Free Trade Agreements: Scrutiny

Debate between Darren Jones and Anthony Mangnall

Thursday 13th July 2023 Commons Chamber

[Darren Jones (Bristol North West) (Lab)]

The Business and Trade Committee has today published a report on the scrutiny of free trade agreements. The Select Committees of this House were recently restructured following the Prime Minister’s decision to restructure Government Departments. This resulted in the Business, Energy and Industrial Strategy Committee becoming the Business and Trade Committee, with the International Trade Committee being wound up. My Committee therefore now has the responsibility, on behalf of the House, for scrutinising any future free trade agreements that the Government enter with other countries.

The report sets out how we on the Business and Trade Committee intend to do that work, and I will now update the House on a number of key points. First, when the UK left the European Union we took back responsibility for negotiating our own free trade agreements, which also meant that this Parliament took back responsibility for the oversight of such processes from the European Parliament. However, our Select Committees are structured and resourced differently from the committees of the European Parliament. Crucially, our powers are based on a convention agreed in the late 1920s, the so-called Ponsonby rule, which was to some extent codified in the Constitutional Reform and Governance Act 2010. The rule was codified at a time when we relied on the European Parliament to scrutinise trade deals on our behalf. Post Brexit, our powers are therefore out of date, inadequate and in need of reform.

The powers that exist today mean that Parliament does not, by right, have access to information during a negotiation period or to draft free trade agreements in advance, nor do we have the power to vote on or amend specific parts of a free trade agreement. Under the Constitutional Reform and Governance Act, all we can do in this House is delay the ratification of an agreement, in the hope that we might persuade the Government to change their mind during the delay. In reality, this power has never been used.

The International Trade Committee and the International Agreements Committee in the other place secured a number of non-binding commitments from the Government by way of correspondence. We list these commitments in the report, on the assumption that my Committee will continue to enjoy the limited access to information granted to our predecessor Committee. Thankfully, although our constitutional arrangements are out of date and inadequate, the Public Administration and Constitutional Affairs Committee is looking at this issue. I look forward to reading its recommendations.

Secondly, when the Government publish the final draft of a free trade agreement, it is sent to my Committee. However, my Committee has neither the capacity, the time nor the expertise to conduct legalistic line-by-line scrutiny of such a complicated legal text. Until such time as the Government decide that such a parliamentary function ought to exist and be resourced, we will therefore not do it. Instead, we will take a thematic approach to any free trade agreement scrutiny and highlight any policy areas that we think warrant further attention or changes.

Thirdly, and lastly, with the Committee having taken a thematic approach to reviewing a free trade agreement, the question is what this House then does about it. As noble Lords will tell us, although the International Agreements Committee may review an international agreement, the other place does not have the power to take any action. Only this House can postpone the ratification of an agreement, through the Constitutional Reform and Governance Act process. That requires my Committee to request a debate on a substantive motion, asking the House to vote to postpone. Ironically, as I understand it, the Government must agree to such a substantive motion, and they never do, which is probably why the postponement power has never been used.

However, as we set out in our report, my Committee intends to call for a substantive motion to postpone the ratification of an agreement only when we conclude that substantive issues raised with the Government have been unanswered and when the consequences are significant. In more normal, but not all, circumstances, we will reserve the right to call for a debate on a neutral motion, to give Members the opportunity to debate the merits of a proposed free trade agreement on the record.

This is a technical, internal report about the scrutiny process in this House, but free trade agreements can have significant consequences for people and the economy, so we thought it important to update the House today on our conclusions about this scrutiny work.

While I have the Floor, I pay thanks and tribute to James Hockaday, who is one of the Committee’s trade specialists. He and his colleagues on the International Trade Committee spent many a night doing the legalistic review of free trade agreements that we have concluded we will no longer do. He is moving from my Committee this week to work with the Clerk of the House, and we wish him well in his new role.

I thank the Backbench Business Committee for giving the Committee time to update the House, and I thank you, Sir Roger, for calling me to do so.

[Anthony Mangnall (Totnes) (Con)]

I congratulate the Chairman on subsuming the International Trade Committee, and on running the Business and Trade Committee so effectively. I join him in sending my best wishes to James Hockaday following all the excellent work he has done, particularly on scrutiny.

I have two questions. First, does the Chairman have any concern that, if the Committee does not receive timely information on a free trade agreement, there will not be enough advance warning for us to know whether we will need a debate on the Floor of the House within 21 sitting days? Would it not be advisable, as other Committees are discussing, to consider whether we should put parts of these free trade agreements to other Select Committees, such as the Environment, Food and Rural Affairs Committee or the Treasury Committee in the case of financial services, so they may review and report on them individually to ensure that the House has a full comprehension and understanding of the trade agreements we are signing?

[Darren Jones]

I welcome the hon. Gentleman to the Business and Trade Committee, following the demise of the International Trade Committee.

There are two important points. First, the 21-day period under the Constitutional Reform and Governance Act needs to be reformed. One such reform might be that the Committee needs more than 21 sitting days to be able to take a view on often complicated and full free trade agreements. No doubt the Minister for International Trade, the hon. Member for Mid Worcestershire (Nigel Huddleston), who is sitting on the Treasury Bench, will have heard that request.

Secondly, it is not for me to commit other Committees to a work programme, but it is right to point out that there are many issues, such as agriculture, defence, human rights and environmental issues, on which colleagues on other Committees take an interest.

I gave evidence this morning to the International Agreements Committee in the other place, and it does significant work on trade agreements among other things. One of the commitments we made was that, between our Clerks and between both Houses, we will co-ordinate our action to try to improve our capacity for reviewing trade agreements.