Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Bill [Lords]

Gareth Thomas Excerpts

Report stage
Tuesday 19th March 2024 Commons Chamber

Finally, we support new clause 12 from the hon. Member for Chesham and Amersham (Sarah Green). Although the Bill is narrow, it introduces a number of measures that affect performers and the manner in which they can assert their rights. It is important to understand as quickly as possible the practical impact of any unforeseen consequences, so we think it prudent to add new clause 12 to the Bill, and are happy to support it.

[Gareth Thomas (Harrow West) (Lab/Co-op)]

I rise to speak to new clauses 4 to 7 and amendment 1. I draw the attention of the House to my entry in the Register of Members’ Financial Interests in relation to BPI. Let me at the outset say what a particular pleasure it was to listen to the maiden speech of my new hon. Friend, the hon. Member for Kingswood (Damien Egan). His description of his constituents’ comments to him during the by-election will chime with all on the Opposition side of the House. It is clear that he will be an asset to the House, and I think it is fair to say that south London’s loss is undoubtedly Kingswood’s gain.

We support accession to the CPTPP because of its geopolitical benefits and the benefits to trade, relatively limited thought they are set to be. Given that the Conservative party has delivered a recession, a cost of living crisis and the worst growth rate in the G7, any uptick in trade and ultimately growth, however limited, would be welcome. There remain, however, a series of concerns about the Government’s approach to the CPTPP and trade deals. Our amendments and new clauses seek to address the weak arrangements for parliamentary scrutiny of trade deals; the growing concern about the investor-state dispute settlement; and issues around performers’ rights, environmental, animal welfare and food standards, and the help that businesses will be offered to exploit the benefits, however limited, of this deal.

On new clause 1, I recognise the concerns articulated by the right hon. Member for Chingford and Woodford Green (Sir Iain Duncan Smith), which were echoed by the right hon. Member for North Somerset (Sir Liam Fox), and I am sympathetic to the former’s call for an enhanced role for Parliament. I am also sympathetic to new clause 11 from the hon. Member for Chesham and Amersham (Sarah Green), under which Parliament would require an assessment of the impact of any new country’s joining the CPTPP. However, I think we need to go further than both those new clauses do. Labour’s new clause 4 would require Ministers to publish such an impact assessment in Parliament and to give the House a vote on any new country joining the CPTPP. Given the security issues, the impact on particular sectors of the economy and on jobs in the UK, as well as the opportunities that an accession could bring, the British people surely have a right to expect this House to consider the merits, or lack of merit, of any new accessions to the CPTPP.

During the Lords debate, the Minister said that he thought that a new state joining CPTPP would trigger the CRaG process in the UK, but the CRaG process, as increasing numbers of Members across the House have largely come to agree, is clearly not fit for purpose; PACAC is the latest Committee to make that clear, in its recent report. New clause 4 provides the opportunity to reform part of that process. Let me refer to what was said by the Chair of the Business and Trade Committee, my right hon. Friend the Member for Birmingham, Hodge Hill (Liam Byrne), and by the hon. Member for Totnes (Anthony Mangnall) and my hon. Friend the Member for Walthamstow (Stella Creasy). We were promised by the Secretary of State and by the Minister in Committee that there would be a debate under the CRaG process, as opposed to there being just this small implementing Bill. We now know that the debate will not happen, so that is another broken promise on trade.

The impact of new countries joining the CPTPP will vary, but could be considerable in certain situations. It is only right that this country expects the House to consider those impacts carefully. I hope that the right hon. Member for Chingford and Woodford Green, and the hon. Members for Totnes, and for Chesham and Amersham, can be persuaded to support our new clause. It would achieve what they want in practice and go further. With the leave of the House, we will press our new clause to a vote.

On new clause 5, I hesitate to damage the reputation of my hon. Friend the Member for Brighton, Kemptown (Lloyd Russell-Moyle) and my right hon. Friend the Member for Hayes and Harlington (John McDonnell), who made excellent speeches on the ISDS. Over the past 10 years, the marked acceleration in usage of the ISDS by large, litigious corporations to challenge Governments’ climate-related or other environmental decisions has prompted concern at the highest levels in the US, in European capitals and at the UN, so much so that Governments across the world are increasingly excluding or revoking the ISDS provisions.

The problem with the ISDS is that it is secretive; it avoids perfectly effective domestic public legal systems; it discriminates against small and medium-sized businesses; it often prevents the voice of those with a genuine interest in the decisions from being heard; and it holds back environmental and other progressive public policy changes. Strikingly, the OECD could find no sustained evidence that the ISDS was key to securing and maintaining business investment. The Nuffield Trust’s briefing for today’s debate stated that the ISDS could enable companies to challenge some health regulations and NHS policies.

The US, Canada and the European Union have all taken steps to revoke the ISDS provisions in some of their major treaties. The average amount—this is just the published cases—that Governments have been forced to pay, from taxpayers’ money, is about $600 million for climate cases. It seems even more noteworthy that the UN Secretary-General’s special rapporteur on environment and human rights expressed concern just last September that the ISDS was a significant threat to the net zero transition, the Paris agreement and tackling climate change.

Some in government clearly share some of those concerns, as they wanted to exclude the ISDS from the bilateral trade deal with Canada, and supported its abolition from trade with the European Union. The Minister was somewhat evasive in Committee. Initially, he tried to duck questions on why the Government wanted to exclude the ISDS from a bilateral trade agreement with Canada but were quite happy to leave it in the CPTPP for Canadian investors to use. Given that Ministers have signed side letters with Australia and New Zealand to disapply the ISDS between our countries in the CPTPP, it seems bizarre that they have not attempted a similar approach with Canada.

Just after Committee, the Government confirmed that they were pulling out of the energy charter treaty, in which ISDS arrangements play a major role, saying that it does not fit with net zero ambitions. The Minister might want to try again to explain why it is essential that we remain committed to the ISDS elements of the CPTPP. It is time for a clear-eyed assessment of the risk that the ISDS poses to our interests. With the leave of the House, the Opposition will press new clause 5 to a vote.

There continue to be significant concerns about the environmental impact of accession to the CPTPP, and the impact on food standards and on animal welfare. The CPTPP covers two of the 11 deforestation fronts expected to account for 80% of deforestation by 2030. A range of environmental groups are very concerned that when the UK joins the CPTPP, preferential access to our markets will be created as a result of the removal of tariffs on palm oil. That could increase demand for products from threatened zones and exacerbate the risk of further deforestation. Ministers still have not published —never mind presented to this House—deforestation due diligence legislation under section 17 of the Environment Act 2021, so it is difficult to accept Ministers’ claims that they are fully committed to our climate change targets, and to protecting important sources of global biodiversity.

On food standards, deep concerns remain that, despite their protestations, the deals that Ministers have negotiated, including the CPTPP, will allow into the UK ever more food produced to lower standards, particularly animal welfare standards. The whole House will remember the words of the former Environment Secretary, the right hon. Member for Camborne and Redruth (George Eustice), who told the House that the Minister and his colleagues had given away

“far too much for far too little”.—[Official Report, 14 November 2022; Vol. 722, c. 424.]

when they negotiated the UK-Australia free trade agreement. The Royal Society for the Prevention of Cruelty to Animals and the National Farmers Union, in particular, have raised concerns that new tariffs negotiated with Mexico and Canada will leave farmers in the UK much more vulnerable to imported eggs, pork and chicken that are produced to standards that would be illegal in the UK. The Pesticide Action Network UK raised concerns acknowledged by the Trade and Agriculture Commission—concerns also raised by an hon. Friend behind me—that more food produced using pesticides banned in the UK will be imported into the UK

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[Lloyd Russell-Moyle]

My hon. Friend is making an excellent, excellent speech. [Interruption.] Well, he knows it anyway, but there is nothing wrong with praising. Is it not also a sign of how the Government, time and again, let down our creative industries? If it were steel or farming, Conservative Members would be in the ear of Ministers through their trade partnership committees, but creative industries are locked out of many of them and ignored. That is why Labour has put forward a plan to put creative industries at the heart of our economic development.

[Gareth Thomas]

My hon. Friend is generous in his description of my speech—I am grateful to him—and absolutely right about the importance of Labour’s plan for the creative sector.

Reform of the UK’s copyright framework should not be taken lightly, and it should only follow proper and well-considered consultation. Otherwise, we risk endangering our gold standard of protection for our vital creative sector. I gently suggest to the House that the reforms allowed for under clause 5 should not have been shoehorned into this Bill, and certainly not without a thorough consultation having taken place first. In that regard we are sympathetic to the merits of new clause 12, tabled by the hon. Member for Chesham and Amersham. We will continue to scrutinise developments in this area, and we hope that Ministers will reach a final decision, after the consultation, that will not have the adverse impact that is feared by some outside the House.

As I have said, I share the concerns expressed by my hon. Friend the Member for Brighton, Kemptown in new clauses 2 and 3, and I therefore hope he will join us with enthusiasm in the Lobby later today. Similarly, I share the desire of my right hon. Friend the Member for Hayes and Harlington for much greater adherence to the conventions of the International Labour Organisation. We raised this issue in Committee, and as I said earlier, I share his frustration—and that of other Members—that Ministers have not allowed the House a substantive debate under the CRaG process.

[Liam Byrne]

My hon. Friend, who is making an excellent speech, is right to underline the point about ILO obligations. In the 2022 Queen’s Speech we were promised an updating of the Modern Slavery Act 2015 that would have required much stronger action and transparency on supply chains in order to eliminate forced labour. That measure seems to have disappeared, so we must insist on more robust action in our trade agreements if we are to wipe out the scandal of modern slavery.

[Gareth Thomas]

My right hon. Friend is absolutely right. Ministers will have heard his point; whether they will act on it remains to be seen, but I certainly hope they do. If we are lucky enough to be elected at the next general election, we will certainly work with the ILO to try to drive better adherence to its conventions.

Last but not least, I share the ambition of my hon. Friend the Member for Walthamstow, who made a powerful speech, for a much more open dialogue on trade and the axing of more of the red tape, bureaucracy and barriers to trade with European markets thrown up by the poor negotiating skills of the last Prime Minister but two.

There remain, in particular, serious concerns about scrutiny of trade agreements and about the damage that ISDS provisions could do, so we will, with the leave of the House, press new clauses 4 and 5 to a vote.

[The Minister for Trade Policy (Greg Hands)]

I thank colleagues for their contributions to the debates on this important Bill. Let me begin with the new clauses relating to new accessions to the CPTPP: new clause 1, tabled by my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith)—who always demonstrates his passion on this important matter—new clause 4, tabled by the hon. Member for Harrow West (Gareth Thomas), and new clause 11, tabled by the hon. Member for Chesham and Amersham (Sarah Green).

As the House may know, there is no rule within the CPTPP that requires new applicants to be dealt with on a “first come, first served” basis. Rather, it has been agreed within the group that applicant economies must meet three important criteria—called the Auckland principles—and it is on those key principles that applications will be assessed. Applicants must: first, be willing and able to meet the high standards of the agreement; secondly, have a demonstrated pattern of complying with their trade commitments; and thirdly, be able to command consensus of the CPTPP parties. Those strong criteria will be applied to each accession application. It is right that we in the United Kingdom, as a new member of the CPTPP group, work within the principles of the group to achieve a consensus decision.

I remind the House that while the UK rightly participates in discussions on this topic with CPTPP parties, we will only have a formal say over an application post-ratification and entry into force of the agreement. It is therefore crucial that we ratify the agreement and become a party, so that we can work with CPTPP members decisively on each current and future application. With that in mind, it would not be appropriate for the Government to give a running commentary on individual applicants, not least because to be drawn on individual applicants now, ahead of the UK becoming a party to the agreement, could have an impact on our ability to achieve that important goal of ensuring that the CPTPP enters into force. I should also make it clear that our own accession process has set a strong precedent. The robust experience that the UK has undergone has reinforced the high standards and proved that the bar is not easy to meet for any aspirant.

Regarding the scrutiny of any hypothetical future accession, I can assure the House that any accession of a new party to the CPTPP would require an amendment to the terms of the CPTPP. Therefore, as with the UK’s accession protocol, our firm intention is that such a future accession would be subject to the terms of the Constitutional Reform and Governance Act 2010—the CRaG process. I assure the House that CRaG is applicable to plurilateral agreements such as the CPTPP. The Act makes no distinction between bilateral, plurilateral or multilateral treaties as outlined in section 25 of CRaG.

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[Gareth Thomas]

We support the UK’s accession to the CPTPP. Despite the concerns we raised during the Bill’s stages, we have not stood in the way of its passage through this House thus far and we do not intend to divide the House on Third Reading. We recognise the geopolitical benefits and the economic benefits, limited none the less as they are likely to be in the near future.

In Committee, we outlined a series of concerns about the inclusion of provisions on the investor-state dispute settlement, and its implications for the NHS, the environment and workers’ rights. We raised concerns about performer’s rights and why on earth the Government chose to launch a consultation on the provisions after the Bill had already begun making its way through Parliament—talk about putting the cart before the horse. We also raised environmental concerns, probing Ministers about deforestation, palm oil, increased carbon emissions, the use of pesticides, threats to indigenous wildlife, and the undermining of the UK’s commitment to combating climate change and preserving biodiversity.

The Secretary of State promised a debate on CPTPP under the CRaG process to the Business and Trade Committee. In Committee, we were also promised a debate on CPTPP by the Minister under CRaG, which has not happened. I say it gently to them both: sadly, it is one more example of Ministers ducking scrutiny of the trade deals they sign. It is almost as if they have something to hide.

We have been grateful in particular to the TUC, Chester Zoo, the World Wildlife Fund, the Trade Justice Movement, Transform Trade, the National Farmers Union, the Royal Society for the Prevention of Cruelty to Animals and the Alliance for Intellectual Property for their help in ensuring that we fully understood the implications of the Bill. I am grateful for their generosity with their time and expertise.

One cannot help feeling that had the Government initiated a thorough consultation exercise much earlier in the proceedings, before the CPTPP was a done deal, we might have come out of the negotiations as less of a rule-taker and with a better deal for the UK. Better consultation with the nations and regions could have happened throughout the whole CPTPP process, but both the Scottish and the Welsh Governments lamented poor communication at key stages from Ministers. Hopefully lessons have been learnt, and we will all have to take the opportunity of the CPTPP review in 2026 to look at what more can be achieved.

I thank all the members of the Public Bill Committee. I particularly thank my fellow shadow Minister, my hon. Friend the Member for Slough (Mr Dhesi), for his invaluable contributions, help and support during the Bill’s passage, but I also thank my hon. Friends the Members for City of Chester (Samantha Dixon), for Cardiff North (Anna McMorrin), for Reading East (Matt Rodda) and for Hammersmith (Andy Slaughter) for their time and commitment to that part of the scrutiny process. I thank Members on both sides of the House, and those in the Lords, who—on Second Reading, in Committee and on Report—have joined in the hard yards, the necessary work, of scrutinising what is a key trade arrangement. I thank the Minister of State, too, for his particularly generous description of me in Committee as a “serial rebel”—which might surprise one or two—and I thank both him and the Secretary of State for their other contributions, some of which have been helpful. [Laughter.] I hope that the dialogue, especially that on the International Union for the Protection of New Varieties of Plants and on performers’ rights, will continue, and I thank the Ministers for their letters to me on those issues.

The UK’s joining the CPTPP will not make up for the Government’s failure to deliver a good trade deal with Europe, or the Conservatives’ broken manifesto commitment that 80% of the world would be covered by new trade agreements—including a trade deal with India, which the Secretary of State herself said this month was highly unlikely to happen any time soon. We remain in the dark as to whether we will ever be tasked with scrutinising a UK-Canada trade deal, or whether negotiations are indeed ongoing, as the Minister says, or they are not, as the Canadians say. What we do know is that, while the Government have made some outlandish claims about the benefits of the UK’s joining the CPTPP, it is likely, as the Office for Budget Responsibility has said, to lead to just a slight increase in GDP “in the long run”. With exports having dropped last year and set to drop further this year, and given the three following years of anaemic growth in exports, even the smallest opportunity for growth is welcome.

The Bill is needed to incorporate the CPTPP agreement in domestic legislation, and that is something that we do not oppose. There are benefits to joining, and despite reservations, we certainly welcome the opportunities that will be opened up for some British businesses. For those reasons, as I have said, we will not stand in the way of the Bill’s completing its passage tonight.