

Regarding job losses, the Regulatory Policy Committee said:

“The assessment acknowledges that UK businesses may become less price competitive and experience a fall in domestic production. The Department should provide analysis of which sectors would be most affected by increased competition. It would have also been beneficial had the Department acknowledge possible increases in UK unemployment (especially for certain skills) as a result of increased competition faced by UK firms. The Department expects imports from Singapore to increase by £607 million in the long-run. Given the size of the potential increase in imports the assessment would have benefited from a more detailed analysis of how this could impact UK firms.”

On the balance of trade, that Committee said:

“The Department argues that the FTA has a positive impact on UK GDP despite the fact that increases in UK imports (£607 million in the long run) are expected to be greater than increases in UK exports (£296 million in the long run). It does not provide a clear explanation of its reasons for believing this to be the case within the IA, but has provided relevant evidence in subsequent correspondence.”

The Minister should have faced up to these questions. Some of them were presented by the hon. Member for Mid Dorset and North Poole.

The listing of geographical indications is another matter, and one that this Government seem minded to forget or ignore. If the Government were serious about growing our exports and opening up opportunities for British businesses overseas, one might imagine that they would follow the example set by other nations and seek protections for our famous products. We saw precisely zero geographical indications listed by the UK in the Canada trade agreement. The Singapore agreement lists just one. Certainly, it is right that Scotch whisky should be afforded protected status in the Singaporean agreement. However, what about all our other famous quality produce—Scottish salmon, Welsh lamb and beef, Jersey Royal potatoes, Stilton cheese and many more—which qualifies for protected status but which the Government have not sought to protect? The Government have made a choice. They would prefer a flood of cheaper imports, even if that would destroy those sectors and put an end to some of our special heritage producers.

Trade negotiations are always about balancing consumer and producer interests, but many now believe that the Government have got that balance wrong. They are prioritising reductions in consumer prices over economic growth, export growth and jobs growth. Having conducted no assessment of the existing non-tariff barriers to trade, and having failed to carry out a meaningful review of the impact of the trade agreement on our economy as a whole, the Government have instead focused on the potential costs to businesses of reading the trade agreement. Annex D of the impact assessment suggests that the only costs to business will be as a result of the time it will take people to read the text. The Minister should know that that is being openly laughed at by trade commentators and analysts. That the Department has expended time and resource on calculating how long it took to read the agreement, but has not committed any resource to investigating what it will mean for jobs in the United Kingdom, is farcical. It is no substitute for a proper analysis of the real impact on business. Perhaps the Minister will tell us what formal consultation his Department has undertaken with business that has led it to conclude that reading time is the real issue to be faced in relation to the trade agreement with Singapore. The Minister knows that after Brexit he cannot simply divvy up any EU impact assessment and pluck future specific UK figures from general EU ones. Why does his Department not undertake proper assessments now?

Under the terms of the draft withdrawal agreement the Government have sought to ensure that the deal with Singapore, among others, will continue to apply to the UK even once we have ceased to be members of the EU, until the end of the transition period. However, the legal application of that remains entirely unclear, and the House has been given little confidence that the Government believe they may be able to ensure such participation in the relevant trade agreements, or that a corresponding future trade agreement can be concluded in short order between the UK and those third countries. Have the Government received formal confirmation that the UK can participate in the trade agreements in question during the withdrawal period—from Singapore or, indeed, any of the third countries with which the EU has an agreement? Have the Government received formal confirmation from Singapore that it will not seek to negotiate any substantive changes to the terms of the agreement? Do they consider that it is, in fact, the best agreement for the future trade relationship between the UK and Singapore, rather than the EU and Singapore?

I now come to the investment protection agreement: the initial agreement between the EU and Singapore was referred to the European Court of Justice, which ruled in May 2017 that it touched on matters that were in the competence of member states and not of the EU operating under the common commercial policy. Specifically, the Court found that portfolio investment and investor protection aspects of trade agreements could not be concluded by the Commission without having been ratified by each member state at national and regional level, where appropriate. That followed widespread public outcry and political opposition across the European Union. Famously the Walloon Parliament in Belgium refused to ratify the trade agreement with Canada, because of concerns about its investment aspects—in particular the investor-state dispute settlement mechanism. That is now repackaged as the investment court system. Belgium has referred the matter to the European Court of Justice, to seek a ruling as to whether the investment court system is even compatible with EU law. Neither France, Germany nor the Netherlands have ratified that agreement, with the Dutch Government waiting on the ECJ ruling before determining how to proceed. In Germany, the issue is being heard before their domestic constitutional courts to determine whether the ICS is compatible with the German constitution.

It is because the progress of the investor protection aspects of the agreement with Singapore face the same opposition in principle, and lengthy delay in ratification, that the EU has seen fit to split out the agreement into two separate documents, such that a free trade agreement can be ratified post-haste, leaving the investment protection agreement to one side. The investment protection agreement contains an ISDS mechanism in the form of the investment court system, which has already been heavily criticised in the EU-Canada agreement.

ISDS mechanisms give superior legal rights only to foreign investors to raise disputes against Governments in order to petition for compensation where their profits, or even potential profits, are impacted by legislative or public policy decisions. This effectively allows companies to sue Governments when they legislate in the public interest—for example, when introducing plain packaging for cigarettes, national insurance, minimum wages or the banning of fossil fuels. These provisions have become increasingly commonplace in new generation trade agreements, resulting in widespread international public outcry against deals such as the Transatlantic Trade and Investment Partnership, the Trans-Pacific Partnership and the Comprehensive Economic and Trade Agreement.

It has always seemed to me a curious irony that the Conservative party opposes the ECJ on the grounds that it is a supranational court, but sees no fundamental problem in allowing foreign investors the right to challenge and strike out domestic legislation introduced in the public interest through a supranational court—power and rights specifically not afforded to our domestic companies. The proliferation of ISDS can encourage treaty shopping, whereby investors restructure their activities and establish them in countries where they may benefit from ISDS mechanisms should they seek to effect policy change or to petition for compensation.

It is increasingly likely that the UK could face costly and damaging dispute proceedings as more and more foreign investors are given such powers under these agreements, including the EU-Singapore investment protection agreement. The very threat of facing such a case, and the often substantial costs involved, even when the chance of winning is in the Government’s favour, can clearly deter Governments from pursuing actions in the public interest—a “regulatory chill” effect.

It is not only European Governments who have expressed concerns about ISDS; many international Governments have refused to accept such chapters in trade agreements. South Africa, India and New Zealand have all stated their opposition to them, and New Zealand has gone so far as to sign side letters with five counter-signatories to the Trans-Pacific Partnership disapplying the ISDS provisions included in that agreement. Their rationale is that their respective domestic court systems are adequately capable of settling any disputes.

Indeed, if our courts are sufficient for British companies, why should they not be considered so for foreign investors too? The UK’s has long been considered a safe legal system and, a significant proportion of global trade is governed by legal documents indicating the UK as the applicable legal jurisdiction. Why, in any event, should British taxpayers be on the hook for the ordinary commercial risks faced by foreign investors?

Recognising the flaws in the arbitration model of ISDS, the European Commission moved to a court-based system—the investment court system. That goes only some of the way to mitigating the risk of spurious claims being brought forward and ruled upon by pay-per-case arbitrators but does nothing whatever to address the perverse superior legal rights afforded to foreign investors, nor the underlying threat to public services and the ability of our Government to implement policy or to legislate in the public interest.

Furthermore, the UK has already entered into a bilateral investment treaty with Singapore, which came into force on 22 July 1975. The Minister advised the European Scrutiny Committee that that agreement would be suspended should the EU-Singapore IPA come into force. Should the UK leave the EU prior to the IPA coming into force, what will be the governing agreement for the UK’s future relationship with Singapore? Will the Minister confirm that he is proposing to increase the protection afforded to Singapore companies wishing to challenge the UK Government from 10 years in the current bilateral investment treaty to 20 years, the sunset clause in the new agreement? It seems patently absurd to sign a document into force when the Minister admits:

“It is not anticipated that the IPA will be ratified by all Member States, concluded by the EU and have entered into force before the UK’s exit from the EU, or indeed by the end of the Implementation Period.”

The problem is far greater than the Minister seems to realise. The IPA is a mixed competence agreement requiring ratification in each of the EU member states individually. The ratification process will not commence until after the European Parliament has completed its own ratification of the agreement. The European Parliament vote is scheduled for 2019, so the national ratification process will not commence across the European Union until after the UK has left the EU.

We must remember that even if the EU’s trade agreements continue to apply to the UK during the transition period, the UK will no longer participate in the structures of the EU during that period. Worse still, the Government’s Trade Bill gives them the power to turn signed EU agreements into UK agreements even before they have been ratified by the EU, so at the end of 2020 we could be left in the absurd position whereby the EU-Singapore IPA has not been ratified but the UK has already copied its provisions into a UK-Singapore IPA, to replace our existing UK-Singapore BIT, and we are enforcing it unilaterally. Is it the Minister’s intention that we should be bound none the less by the EU-Singapore IPA even if that agreement should come into force years after we have left the EU?

Of course, that remains somewhat dependent on the findings of the ECJ as to whether the investment court system and ISDS provisions are even compatible with EU law. Will the Minister tell us what assessment his Department has carried out in respect of that and precisely what it would mean for any agreement that the UK has entered into? In particular, if the UK has ratified such an agreement, exercising our own competence, as is the case with this agreement, could the agreement continue to apply even if struck down by the ECJ and thus no longer applicable across the remaining EU member states?

Clearly a number of substantive issues have not been properly addressed thus far by the Government. The European Scrutiny Committee has quite properly sought clarification, but sadly the Government have not seen fit to respond properly and fully to those concerns. Parliament must be afforded an opportunity for a timely and informed debate on our trade agreements and future trade relations with other countries. Such a debate must be supported by clear facts about: market growth opportunities; which barriers to trade are being removed or lowered; which sectors stand to gain or to lose; the impact on jobs in this country; and the rights afforded to foreign investors.

That said, we believe that the Singapore free trade agreement as it currently stands could be a model for a future UK-Singapore relationship. Had we been voting on that agreement alone, we would have supported the Government’s decision to proceed with signing the agreement despite the appalling lack of facts and coherent analysis from the Government. That they have bundled that agreement together with the investment protection agreement, despite the clear policy and legal problems presented, means that we cannot possibly vote in favour of the motion.

[Mr Chris Leslie (Nottingham East) (Lab/Co-op)]

I had not intended to speak, but I have a number of criticisms of the Government. On the Brexit process, for instance, whether we keep existing free trade agreements or make new ones, will it be possible for agreements to be rolled over in time for exit day? I have real doubts about the Department’s commitment to securing the arrangements for that.

The contribution by my hon. Friend the Member for Brent North prompts me to query the conclusions he has reached. He takes a similar stance on this agreement as he took to our trade agreements with Canada and Japan. As a party, we cannot take a purist, oppositionalist view to all potential trade agreements. No trade agreements are perfect. They all involve some degree of compromise. By no means do I say that the Singapore-European Union free trade agreement is perfect—I am sure, were we all individually in charge, we would all have far greater insight than the negotiators and be able to secure a far better deal—but I am worried that there are real firms, real jobs and a real economy in the real world that may be affected if we turned our face against all proposed trade agreements. It is therefore not responsible to oppose a motion that simply welcomes the proposed signature and conclusion of the EU-Singapore free trade agreement.

The motion notes the signature of the IPA. As I understand it, the Singapore-EU IPA is similar to the Canadian arrangement and far superior to that which was mooted in the proposed TTIP agreement with the United States. A number of objections were made to that, but as I see it, the proposal we are debating is more transparent and would have less impact on public procurement. We have to weigh up this whole question in the round.

At best, my hon. Friend may not be seeing the wood for the trees. If we turn our face against all future trade agreements, we may inhibit the trading gains and growth that we may be able to secure for our constituents. At worst, we are allowing the anti-trade ideological zeal from some quarters on the left to infect us against free trade arrangements more generally. It would be terribly damaging to allow the Labour party to get into that stance.

[Barry Gardiner]

I have delayed the Committee quite enough, so I do not propose to intervene for long, but I hope my hon. Friend understands that I made it clear that we in the Labour party would support the free trade agreement element of what we are discussing. We believe the Government have not handled the matter correctly. We believe that the impact assessment should have been much better, and that a number of questions rightly raised by the European Scrutiny Committee, which the hon. Member for Mid Dorset and North Poole put forward, should have been addressed much earlier. Having said that, we would support the free trade agreement element. There is no dispute whatsoever between my hon. Friend and I on that matter. We must enhance trade and let business in this country thrive, for the sake of our economy, jobs and growth.

However, the Government bundled the IPA in this way. They could have separated it out. In fact, the European Union has tried to separate these things out. This Government have not. That is their failing. They cannot expect us to swallow something that is, in policy terms and in logical, logistical and chronological terms, legally problematic along with the free trade agreement, which otherwise we would have accepted.

[Mr Leslie]

I heard my hon. Friend’s argument the first time. As I said, we can take an absolute view—that unless we get 100% perfection in every area, we will vote against things—but we also need to take a view on our responsibilities with our vote. If my hon. Friend’s very powerful speech persuaded all Committee members to take the same view that he did, the UK would turn down the ratification of the EU-Singapore free trade agreement and the British contribution, as we try to negotiate amicable and cordial relationships with the rest of the EU, would be to say “Get lost!” to the EU-Singapore trade arrangement. At this particular time, it would not be prudent, diplomatic or wise, especially as we are leaving, for the UK to sabotage the EU’s trade arrangements with Singapore. I happen to think that we should support a Singapore-UK free trade agreement in these terms—I am glad to hear him say that. Obviously, I would want that to be rolled over.

This agreement is an important link to the ASEAN economies; it has net benefits for our constituents. As Vic Feather, the famous trade unionist from Bradford, once said, “If your boy comes home from school with 99 out of 100, don’t hit him over the head.” Sometimes we need to accept that there are gains to be had from being responsible and taking the best that might be on offer. Sure, it could be better and improved, but a responsible approach to trade at this particularly sensitive time in our negotiations with the European Union would not be to block the EU-Singapore trade deal. My hon. Friend may be right that it is a bit mischievous for the Government potentially to wrap these things together in the motion, but the motion is simply a “take note” motion. There are other ways and means of raising these particular issues. I am not minded to oppose the motion before the Committee.

[George Hollingbery]

I would like to correct the record if I may, Sir Henry, because I called you Mr Bellingham throughout my remarks, which I am sure others noticed but I am afraid I did not, and I apologise.

With the leave of the Committee, I will respond briefly to the points raised by the hon. Member for Brent North. Non-tariff measures are very important, but it is not our analysis that they are better for Singapore than they are for the UK in these agreements. I refer the hon. Gentleman to graph 5 in paragraph 1.30 of the economic impact assessment, where he will find a considerable number of areas where Singapore imposes non-tariff measures—for example, instruments, clocks, recorders and reproducers, vehicles, aircraft and vessels, machinery and electrical equipment, base metals and articles, textiles and articles, and paper and paperboard.

The list goes on and on. Hon. Members may not have this document to hand, but by comparison there is another graph that shows the number of non-tariff measures applied by the UK on Singapore. There are almost none at all that we can evidence. The impact assessment absolutely does assess that, and it is quite clear to me on reading it that there are many more measures to be washed away by Singapore than there are by the UK. I will give a few more examples. Banks will be able to increase the numbers of branches, which was previously controlled. Insurance sales will be able to be made online in ways that were not possible before because of regulations. Substantial procurement opportunities will be opened up that hitherto did not exist because the entities being addressed were not included in the procurement schedule. There are all sorts of areas where the FTA opens up opportunities for British business.

On the sectors most affected by increased imports, I do not have the evidence to hand to give the hon. Gentleman, but my impression is that a good deal of what will occur in this area is import substitution, because an awful lot of what Singapore supplies to the UK is intermediate goods that go on to make other goods. I would expect the impact to be greater on substitution than on British companies. That is not to deny that there will be an impact; indeed, the impact assessment addresses that. I should probably say to him that the costs identified in the impact assessment, which he finds so risible, are about the cost of compliance or using the FTA. They are not costs to the British economy; they are simply the costs to businesses of taking on board the FTA and understanding it so that they can participate in that market. The actual net costs, as the FTA will affect the United Kingdom because of potential job losses and reductions in GDP, are accounted for in the £95 million figure. Therefore, they are properly modelled.

There are issues with the model, and I would not disagree with the hon. Gentleman that it is not entirely ideal, but the effects for the UK consumer and businesses as a whole, and for UK GDP, are undoubtedly positive. Furthermore, the estimates use bound figures for the liberalisation of services; basically, all they do is lock in calculations as to the certainty of the old rules now being completely complied with. They do not look at the potential for new services coming into the Singaporean market from UK companies and, despite the fact that this is a sensible, reasonable and rational estimate of £95 million, we believe that if we really bottom out, there are potentially much greater benefits to be had.

The hon. Gentleman asked questions about the participation agreements and whether they are confirmed in the EU mechanism, which I think I addressed in my opening remarks. The answer to the question about changes to the agreement, and whether we will use clause 2 powers from the Trade Bill to radically change this agreement, is unequivocally no. The clause 2 powers are there to transition agreements. That is not to say that there will not be some circumstances where it might be appropriate to use clause 2 powers to change that agreement; if they change slightly, if there are bodies that arise and fall away, that might well be something that we would look at in the future. However, it would be by far and away our preference to use clause 2 powers for transition alone. I do not rule out the fact that clause 2 powers exist and can be used for further work at a later date.

If and when it is agreed that both sides in this bilateral relationship feel it is appropriate for more work to be done on a future trade agreement that would substantially modify what has been transitioned for the sake of continuity for business and consumers, that will almost certainly come back as a future trade agreement and will therefore engender all the mechanisms that the Government have described around those. That would be made clear at the time; we make no judgment at the moment, but that mechanism exists to look at new free trade agreements and the Government will come forward with proposals at the time for what they want to do.

Of course, the clause 2 powers also carry with them substantial obligations to inform Parliament about how an agreement has changed, what the substantial nature of that change is and how any delegated legislation will enact the changes described. Parliament will remain totally informed of any changes that the Government propose under clause 2 powers. That is the compromise that was reached on the new clause 6 argument, which the hon. Gentleman will well recall. I believe the House accepted that as a sensible, transparent way of dealing with this issue, and of course it must be agreed in both Houses. If we have a new free trade agreement, that will undoubtedly come forward under the new mechanism that the Government have described, some elements of which are still being developed.

[Barry Gardiner]

I appreciate that the Minister is trying to answer the specifics of the questions I have posed. Do I take it that what he has just said is confirmation that the Government have not received formal confirmation from Singapore that Singapore will not seek to negotiate any substantive changes to the terms of this agreement? If that is the case, given that we have an existing bilateral investment treaty with Singapore, does he not see that there is a certain convolution—to put it no more strongly—in moving from an existing bilateral investment treaty to a future treaty that we are seeking to take as a roll-over now, which will then be subject to further clauses of negotiation to be a substantive further treaty in due course? Does he not see that as a somewhat otiose methodology?

[George Hollingbery]

I think all I want to add is that we currently have the bilateral investment treaty in place and any future trade agreements or any changes will go through the mechanisms. On our attitude to future investment treaties that go along with the free trade agreement, the thinking is not set on either side and those negotiations continue. I understand the hon. Gentleman’s concern, but I do not believe it is a concern; I believe it is very straightforward. The Singaporean Government, through the Prime Minister, have made very clear indications to us that they will be willing to accept a technical replication and then—at a future date yet to be agreed and through conversations yet to be had—we will discuss future arrangements, but nothing is set in stone in that way.

On investment protection arrangements more generally, Committee members will know very well why these exist. If one signs free trade agreements and one wants one’s companies to be able to invest in a foreign territory where there is the slightest question about the rule of law in that area—I do not necessarily apply that to Singapore in any way, shape or form, but there are plenty of companies out there looking for that level of confidence, which is a good thing to put in place—or simply if a company or investor decides to make an investment in a third-party country whose Government have undertaken to have in place certain arrangements that the business relies upon, then it seems reasonable to have in place some mechanism to pursue a dispute where promises have not been kept, if the investment was made on the basis that certain regulations or agreements would be implemented in a certain way.

I think this is probably just a difference of principle between us. It seems to me that the Labour party has an issue with this. I believe that such a mechanism makes it a great deal easier for companies to consider investing abroad, and I would have thought that it was something that we would want to encourage.

I thank the hon. Member for Nottingham East for his comments. I will be happy to engage with him on the rolling-over of existing trade agreements at some stage—although I note that I already have, in the International Trade Committee last week; in which case I will finally wrap up.

Today we have discussed the benefits of the EU-Singapore FTA. We have also heard the reservations and concerns of hon. Members. I truly believe that the FTA is a positive agreement for the UK, and that it is in our national interest to see that it is signed and concluded. Although it is not anticipated that the IPA will apply to the UK before we leave the EU or during the implementation period, it is only right that the UK ensures that fellow member states can get on with the business of ratifying the agreement by supporting signature and conclusion of this agreement. After all, we remain members of the European Union and we have obligations that we must fulfil.

As the UK asserts its position as a global champion of free trade, now and as we leave the EU, we will continue to play an active and supportive role in the development and delivery of EU trade policy. We will also continue to work together to ensure continuity of our trading relationship as we leave the EU. I have been clear about the Government’s commitment to engaging further with Parliament as we develop our independent trade policy, and we will continue to work with stakeholders across the whole of the UK. I commend the Government’s motion to the Committee and urge members to support it.

Question put.

Trade Bill

Barry Gardiner Excerpts

3rd reading: House of Commons & Report stage: House of Commons
Tuesday 17th July 2018 Commons Chamber

[Barry Gardiner (Brent North) (Lab)]

I beg to move, That the clause be read a Second time.

[Mr Speaker]

With this it will be convenient to discuss the following:

New clause 21—Right of devolved authorities to appoint negotiators—

“(1) Each devolved authority shall have the right to appoint one member of any delegation tasked with negotiating an agreement with another state on behalf of the UK if that agreement falls within section 2(2).

(2) A devolved authority shall not make an appointment under subsection (1) unless the person appointed is reasonably competent to carry out the role of a trade negotiator.”

This new clause would permit the devolved authorities to each appoint one member of any negotiating delegation and would ensure that the person appointed is competent to carry out the role.

Amendment 25, in clause 1, page 1, line 15, at end insert—

“(1A) No regulations may be made under this subsection by a Minister of the Crown, so far as they contain provision which would be within the devolved competence of the Scottish Ministers (within the meaning given in paragraph 7 of Schedule 1), unless the Scottish Ministers consent.

(1B) No regulations may be made under this subsection by a Minister of the Crown, so far as they contain provision which would be within the devolved competence of the Welsh Ministers (within the meaning given in paragraph 8 of Schedule 1), unless the Welsh Ministers consent.”

This amendment and Amendment 26 seek to ensure that regulations cannot be made without consent from devolved Ministers.

Amendment 26, in clause 2, page 2, line 40, at end insert—

“(7A) No regulations may be made under subsection (1) by a Minister of the Crown, so far as they contain provision which would be within the devolved competence of the Scottish Ministers (within the meaning given in paragraph 7 of Schedule 1), unless the Scottish Ministers consent.

(7B) No regulations may be made under subsection (1) by a Minister of the Crown, so far as they contain provision which would be within the devolved competence of the Welsh Ministers (within the meaning given in paragraph 8 of Schedule 1), unless the Welsh Ministers consent.”

See explanatory statement for Amendment 25.

Amendment 27, in clause 2, page 3, line 3, at end insert—

“(10) No regulations may be made under subsection (8)(b) unless the Secretary of State has consulted with the Scottish Ministers and the Welsh Ministers.”

This amendment would require the Secretary of State to consult with Scottish Ministers and Welsh Ministers before deciding whether or how to prolong the period during which implementing powers can be used.

Government amendments 49, 50 and 61 to 63.

Amendment 28, in schedule 1, page 7, line 24, at end insert—

“(4) This paragraph does not apply to regulations made under section 1(1) or 2(1) by the Scottish Ministers or the Welsh Ministers.”

This amendment would remove the constraints on Scottish and Welsh Ministers in making regulations under this Act which modify retained EU law.

Government amendments 64 to 67.

Amendment 29, in schedule 1, page 8, line 5, at end insert—

“(4) This paragraph does not apply to regulations made under section 1(1) or 2(1) by the Scottish Ministers or the Welsh Ministers.

Requirement for consultation in certain circumstances

3A (1) No regulations may be made by the Scottish Ministers or the Welsh Ministers acting alone under section 1(1) or 2(1) so far as the regulations are to come into force before exit day unless the regulations are, to that extent, made after consulting with a Minister of the Crown.

(2) No regulations may be made by the Scottish Ministers or the Welsh Ministers acting alone under section 2(1) so far as the regulations make provision about any quota arrangements or are incompatible with any such arrangements unless the regulations are, to that extent, made after consulting with a Minister of the Crown.

(3) In sub-paragraph (2) ‘quota arrangements’ has the same meaning as in paragraph 3.”

This amendment would follow amendments made to the EU (Withdrawal) Bill to replace a requirement to seek the consent of the UK Ministers before making regulations to be commenced before exit day, or regulations making provision about quota arrangements, with a requirement to consult.

Government amendments 68, 69 and 76 to 78.

[Barry Gardiner]

I rise to speak to new clause 4, which stands in my name and those of my right hon. and hon. Friends.

The extent to which the Bill encroaches on matters of devolved competence and undermines the power of devolved authorities is of particular concern. I am proud that it was a Labour Government who delivered the devolution settlements. They were established with a presumption of full devolution, except in matters considered reserved to the Government of the United Kingdom. Indeed, amendments to devolution legislation contained in the Scotland Act 2016 and the Wales Act 2017 specifically put that presumption on to a legislative footing, stipulating that Ministers would not legislate on matters that fell within devolved competence without “normally” seeking the consent of the appropriate devolved Government. However, the Bill seeks to do exactly that.

The Public Bill Committee heard in great detail the serious consequences the Bill would have for the United Kingdom and each of the devolved nations and their respective Administrations.

[Stewart Hosie]

Will the hon. Gentleman give way?

[Barry Gardiner]

A little later.

Certainly, my good friend the shadow Secretary of State for Scotland has impressed on me the deficiencies of the Government’s approach, and it is with her strong advice that I have sought, in consultation with the shadow Secretaries of State for Wales and Northern Ireland, to propose a strong new clause that absolutely and even-handedly respects the devolution settlements and the Sewel convention.

[Stewart Hosie]

Will the hon. Gentleman give way?

[Barry Gardiner]

Once I have explained a little bit about what new clause 4 would do, I will happily give way to the hon. Gentleman.

The provisions in clauses 1 and 2, taken with the Government’s latest amendment 34, would allow the Government in Westminster to use Henry VIII powers to modify primary legislation or retain direct EU legislation in areas of devolved competence, such as procurement, agriculture and food standards, without the consent of the relevant devolved authority—even without any consultation. That goes far beyond the convention of not “normally” legislating in matters of devolved competence without such consent.

Just as the Government have erred on one side by proposing in the Bill a disrespectful power grab downwards into areas of devolved competence, so the Scottish National party, in seeking to amend the Bill, have erred in the other direction by failing to respect the boundaries of the devolution settlement and seeking a power of veto and co-decision making in matters that were always reserved to the United Kingdom sovereign Parliament. We must be clear that international trade is a matter of exclusive competence of the UK Government. At no stage has any devolved authority had any competence in respect of matters of international trade, but I will deal with the Government’s amendments first.

Modern trade agreements are so complex and so extensive that there are areas where matters of trade competence do cross over into matters that would otherwise be devolved competence: food standards, animal welfare standards, access to fishing waters, determination of regulatory and oversight bodies, and so on. All these are the substance of international trade agreements, and where such agreements have been negotiated, a devolved authority is entirely right to consider that its consent must be sought prior to regulations to implement the agreement on such matters being made in accordance with the powers in the Bill.

That the Bill allows for Ministers to act in contravention of that convention and without seeking consent from or even consulting the relevant devolved authority is precisely why neither the Welsh nor the Scottish Government have agreed to give the Bill their legislative consent. That is why Labour said in Committee that it would table an amendment to require the convention to be observed, while ensuring that no power of veto was afforded to a devolved Government on matters that were the exclusive competence of Her Majesty’s Government.

[Stewart Hosie]

Will the hon. Gentleman give way?

[Barry Gardiner]

I am just about at the point where I will.

Our new clause 4 would achieve this by setting out that normally the Government must seek the consent of the devolved Governments before making such regulations, ensuring that the convention is protected in the Bill, while similarly allowing the Government to use existing powers where a devolved Government act or—importantly—fail to act in such a way that ensures the UK is in compliance with its legally binding obligations arising from an international trade agreement.

[Stewart Hosie]

The hon. Gentleman is getting this completely wrong. The Scottish Government do not want a veto; the Scottish National party does not want a veto. We recognise that trade is a reserved matter. Our amendments simply say that Scottish Ministers should be consulted, or their consent sought, when UK policy intersects with devolved policy. This is not a veto on a reserved matter. It is common sense. It is equality—it is parity—in respect of implications for devolved matters. Labour Members should go back to the drawing board, because they are simply getting it wrong.

[Barry Gardiner]

I note the hon. Gentleman’s objections. We clearly have a different view of the nature of the devolution settlement. I will try to take his amendments in turn and explain to him precisely why I believe that he is mistaken.

Let us imagine circumstances in which a devolved Administration simply failed to introduce implementing regulation to an aspect of a trade treaty that that Administration did not like. It would be the UK Government, not the devolved Administration, who were held to be in breach and subject to any penalties that might be imposed. That is why the relevant devolution Acts provide that—not “normally”, but in such exceptional circumstances—the UK could implement such regulations without consent to ensure that the UK complied with its international obligations.

Of course, other amendments have been tabled on these issues. New clause 20, tabled by SNP Members, calls for the devolved authorities to have a right to vote on whether Her Majesty’s Government may exercise what is currently the Government’s exclusive competence to begin trade talks. Our new clause states that negotiating mandates should be formulated transparently and with formal engagement with key stakeholders, including the devolved authorities. However, a right of veto on whether trade talks can begin is a power that no legislature in the country—including the House of Commons—currently has, and it would constitute a substantial new power for the devolved authorities.

[Mr Paul Sweeney (Glasgow North East) (Lab/Co-op)]

My hon. Friend’s definition of a veto seems to be disputed by the Scottish National party. Does he agree that, in terms of initiating as well as ratifying any trade negotiations, if the Scottish Parliament withholds its consent, that is, in effect, a veto?

[Barry Gardiner]

My hon. Friend has put it very succinctly, and he is absolutely correct. That is why the SNP’s new clause 20 does not respect the devolution agreements; nor is it about ensuring that devolved authorities have a say. If that were the case, I would have expected SNP Members to support the amendment that we tabled in Committee, which called for the Joint Ministerial Committee to be convened to consult on the implementation of regulations under the Bill and on negotiations on future trade agreements. Indeed, our new amendment 19 would ensure that such consultation frameworks are established.

Similarly, in new clause 21, the SNP has sought to ensure that each devolved authority takes aspects of trade competence from Her Majesty’s Government and to provide for devolved authorities to have their own appointed trade negotiators at trade talks. Our new clause 4 could does not support that, because it could ultimately lead to several trade negotiators’ working against each other to secure the best terms only for their respective territories. Such a bunfight at the negotiating table would allow negotiating partners to play our own negotiators off against each other.

We believe that trade deals must ensure that benefits are delivered across the United Kingdom and that a whole UK approach must be taken to negotiations. That is why we have called for advanced consultation to ensure full and proper representation in those negotiations. It is also why we would have been happy to support new clause 22 had it been put to the vote. It sought to ensure transparency on trade talks, and it would have afforded a right to the devolved Parliaments to scrutinise all aspects of a trade agreement and related correspondence or documents as they so required.

Our new clause 4 would absolutely guarantee the right of consent to devolved Administrations whenever a Government sought to implement regulations to carry out their obligations under international treaties. What it would not do is give the devolved Administrations a power of veto over the ratification of international treaties, the negotiation of which is a matter for the Westminster Government. SNP Members would seek to secure the ultimate power of veto that has thus far eluded them in other amendments and that they have been very clear about seeking.

[Angus Brendan MacNeil]

Will the hon. Gentleman give way?

[Barry Gardiner]

I am pressed for time. I know that you want me to conclude my remarks very shortly, Madam Deputy Speaker.

While other amendments are about consent before the making of regulations implementing obligations arising under a trade agreement, that clause would prevent the trade agreement from ever having legal effect, as it could not be ratified unless the devolved authorities had consented. It has been carefully worded, but its intent is clear: it is not limited only to matters of devolved competence, but covers all trade agreements in their entirety even if no aspect of that agreement would touch on devolved competence and even if absolutely no regulations were required to implement that agreement. New clause 23(3)(b) would ensure that any trade agreement

“having an impact within the territory over which the devolved authority presides”

was subject to this consent power. Quite clearly, every single trade agreement will be, as there will be exporters across the UK who can trade under the terms of that agreement. It is a thinly veiled attempt at securing the Wallonian veto power that the hon. Member for Kilmarnock and Loudoun (Alan Brown) told us in the Committee was his intention.

The Committee took many more pieces of evidence. I will not detain the House with them today, but simply say that new clause 4 absolutely respects the devolution settlement. It sets out the right relationship so that Government cannot overreach into devolved competence nor the devolved authorities reach up into powers that are reserved for this sovereign Parliament.

I also support new clause 19, but I will not detain the House any longer.

[Stewart Hosie]

I shall speak to amendment 25 in my name and to amendments 26, 27, 28 and 29. New clause 21 is in this group, but I referred to it earlier so will not do so again now.

First, however, let me make an observation about the Labour party’s position. It seems to rely on the new form of words that the UK Government would not normally legislate or do this or do that in relation to anything that was a devolved competence. If we were talking about normal, reasonable people in normal, sensible times when they did not interfere at all except in extremis, perhaps we could accept that. However, they have taken the Scottish Government to court to undermine a democratic decision of the Parliament, so, of course, we accept the principles of devolution, but to make them work there now must be formal arrangements and consent must be sought. We can no longer rely on the formulation of the UK Government not normally doing x, y or z.

--- Later in debate ---

[George Hollingbery]

I thank the hon. Gentleman for his question. What I can say on that is that the Scottish National party has already welcomed a number of measures in the Bill today. The negotiations are ongoing with the Welsh Government and I would hope that in due course we will reach those legislative consent motions.

As I was saying, this will ensure that England, Scotland, Wales and Northern Ireland maintain the greatest amount of certainty, continuity and stability in our trade and investment relationships for our businesses, citizens and trading partners. I am certain that all Members across the House support the importance of maintaining these trading opportunities for business across the UK, such as we see with the 10% of Scotch whisky exports that go to countries with which we wish to transition existing trade agreements. As parts of these agreements will touch on devolved matters, this legislation creates powers for devolved Administrations to implement them. These powers will be held concurrently by the devolved Administrations and the UK Government. That approach will ensure that where it makes practical sense for regulations to be made once for the whole UK, it is possible for this to happen. However, in the trade White Paper, and throughout the Committee stage, the Government have publicly and repeatedly committed to not normally use the powers in the Bill to amend legislation in devolved areas without the consent of the relevant devolved Administrations—and not without first consulting them. I make that commitment again today. As such, new clause 4 is unnecessary.

[Barry Gardiner]

I take in good faith the assurance the Minister has given across the Dispatch Box that the Government would not normally do that, but surely he cannot equate that with having the security of that commitment in the Bill. He must accept that on this side of the House we have tried to be even-handed in ensuring that the terms of the devolution settlement are respected both by government and by the nationalists in Scotland. If he is simply saying, “Everybody must rely on an assurance across the Dispatch Box”, that is not good enough.

[George Hollingbery]

I say to the hon. Gentleman that the Sewel convention is well established. It has been in place for many years and it has proved more than adequate up to now. We believe it is the right way forward to handle this particular issue, so we see no need for new clause 4 to be in the Bill.

We will work closely with the devolved Administrations to deliver an approach to the implementation of trade agreements that works for the whole of the UK, reflecting the needs and individual circumstances of England, Scotland, Wales and Northern Ireland. The Government’s approach respects a long-standing and robust convention between the UK Government and the devolved Administrations.

--- Later in debate ---

[George Hollingbery]

If Members do not mind, I shall make a little more progress.

Concurrent functions have always been a normal part of our devolution arrangements, and the Bill broadly replicates the concurrent approach taken under section 2(2) of the European Communities Act 1972. That has proved an efficient and effective precedent for the devolved Administrations and the UK Government. I thank the hon. Member for Dundee East (Stewart Hosie) for raising the issue of the devolved authorities’ role in the transitional agreements and any extension of the sunset provision. I am happy to confirm that, should they make the decision to use the three-year sunset extension or provision, the Government commit to engaging the devolved Administrations in that decision-making process in advance.

The Government have made a number of their own amendments to reduce restrictions on the powers conferred on devolved Ministers, bringing greater parity between UK Ministers’ powers and devolved Ministers’ powers. I particularly wish to draw the House’s attention to two changes. Government amendments 64 to 67 change the requirement on devolved Ministers from seeking the consent of UK Ministers to consulting UK Ministers before making regulations under the Bill’s powers that relate to quotas or the pre-exit commencement of regulations.

[Barry Gardiner]

I am concerned about what the Minister said. Does he not accept that if the provisions in clauses 1 and 2 are taken in conjunction with Government amendment 34, they will allow the Westminster Government to use Henry VIII powers to modify primary legislation or retained direct EU legislation in areas that are a matter of devolved competence? That is to go beyond “not normally”, which is why new clause 4 is essential.

[Mr Speaker]

Order. May I just emphasise that there is no obligation to continue up to the wire? I know that sometimes some people on the Government Bench say “Keep going till the cut-off point,” but it is not necessary to do so. There is a lot of other material to be debated. The Minister, who is a most courteous fellow, was extremely succinct earlier; he should not think that that was unpopular in the House.

[George Hollingbery]

You will be glad to hear, Mr Speaker, that I do not have a great deal more to say.

Let me engage with the shadow Secretary of State’s point. The powers that the Government are taking relate to where any regulations under section 12 of the European Union (Withdrawal) Act are in force and intersect with devolved Ministers’ rights to modify retained direct EU law. We are carving out an area in which the UK Government believe it is right and proper that the interests of the wider United Kingdom have precedence. I think the shadow Secretary of State understands what I mean; indeed, from the look on his face I believe he probably secretly agrees with what I am saying.

[Barry Gardiner]

indicated dissent.

[George Hollingbery]

The hon. Member for Dundee East will know that work is ongoing around the extent of the areas which I have just outlined to the shadow Secretary of State and which will be covered by section 12. The changes I have outlined recognise the important role that the devolved Administrations will play in implementing trade continuity agreements in devolved areas. I reiterate that, in line with convention, UK Government will not normally implement such measures in devolved areas without the consent of the devolved Administrations.

The amendments demonstrate significant progress in our discussions with the devolved Administrations.

--- Later in debate ---

[Barry Gardiner]

I thank the Minister for Trade Policy for stepping into the shoes of the right hon. Member for Chelsea and Fulham (Greg Hands) with great aplomb. He has displayed his customary tact in all our engagements and has helped the Government deliver the Bill, despite all the pressures he has faced. I pay tribute to the hon. Member for Huntingdon (Mr Djanogly), who I thought made an exceptionally thoughtful speech on Report and gave the Government a great deal of wise counsel that they might have done better to take even more notice of than they did.

In particular, of course, I want to thank my hon. Friends the Members for Sefton Central (Bill Esterson) and for Bradford South (Judith Cummins) for their exceptional work in preparing for the debates on Report and in Committee. It has been a long process since last October. We were not quite sure whether we would see the Bill this side of the summer recess, or whether it would even resurface before Christmas, but it is a great tribute to them that they were able to scrutinise the Bill with the care it deserved.

I echo the Secretary of State’s remarks about the expert witnesses. It is one of the great features of the innovations over the past 15 to 20 years in this House that expert witnesses now give their testimony to Committees at the beginning and inform our procedures. We certainly benefited hugely from all they said. Of course, I wish that the Secretary of State and the Minister had taken a little more notice of what they said, because they were often extremely critical of the Government, but that was not to be.

Finally, let me apologise to the Government Whips. I am not known in this place for speaking with brevity, and I must apologise to the Whips because when I curtailed my remarks this afternoon, it meant that the session did not go the full length, and I think that they took their wrath out on the Minister for ending it early.

Trade Policy

Barry Gardiner Excerpts

Monday 16th July 2018 Commons Chamber

[Barry Gardiner (Brent North) (Lab)]

I thank the right hon. Gentleman for advance sight of his statement. I have to say, when he said that he wanted to boost his relationships with old friends and new allies, I did wonder for a moment whether he was talking about the previous Foreign Secretary and the current Prime Minister, but it seemed not.

The Trade Bill completed its Committee stage more than six months ago. Since then, the Government have been too scared to bring it back for fear of what their Back Benchers might do to it, but tomorrow, this House will debate Report stage and Third Reading of the Trade Bill, so it was with a certain amount of disbelief that I saw that today of all days, the Secretary of State would be making a statement on “Delivering a transparent and inclusive UK trade policy”. I thought to myself, “This man’s having a laugh.” He is.

For months, since the first publication of this flawed piece of legislation last October, we have been saying that it fails to do what the Government led us to believe it would in the Gracious Speech at the state opening of Parliament—namely, to set out the legislative framework to deliver a transparent and inclusive UK trade policy. Business has been saying it; unions have been saying it; civil society has been saying it. Madam Deputy Speaker, did you ever hear of such a coalition? The International Chamber of Commerce, the CBI, the British Chambers of Commerce, the EEF, the Institute of Directors and the Federation of Small Businesses all joined forces with the TUC, Unite the union, the Trade Justice Movement and even the Consumers’ Association, which publishes Which?, to tell the Government they needed to sort this out.

We tabled a series of amendments in Committee. The Government refused every one. So why this protestation, this deathbed Damascene conversion by the Secretary of State? It is a welcome confession, but as drafted the Bill does not provide what so many on the Government Benches told us was the point of leaving the EU. It does not give control over laws to this sovereign Parliament; it gives them to Ministers. What today in his statement has the Secretary of State done to change this? The words are warm. The detail is far from clear. Will he be accepting new clause 3 tomorrow? It sets out a proper scrutiny procedure for trade agreements. We tabled that amendment in Committee only to see it scorned. We welcome his statement that the Government will be bringing forward a proper consultation process in advance of future trade agreements. Does this mean he will be accepting our amendment 18 on consultation or our new clause 4 on respecting the rights of the devolved Administrations? The true penitent must not merely confess his sins; the true penitent must amend his ways. There is little in this statement that shows the Government are prepared to do so.

Modern trade agreements are so complex and extensive that they reach into nearly all aspects of government and policy, but they are not like domestic legislation, which can be repealed when it is no longer technically suitable or politically acceptable. Instead, they place legally binding obligations on Governments in perpetuity that cannot be simply amended or repealed yet those obligations can be agreed behind closed doors and in total secrecy by the Government’s negotiators alone. That is why it is incumbent upon Members of this House to ensure a rigorous and robust scrutiny framework for trade agreements.

Until now, the Government have rejected every single one of our amendments. It is welcome that, however late in the day, they have tabled amendments addressing at least some issues before tomorrow’s Third Reading, but they do not go far enough. They have now agreed with Labour that regulations should not be implemented under the negative procedure. They have also agreed with Labour that there could be substantive variation in the roll-over agreements compared with the corresponding EU agreements and have brought forward amendments that will require the Government to report on any such change. But of course as one hand gives, the other hand takes away, as they have also tabled an amendment that would allow them to ignore this, should they so choose. Reporting on a change is not the same as giving Parliament the power to amend it. I trust that, given the Secretary of State’s acknowledgement today of the Bill’s failings, he will support those amendments that seek to rectify the shortcomings tomorrow.

Finally, why are we having this statement today? It could and should have been delivered as part of the debate on the Bill tomorrow. Indeed, any concessions could have been brought forward as amendments at any stage since it had its Second Reading last November. Today’s statement can only have been brought forward in a bid to limit time for this afternoon’s critical debate on the Taxation (Cross-Border Trade) Bill and to stave off any opportunity for right hon. and hon. Members to expose the ludicrous position this Government have now got themselves into by saying they will accept European Research Group amendments that directly contradict the Chequers agreement.

A group of Ministers and Back-Bench Members within and outside the Cabinet now appear to be deliberately steering the Brexit negotiations on to the rocks of a no deal, with all the damaging consequences for jobs and our economy of moving disruptively on to World Trade Organisation rules. I believe the Secretary of State is one such. The warm words and platitudes of this statement do not mask the cynical political game he is playing and make a mockery of the role of this House in undertaking proper and rigorous debate of some of the most important legislation to come before us in 50 years.

[Dr Fox]

As no questions were actually raised in the hon. Gentleman’s response to my statement, I am tempted simply to sit down again.

One of the reasons we give advance notice to Front Benchers is to try to ensure that they are at least be talking about the same issue as we are. However, I am afraid the shadow Secretary of State does not seem to understand that the Trade Bill, which we will debate tomorrow, specifically does not involve future free trade agreements; it merely involves continuity agreements. If the hon. Gentleman does not understand that point, I am not sure what else in the Bill he will understand.

Today’s statement related to new free trade agreements. I gave the House a commitment that I would set out, before the summer recess, what our proposals would be, in the context of transparency and inclusivity, when it came to negotiating those new free trade agreements. The fact that we are making statements during the negotiations, and giving updates to the International Trade Committee, shows that we have acted in good faith. I am afraid that this afternoon we have simply had bluster and bunkum instead of reason and rationality, and if anyone was making a mockery of anything, it was a mockery of Front-Bench duties.

Oral Answers to Questions

Barry Gardiner Excerpts

Thursday 28th June 2018 Commons Chamber

[Dr Fox]

Inasmuch as I am able to discern what it is, which the events of this week make extremely difficult, the answer would have to be no—not least because, in regard to trade, the Opposition Front Bench has become a caricature of a loony left party in seeming to regard Justin Trudeau as a lackey of global corporatism.

[Barry Gardiner (Brent North) (Lab)]

Ministers have made much today about the vote on the Comprehensive Economic and Trade Agreement earlier this week. I am not quite sure what they do not understand about no deal with Canada being better than a bad deal; I thought that in other areas that was actually their party policy.

I want to focus on the damning report on carbon emissions released today by the Committee on Climate Change. The Conservative Committee Chair, Lord Deben, set out a stark demand:

“Act now, climate change will not pause while we consider our options.”

In response, will the Secretary of State explain why, on the latest figures, 99.4% of the support that UK Export Finance gives to the energy sector goes to fossil fuels? Will he tell the House what steps he is now taking to redress that imbalance, to promote and support renewable energy and respect the Equator Principles, which his Department signed up to, about sustainability in global trade last year?

[Dr Fox]

When I saw the hon. Gentleman stand up, my heart sank, given that this is only a 30-minute session.

We use UK Export Finance to promote a whole range of environmental and trading issues—in fact, I was in discussions with Equinor in Oslo last week about how we can use UK Export Finance to further the use and export of renewables.

Draft EU-Canada Trade Agreement Order

Barry Gardiner Excerpts

Tuesday 26th June 2018 Commons Chamber

[Barry Gardiner (Brent North) (Lab)]

I am grateful for the opportunity to speak in this important debate on the Floor of the House at last. The order will specify CETA as an EU treaty for the purposes of the European Communities Act 1972. It is important to recognise that, unfortunate though it may be, the agreement itself cannot be changed at this stage by anything we might say this afternoon.

We want a comprehensive and mutually beneficial trade agreement with Canada. We want to boost fair and open trade with our closest allies and neighbours. Of course we do. We share a common language, unique cultural and economic bonds, the same parliamentary model and a common legal tradition, and we count Canada among our closest, oldest and most trusted allies.

In 2016, our exports to Canada amounted to some £8.3 billion—our seventh-largest non-European export market. In turn, we are Canada’s third most important export market. Our appetite for Canadian goods means that Canada runs a trade surplus with us of some $6.8 billion according to 2017 figures. We are Canada’s most important European trading partner. The vast majority of Canada’s European-bound goods move through our ports. We are the second-biggest recipient of Canadian investment. Similarly, we are the second-biggest foreign direct investor into Canada. More than an estimated 700 British firms have an established presence in Canada and some 1,100 UK firms are owned or controlled by Canadian interests.

In matters of trade, the UK and Canada face similar issues. Boeing’s efforts to have punitive tariffs levied on Bombardier C Series aircraft threaten thousands of jobs both in Canada and here, where the company’s Northern Ireland plant engineers and manufactures wings for those aircraft. We both face the spurious and illegal tariffs imposed by President Trump on our steel and aluminium exports under the false pretence of national security.

Do we want a trade deal with Canada? Of course we do. Only by working together can we and Canada address and resolve American protectionism and make a concerted effort on the world stage to enforce the rules-based system that underpins international trade. Only by working together can we push for a serious response to global overcapacity issues.

[John Spellar (Warley) (Lab)]

Will my hon. Friend give way?

[Barry Gardiner]

I will give way to my right hon. Friend in a moment if he is patient—I am sure he will be.

Yes, a Labour Government would very much welcome a trade deal with Canada built on the commercial and diplomatic ties that bind our two countries; a deal that seeks to further elevate our shared standards, rights and protections; and a deal that would lead to increased economic prosperity and jobs. The EU-Canada comprehensive economic and trade agreement is not such an agreement.

[John Spellar]

I thank my hon. Friend for giving way. Given the considerable links and advantages of our relationship with Canada, if we cannot do a deal with Canada, which country can we do a deal with?

[Barry Gardiner]

The presumption in my right hon. Friend’s question is entirely wrong. The presumption is that we cannot do a trade deal with Canada, but of course we can. We want to do a trade deal with Canada, but he will recognise that we did not want the TTIP deal with the United States even though the United States perhaps has a claim above Canada’s to be our closest ally on the international stage. The question is not who but what. Of course we can do a deal, but it must be the right deal for British business and jobs.

[Andrew Percy (Brigg and Goole) (Con)]

I spend a lot of time in Canada as our trade envoy. What would the hon. Gentleman’s message be to those British companies I meet in Canada that tell me how the provisional application of CETA is helping to boost their trade in that country and open up procurement—there are $20 billion-worth of opportunities in the city of Toronto alone. He wishes to cut that off to British businesses by rejecting this deal, so what is his message to them when they are already benefiting and helping to support jobs in the United Kingdom?

[Barry Gardiner]

As I think I have already made clear to the House, we want those jobs and procurement opportunities, but we want them on the right terms.

[Dr Fox]

For the sake of clarity, is it the Opposition’s position that the United Kingdom should not ratify CETA?

[Barry Gardiner]

I will of course answer the right hon. Gentleman’s question—I will come to it later in my speech. Like my right hon. Friend the Member for Warley (John Spellar), the Secretary of State will just have to be patient a little longer.

The CETA deal has been marred by controversy. Hundreds of thousands of people have taken to the streets across Europe in protest. The deal was largely conducted in secrecy and with minimal consultation. It threatens the essential ability of Governments to legislate in the public interest. That is why it is so essential that Parliament has finally been afforded the opportunity to debate the agreement on the Floor of the House.

I pay tribute to the work of the European Scrutiny Committee under the chairmanship of the hon. Member for Stone (Sir William Cash), who is no longer in his place. In this respect, the Committee made repeated attempts over the past two years to ensure that Parliament was given just such a chance. The debate has been pending since the Committee granted a scrutiny waiver to the Secretary of State in October 2016.

[Catherine McKinnell]

Going back to the earlier discussion, if the position is not to support the Canada trade deal, will my hon. Friend explain what the procedure is for negotiating a new trade deal with Canada, given the complexity of leaving the EU?

[Barry Gardiner]

I do not know whether my hon. Friend heard the Secretary of State’s remarks. He has made it clear that negotiations are under way. The constitutional position is that all current agreements with third-party countries that we have through the EU will have to be rolled over as new agreements. They will be legally distinct. In that respect, they must all be renegotiated.

[Several hon. Members rose—]

[Barry Gardiner]

I see a lot of Members standing. I am happy to give way later in my remarks but I want to make progress now.

The debate has been pending since the European Scrutiny Committee granted a scrutiny waiver to the Secretary of State in October 2016 to proceed with signing the agreement in order to bring the trade elements, but not the investment elements, into provisional application. That waiver was on the express condition that there was prior debate on the Floor of the House. That debate did not take place.

It is unusual to bring a statutory instrument to the Floor of the House rather than to a Delegated Legislation Committee. The Government are pretending to have afforded the House the opportunity to properly debate and scrutinise a controversial agreement and one of the most extensive that the country has entered into—the Secretary of State has admitted as much. However, at this stage it is all too late. The agreement is signed and cannot be renegotiated.

On 5 July 2016, the European Commission published its proposals for the signature and provisional application of CETA. On 7 September 2016, the European Scrutiny Committee recommended an urgent debate on the Floor of the House, noting the significant political and legal importance of the agreement. On 6 October 2016, the Minister sought clearance from the Committee to sign the agreement without having such a debate. On 12 October 2016, the Committee granted the Government a conditional scrutiny waiver, allowing them to proceed with signing the agreement only after a debate on the Floor of the House—the Committee directed the Government to ensure such a debate. [Interruption.] I hear the Secretary of State muttering from a sedentary position, “Process, process, process,” but process is how the House ensures proper transparency and scrutiny.

On 17 October 2016, the Secretary of State advised the Committee that it was his intention to override scrutiny and proceed not only with the signature of the agreement but with its provisional application, despite the controversy attached to it and despite the fact that the House had been given no opportunity to scrutinise or debate it.

[Owen Smith (Pontypridd) (Lab)]

Will my hon. Friend give way?

[Barry Gardiner]

No.

On 18 October 2016, the Government confirmed their support for signature, provisional application and conclusion of CETA. Overriding scrutiny, Mr Speaker, is no minor matter. The Committee rightly called an emergency evidence session demanding that the Secretary of State account for his decision to override the Committee’s scrutiny reserve and to proceed with provisional application. The Secretary of State had the audacity to tell the Committee:

“I very much believe in the democratic process and the importance of transparency and, as the Committee knows, I have long been one of those Members who has been very much supportive of the scrutiny process and I’m sorry that the timescales meant that it was not possible to have a debate before decisions needed to be made on CETA.”

He went on to tell the Committee that this was

“down to the parliamentary calendar and the timescales set for us. However, I therefore reinforce my commitment to the Committee today to hold such a debate and I’m very happy to have that debate on the Floor of the House. Our officials are already working with business managers to identify a date most likely, we understand, in November.”

That, for the avoidance of doubt, was November 2016.

So, November comes around and, having had no indication of a debate being forthcoming, the Committee published its summary of that urgent evidence session and noted:

“We consider such a debate to be urgent and ask that it be scheduled before 13 December”.

[Interruption.] I know the Secretary of State does not like this, because it brings up all the ways in which he has sought to avoid transparency and scrutiny in this place.

By 30 November, the Secretary of State failed to secure a debate in the timeframe he himself had suggested to the Committee. On 7 December, the Committee repeated the need for a debate and called for it to take place before mid-January 2017, recognising that the Secretary of State would not be bringing forth a debate by the earlier stipulated deadline of 13 December.

It was farcical. The Secretary of State had absolutely made it farcical, but it got worse. My office submitted a freedom of information request on 15 December requesting details of the correspondence between the Department and business managers regarding scheduling a debate on CETA since 1 December 2016. It may come as no surprise that the Department failed to respond within the suggested timeframe. However, a response was forthcoming by 25 January. Staggeringly, it admits in its response that the first attempt to bring forward a debate on CETA was not in July 2016, as one might expect, and not even in September when the House returned after summer recess. It was an email sent from an undisclosed official to the Government Chief Whip’s office on 25 October at 1.57 pm, just 24 hours prior to the Secretary of State’s scheduled appearance before the Select Committee.

For the avoidance of doubt, I want to reassure the House that the Secretary of State did not misspeak. He did not mislead the Committee in any way when he told the hon. Member for Stone that

“our officials are already working with business managers to identify a date”.

They had been: for a whole 24 hours and 33 minutes. If it should be that prior to being summoned to give evidence to the European Scrutiny Committee on why the Government had blatantly ignored the Committee’s limited and conditional waiver and the condition that a debate take place, the Secretary of State had instructed his officials to come up with a cover, at least the literal interpretation of his words was strictly accurate. More troubling is his apology to the Committee implying that there had been efforts to find time to schedule a debate, saying,

“I am sorry that the timescales meant that it was not possible to have a debate before decisions needed to be made on CETA in the Council.”

[Jeremy Quin]

I am most grateful to the hon. Gentleman for giving way. For someone who seems so keen to have had a debate on this particular treaty, he seems very, very wary about actually getting on to the substance of the issue we are here to discuss. The only point on which I have heard him say he disagrees with what is laid before the House is some wording about it impinging on national Parliaments to regulate their own affairs. What bit of the treaty does he disagree with? Is it chapter 23, which ensures that we protect employment rights? Is it chapter 24, which ensures that we protect environmental rights? Or is it the legal text that provides protections for our NHS? What is it that he disagrees with?

[Barry Gardiner]

I am grateful to the hon. Gentleman for pressing me on to the substantive part of the debate, but he will understand that the way in which international treaties progress through this House, the way in which they are scrutinised and the transparency with which that is done are matters of real importance. The reason why is that the substance of these treaties needs to be agreed in terms of a mandate. It then needs to be ensured that the scrutiny that applies is available to Members of this House at all stages. That is what in this situation entirely failed to happen.

The Secretary of State said:

“I am sorry that the timescales meant that it was not possible to have a debate before decisions needed to be made on CETA in the Council. This was down to the parliamentary calendar and the timescale set for us.”

“Not possible”? How did he know? He never bothered to ask. Why would the Government so determinedly pursue such a tack? The Secretary of State told us why when he admitted to the Committee in October 2016 that the

“UK could not be seen to block the agreement as it would send a negative signal to Canada.”

In a meeting between the Secretary of State and his Canadian counterpart that took place on 16 July, we are told by the then Canadian Trade Minister, Chrystia Freeland, that

“when I asked him if I could count on his and Britain’s continued support for CETA, he told me Britain would not just be supporting CETA, Britain would be pushing for CETA at the EU table.”

Heaven forfend that Parliament might have had a say in such a deal now that the Secretary of State had given his gentleman’s agreement to Canada!

There are two key issues that Members need to consider today. One is the issue of substance, and we will come on to the reservations on that score that exist throughout Europe, not just on the Opposition Benches, where they are currently being debated in constitutional courts and campaigned on by colleagues in the trade union movement. Incidentally, they were fully set out in Labour’s general election manifesto last year. The second issue is process. Why have the Government repeatedly attempted to avoid proper scrutiny of the agreement? The reality of today’s debate is that it is nothing more than a masquerading exercise designed to give the illusion of scrutiny when there has in fact been so little. We are now too late in the process and can do nothing to alter its course.

[Angus Brendan MacNeil]

I think many people watching will want to be clear, given the fragile and febrile nature of their politics in the UK at the moment, on what position the hon. Gentleman would adopt on CETA if he was to find himself International Trade Secretary in a few months’ time.

[Barry Gardiner]

If we were out of the European Union, we would then be negotiating a new trade agreement with Canada and we would ensure that all—[Interruption.] Much that is in CETA is to be welcomed, as was outlined by the hon. Member for Brigg and Goole (Andrew Percy) who intervened on me earlier. Much of it is to be welcomed, but there are aspects of the trade agreement that the hon. Gentleman will recognise, and all of Europe recognises, as simply unacceptable.

Other Parliaments have, of course, had the opportunity to properly register their views on this agreement and perhaps this illustrates why the Secretary of State has been so concerned about allowing the House to have its say. In the Committee stage of the Trade Bill, I set out how a Labour Government would ensure full and proper consultation with key stakeholders—businesses, unions, civil society and the devolved Administrations—in advance of entering into negotiations on trade talks. My party believes that Parliament should have a vote to approve such mandates. That was why we tabled amendments to the Bill in respect of the same, but the Government voted down every single amendment we put forward.

[Dr Fox]

Are we then to assume that, for the purposes of consistency, Labour will table a negative motion under the Constitutional Reform and Governance Act 2010—or CRAG—procedure?

[Barry Gardiner]

I will come on to our position in due course.

The European Commission hailed CETA, calling it

“the most ambitious trade agreement between countries ever undertaken.”

However, unlike other deals currently being progressed by the European Commission, it is a mixed agreement—trade and investment.

The investment provisions of CETA touch on matters of national competence and, as such, the agreement must be ratified at the national level and the regional level where appropriate. The European Commission and respective national Governments have sought to circumvent this process by provisionally applying CETA since 21 September last year, but the deal has not been ratified and is therefore not yet fully enforceable. To understand why, we need to look at the Wallonian Parliament in Belgium, which refused to ratify the agreement over concerns about investment aspects of it and, in particular, the investor-state dispute settlement mechanism, now known under this agreement as the investment court system. This is where process meets substance. Belgium has referred the matter to the European Court of Justice to seek a ruling on whether the investment court system is even compatible with EU law.

[Caroline Lucas (Brighton, Pavilion) (Green)]

The hon. Gentleman is making a powerful case about a very flawed process. Following public pressure, the provisions in CETA for an investment court system are still only marginally better than the original investor-state dispute settlement system. Does he share my concern that this still amounts to a parallel justice system for large corporations that could render the UK vulnerable to lawsuits, such as that brought by Veolia against Egypt for introducing a minimum wage?

[Barry Gardiner]

I absolutely share the hon. Lady’s concern. That is one reason why it was part of the Labour party’s manifesto at the last election that we would not approve trade agreements that had these mechanisms in them.

[Sir Desmond Swayne (New Forest West) (Con)]

On a point of order, Madam Deputy Speaker. There is some pressure on time. The hon. Gentleman has been at it for over 20 minutes and we still do not know where he stands. Is it in order for him to keep the House in such suspense?

[Madam Deputy Speaker (Dame Rosie Winterton)]

It is quite in order for the hon. Member for Brent North (Barry Gardiner) to be making his opening remarks. I am sure he is not going to be too much longer; there are a lot of people waiting to speak.

[Barry Gardiner]

Thank you, Madam Deputy Speaker.

[Owen Smith]

Would he give way to a Labour colleague?

[Barry Gardiner]

I would give way to a Labour colleague.

Just last week, the incoming Italian Government signalled that they too would refuse to ratify CETA when the new Agriculture Minister indicated that the lack of protections for Italian food producers presented a serious threat to the sector, calling the deal wrong and risky. France, Germany and the Netherlands have not ratified the agreement, and the Dutch Government are waiting on the ECJ ruling before determining how to proceed. In Germany, the issue is being heard in a case before its domestic constitutional courts to determine whether the investment court system is even compatible with the German constitution.

[Vicky Ford (Chelmsford) (Con)]

The hon. Gentleman is making a very good point but, if CETA is such a terrible deal, why did so many Labour Members of the European Parliament vote for it, including their lead spokesman on the issue, who had full transparency on the deal as it was negotiated?

[Barry Gardiner]

The hon. Lady makes a false premise. Many parts of this deal would be welcomed, but there are essential parts of it that cannot be welcomed and which would stop us, therefore, being able to ratify it in the way she suggests.

The ISDS mechanisms give superior legal rights only to foreign investors to raise disputes against our Government to petition for compensation when their profits, or even their potential profits, are impacted by legislative or public policy decisions. This effectively allows companies to sue Governments when they are legislating in the public interest; for example, by introducing plain packaging for cigarettes, national insurance, minimum wages or even banning fracking. These provisions have become increasingly commonplace in new-generation trade agreements and this is what has resulted in such widespread international public outcry against deals such as the Transatlantic Trade and Investment Partnership, the Trans-Pacific Partnership and CETA.

The proliferation of investor-state dispute settlements can encourage treaty shopping, whereby investors restructure their activities to establish in countries where they may benefit from ISDS mechanisms, should they seek to effect policy change or petition for compensation. While the Government have previously argued that the UK has only ever been subject to four such dispute cases, and that the UK never lost such a case, it begs the question: why does the Secretary of State feel that this mechanism needs to be incorporated in a deal with a country such as Canada?

[Geraint Davies]

Will my hon. Friend give way?

[Barry Gardiner]

I will give way to my hon. Friend in just a second.

The Secretary of State spoke about the need to give investors protection and security and he has boasted many times in the past 12 months about the record number of FDI deals that he has been able to achieve. Unaccountably, he failed to report that those deals, though record in number, showed a 92% drop in value. Today’s figures also reveal a drop in the number of deals, and the number of jobs saved by such investments is down by 54% year on year, according to his website.

Indeed, many Canadian companies have used investor-state dispute provisions in trade agreements to challenge foreign Governments, whether it has been the closing down of mines in El Salvador following a moratorium to protect unpolluted drinking water, or the Obama Administration’s decision to suspend the Keystone pipeline over concerns about potential damage to the environment. The very threat of facing such a case, even when the chance of winning is in the Government’s favour, can clearly act as a deterrent to Governments from pursuing actions in the public interest—a regulatory chilling effect. This may well have been President Trump’s view when he reversed his predecessor’s decision and greenlighted the Keystone pipeline, thus avoiding costly legal action and the chance of a substantial payout.

Having watched cases taken against the Uruguayan and Australian Governments by the tobacco giant, Philip Morris, many countries are cautious about introducing plain packaging in tobacco product laws. It is not just European Governments who have expressed concerns about ISDS.

[Angus Brendan MacNeil]

I am slightly puzzled by the hon. Gentleman. At the moment, there is talk about the provisional application of CETA. What situation would he want with CETA? I know that he has reservations—if I have reservations about a car I am going to buy, I do not buy it. He has reservations about CETA, so would he not apply CETA? Would he provisionally apply it? What would his position on CETA be if he were the Secretary of State for International Trade and President of the Board of Trade in a few months’ time?

[Barry Gardiner]

I did answer that question earlier following an intervention. There are many aspects of this trade agreement that we would welcome and would wish to pursue, but we cannot—[Interruption.]

[Madam Deputy Speaker (Dame Rosie Winterton)]

Order. Will the hon. Gentleman face the Chair? We cannot hear otherwise.

[Barry Gardiner]

I apologise, Madam Deputy Speaker. There are many aspects of the deal that we would welcome, but there are elements of it that are absolutely unsustainable and constitute red lines. South Africa, India and New Zealand have all stated their opposition to ISDS procedures, and New Zealand has gone so far as to sign side letters with five counter-signatories to the Trans-Pacific Partnership disapplying the ISDS provisions included in that agreement. The current impasse in the renegotiation of the North American free trade agreement hinges on US demands to drop ISDS provisions from the revised agreement, the rationale being that their respective domestic court systems are perfectly capable of adequately settling any disputes. Indeed, if our courts are sufficient for British companies, why should they not be considered so for foreign investors, too? The United Kingdom has long been considered a safe legal system, and a significant proportion of global trade is governed by legal—

[Andrew Percy]

On a point of order, Madam Deputy Speaker. The shadow Secretary of State has now spoken for longer than the Secretary of State. Many Back Benchers are waiting to get in on this important debate. Is he still in order?

[Madam Deputy Speaker (Dame Rosie Winterton)]

The hon. Member for Brent North is still in order, but I point out that a lot of speakers want to come in. I am sure that he will bring his remarks to an end very shortly.

[Barry Gardiner]

Thank you, Madam Deputy Speaker. Indeed—I will respect your decision and, in that regard, I hope that nobody else will seek to intervene as I conclude my remarks.

[Owen Smith]

Will my hon. Friend give way? [Interruption.]

[Madam Deputy Speaker (Dame Rosie Winterton)]

Order. It is important that the hon. Member for Brent North is heard with politeness, because I know that he wants to bring his remarks to an end fairly quickly. I think we should give him the chance to get on and do that.

[Barry Gardiner]

Over the past few years, the Government have entirely failed to explain why British taxpayers should be on the hook for ordinary commercial risks faced by foreign investors. If a company has concerns about the stability of the regulatory environment, it should factor that into its investment decision. Recognising the flaws in the arbitration model, the European Commission and Canada have moved to a courts-based system, but the Secretary of State covered that, so I will not dwell on it.

A Labour Government would not seek ISDS provisions in future trade agreements, but the threat to the Government’s capacity to deliver in the public interest is not confined to the use of ISDS mechanisms. Modern trade agreements such as CETA and the EU-Japan economic partnership have been negotiated using the negative list approach for the scheduling of services liberalisation commitments. Under this approach, all service sectors not explicitly exempted from liberalisation are included. The use of this method marks a significant departure from the use of the positive list in all earlier EU trade agreements, where only those service sectors listed are subject to the rules and disciplines of the agreement. It is considered a particular threat to public services, as it may prove impossible to shield them from liberalisation effectively once they have been committed to an international trade treaty.

This means that any emergent sector in the future will automatically be subject to liberalisation even where there might be a clear need for Government intervention. We cannot predict what those will be prior to their emergence, but that is the very point of using a negative list—to reduce the capacity of the Government to regulate in the future. Collectively, these measures only benefit big businesses and curtail the rights of Governments to act in the best interests of their peoples. That is why there has been so much resistance and uproar from civil society organisations and trade unions alike.

It is ironic that, just as we are told we need to leave the EU to regain control of our laws and how they are interpreted in the courts, Parliament’s ability to legislate in the public interest is being curtailed by negative lists and regulatory chill and by the establishment of a supranational courts system where foreign businesses are given superior rights to our own domestic companies and can tell our Government what they can and cannot do if they are not to sue us for taking sensible public policy decisions to protect the public against new and emerging dangers.

Similar concerns extend to the labour rights provisions of CETA. One study forecast that 10,000 jobs could be lost as a direct consequence of CETA. The threat to European jobs—[Interruption.]

[Madam Deputy Speaker]

Order. I must insist that the hon. Gentleman be heard out. I am sure he will bring his remarks to a close in the next minute.

--- Later in debate ---

[Barry Gardiner]

The real abuse is the way the Secretary of State has ignored all the waivers he has been given by the European Scrutiny Committee and all the assurances he gave that he would try to secure this debate on the Floor of the House before it became meaningless. The real abuse is the way he has conducted this whole saga over the past two years.

A Labour Government would have demanded better protections for jobs and workers’ rights. The Government’s failure to seek protections for British workers is matched by their failure to seek protections for British businesses.

[Owen Smith]

Will my hon. Friend give way?

[Barry Gardiner]

I will give way to my hon. Friend.

[Owen Smith]

I am extremely grateful to my hon. Friend for giving way, and I am sure that the whole House is enjoying his exhaustive speech as much as me, particularly his looking through the parliamentary entrails of this issue. For clarity, is his position and that of our party now that we believe we could strike a better deal than the EU27 as a standalone nation after Brexit?

[Barry Gardiner]

Indeed I do. We actually said so in our manifesto. We made that clear in the manifesto that both my hon. Friend and I stood on and with which we went to the voters of this country, and he was elected on it just as I was. I propose to stand by it; I am not sure if he does.

For all these reasons, the Opposition cannot support the Government’s motion.

[Dr Fox]

On a point of order, Madam Deputy Speaker. I hesitate to raise this point of order, but in response—or non-response—to a series of interventions, the shadow Secretary of State promised the House that before he sat down he would make it clear whether he believed the Labour party would vote to ratify the agreement or lay a negative motion, which is procedurally very important under the CRAG procedure. Why did we not get an answer?

EU-Japan Economic Partnership Agreement

Barry Gardiner Excerpts

Tuesday 26th June 2018 Commons Chamber

[Barry Gardiner (Brent North) (Lab)]

I welcome the Minister for Trade Policy to his new post. I am delighted to have him opposite us at the Dispatch Box. I also pay tribute to the right hon. Member for Chelsea and Fulham (Greg Hands) for the work that he did in this Department. We had many voluble exchanges in Committee and on the Floor of the House and he always dealt with them with exceptional good humour. I am sure that he will return to the Front Bench at a later stage and I look forward to that.

I am grateful for the opportunity to speak in this debate to set out our position on the EU-Japan economic partnership agreement. The relationship with Japan is, as many have said, of enormous importance, and we on the Labour Benches want to ensure that our future co-operation boosts trade and jobs in both our economies.

Exports make up 30% of our national economic output, and we celebrate the jobs and the myriad other benefits that come from international trade. No country exemplifies the importance of foreign investment to our economy more than Japan. It is Japanese companies that have chosen to invest billions in the manufacturing capital of this country over many decades, and with that investment has come jobs—good jobs, skilled jobs. Some 3,800 are directly employed by Toyota, with 7,000 directly employed by Nissan, and 3,400 directly employed by Honda. We could double those figures when we factor in the indirect employment in the UK that comes from these companies—the manufacturers of parts that go into their supply chain and the logistics companies that ensure their just-in-time delivery systems.

I was at Honda a week ago last Friday speaking both with the unions and the management in Swindon. A new car rolls off its production line every 69 seconds, and its just-in-time supply chain is critical to that performance. That is why workers at that plant were telling me of their strong support for Labour’s position on a new customs union that would stop disruption to that supply chain and why they cannot understand the Government’s red line that there should be no such customs union after we leave the EU.

The Government have put our trading relationship with Japan under enormous strain because of their disorganised approach to Brexit. Companies such as Honda will speak for themselves, but many working there cannot understand why the Government are taking such a risk with their livelihoods. Japan is one of our key export partners. It accounted for £12.5 billion of our exports in 2016.

[John Spellar]

Before my hon. Friend moves on from his comments about Japanese companies in the UK, will he join me in commending the very long-term view that those Japanese companies take? They invest significantly not only in capital equipment, but in their staff and their continuous training programmes, all of which have been an example that, I am pleased to say, has now been followed by many British companies.

[Barry Gardiner]

Indeed. I absolutely agree with my right hon. Friend. The Japanese investment into our country over many, many years has been hugely beneficial not simply in creating those jobs, but in sustaining them into the future. We absolutely cannot afford the Government’s red line, which puts that in jeopardy.

As I was saying, Japan accounted for £12.5 billion of our exports in 2016—it was our fifth largest export market. A Labour Government would certainly want to do a trade deal that builds on the commercial and diplomatic ties that bind our two countries together. The Government have been forced into calling this debate by the European Scrutiny Committee, chaired by the hon. Member for Stone (Sir William Cash). The Committee rightly said that the agreement raised

“complex legal and policy issues for the UK”,

which remain unanswered.

[Kevin Hollinrake (Thirsk and Malton) (Con)]

On a point of clarification, I think that it is the official position of the hon. Gentleman’s party—I am not sure whether he is fully signed up to it—that it would remain part of the customs union after leaving the European Union, which would inhibit his chances of striking a free trade deal anywhere, as the EU would be required to negotiate that deal on his behalf. Bearing in mind his reservations about the EU-Canada comprehensive economic and trade agreement discussed in the previous debate, and his potential reservations in this debate, is he confident that the EU will negotiate those trade deals to his satisfaction?

[Barry Gardiner]

Clearly, while we remain a member of the EU, we have a seat at the negotiating table of any deals. If we are outside the EU, we will not have that, but, equally, we will not have the benefit of being part of a 500 million-strong consumer market that would enable us to negotiate better deals. I am sure that the hon. Gentleman appreciates that being in a new customs union with the EU, as the leader of my party set out in a speech he gave in Coventry a little while ago, would mean that we would be co-decision makers with the EU in that relationship—a customs union not such as the one we currently have with the EU, but one much more like Mercosur, where each of the countries has equal sway.

[Sir William Cash]

rose—

[Barry Gardiner]

I will make a little progress and then, of course, I will very happily give way to the hon. Gentleman, because his Committee has raised a number of questions on the EU-Japan deal that we need to explore further. The Committee insisted, in fact, that the Government bring the deal to a debate on the Floor of the House before the EU Council. Interestingly, in the light of the absurdly tight timeframe that the Government imposed on themselves, the Committee also instructed them to publish their impact assessment on the EU-Japan EPA no later than 4 June.

The first question that the Minister must answer then is why the Government failed to meet that deadline. The impact assessment was published a week late, on 11 June, on the same day that this debate was announced. It is an extraordinary document. Its own authors openly acknowledge that the assessment cannot be taken as an accurate guide to the future impacts of the agreement. It failed to calculate the specific effects on individual EU member states. The assessment admits that it cannot know what proportion of any aggregate gains from the EU-Japan EPA might come to the UK or to any other EU member state. There has been no proper independent assessment of the impacts on the UK, and the authors—these are the authors of the assessment—say that they have just had to assume proportionate outcomes in line with the UK’s projected share of EU trade with Japan.

[Sir William Cash]

I thought I might try to lift this enormous pile of documents to show the House what we are actually considering today; it is really quite formidable. I want to make one point regarding the single market. Does the hon. Gentleman deny that, in relation to our trade with the other 27 member states, we run a deficit of £82 billion a year—these are figures from the Office for National Statistics—whereas our external growth, our external surplus, is growing exponentially and, of course, 90% of all future trading will be outside the EU?

[Barry Gardiner]

I am grateful to the hon. Gentleman on two counts—first for showing us precisely what we are talking about. I know that he will have read the full EPA assessment, as I have done. I am equally grateful to him for raising the issue of the balance of trade surplus and deficit that we currently run. I am just about to come to that point, so I hope that he can hold off with his remarks.

It is perhaps most damning to quote from the impact assessment document itself, which states:

“Figures presented here reflect the long run impacts per annum and should be treated as a magnitude of change and not a forecast…It is important to note the results below are not based on the final EU-Japan EPA text and are therefore subject to a degree of uncertainty…Estimates are produced against a baseline of 2008 and reflect a world in which the Doha trade round and EU-Korea FTA are un-concluded.”

So there we have it. The baseline is 10 years out of date and fails to take account not only of the EU-South Korea FTA, which has been applied ever since July 2011 —seven years ago—but of the terms of the final agreement text that it is supposed to be assessing.

The European Scrutiny Committee was absolutely right to demand in its report

“a clear breakdown of how different UK sectors and stakeholders are expected to win or lose from the agreement.”

All the independent projections made of the EU-Japan deal calculated that the gains accruing to Japanese firms would be far higher than those seen by European businesses. All the forecasts spoke of major increases in Japanese exports, and the potential loss of jobs and businesses in Europe as a result. The Government assessment has at least picked up on these forecasts, recognising that the UK’s balance of trade with Japan will take a serious hit when this agreement comes into force. Voting to approve this motion will allow the Government to rush ahead and sign a deal that the Government’s own figures show will result in a decline in our trade balance with Japan of between £2.2 billion and £2.9 billion, so the hon. Member for Stone, who chairs the European Scrutiny Committee and asked for the impact assessment to be published, will now see that the effect of this deal is, in fact, to increase our problems in terms of our balance of payments with Japan.

[The Secretary of State for International Trade and President of the Board of Trade (Dr Liam Fox)]

I will try again. Am I now to assume that the official position of the Labour party is not to ratify the Japan EPA?

[Barry Gardiner]

Note how keen the Secretary of State is to deflect the House from the fact that his own impact assessment says that, in signing the deal, this country will be between £2.2 billion and £2.8 billion worse off.

[Dr Fox]

Surely the House has a right to know the position of the official Opposition. Do they or do they not agree with this House ratifying the agreement that we are discussing and scrutinising today?

[Barry Gardiner]

Yes; and, ultimately, if the Secretary of State is patient and listens, it will become clear—

[Dr Fox]

This is rubbish.

[Barry Gardiner]

Goodness me! The Secretary of State is getting really exercised from a sedentary position; he is starting to be abusive. Let us be clear what has aggravated him so much. It is that I have read his impact assessment, and his own assessment of this deal says that this country will be £2.2 billion to £2.8 billion worse off.

[Several hon. Members rose—]

[Barry Gardiner]

I will make a little progress, Madam Deputy Speaker, because I know that you want to encourage other Members to speak.

The automotive industry offers the clearest indication of the issues posed by the EU’s deal with Japan. The EU-Japan EPA will, for example, remove the 10% tariff that currently applies to all car imports into the UK from Japan, which will—again, according to the Government’s figures—result in a £2.8 billion surge in Japanese car imports into the UK. That will have significant implications for the future viability of our domestic automotive sector and the thousands of jobs attached to it. But this is precisely where the Government’s assessment is so hopelessly unsatisfactory. It fails to ask the real questions as to what the long-term impacts on the UK car industry might be when we remove the existing 10% tariffs on Japanese car imports. This question is clearly of the utmost importance when it comes to safeguarding jobs in the UK auto industry, as there will no longer be a trade incentive to maintain Japanese investment in precisely the way in which my hon. Friends the Members for Newcastle upon Tyne North (Catherine McKinnell) and for Crewe and Nantwich (Laura Smith) mentioned earlier.

[Mr Chris Leslie (Nottingham East) (Lab/Co-op)]

I wonder whether my hon. Friend could help me out, because the Opposition are very keen to get to the denouement of this particular question. It feels to me as though he is raising some issues of concern. But, by and large, this is quite a positive deal for the UK, the EU and Japan. Is he saying that we should oppose the motion before the House?

[Barry Gardiner]

I am astonished. I should have thought that each week my hon. Friend reads—just as I do—the Whip that comes out from our Whips Office, so he will know perfectly well which way we will be voting. [Interruption.] No, and Government Members will get to find out in due course.

[Mr Leslie]

On a point of order, Madam Deputy Speaker.

--- Later in debate ---

[Madam Deputy Speaker]

That is a point of debate. I want the debate to move on because a lot of Members wish to speak.

[Barry Gardiner]

The Government have not published any serious analysis as to the potential outcomes of the EU-Japan EPA on the car industry beyond the basic econometric analysis in their impact assessment. It cannot be right to allow the Government to proceed with fast-tracking approval of this trade deal when we have not had answers to the critical questions posed by the hon. Member for Stone and his Committee, based on a proper analysis of what the likely impacts might be.

[Craig Mackinlay (South Thanet) (Con)]

Will the hon. Gentleman give way?

--- Later in debate ---

[Barry Gardiner]

I will not, because Madam Deputy Speaker wants me to press on to allow hon. Members to make their own contributions.

The car industry is far from the only sector involved in what is a comprehensive trade deal. Food and drink producers are also implicated, not least as regards the protection provided in the agreement for products with specific geographical indications. Once again, the Government have failed to defend the interests of British producers on overseas markets. France, Spain and Italy have each listed dozens of their national products for special protection in annex 14-B of the deal and Japan has listed 48 of its products for protection, yet the UK Government could only be bothered to list four products under the geographical indications provisions of the deal—Scottish farmed salmon, west country farmhouse cheddar, Stilton and Scotch whisky.

[Geraint Davies]

What about Welsh lamb?

[Barry Gardiner]

Indeed. As my hon. Friend says, what about Welsh lamb? What about Scotch beef, Dorset blue, Yorkshire Wensleydale, Cumberland sausage and Melton Mowbray pork pies? Can the Minister explain why we failed to register geographical indications to protect more of our UK food produce?

The European Scrutiny Committee raised many further crucial issues relating to the deal that remain unanswered. Under the negative list approach, all service sectors that are not explicitly exempted from liberalisation are included. It is considered to be a particular threat to public services, as it may prove impossible to shield them from liberalisation effectively once they have been committed to an international trade treaty. It means that any emergent sector in the future will be automatically subject to trade liberalisation even where there may be a clear need for Government regulation or intervention. We cannot possibly predict what those will be prior to their emergence, but what is the point of using such “negative lists” to reduce the capacity of the Government to regulate in the future?

Annex 1 allows countries to list existing non-conforming measures that enjoy some protection. Annex 2 is a stronger protection, in that it permits countries to protect service sectors into the future by allowing for the introduction of reforms that would otherwise contravene the EPA rules. As the Minister said, the UK has entered annex 2 reservations for cross-border auditing services, manpower planning for doctors in the NHS, privately funded ambulance services, and residential health facilities services other than hospital services. I repeat: other than hospital services. In other words, they are, and will forever remain in future, subject to liberalisation and competition under this agreement, in contradistinction to the implication that we heard earlier. I therefore repeat the Committee’s question: will the Minister confirm whether he is content with the proposed provisions enabling Governments to regulate in the public sector?

Do the Government intend to negotiate the UK’s future trade partnership and its future investment relationship with Japan at the same time, as one agreement—another question posed by the hon. Member for Stone and by my hon. Friend the Member for Crewe and Nantwich—or will the separate EU-only trade agreement constrain the UK’s ability to negotiate and conclude an integrated trade and investment agreement? The House will be rightly concerned that the Government have simultaneously inserted into the Trade Bill sweeping Henry VIII powers to implement such a future trade agreement without any proper scrutiny or oversight. Will the Minister confirm that no such investment chapters will be included in any future trade agreement with Japan?

Let me be clear: Labour would like to see a trade agreement with Japan. We have an incredibly strong trade and investment relationship between our two countries, and we believe that we can continue to build on that. We want a positive, dynamic relationship that elevates standards, boosts opportunities to benefit from advances in technology and research and development, and continues to support growth and investment in our high-tech manufacturing sectors and world-class services sector. But we cannot be expected to rely on this Government’s quiet promises alone, and it is imperative that Parliament has the proper opportunity to scrutinise and debate these trade agreements well in advance of their being signed.

It is worth noting that this deal has yet even to go through the full scrutiny process in the EU, with INTA—the Committee on International Trade—not scheduled to hold a public inquiry until 9 and 10 July and the European Parliament scheduled to vote on whether to give consent to the agreement in December. If the motion before us is voted through, it will allow Ministers to endorse the agreement without proper scrutiny by the House, and even before the full scrutiny process of the European Union has been properly applied. That sets a dangerous precedent for future trade agreements and makes a mockery of the idea that any future trade agreements to which the Trade Bill applies will have received proper scrutiny by this House.

[Several hon. Members rose—]