Free Trade Agreement: New Zealand

Emily Thornberry Excerpts

Thursday 21st October 2021 Commons Chamber

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

I thank the Secretary of State for advance sight of her statement. While there is much to digest from last night’s agreement, I hope she will forgive me if, in the short time that I have, I focus on the impact of the deal on our farming communities.

As I have already mentioned today, according to the Government’s own forecasts, this deal will lead to reductions in growth and jobs in the UK’s farming sector because, as the scoping paper says,

“New Zealand producers may be able to supply UK retailers and UK producers at lower cost relative to domestic producers.”

In those circumstances, any other Government would normally keep in place quotas to stop their farmers from being undercut, but, just like with the Australia deal, our Government have set those quotas so high as to be utterly meaningless. In year 1 of this new deal, New Zealand can export four times as much lamb as it did last year before any tariffs kick in; it can export more butter to Britain than it has done in the past six years put together before facing a single tariff; and it can export 25 times more beef, entirely tariff-free, as it can right now with a 20% tariff. For all practical purposes, this deal therefore gives us unlimited, tariff-free trade from New Zealand to go with unlimited, tariff-free trade already agreed with Australia, confirming this as the precedent that every other major exporter will now expect to follow. Not just that, but we are eliminating the tariffs on dozens of products from Australia and New Zealand that fall well short of our domestic welfare standards. This includes our domestic restrictions on antibiotics, whose production is doing huge damage to the environment.

These are bad deals for our farming industry. They will undermine the competitiveness of our farmers and the standards that they are required to maintain. In other words, these deals are exactly what the Trade and Agriculture Commission was established to prevent. That brings me to the appointment of the new TAC members confirmed by the Secretary of State earlier and to the written ministerial statement, which the House has just received, containing her response to the TAC report, seven and a half months after it was submitted.

There are two crucial issues at stake in those announcements, and they are inextricably linked to the deals with Australia and New Zealand. The first concerns the TAC’s recommendations to establish a national framework of standards covering food safety, animal welfare and the environment, and to use that framework to determine which imports from Australia and New Zealand should benefit from the elimination of tariffs. We know that that recommendation is entirely feasible and entirely practical, because DEFRA Ministers are currently consulting on applying exactly the same principle when it comes to labelling food products for their impact on animal welfare. Their consultation proposes a clear distinction between

“baseline UK welfare regulations which UK farmers are required to meet”

and “imports of lower welfare” that are undercutting our farmers.

May I ask the Secretary of State three questions? Why has she rejected the recommendation on the use of a standards framework to determine the scope of tariff reductions? Can she confirm that, as a result, a number of products described by DEFRA as “imports of lower welfare” will have their tariffs reduced under the deals with Australia and New Zealand? Can she explain why it is possible to differentiate on standards when it comes to labels placed on imports, but not on the tariffs they face?

The second fundamental issue is around the role of the TAC in relation to Australia and New Zealand. Members of Parliament, the media, the public and, most of all, our farming communities were repeatedly promised last November that the new TAC would provide Parliament with an assessment of every trade deal for how it would affect the competitiveness of UK farmers and whether it would undercut the standards they are required to meet. No matter how that role was defined in statute, we all know what we were promised. If the new TAC is not going to assess these two trade deals in that way, not only is that utterly shameful, but it will turn the TAC into a total waste of time.

I hope the Secretary of State will honour those promises, because if we ever needed a better illustration of why we need the TAC to perform that role, we have it in the deals agreed with New Zealand and Australia. That is why it is more vital and more urgent than ever that the new TAC should be able to do the job that the House was promised and act as the voice of the farmer when it comes to passing verdict on these two new deals. I ask the Secretary of State again: will she let the TAC do its job?

[Anne-Marie Trevelyan]

I will do my best to answer the right hon. Lady’s questions. We are really pleased. The deal is really balanced and brings lots of exciting opportunities for our businesses and our consumers. We will see customs duties on 100% of tariff lines for originating products removed. The UK will eliminate tariffs on 96.7% of tariff lines on the day the FTA comes into force, and New Zealand will eliminate 100% on the day the FTA comes into force.

On beef, the UK will remove duties after 10 years, and the quota volume will increase in equal annual instalments to ensure that the markets can stabilise and grow as required. To the right hon. Lady’s point about the increase in sheepmeat capacity, the interesting thing with New Zealand is that it already has a much larger World Trade Organisation quota that it does not use with the UK because, as we discussed earlier, it has the opportunity to sell many of its meat products into the Asian markets, where it gets high prices. We are therefore not expecting New Zealand to use these quotas in these early years, but we look to the opportunity for us to work for mutual benefit. For butter, full liberalisation will be over a five-year period, and it is similar for cheese.

This is a really exciting deal, and not only for the food and agriculture sector. There is a huge amount of opportunity for our businesses, looking at the digital space in particular and service provision. I reiterate—we will keep saying it until the Opposition are willing to be comfortable with it, if required—that we will never compromise standards for food coming into the UK. I had an interesting conversation with a farmer just last week, who was perhaps more forward-thinking than some Opposition Members. As we have different pests and different soil types, the sorts of products used in other countries may be different, but that does not mean that the quality, standard or welfare is lower. We will always be clear that we will not accept the lowering of standards. We appreciate that different countries have to manage their climatic and environmental situations in different ways, so that will continue to be the case.

I am pleased that the right hon. Lady has seen the written ministerial statement just put out by the Department on the TAC response and the launch of the new Trade and Agriculture Commission, which will be independent. It will have the opportunity to scrutinise all those free trade deals as they come forward, including, in the first instance, the New Zealand and Australia deals, once we have brought them to a full signed conclusion.