Australia and New Zealand Trade Deals

Ben Lake Excerpts

Monday 14th November 2022 Commons Chamber

[Greg Hands]

I disagree with that. I am just checking my records and I have had extensive interactions with representatives of NFU Cymru during the negotiation process. I met them on 19 May 2021—I met the Farmers Union of Wales on 19 May as well—and on 26 May, 16 June and 13 September. It was important for us to get the confidence of the farming community in Wales and I also did various Zoom calls at the time—this was during one of the lockdowns—with MPs and their constituent farmers. The protections we have in the deal are very considerable. For example, the tariff rate quotas carry on for 10 years in some cases, and there are product-specific measures to protect sensitive agriculture produce from years 10 to 15 as well as bilateral safeguard mechanisms. There are a lot of protections there.

[Ben Lake (Ceredigion) (PC)]

Will the Minister give way?

[Greg Hands]

I will give way in just a moment, but perhaps the hon. Gentleman will explain what his position might be and whether his party will ever support a single trade deal that has been proposed either by the European Union or by the UK Government. Will he tell us that?

--- Later in debate ---

[Ben Lake]

It is not often that I get the opportunity to do so, and I am happy to say that when there is a good trade deal for Welsh farmers, I will be very happy to support it. Further to the Minister’s point about NFU Cymru, that union and the Farmers Union of Wales have both expressed concerns about the cumulative impact of the various trade deals. Has that featured in any assessments the Department has made, and if so, can he share with us what he makes of Welsh farmers’ concerns about this cumulative impact?

[Greg Hands]

I welcome the hon. Gentleman’s support for trade deals and I look forward to him voting for one of them one day. In terms of the impact on Welsh farmers, I must point out some of the market access that we have recently gained—for example, Welsh lamb is now able to enter the US market for the first time in many decades due to the United States removing the small ruminants rule, and I was in Taiwan only last week are trying to negotiate access for Welsh lamb to the Taiwan market. When it comes to accumulation, he ought to think about the fact that there is tariff-free, quota-free access for the European Union for the UK at the moment. That has been the case from day one of the trade and co-operation agreement.

Dolphin and Whale Hunting: Faroe Islands

Ben Lake Excerpts

Monday 11th July 2022 Westminster Hall

[Kerry McCarthy]

I agree with the hon. Lady. I have seen this so often. I remember sitting in a meeting with a Trade Minister—this goes back some time, because I have been around for quite a bit. When I spoke about human rights in China—I was shadowing the human rights Minister in the Foreign Office team—I was told that trade is a separate matter. I was told, “Human rights is dealt with by the Foreign Office. We are here to talk about trade and to get deals done.” That is entirely wrong. I could mention all sorts of examples that we should not accept of a lowering standards or of human rights abuses in other countries. We should use trade negotiations to set a clear marker on our standards and the standards we are prepared to accept from other countries.

The Government said in February that the UK

“continues to call on all whaling nations, including the Faroe Islands, at every appropriate opportunity to cease their whaling activities”.

I do not understand why the trade negotiations that took place in early 2019 were not an “appropriate opportunity”. What counts as an appropriate opportunity? Perhaps the Minister can tell us what discussions were had back then.

[Ben Lake (Ceredigion) (PC)]

The hon. Lady is making a powerful speech. Does she share my concern that, in addition to the cruelty and barbarity of such spectacles, there is—according to our research briefings—no real idea of the number of whales left in the ocean surrounding the Faroe Islands? Indeed, the last assessment was conducted way back in 1997. Are arguments about the Grind being sustainable not completely undermined by that very omission?

[Kerry McCarthy]

Yes, they are. We should protect and preserve the ocean, not plunder it; what is in the ocean is certainly not there for the sake of such horrific pastimes. There is a conservation issue, and that is one reason why successive Governments have taken such a firm stance against whaling.

Some people would try to defend whaling as a traditional activity, but a snap poll of Faroe Islanders, conducted following the infamous 12 September Grind, found that over 50% of respondents were in favour of halting dolphin hunting. Save the Reef reported that fewer than 20% of Faroe Islanders consumed any pilot whale meat or blubber at all. Yet that meat was the reason for the derogation; it was said that it was needed for the local food supply. We know that that is nonsense if we look at the numbers of whales and dolphins that have been killed. As has been mentioned, a record 1,428 dolphins were slaughtered in the 12 September hunt last year—the single largest killing event in the islands’ history. It is clear that that was for no other reason than for pleasure and the spectacle—it was nothing to do with food.

It is important to recognise cultural traditions, and the role they play in binding communities together and sustaining age-old customs. However, we have a responsibility to evolve, as we have seen in this country with the discussions about fox hunting and in Spain with the discussions about bullfighting. There are many practices that would once have been deemed acceptable but that no longer are.

[Ben Lake]

On that point, does the hon. Lady agree that arguments in favour of the practice continuing on the basis of cultural heritage would be far more powerful if hunts were conducted, as they used to be back in the 15th century, using wooden rowing boats and rocks, rather than modern machinery? To my mind, the idea that this pines back to cultural heritage is somewhat hollow, given that they are not conducted in the way they were in the 15th century.

[Kerry McCarthy]

I am not sure I would advocate throwing rocks at whales and dolphins—although I suppose there is a good chance they would miss, so it has to be better than the way things are done now. I take the hon. Gentleman’s point: this has evolved into something way beyond the traditional practice.

Whale and Dolphin Conservation, which I have worked alongside in the past, described pilot whales as very sociable and incredibly loyal, with an inquisitive nature. They are highly intelligent social mammals. Humans have taken advantage of that social nature by subjecting pods to incredibly stressful hour-long hunts that culminate in whales watching their kin being killed in front of them and bleeding to death. There is no regulation or oversight; killings can be indiscriminate and methods are unchecked. It is not always apparent that a spinal lance has been used to administer a quick death, and there are frequent reports of knives being used to hack away at the meat. We have heard some of that before.

This practice falls well below anything that the UK would accept, but the fact is that we are tacitly accepting it, although I know the Minister will try to assure me that we are not. We are endorsing these methods by virtue of the fact that we are signing a trade deal with the country that carries them out. It will be the people and the Government of the Faroe Islands who ultimately determine if and when the slaughter ends. However, we have an opportunity to play our part and to end our complicity by suspending the free trade agreement. I hope that the Minister, who I need to welcome to his place—it is so confusing at the moment, because we have no idea who may turn up—will get off to a flying start by telling us all exactly what we want to hear.

Free Trade Agreement: New Zealand

Ben Lake Excerpts

Thursday 21st October 2021 Commons Chamber

[Madam Deputy Speaker (Dame Rosie Winterton)]

Final question—Ben Lake.

[Ben Lake (Ceredigion) (PC)]

Diolch, Madam Deputy Speaker. I am sure that the Secretary of State will be aware of similar concerns expressed by the agricultural unions in Wales overnight and this morning in the light of the agreement in principle. Given that the Government’s own analysis suggests that the number of people working in agriculture may be negatively impacted by this deal, I think those concerns are well founded. May I ask her, quite simply: how will Ceredigion farmers benefit from this deal?

[Anne-Marie Trevelyan]

Farmers will have the opportunity to reach out and share their wares more widely; that continues to be the case. I continue to proffer reassurance that New Zealand already has an enormous WTO quota, which it does not use with the UK because it exports a lot of its sheepmeat to Asian markets. Indeed, much of the EU imports that come into the UK are balanced easily by the fantastic British produce that comes from our Northumbrian and Welsh farmers—and, indeed, any other of our farmers, but we have a very strong voice for those two farming communities in particular. I reassure hon. Members that giving our farmers opportunities to reach out and build new relationships and new trading routes is our great passion, and we will continue to do that in the Department.

Free Trade Agreement Negotiations: Australia

Ben Lake Excerpts

Thursday 17th June 2021 Commons Chamber

[Ben Lake (Ceredigion) (PC) [V]]

The Secretary of State makes much of the so-called transition period secured for farmers, but information on the Australian Government website suggests that the tariff-rate quota for Australian beef will increase nearly tenfold immediately, and that the deal will see the quota for Australian lamb nearly doubled in the first year. If she is serious about wanting farmers to compete and succeed, why, at the very first attempt, has she conceded to such a drastic and immediate increase in tariff-rate quotas that imperils the future of Welsh agriculture before domestic post-EU agricultural policies are even in place?

[Elizabeth Truss]

The fact is that there is very little Australian beef imported at the moment. What makes much more sense is to compare the amount in year one, 35,000 tonnes, with the amount that we currently import from the EU, which is 230,000 tonnes of beef. I do not remember the hon. Gentleman complaining when we agreed a tariff-free, quota-free deal with the EU, which is exporting far more beef and lamb than under our agreement with Australia. In fact, the likelihood is that, over time, some of those Australian exports will simply replace exports from the EU.

Trade Bill

Ben Lake Excerpts

Report stage & 3rd reading & 3rd reading: House of Commons & Report stage: House of Commons
Monday 20th July 2020 Commons Chamber

[Craig Williams]

I have won the argument on chlorinated chicken and we have moved on to another product. I say to the hon. Lady that working with the Government, as I am with the Secretaries of State for both DEFRA and International Trade, on traceability, accountability and labelling, is the right thing to be doing—not making cheap political points in what is one of the most essential debates and Bills for this country right now.

I was trying to get to a point about the scrutiny in this place. As a member of the International Trade Committee, I commend our illustrious SNP Chair, who has brought real teeth and scrutiny to the process. The willingness of the Secretary of State and our negotiators to brief the Committee in private session has been extremely welcome.

The fact is that we have the CRAG procedure, which has been talked about at length—I see some Members starting to smile on the Opposition Benches. It would be an Opposition who really could not use the process to full advantage who could not bring a vote against any kind of trade deal that came forward. For anything to be able to be snuck through, there would have to be a complete dereliction of the Opposition’s duties—never mind the Back Benchers on the Government side, who will hold our Government to account, as is our job.

Having spoken to the Minister on the Treasury Bench at length on these issues, I feel safe in the knowledge that the trade deals that we are doing will be welcomed in my farming and agricultural community. The deals will open up not just markets that that community wants, such as lamb to the United States of America—the second largest importer of that meat in the world. They are already opening up the beef market, which has been lying dormant for so many decades and they will enable the import of products of a reasonable standard. Consumers in my constituency and across the United Kingdom can take huge comfort from the import bans in place in the law, which will not be removed.

I know that there is a time limit and that other Members want to speak. I commend the Treasury Bench for their engagement with our farming community, with me and with the International Trade Committee. I commend the Bill unamended.

[Ben Lake (Ceredigion) (PC)]

It is a pleasure to follow my constituency neighbour, the hon. Member for Montgomeryshire (Craig Williams). I begin on a point of consensus, for I fear that we might diverge a little as I proceed.

I am sure that the hon. Gentleman will agree with me that trade is an important part of the Welsh economy. It was worth £17.5 billion in 2019 alone. While the Government pursue trade deals across the world to explore new opportunities, the hon. Gentleman will also agree with me, I think, that they should not squander the opportunities on our doorstep. Although Wales is a proud global partner, we cannot escape the fact that at present more than 60% of Welsh exports are destined for our friends—and, hopefully, our continued close trading partners—in the European Union. I hope that negotiations with the EU will conclude without there being new barriers to that trade or additional costs for our businesses.

I am certain, however, that the UK’s approach to trade with other members of the global community must champion the interests of each of the UK nations—an objective far more likely to be realised successfully if all four Governments of the UK play a role in formulating trade mandates and scrutinising negotiations as well as ratifying agreements.

I commend the remarks of the hon. Member for Dundee East (Stewart Hosie), who eloquently detailed the Bill’s deficiencies in this regard; I add only that the Government should guarantee the democratic rights of the devolved Administrations in the Bill as well as offering legal protections to our public services and strengthening some of the safeguards when it comes to parliamentary scrutiny of standards.

Unfortunately, as it stands, the Bill in my opinion denies the role that the Welsh Parliament has in articulating Wales’s interests. That is why Plaid Cymru has tabled new clause 18, to ensure that all four nations must consent to any trade deal struck in their name. We will also be supporting new clause 4, in addition to the amendments tabled by the hon. Member for Dundee East, which would ensure not only that that deficiency is addressed, but that UK parliamentary oversight is strengthened.

US Tariffs: Scotch Whisky

Ben Lake Excerpts

Monday 7th October 2019 Commons Chamber

[Conor Burns]

As I have indicated on a couple of occasions, the Government think that the way to move forward is to ask our friends and allies in the United States not to implement these tariffs within the timeline that they are proposing, to work with the EU and the other countries within it which are affected by the Airbus-Boeing dispute and are therefore subject to these tariffs, to secure a judgment from the WTO that confirms that we are now compliant, and to talk to the United States about how we can withdraw the tariffs and allow a sector that is vital to us and to the United States to proceed unimpeded.

[Ben Lake (Ceredigion) (PC)]

This announcement has put the hard reality of trade disputes into sharp relief, but may I ask the Minister whether the tariff also applies to Welsh single malt whisky, such as that produced by Dà Mhìle Distillery in my constituency? In the harmonised tariff schedule published by the United States Government, the relevant subheading and description refer only to Irish and Scotch whisky.

[Conor Burns]

My understanding is that that applies to the whole United Kingdom, but I shall be happy to check and to write to the hon. Gentleman tomorrow.

International Education Strategy

Ben Lake Excerpts

Wednesday 22nd May 2019 Westminster Hall

[The Parliamentary Under-Secretary of State for International Trade (Graham Stuart)]

It is a pleasure to take part in this debate. We have had well-informed contributions from across the House. I thank the hon. Member for West Bromwich West (Mr Bailey) for raising this important topic. When he chaired the Business, Innovation and Skills Committee and dealt with higher education, I chaired the Education Committee, and we worked in tandem.

As everyone has said, the UK has a wonderful education system. Despite its size, four of the world’s top 10 universities, and 18 out of the top 100, are here. We lead Europe in having the most highly rated universities. With early years, further education, our independent schools, our curriculum and syllabus providers, and so many assessment systems, we have a rich compost of educational provision in this country. It brings in £20 billion a year—significantly more than all sorts of large industries that we might think do a great deal more than education. It brings in real money, as has been said, and provides employment, often outside the areas we might expect. It provides well-paid jobs and opportunities in some of the more challenging parts of the UK, bringing expertise and people with certain skillsets to areas where they are most needed. It builds friendships around the world. As the investment Minister, I can say that it is extraordinary how often people choose to invest in this country because they or their family members have been educated here. That is an important part of our offer.

[Ben Lake (Ceredigion) (PC)]

We have heard about the benefits that international students bring to the UK, and about the reputational risk of malign visa arrangements, but it is important to reflect, as the Minister just mentioned, on the fact that the economic impact of international students ripples out far beyond the locations of the particular universities. We know about the effect of universities such as Aberystwyth in my constituency, but a 2017 report showed that, in Wales, the impact of international students alone sustained more than 1,600 jobs in regions where there is not a university. That is an important point to bear in mind when we look at immigration policy.

[Graham Stuart]

I am grateful for that contribution.

Most countries on Earth—some 160—use UK international qualifications in their national secondary exams. Thousands of international schools use the UK’s K12 curriculum, and almost 25,000 students attend more than 40 overseas UK schools. As I have said, the latest figures show that our exports are worth almost £20 billion. That includes transnational education, which has experienced the most meteoric rise in value, albeit from a lower base. Some 67% of the value of those exports comes from higher education, much of it in the form of international students—that has mostly dominated the debate this afternoon—of whom there were around 442,000 in 2016.

That is a great record. We punch above our weight, but I think that there is unanimity in the Chamber that we are not yet fulfilling our potential, considering the quality of what we have and the need around the world for that kind of quality and service. Frankly, that is why we have a refreshed international education strategy.

Perhaps because of my background, I find that education is one of the most interesting sectors that I deal with as a trade Minister. Education gives almost no negatives. It brings real money and builds links, and people who come here to study then form part of teams or found companies and innovate, when they might not otherwise have done so. We must be restless, forward looking and ambitious—as everyone in this Chamber has been—to ensure that the potential of emerging opportunities in the global economy are used to their fullest.

The rapid shifts in economic and demographic power across the global economy are creating opportunities in precisely the areas where the UK enjoys a competitive advantage. As my hon. Friend the Member for Henley (John Howell) knows well, last year the Prime Minister set out an ambition that we should seek to become the largest G7 investor in Africa. We need to work with countries, such as Nigeria, across Africa—I just met an economic Minister from Tunisia—to bring companies of all sorts into Africa, and what better than companies that work in education?

We look to deliver through the strategy in several ways. The strategy recognises that it is not Government who export, but our educational providers and institutions. That is why it is a sector-led strategy. I am grateful to all colleagues across the House, whatever their criticisms of elements of Government strategy, for supporting this strategy, which has been well supported and much crafted by the sector. The sector-led strategy was developed in co-operation with educators and looks to address the practical barriers that they face to exporting, and to find the right tools to overcome them.

Yesterday, I met Destination for Education, which is a coalition of pathway providers—people who help others come into our system—including INTO, Kaplan and Study Group. We discussed their future engagement with Government and, in particular, how we can co-operate on changes to the student visa process and respond effectively to competition from rival markets, which so many hon. Members have mentioned. That is about Government listening to the needs of providers and adapting our approach as we go. Several key organisations and individuals have been involved in achieving that new level of engagement and dialogue.

If I may—without being invidious to some—I highlight the work of Universities UK International, the UK skills partnership, English UK and, in particular, the British Council and its chief executive Sir Ciarán Devane, for their invaluable help in setting up engagement sessions to allow us to take on board the views of a broad range of education providers. Those providers have a wide range of skills and experience when it comes to exporting, and the strategy is about catering to these diverse needs.

Oral Answers to Questions

Ben Lake Excerpts

Thursday 25th April 2019 Commons Chamber

[Graham Stuart]

We will take every opportunity to support UK steel exports, and of course exports in general, which is why we produced our export strategy last year. With the help of Members such as my hon. Friend, we will champion local businesses and ensure that that message goes right around the world.

[Ben Lake (Ceredigion) (PC)]

The Canadian model offers a useful example of how the devolved Administrations should be involved in trade policy formulation. Does the Secretary of State agree that a substantive role in the strategic trade advisory group is essential for the meaningful involvement of the Welsh Government in UK trade policy?

[The Minister for Trade Policy (George Hollingbery)]

The strategic trade advisory group is there to provide a broad societal view of what should be achieved in free trade agreements. We are of course talking in depth with the Welsh Government about their views on what we ought and ought not to be doing on trade policy, the industries we should be championing and how. I do not think that the strategic trade advisory group is the right place for that engagement, but there is of course a Welsh business represented on the group.

Future Free Trade Agreements

Ben Lake Excerpts

Thursday 21st February 2019 Commons Chamber

[Stewart Hosie]

I do. It was interesting to listen to what the Secretary of State said earlier. He laid out very clearly, to be fair, the component parts of the NHS that were to be protected. I listened very carefully, but let me give an example of something that was not included: cleaning. People might say, “Big deal,” but in Scotland, when cleaning was contracted to the private sector, hospital-acquired infection rates went up. We then took a decision to bring back NHS cleaners, and hospital-acquired infection rates came down. Had that contract been won under the terms of one of these agreements, we could have been sued and challenged if we had tried to take a public health measure to return something as simple as cleaning from the private sector to the public sector. When it is considered on terms that people can understand—my hon. Friend is absolutely right to raise this point—it demonstrates how, and I will give a few more examples later, public health concerns can be overridden by some of the provisions in these international trade deals.

I look at trade and the proposed deals that we are discussing today through four prisms: how they will affect the success of Scotland’s export businesses; how they will support the Scottish Government’s trade and investment strategy; by asking if the processes suggested ensure that there is proper scrutiny of trade deals; and the attitude towards investor-state dispute settlement arrangements, which can give foreign companies special legal rights outwith our national legal systems. I think it is right that we look at trade through these four prisms.

Scotland’s exporting businesses—it is businesses, not Governments, that export—have done a remarkable job. Last year—I use these figures because they were immediately to hand—Scotland’s exports rose to £29 billion. That was 12% up on the previous year, the largest rise in any part of the UK. With imports at £24 billion, Scotland is a net exporter, which is a fantastic position for the economy to be in—a position that we should strive to retain but one which is put in jeopardy not just by a hard Tory no-deal Brexit, but by any form of Brexit, and that is the point. We hear about the Prime Minister’s deal, but that is only the transitional arrangement. It is not the deal we will have to cut to kick in in 20 months’ time, at the end of the transitional period; that is the bit the Government always seem to ignore.

I said it is businesses that export, not Government, and that is true, but Governments do and must support exporting companies. The Scottish Government’s trade and investment strategy is first class. It brings together trade, investment and the internationalisation of our economy. It defines our ambition and the importance of the “One Scotland” approach. It links to Scotland’s innovation and investment hubs. It tells us what our global opportunities are, and it supports global Scotland and our approach to boosting export performance. Anything the UK Government do should support that.

Although we can and do support trade, we do not negotiate our own deals or have a seat at the top table in the EU, which strikes the best trade deals currently. Until we do—this relates directly to any new deal—we demand a formal, statutory input to trade deals, including the ones being discussed today, at every stage of every trade deal, from setting the mandate for negotiations right through to implementation.

[Ben Lake (Ceredigion) (PC)]

My hon. Friend is making an important point about how Parliaments across the United Kingdom should have a thorough input to trade negotiations, including the mandate. The Welsh Affairs Committee received evidence from representatives from Canada, who engage thoroughly with the devolved legislatures in that country, as well as with businesses, before even coming up with the mandate for negotiations.

[Stewart Hosie]

That demonstrates that it can be done and there is nothing to be afraid of. It is vital so that Scotland’s national interests, as well as those of Wales and Northern Ireland—all the devolved nations—are given equal weight to the needs and ambitions of exporting companies in London and the south-east.

--- Later in debate ---

[Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)]

Thank you, Mr Deputy Speaker. I will take cognisance of the fact that I started at 2.7 pm and will look to not to be too long. I want to thank the hon. Member for Brent North (Barry Gardiner), who reminded me as he was speaking that I had not arranged for somebody to feed my sheep this morning. My 81-year-old neighbour Iain MacLean stepped into the breach quite admirably, but only because I was reminded by the hon. Gentleman.

I was talking earlier about how citrus fruit may not be an offensive trade interest, but I have just heard that the weather today in Aboyne, Lossiemouth and Altnaharra in the highlands of Scotland is about 17° C or 18° C. It is a summer’s day in Scotland, so anybody watching who is looking to have a decent half-term break should head to Scotland and forget about going anywhere else. It seems to be the place to go for the temperatures. I note that the Conservative Benches are empty, but perhaps they are in Val d’Isère taking advantage of free movement while it still exists. This may be the Brexiteers’ last holiday.

I also thank the hon. Member for Brent North for his frank honesty. I was talking earlier about damage to GDP and gains through the trade agreements. Of course, a no-deal Brexit and crashing out would, according to the UK Government, damage UK GDP by 8%. Now, the gain in GDP would be about 0.2% from a USA-style trade agreement, but that would mean we would need 40 USA-style trade agreements to make up the gap. There is only one problem. The USA accounts for over a quarter of the world’s GDP, so needing 40 USAs means that we will have to find 10 planets of people as wealthy as Americans in 2019—not 1919 or 1819, but as wealthy as they are today.

If there is an FTA, which is the route the Government want to take after kicking the can down the road for another 21 months of European Union membership—putting the pain off for another wee while—there would be a 6% hit to GDP. We would then need 30 USA-style agreements, or seven and a half planets.

If we follow Labour’s policy of a customs union only—I pay tribute to the honesty and candour with which the hon. Gentleman admitted this—there would be a 4% hit to GDP, requiring 20 USA-style agreements, or five planets, to make up for the lost GDP caused by ripping up our current deal with the European Union.

It is important to bear that in mind. It is nice to talk about flashy new trade agreements and trade policies but, in actual fact, trade is what drives all this. As I said to the Secretary of State, people who are selling shellfish or frozen fish, as people I know in the north-west of Scotland are, will not be able to do their rotations to Europe because of the barriers and all the paperwork listed by the hon. Member for Yeovil (Mr Fysh), and they cannot exactly drive their lorry on a rotation to New Zealand, South America, Chile or wherever else in the CPTPP, or wherever else we might find ourselves having an accidental trade agreement.

As Chair of the International Trade Committee, I welcome this opportunity to debate these potential free trade agreements with the United States, Australia and New Zealand, and to debate possible UK accession to CPTPP. The Government initiated consultations on these potential trade agreements last summer and, despite having closed four months ago, we have yet to see the Government’s response, which would have helped to inform this debate. The Government received a vast number of responses to the consultations, but I understand that many of those 600,000 responses were duplicates. I hope we will see the responses soon.

The Committee recently went to the World Trade Organisation in Geneva, where there is much bemusement as to what the UK is doing. Trading on WTO terms is the most expensive form of trade, and the deputy director general of the WTO, Alan Wolff, said that if we trade on WTO terms, or something close to it, rather than the open single market we currently have, a “Brexit gap” in economic performance would damage our GDP. That is a good way of seeing it, because we are talking about a 4%, 6% or 8% Brexit gap in our economic performance.

It is good that we are having this debate, because the Committee published a report in December titled, “UK trade policy transparency and scrutiny,” which made a host of recommendations on Parliament’s role in future free trade agreements. One recommendation is that Parliament should have an opportunity to debate the Government’s negotiating mandate, or “outline approach” to use the terminology that the Department for International Trade favours, on a substantive motion before negotiations begin on the free trade agreements. I think negotiators would find it useful to have such a steer on the will of Parliament as to what they should progress in any negotiation.

An example of how not to do it is the Prime Minister’s approach to her international agreement with 27 other actors under one umbrella, the European Union. She came back to Parliament and found herself with a whole range of people, from Yeovil to the north of Scotland, ranged against her for various reasons. Had she tried to carry Parliament with her from the beginning, she might have found herself in a different position. We should be adopting such an approach to future trade agreements. Governments come and Governments go, and an awful lot of work might be done before being stopped and wasted. The resource of trade negotiators is few and far between, and they take a long time, so we do not want to negotiate something for three or four years and then find ourselves having to scrap it—assuming we Scots are still here, because independence may well be around the corner for us.

My Committee also recommended that devolved Governments should be consulted on this, as Canada and other countries tend to do. We have to make sure that we have as big a buy-in as possible. As we are seeing with Honda and Japan at the moment, there can be winners and losers in these agreements. As I said to the hon. Member for Brent North, the automotive sector in the midlands of England has perhaps lost out in the EU-Japan agreement.

If there are to be losers, how do we compensate them? If the UK enters a free trade agreement that, say, benefits the south-east of England and destroys, for instance, Welsh lamb, is there any idea of fiscal transfer or compensation for the sacrifice of the Welsh for the south-east of England? Do not think these are esoteric, way-out-there possibilities, because the air agreements that the UK entered into after 1945 specifically mentioned international flights only flying into London airports, which damaged the north of England, Wales, western England, central Scotland, northern Scotland and many other places. Iceland, for obvious reasons of its geography, was one of the first to break that. Having created the advantage of a transport hub in the south-east of England, there was a huge reluctance to cough up for the sacrifice imposed on others.

There are trade-offs in the decisions and directions that Governments take. Interestingly, of course, the Irish Government were quite different during that period. Rather than centralising around Dublin, they actively promoted the west, which is why Shannon airport is still the destination it is, and Knock airport in the north-west has also benefited.

The Committee feels that the Government should publish a trade policy strategy that articulates a vision for the UK as an independent trading nation—if all those things come into being—and outlines the UK’s immediate and future trade priorities at bilateral, plurilateral and multilateral levels. We propose that such a strategy should outline the UK’s key objectives, interests and priorities in respect of its trade policy. Sadly, we have yet to see such a strategy, so I urge the Government to publish one, as it would allow potential new FTAs, such as the ones we are debating today, to be seen in a wider context.

The UK has been spoken of as being a dwarf in comparison with the US, and the Secretary of State robustly jumped to the Dispatch Box to say that the UK is absolutely not a dwarf compared with the United States and that it is the fifth largest economy. When we actually look at it, the United States makes up about 28% of global GDP—about a quarter, as I said earlier—and the United Kingdom is about 2.3% of global GDP, so it is about a twelfth of America. If I came across somebody 12 times taller than me, I might feel rather dwarfish. We might find that the muscle that can be applied in trade negotiations by a grouping 12 times larger than us is somewhat more substantial than what we bring to the table ourselves.

[Ben Lake]

The hon. Gentleman makes an important point about how many other nations will look at the market size of the UK and will perhaps consider that they do not want to concede in the same way in these negotiations as they perhaps would have if we were still a member of the European Union. Perhaps that goes some way towards explaining some of the difficulties that the UK Government are having in trying to sign off on some of these roll-over agreements.

[Angus Brendan MacNeil]

The hon. Gentleman makes an interesting point. There are 40 such agreements with about 70 countries, and the UK’s hope is that we can stand on the shoulders of the European Union and roll over that work, which of course relies on 70 other countries not seeing a possible advantage in getting better trading terms, as a number of them certainly do. A negotiator who wants to be promoted within their trade negotiating structure will, when the UK appears over the horizon with probably not the most experienced negotiators—they certainly will not have the same track record on international negotiations—see too great an opportunity to resist.

Interestingly, I note that the countries that have concluded the much-trumpeted trade agreements are ones with a tremendous balance of exports in their favour. Chile’s is about £150 million to £200 million in its favour, but the outstanding winner here has to be the Faroe Islands; I like to blow the Faroes’s trumpet as chair of the all-party group on the Faroe Islands, but my goodness! It exports £229 million-worth into the UK while importing only £16 million-worth back. So not only have the Faroes got themselves up the scales of acknowledgement, but they have done themselves a fantastic piece of business by rolling over what was already a very advantageous trade agreement. So well done the Faroe Islands, and I hope the welcome in Tórshavn will be as good as it always is.

Let me now look at UK-US trade relations. When we went to the US the farm lobby asked, “Why folks? Why have you done this?” They were just bemused. Ford said that for it, “The UK-US is incremental, but the UK-EU is existential, particularly the interplay with the UK-EU and Turkey. The tariffs that could be accumulated in that direction could be problematic.”

The International Trade Committee’s key recommendation was that

“the Government should undertake detailed work modelling the potential effects of a UK-US agreement on the economy.”

Evidence to the inquiry regarding the impact on GDP varied, but it was about 0.2%. We also have to make decisions about whether we have some increase in regulatory barriers with the EU in exchange for the removal of barriers with the US, and what the overall benefit of that is. As someone who keeps a few sheep, as I mentioned to the hon. Member for Mole Valley (Sir Paul Beresford), I can see a huge problem if we find ourselves putting up barriers to the EU to please some Americans and the American Administration in order to wave a piece of paper and say, “Trade agreements in our time.” That huge danger presents itself to a UK Government who might rush into trade agreements for the sake of it.

Trade Policy

Ben Lake Excerpts

Monday 16th July 2018 Commons Chamber

[Dr Fox]

One of the most recent comments I have read is that this would stop Britain being able to import food of a standard that we do not currently find acceptable. I have said at the Dispatch Box many times that the Government have no interest whatsoever in reducing the quality of the food that we have in the United Kingdom nor the standards by which it is produced. In any case, if we reduced our standards, that would undermine the reputation of the goods that we sell abroad. It is because of our high standards that, according to Barclays, 57% of Chinese consumers, for example, are willing to pay more for goods made or produced in the UK.

[Ben Lake (Ceredigion) (PC)]

The Secretary of State has committed to ensuring that the devolved Administrations are able to inform the Government’s approach to negotiations, but will he clarify what role they will have in the negotiations themselves and whether their consent will be sought before any trade agreement is ratified?

[Dr Fox]

I would imagine that, in line with other agreements, we would seek legislative consent from the devolved Administrations where there were elements in which they were required to apply parts of those negotiations. I would hope that, because I believe our interests are one and the same, we would want to work together to ensure that what we get for UK consumers, UK producers and UK exporters are of maximum benefit.