Leaving the EU: Future Trade Remedies

Gill Furniss Excerpts

Tuesday 17th April 2018 Westminster Hall

[Bill Esterson (Sefton Central) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Hollobone. I congratulate the hon. Member for Stoke-on-Trent South (Jack Brereton). He made some extremely important points, which I shall touch on. I will also mention some of the comments from the hon. Member for Hornchurch and Upminster (Julia Lopez).

Trade remedies are a key element of our future trade policy. Without adequate trade remedies, we will become the dumping ground for not only Europe but the rest of the world. That point was made to us by Gareth Stace of UK Steel when he gave evidence to the Trade Bill Committee. Trade remedies are the means by which we protect our industries and our economy—meaning producers and consumers. What that protection looks like is very topical, given the imposition of tariffs of up to 25% on steel and aluminium imports into the US—[Interruption.] The hon. Member for Stoke-on-Trent South is not the only one struggling with his words today.

Those tariffs have been imposed by President Trump on the spurious grounds of national security. The danger exists that United States-bound steel will now be dumped in the UK instead, as we saw China do just a few years ago, which led to a crisis and the appalling news for the people of the north-east with the closure of SSI in Redcar. That is why an international, co-ordinated approach on anti-dumping is essential and why a common approach is needed to trade defence.

[Gill Furniss (Sheffield, Brightside and Hillsborough) (Lab)]

I congratulate the hon. Member for Stoke-on-Trent South (Jack Brereton) on securing this very important debate. I want to touch on the things that my hon. Friend the Member for Sefton Central (Bill Esterson) has just said about dumping. In 2015-16, when the steel crisis was a huge issue, there were 92 EU trade remedies and those covering steel were vital in stemming the flow of under-priced Chinese steel, but ever since, the Tories have pushed back against any new measures in the EU to defend our industries from that arising again. I would like to know whether the Minister will give some assurances, particularly at this difficult time in the steel industry’s history, to reassure the manufacturers, the workers and UK Steel, which has been mentioned, that their industry will get the protection that it deserves and will survive the latest crisis.

[Bill Esterson]

I am grateful to my hon. Friend for the intervention. I was about to make the same point. She is absolutely right to say that we need to hear from the Minister what his intentions are.

The EU does not want the UK to be swamped with dumped goods, whether that is steel, ceramics or washing machines, because if that happened, such goods could enter the EU market from the UK. Equally, UK businesses do not want dumping, because it is unfair competition. Lack of protection in the UK risks thousands of jobs in the UK. It is no good the Minister’s saying that it means cheaper goods for consumers—as I have heard him say on countless occasions—because the workers whose jobs are at risk are consumers as well. No job means no wage to buy the goods. A lack of trade defence is bad for producers, workers and consumers, yet that is what there has been far too often. My hon. Friend the Member for Sheffield, Brightside and Hillsborough (Gill Furniss) is right to highlight exactly what happened in the steel industry, because when the Government failed to support EU trade defence measures against Chinese steel dumping and acted too late to intervene and save SSI, it was the Conservative group of MEPs, at David Cameron’s prompting, who were the cheerleaders in the European Parliament against Europe-wide action. That included their blocking attempts to end the use of the lesser duty rule.

However, protection and the use of trade remedies is not the same as Trump-style protectionism. Trade remedies should be about the creation of a level playing field that defends domestic producers against unfair competition from dumped goods. They are an essential policy tool to correct multilateral distortions. Failure to use anti-dumping measures, in the name of free trade, misses the point that for trade to be free, it also has to be fair. Adjustments are needed in the event of Chinese or Russian state subsidies or distorted pricing of raw materials, or to address Trump’s tariffs. The European Commission is due to vote soon on higher anti-dumping duties to tackle raw material distortions, so it is incredible for the Government to say, as the Minister has, that they will vote against those measures.

That brings us to the customs Bill—the Taxation (Cross-border) Trade Bill—and the Trade Bill. As the hon. Member for Livingston (Hannah Bardell) said, we should be debating the amendments to the two Bills on Report in the main Chamber, not having a general debate in this Chamber, but as we are, let us look at what the Bills will do.

The Government are planning to give themselves the power to decide not to act on behalf of UK industries, in favour of the consumer interest. That will be a political decision, balancing the interests of jobs in one area of the country against the interest of consumers—a point made to us by George Peretz, QC, when he gave evidence to the Trade Bill Committee. Trade remedies are essential to protect British industries, whether that is steel, ceramics, tyres, chemicals or pharmaceuticals. The Minister will no doubt say—he has said it before—that the lesser duty rule has been effective in tackling unfair trade. He wants to continue to apply it at the very moment when the EU is moving away from it, so tell us: where is the evidence to support that approach? I am glad that he is nodding, because I am looking forward to hearing his answer. Ask workers who used to work at SSI. Ask the MTRA. Ask industry and workers. They believe in strong trade remedies and they want to know the reason why the Government are taking a different approach.

The continued application of the lesser duty rule will see dumped goods diverted to the UK, and as we leave the EU, divergence in trade remedies will add to the damage done to the UK economy. The Minister is fond of saying to me and my colleagues that we are against the creation of a trade remedies authority. He knows that that is not true, of course, but that does not stop him saying it. The difference between him and me is that I want the Trade Remedies Authority to be effective. I take seriously the importance of trade remedies in creating a level playing field for our producers so that they can compete in international trade in a fair market. That is why we tabled a reasoned amendment on Second Reading of the Trade Bill that stated categorically our support for the creation of a trade remedies authority, but we believe that the Trade Remedies Authority should be representative of all sides of industry; it should include representatives of producers, trade unions and each of the devolved Administrations. We tabled amendments to that effect in Committee, as did the SNP. In addition, the chair of the TRA should go through parliamentary scrutiny of their appointment, rather than being placed in post by the Secretary of State; Parliament should also have its say on the membership and non-executive appointments. I totally agree with the hon. Member for Hornchurch and Upminster that the Select Committee on which she serves should be scrutinising all these appointments. The Government are using ministerial discretion in the establishment of the TRA before the legislation has been passed that sets it up, and the Minister should explain why, as ministerial discretion is usually reserved for matters of disagreement on spending within a Department.

British industry needs a strong, robust and independent Trade Remedies Authority that will use international best practice. Our amendments to the customs Bill and the Trade Bill will be designed to achieve the objective of giving our industry a level playing field. The Minister and his hon. Friends should support our approach or introduce their own amendments to do just that; otherwise, workers in the Potteries and many more across the country will face the possibility of the same fate as steelworkers faced in Redcar just a few years ago.