Oral Answers to Questions

Greg Hands Excerpts

Thursday 15th July 2021 Commons Chamber

[Marion Fellows (Motherwell and Wishaw) (SNP)]

What assessment she has made of the potential effect on the UK steel sector of removing tariffs on steel imports.

[The Minister for Trade Policy (Greg Hands)]

The Trade Remedies Authority assesses the UK’s trade remedies and makes recommendations to the Secretary of State. This includes the recent review of the UK steel safeguards. The Government accepted the recommendation of the TRA to extend 10 of 19 steel safeguards. The Government also introduced legislation to allow us to extend the current steel safeguards measure for an initial period of 12 months to a further five categories.

[Marion Fellows]

The Trade Remedies Authority recommended revoking nine of 19 steel safeguards despite calls from the sector and the all-party parliamentary group on steel, which wanted all tariffs extended, but the UK Government will keep only about 15 of them. The UK steel sector is not on a level playing field with competitors because of higher energy costs and the lack of a corporate industrial strategy from this and successive Tory Governments. Is this not another broken Brexit promise to a domestic industry and its workers?

[Greg Hands]

I remind the hon. Lady that we have invested £500 million in recent years to help with the cost of energy. I also remind her of the welcome from the sector for the Secretary of State’s decision on 30 June, when Gareth Stace, director general of UK Steel, said:

“Today the UK steel sector applauds the Prime Minister…and Trade Secretary…for standing up for steel”

and

“taking back control”.

[Kenny MacAskill (East Lothian) (Alba)]

What assessment her Department has made of the opportunities for businesses to export abroad.

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[Alyn Smith (Stirling) (SNP)]

What recent assessment she has made of trends in the level of UK exports to the EU.

[The Minister for Trade Policy (Greg Hands)]

Latest monthly figures for UK goods exports to the EU show that in May 2021 exports were £14 billion, up by 8% on the previous month. This is the highest monthly figure, as mentioned by the Under-Secretary, my hon. Friend the Member for Beverley and Holderness (Graham Stuart), since October 2019, and it is £2 billion higher than the monthly average for 2020 and just £0.2 billion lower than the monthly average for 2019. Latest quarterly figures for UK services exports to the EU show exports for the first quarter up by 2% on the previous quarter of last year, but still 2% below the 2020 quarterly average and still some 20% below the 2019 quarterly average.

[Alyn Smith]

Well, there are lies, damned lies and statistics, and I do hesitate to criticise and rain on the Jackanory story we are hearing from those on the Government Benches, but let us look at some facts from the Office for National Statistics. Comparing quarter 1 of this year with 2019, UK-EU trade is down by 27%. Some of that is accounted for by covid; much of it is accounted for by Brexit. Make UK reports that 96% of its members are having problems with the new trading regime. These are facts. What is the Minister’s secret? How does he maintain his Panglossian optimism for the future while ignoring such pain and hurt in the here and now?

[Greg Hands]

I was quite deliberate in the use of those statistics. We do need to take care with monthly statistics. None the less, the first quarter data is already two months out of date. The hon. Gentleman is right that there was a dip in January, but that was due to the closure of the border at that time due to the prevalence of the alpha variant in this country. Since then, there has been a very significant recovery. The latest data from May shows £14 billion of exports, up by 8% on the previous month, and only just lower than the monthly average from before the pandemic. He can quote the ONS, but perhaps he might want to look at the latest data, refresh his briefing, and ask his questions according to the latest available data.

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

Three weeks ago, Lord Frost rejected the EU’s offer of a veterinary agreement, saying:

“We are very ambitious about CPTPP membership… That is the problem.”

Since we cannot ask Lord Frost himself, can the Minister perhaps tell us why the UK’s accession to the comprehensive and progressive agreement for trans-Pacific partnership is incompatible with reaching an agreement with Europe on food standards? From which of our current food standards do the Government wish to diverge?

[Greg Hands]

I think the hon. Gentleman is confusing a number of different things, but let me start by saying that the UK proposed an equivalence agreement on sanitary and phytosanitary rules in negotiations—that was proposed by Lord Frost—but the EU refused. The EU does have agreements with, for example, New Zealand and others that still respect regulatory autonomy. We are very happy to discuss with Brussels an agreement on SPS rules so long as it respects UK regulatory autonomy and we do not sign up to dynamic regulatory autonomy. That is the read-across to other trade agreements; it allows us to have an independent trade policy while maintaining the high-quality trade deal that we have with the European Union.

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

The Minister can defend his Government’s Brexit bourach all he likes, but EU-UK trade fell by 27% in quarter 1, with Scotland punished even further. He cannot blame covid, as the fall was over three times worse than the global comparison. Official statistics show that for every £245 that Brexit cost in lost trade, even if the Government were to agree multiple free trade agreements, it will bring in only around £18 in return. The UK is virtually alone in facing this kamikaze blow to its exports. Scotland voted against this trade catastrophe. When will the UK Government renegotiate this disaster—or do they intend to continue to be anti-trade?

[Greg Hands]

I take that with a bucket of salt from the SNP about being anti-trade. As we have heard so often in this House, the SNP has failed to support any trade agreement negotiated either by Brussels or by us in Westminster. I do not think there is a single party in this House that is more anti-trade than the Scottish National party. I urge the hon. Gentleman to have a look at the latest data. Trade with the EU is recovering—it may not yet be fully recovered, but it is recovering—and the latest data, in May, shows a very significant 8% improvement on the previous quarter. I refer him to last Friday’s data.

[Drew Hendry]

Mr Speaker, you can see why we do not support any trade deals from this Government—because they always sell Scotland out. Let us hear what industry is saying. Fishing representative bodies continue to say that the Prime Minister has betrayed them and that they have been sold out. Individual losses of tens of thousands of pounds are commonplace due to export delays. A perfect storm of red tape, driver shortages and other Brexit issues are destroying businesses across the board, but especially in food and drink. According to the Road Haulage Association, almost a third of UK hauliers say they are having to avoid working with the food and drink industry due to increased checks and admin. Costs are up everywhere on materials, admin and transport—20% in distilleries. What compensation is planned for those affected—or, when the Prime Minister said “eff business”, was that an instruction?

[Greg Hands]

There was a lot in that further supplementary. May I just remind the hon. Gentleman that most of the trade deals that he and his party have not supported are actually the EU’s trade deals? His party’s policy is to re-join the EU. The SNP was against the EU-Japan deal in the European Parliament and abstained here; it was against the Canada deal; it was against the Singapore deal; it abstained on South Africa, and it abstained on Korea.

When it comes to fisheries, I refer the hon. Gentleman back to what the ONS said, not this past Friday but in relation to February’s data—he is so out of date. This is what the ONS said in April:

“The disruptions to food exports in January 2021 appear to have largely been overcome and may have only had short-term impacts on trade.”

That is what it said in April, yet he is still not up to date. On hauliers, we are discussing all the time with the Department for Transport what extra action needs to be taken.

Finally, the hon. Gentleman asks for compensation. Perhaps he can come to this House and account for the £180 million given by this Government to the Scottish Government for dealing with the consequences and the impact of Brexit at the end of the transition period, because we are not at all sure where that money has gone.

[Matt Western (Warwick and Leamington) (Lab) [V]]

The reality on the ground is quite different from what the Minister may be claiming. I recently met many manufacturers and businesses in Warwick and Leamington, such as Bravissimo, Vitsoe and young British designers, and they are desperate. Their concerns are underlined by surveys by the Federation of Small Businesses, the Institute of Directors and Make UK showing the serious and lasting damage being done to UK firms trying to maintain their trade with Europe in the face of the inadequacies of the Government’s Brexit deal. Can I ask the Minister of State whether he thinks Lord Frost has the bandwidth to fix those problems, on top of the Northern Ireland protocol, or do we need someone else in Government to get a grip?

[Greg Hands]

The Government have full bandwidth on all these aspects. We are satisfied with the trade and co-operation agreement. It is an agreement that is working well. In terms of adding support to exporters, that is the role of this Department and other Departments. We have helplines in place. We have the Brexit business taskforce. We have the DIT internationalisation fund. The Department for Environment, Food and Rural Affairs has a £23 million seafood disruption fund. We have recently opened trade hubs in Edinburgh and Darlington, and we will open hubs soon in Cardiff and Belfast. We have a refreshed export strategy coming later this year. The Government are fully engaged on assisting exporters to get their goods and services into the European Union.

[Karl MᶜCartney (Lincoln) (Con)]

What recent progress she has made on negotiating new free trade agreements.

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[Martin Vickers (Cleethorpes) (Con)]

What recent progress she has made on negotiations to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.

[The Minister for Trade Policy (Greg Hands)]

Her Majesty’s Government formally began negotiations on the UK’s accession to CPTPP on 22 June. Negotiating teams will be working hard over the coming months to ensure a good deal for businesses, producers and consumers across the UK. The UK’s accession would make CPTPP a truly global free trading area and strengthen the UK’s relationship with 11 dynamic economies across four continents.

[Paul Bristow [V]]

Taiwan is one of the top 20 trading nations in the world, a vibrant democracy, a member of the WTO and an Asia-Pacific Economic Co-operation member economy. Could the Minister confirm that the UK welcomes Taiwan’s intention to join CPTPP alongside our own application and update the House on efforts to deepen our bilateral trade ties with Taiwan?

[Greg Hands]

Taiwan is a subject close to my heart, and we know that it is an important and growing trading partner for the UK. It is a highly valued member of the WTO as well. Future membership of CPTPP is a matter for the members at that time, but I note that Taiwan is looking to align itself to CPTPP’s high standards and is continuing its long-standing commitment to rules-based trade and the global trading system. We expect CPTPP to grow in size, and future members will be a matter for future consideration. I am looking forward to our next round of Joint Economic and Trade Committee talks with Taiwan, hopefully as soon as travel becomes possible again.

[Martin Vickers [V]]

I very much support the Government’s efforts to become a member of CPTPP, which, as the Minister mentioned, offers great prospects. Indeed, my constituency is a major centre for renewable energy and has links with, for example, Taiwan. Does he anticipate that the renewable energy sector will gain great advantage from CPTPP membership and boost those industries in my constituency?

[Greg Hands]

Yes. CPTPP will of course liberalise trade in goods and services in the fast-growing markets in the Pacific, and fast-growing markets have fast-growing needs for clean energy. In recent times, I have been in Vietnam, Korea and Taiwan, pushing UK expertise and exports, for example, in the offshore wind sector. I remind the House that the UK has the world’s largest offshore wind capacity. I am sure there will be opportunities for that and other renewable sectors in Yorkshire and the Humber, including in Cleethorpes.

[Bill Esterson (Sefton Central) (Lab)]

The Government are relying on increased trade with Malaysia for three quarters of the forecast benefits from joining the CPTPP. That may explain why Ministers have turned a blind eye to the growing use of slave labour in Malaysian factories. If the Minister disputes what I have just said, perhaps he can tell us what proportion of the 760 million medical gloves bought by the Government from Malaysia during the pandemic were manufactured using slave labour?

[Greg Hands]

We take our obligations and any allegations of the use of slave labour extremely seriously. I am happy to look into it if the hon. Member has specific allegations in relation to Malaysia. I might add that the Malaysian supply of latex gloves last year was extremely important for this country, but I am happy to look into it if he has specific evidence of the use of slave labour. Of course, Malaysia has not yet ratified CPTPP. We hope that it will and I remind him that CPTPP has a comprehensive chapter on labour and workers’ rights.

[Bill Esterson]

The Minister really was not in a position to answer that question because his Department failed to act on warnings last year from the high commissioner in Kuala Lumpur telling them that their slavery audit function for glove manufacturing was not up to the task. It simply cannot be allowed to continue, so if I write to the Minister with the Government’s current list of glove suppliers—I have a list of 19 companies so far—will he agree to conduct a proper audit of their factories? Bearing in mind what he just said about accession to CPTPP and Malaysia having yet to ratify it, will he also reconsider signing any trade agreement with Malaysia as long as its reliance on slave labour persists?

[Greg Hands]

I repeat my offer to have a look at the specifics, of course. The UK Government take all such accusations, allegations or reports extremely seriously. When it comes to Malaysia joining CPTPP, they have signed and it is up to them to ratify. The UK is not currently a member of CPTPP so it is not up to us who joins it at the moment, but I remind the hon. Gentleman that CPTPP does include a comprehensive labour chapter that ensures that the parties protect and enforce labour rights, improve working conditions and strengthen co-operation on labour issues, all of which would be very helpful in the sort of cases that he is talking about.

[Tom Randall (Gedling) (Con)]

What recent progress she has made with her G7 counterparts on advocating for free and fair trade throughout the world.

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[Mr Alistair Carmichael (Orkney and Shetland) (LD)]

What assessment she has made of the potential effect of tariff-free trade of agricultural goods between the UK and Australia on UK farmers and crofters.

[The Minister for Trade Policy (Greg Hands)]

There will be more UK export opportunities for our food and drink industry with the removal of all Australia tariffs. We have considered the impact of additional market access for beef and lamb on UK farmers, which has been balanced by a lengthy 15-year staging period. An independently scrutinised impact assessment will be published prior to implementation.

[Mr Carmichael]

Patrick Krause, chief executive of the Scottish Crofting Foundation, recently made the point that the real risk for Scottish crofters from the Australia deal comes from the fact that other countries with which we do trade deals will want the same good terms that we have given to Australia. As he said,

“Crofting is good for food, and also has very impressive environmental and climate-change mitigation credentials. And crofting is about the people—crofting has maintained communities in remote rural places.”

How much of that does the Minister think will be said of the products that will be imported to replace crofted lamb?

[Greg Hands]

I thank the right hon. Gentleman for his engagement and his interest. I have engaged extensively with Scottish farmers, crofters and Martin Kennedy of the National Farmers Union Scotland. I have done various roundtables with constituency MPs as well. On the impact of Australian beef and lamb imports, we think it is very unlikely that there will be a surge in imports into this country. Currently, there are strong incentives for Australia to sell into Asia. For example, the lamb quota is not currently fully used. Beef production prices in Asia are twice what they are in the UK. Australia exports 75% of its beef and 70% of its lamb to Asia, which is why I would expect that pattern to be continued. But this is also why we have built safeguards and a staging period of 15 years into the deal.

[Kerry McCarthy (Bristol East) (Lab)]

What recent discussions she has had with UK trade partners on inserting clauses on environmental standards into future trade deals.

[The Minister for Trade Policy (Greg Hands)]

We are seeking environmental provisions with all partners with which we are currently negotiating to ensure that future trade is sustainable and upholds the UK’s high environmental standards. The precise deals of any free trade agreement are a matter for formal negotiations.

[Rachael Maskell]

Despite what the Minister says about calling for more control over trade, he has completely failed to advance the “polluter pays” principle through the carbon border tax, failed to advance the agenda at the G7, failed to put it into any of the trade agreements that he has drawn up and failed to put it into any of the negotiation frameworks that he is currently discussing. Can he tell me whether he will fail at the next stage when it comes to COP26? Is he already engaged in pre-negotiation talks with all the partners, and how will the principle fare on the COP26 agenda when the summits meets in November?

[Greg Hands]

We take a strong interest in carbon leakage and in how trade deals with carbon. We are studying carefully, for example, EU proposals on the carbon border adjustment mechanism. At the World Trade Organisation in general, we are looking to advance our environmental agenda. The hon. Lady will know of the different measures taken by the UK Government; for example there is the UK global tariff, which reduced and eliminated tariffs on 104 environmental goods. We are also seeking good environmental chapters in all of our future free trade agreements.

[Mr Speaker]

I call Kerry McCarthy for the final question.

[Kerry McCarthy]

Thank you for sneaking me in, Mr Speaker.

Today, we heard the devastating news that the Amazon is now a carbon source rather than a carbon sink. With deforestation at a 12-year high, it is emitting more CO₂ than it absorbs. Is the Minister following the progress of the land-grabbing legislation, which has been dubbed the destruction package, that is going through the Brazilian Parliament at the moment? What discussions has he had with his counterparts, and what impact would that have on trade negotiations with Brazil? May I urge him to rule them out if this package goes through?

[Greg Hands]

We are not currently negotiating a trade agreement with Brazil. We follow the position in Brazil very closely, and we engage strongly on a bilateral basis on all of these issues with the Brazilian Government. We have very good diplomatic representation not just in Brasilia but across different parts of Brazil, to make sure that the UK position and the importance of deforestation for the UK, particularly in this COP26 year, is upheld.

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[Andrew Jones (Harrogate and Knaresborough) (Con)]

I welcome the historic free trade agreement that my right hon. Friend has secured with Australia and congratulate her on it. As somebody who has done some exporting to Australia before coming here, I know that this presents significant opportunities for UK businesses and consumers. I was really pleased to see increased opportunities for younger people to travel and work there, which is a very valuable experience and an interesting element for a trade deal.

[The Minister for Trade Policy (Greg Hands)]

My hon. Friend is correct. The Australia deal is a fundamentally liberalising agreement that removes tariffs and supports millions of jobs. It will strengthen the bonds of friendship—I speak as the parliamentary president of the Conservative Friends of Australia—for example by championing youth mobility, which he referred to. The deal also paves the way for joining the comprehensive and progressive agreement for trans-Pacific partnership and the growing middle-class markets of the Pacific rim. We are realising the vision of a global Britain that looks to one of the most dynamic trading areas in the world.

[Mr Virendra Sharma (Ealing, Southall) (Lab) [V]]

Does the Minister think it is appropriate that HSBC continues to meet Trade Ministers privately and advise on UK trade policy with China while it supports the crackdown on the pro-democracy movement in Hong Kong and continues to freeze prominent activists’ bank accounts?

[Greg Hands]

HSBC is an extremely important company and employer in this country. I do not have a problem with Ministers meeting HSBC, let us put that on the record. The hon. Gentleman will also be aware of the very strong action we have taken in relation to China and the measures announced by the Foreign Secretary in this House in January in relation to supply chains in Xinjiang and actions in Hong Kong, which had broad agreement across the House. We will continue to make vigorous representations in relation to China, and we are monitoring the situation very closely.

[Tom Randall (Gedling) (Con)]

  The UK is already one of the world’s biggest exporters of services, with remotely delivered service exports worth £207 billion in 2019 alone. I am delighted to see that negotiations have been launched for a new digital economy agreement with Singapore. Can my right hon. Friend confirm that this new advanced high-tech digital trade agreement could remove barriers to digital trade and thereby allow UK exports to expand into high-tech markets?

[Greg Hands]

My hon. Friend is absolutely right. Services are 80% of the UK economy. We are the world’s second largest exporter of services, and a huge number of those are digitally enabled. The digital economy agreement between the UK and Singapore will be a model for global digital trade rules, and I met Singapore Minister Alvin Tan just yesterday to discuss it. Singapore is a global leader in this area. We are looking forward to signing an excellent agreement with Singapore.

[Helen Hayes (Dulwich and West Norwood) (Lab) [V]]

  We cannot claim to have reached genuine net zero as a country or even have a plan to do so until we take into account the impact of our imports on global carbon emissions. The Secretary of State and the Minister for Trade Policy have acknowledged the importance of that, but neither has answered this very simple question: will the Government commit to ensuring that proposals for a carbon border tax are on the agenda for COP26 in November, so that meaningful progress can be made on accounting for and reducing carbon emissions from trade? Yes or no?

[Greg Hands]

We are following developments on the EU carbon border adjustment mechanism closely. The UK has ambitious carbon pricing through our emissions trading scheme and carbon price support mechanism, and we expect the EU CBAM to take account of that in its implementation. The COP President-designate, my right hon. Friend the Member for Reading West (Alok Sharma), has said that he does not anticipate carbon border adjustment mechanisms becoming an issue within the COP26 negotiations.

[Mrs Sheryll Murray (South East Cornwall) (Con)]

  Many of my farmers in South East Cornwall already find it difficult to deal with the amount of paperwork they have. Some will have seen the entertaining but very informative show by Jeremy Clarkson, as he worked his farm. How is the Department proactively going to help our farmers achieve global sales?

[Kerry McCarthy (Bristol East) (Lab)]

In the national food strategy, which was published today, I note that despite the manifesto pledge in 2019, the Government have still not said what standards they propose to protect or what mechanism they will use to defend those standards in trade negotiations. Is the Minister prepared to do that now?

[Greg Hands]

We have been absolutely categorical in our commitment on food standards and food safety standards. There will be no compromise on UK standards in relation to any trade agreement. That has been the case—[Interruption.] Our commitment is absolute. If the hon. Member were to take a look at all the trade agreements we have done with 67 countries—if she looked at the Australia trade deal agreement in principle and the Japan deal—she would see no diminution in our food safety and animal welfare standards so far.

[Ian Levy (Blyth Valley) (Con) [V]]

  Enshore Subsea, based at the port of Blyth, has a proud history of subsea trenching for the oil and gas industries, as well as the telecoms and offshore power industries, dating back over 25 years. It is a fine example of the incredible innovation offered by UK businesses excelling on the world stage. Will my hon. Friend come with me to the port of Blyth to visit this fantastic world-leading business, and discuss with it how we can best enable businesses like it to compete across the globe?

[Rob Roberts (Delyn) (Ind) [V]]

My right hon. Friend the Secretary of State and her team have completed 67 trade deals around the world, and she and I have spoken many times about the aspects and impacts of the deals that she has done on north Wales, particularly in relation to agriculture, which is such a significant part of my constituency. What assurances can the Minister give to the people of Delyn that maintaining the highest level of food and agriculture standards in our global trading is at the forefront of all our negotiations?

[Greg Hands]

I can absolutely give that commitment to the people of Delyn. The Government have been very clear that any trade deals must work for UK consumers and businesses, upholding our high regulatory standards. The Government, as I mentioned earlier, have manifesto commitments to no compromise on standards in animal welfare, food safety and the environment.

[Christian Wakeford (Bury South) (Con) [V]]

Mr Speaker, I am delighted to be joining you from the 7th global forum for combating antisemitism here in Israel. With that in mind, as a newly independent sovereign trading nation, we have a number of trading opportunitieseb;normal;j ahead of us, including with countries such as Israel, with which we already have a £5 billion continuity trade relationship. Can my right hon. Friend the Secretary of State confirm what progress has been made on an advanced high-tech free trade agreement with Israel, and what help can she offer the likes of the Northern Health Science Alliance in conjunction with Israel?

[Mary Kelly Foy (City of Durham) (Lab) [V]]

Following the recent investor-state dispute settlement challenge from Canadian fossil fuel company TC Energy to President Biden’s cancellation of the Keystone tar sands pipeline, seeking an unprecedented $15 billion, what responses has the Secretary of State received on the issue of ISDS in the recent consultation on UK-Canada trading arrangements, and will she commit to dropping ISDS in the UK-Canada trade deal?

[Greg Hands]

We will be responding in due course to the call for input on going further on a trade deal with Canada, and we are looking forward to that negotiation starting in the autumn. I would remind the hon. Member that there are no ISDS provisions in the UK-Australia deal, but I would also remind her that the UK has never lost an ISDS case. We do have ISDS provisions in quite a number of our existing agreements, and the UK has never lost any such case.

[Henry Smith (Crawley) (Con) [V]]

  Does my right hon. Friend agree that it is thanks to UK Export Finance reacting so quickly to the economic challenges of the covid-19 pandemic with the full backing of the Treasury that it was able to help some 549 companies and all their suppliers sell to 77 countries around the world last year?