Agricultural Exports from Australia: Tariffs

Emily Thornberry Excerpts

Thursday 27th May 2021 Commons Chamber

[Emily Thornberry (Islington South and Finsbury) (Lab)]

(Urgent Question): To ask the Secretary of State for International Trade, if she will make a statement on the United Kingdom’s proposed tariff offer to the Australian Government on their agricultural exports.

[The Minister for Trade Policy (Greg Hands)]

Our trade agreement with Australia is very likely to be the first from-scratch deal that we have struck outside the European Union. It is a major milestone for global Britain and a major prize secured for our newly independent trade policy. It is on course to slash tariffs on iconic UK exports, saving business potentially about £115 million a year.

The deal will be the most advanced that Australia has struck with any nation bar New Zealand, and will, we expect, be particularly forward-leaning in areas such as services, procurement and digital trade. It will be a great deal for the UK, and our farmers will continue to thrive. The agreement is a gateway into the massive CPTPP—comprehensive and progressive agreement for trans-Pacific partnership—free trade area in the Asia-Pacific, and opens doors for our farmers into some of the biggest economies of now and the future.

Our food is among the best in the world and incredibly competitive. We should be positive, not fearful, of the opportunities that exist for our agriculture and our farmers. We give the EU preferential trading terms, which I do not recall those on the Opposition Benches objecting to. We should be unafraid of giving our Australian cousins something similar, taking the chance to deepen trading ties with one of our closest friends and allies.

Australian meat is high quality and produced to high standards, and it arrives here in low volume. Meanwhile, Australia has some of the highest animal welfare standards in the world. The UK accounts for just 0.15% of Australian beef exports, and our analysis suggests that any increase in imports is more likely to displace food arriving from the EU. Any deal we strike will contain protections for our farmers, any liberalisation will be staged over time, and any agreement is likely to include safeguards to defend against import surges. Negotiators are now working to agree the outstanding elements with the aim of reaching agreement in principle in June.

This is not the end of the process. Later this year, Parliament will be given ample opportunity to scrutinise the agreement—we welcome scrutiny of the agreement—as well as any legislative changes that may be required before the agreement enters into force. Parliamentarians will also receive an independently scrutinised impact assessment. Mr Speaker, you will know that our scrutiny arrangements are among the most robust, and in line with other parliamentary democracies. Indeed, in some areas we go further still.

This will be a great deal for our United Kingdom. It will deliver big benefits for both countries and will help us build back better from the covid pandemic. I commend it to the House.

[Emily Thornberry]

Let me make it clear at the outset that we support a trade deal with Australia that is designed in British interests and will create jobs in our economy and increase our exports and growth. What we cannot support is a deal being rushed through in time for the G7 summit without proper debate or consultation, let alone the advance scrutiny that the Government promised by the Trade and Agriculture Commission. We cannot support a deal on agricultural tariffs that will cost jobs in our farming communities, undercut our food standards, increase our carbon offshoring and open the door to the destruction of our farming industry through further lopsided trade deals.

As an exercise in intellectual honesty, I would just ask all those on the Conservative Benches, in the right-wing think-tanks and on the newspaper comment pages to consider for one second how they would have reacted if it was Brussels that had negotiated this trade deal and sold out Britain’s farmers. They would have been rightly furious, and they should not be any less so when it is their own Government who are doing the selling out. However, what matters now is to try to improve the deal on the table before it is signed in Cornwall.

Assuming that it is now too late to remove the offer of zero tariffs, can I ask the Minister of State to pursue three other changes? First, will he put in place a safeguard trigger—which, as I am sure he knows, Australia was willing to accept in its deals with Japan, China and the United States—to protect British farmers against surges in cheap imports? Secondly, will he make it clear that zero tariffs will apply only to Australian products that meet the same standards that British farmers are required to meet on food safety, animal welfare and environmental protections? Thirdly, will he insert a review clause into the deal so that, if its impact is even more negative than was forecast by the Government last year, there is scope both to amend the deal and to learn from it in future trade deals? Those are the bare minimum changes that we need to mitigate the damage that this rushed and botched negotiation is inevitably going to do, so I hope that the Minister of State will agree to pursue all three of those priorities today.

[Greg Hands]

I thank the right hon. Lady again for tabling this question. Let me answer each and every one of her questions. First, she said that this had been rushed through. I was at the Department at its inception in the summer of 2016, and one of the very first things that was announced in 2017 was our target for our initial batch of free trade agreements, which included Australia. That was back in 2017 and repeated by the current Secretary of State in 2019. She talked about the Trade and Agriculture Commission. This will be up and running soon—[Interruption.] If she is that keen to see it up and running soon, she might have supported the passage of the Trade Bill, which became the Trade Act 2021 just before Easter; instead, we saw her repeated manoeuvres to delay and undercut the Bill at the time.

The right hon. Lady talked about any deal potentially undercutting our food standards. I was absolutely clear in the statement that there will be no compromise on our standards of animal welfare, food safety and the environment. That is our manifesto commitment, and it has often been repeated. She made a point about emissions and food miles. There is controversy in relation to meat production emissions, but no more than 5% of emissions are reckoned to come from the transportation across oceans of that product.

Let us look at Australia’s current trade patterns. Only 0.15% of Australian exports come to the UK. Australia sells 75% of its beef and 70% of its lamb into Asia at the moment. That is where the fast-growing markets are, and that is something that we in the UK are seeking to get access to ourselves through agreements such as the CPTPP and other trade agreements. There is a big opportunity here for UK agriculture.

The right hon. Lady asked about a safeguard trigger. As I said in my opening statement, safeguard triggers are typical of free trade agreements. This is still a free trade agreement that is subject to a live negotiation, but I would say that these things are typical of free trade agreements. She asked if we would have zero tariffs if the Australian produce met our standards. The Australian lamb and beef coming into the market today meets our standards. There will be no change as a result of the free trade agreement to our standards. Australian beef and lamb will continue to have to meet our import standards. If that is the only objection to zero tariffs, I take it that she would welcome such a situation if there were zero tariffs in the deal. She also asked about a review clause. Again, that is a typical feature of free trade agreements.

The right hon. Lady has to explain why she is seemingly so opposed to such a trade deal with Australia, a key Commonwealth, Five Eyes and like-minded trade ally of the United Kingdom. She did not complain about the zero-tariff, zero-quota access for EU beef and lamb, which had no staging on it at all. Why does she do so for Australia? I believe her real problem is that she still wants to remain in or rejoin the EU, like her neighbour the Leader of the Opposition, and cannot see the benefits of doing any trade deal with Australia. I commend the prospective deal to the House and invite more progressive voices on the Opposition Benches to join us in backing an FTA with our close friends and allies.