Trade (Australia and New Zealand) Bill

Debate between Jonathan Djanogly and Angus Brendan MacNeil

2nd reading
Tuesday 6th September 2022 Commons Chamber

[Mr Jonathan Djanogly (Huntingdon) (Con)]

These Australian and New Zealand free trade agreements are in the round, I believe, a good thing for the UK and they have my support and good wishes for their potential in binding our countries ever closer together.

I have heard various attacks on various aspects of the deals, but some of the complaints are a bit like comparing apples with pears—like those who complain about falling trade with the EU and then say that there will not be much coming in from Australia under this deal to compensate. Surely, given where we are, and now that we can negotiate our own trade deals post Brexit, we need to be getting out there and negotiating those deals, like we have with this deal, even if we also need to be organising a better deal with the EU. It might be more persuasive if opponents suggested that the EU had a better FTA with Australia than we do; but of course that case cannot be made—perhaps because the EU and Australia do not yet have a deal. Many provisions here are uncontentious and just good to have, for instance, procurement provisions that create the level playing field, developed beyond WTO minimums, to provide for non-discrimination and anti-corruption, meaning that bidders for contracts will not be put off by the likelihood of local businesses getting preference. Co-operation on the recognition of professional services, business mobility and the recognition of qualifications will be a great help, not only in enabling UK plc to promote our excellent professional services to Australia, but allowing Australian professionals to work here in areas where there is a crying need for such highly qualified workers, such as City law firms. The import of young talent will be a significant benefit to us. I would be interested to hear the Minister’s view on how these immigration provisions will impact on future free trade agreement negotiations. For instance, in our FTA negotiations with India will the Australian worker mobility provisions constitute the starting point?

Some people complain that the additional trade figures proposed are small, that Australia will sell more to us under this deal than we sell to it, at least in the short term, or that Australia has got a better deal. This is short-term political point scoring and it is short-sighted, because we need to look at the future potential to increase trade. If UK business is provided with anything like what the Government say will be approximately £10 billion of new legally guaranteed market access, this deal represents a huge opportunity.

Earlier in the debate there was a discussion as to how this FTA might help smaller businesses in practice. In that regard, I was contacted only a few days ago by a Huntingdon family-run mid-size company called Le Mark Group, which makes high-value work clothes, tapes and stage flooring. It is now targeting Australia and is already grateful for help from the international fund. Apparently, the Australians are very keen on its “Dirty Rigger” range of work gloves. The key point the company makes is that having the FTA in place has meant that it has had the solid platform to find a dealer that would truly commit to promoting and stocking a sufficient quantity of product. So this deal will help business, small as well as large, and I think more positivity in this debate would have been justified in that regard.

Representing a rural seat, I understand concerns about food and meat imports and ensuring that quality is maintained and that UK farmers are not left in an uncompetitive situation. Given that full market access will not happen for 15 years, there should be plenty of time to cater for the harmonisation of environmental and welfare issues, and we should be looking to ensure that that happens. I heard the Secretary of State confirm that that is the intention. In any event, all existing Australian beef and lamb is currently eaten domestically in Australia or in Asia; there is no spare capacity. One also needs to ask: whatever levels of imports are set or not set, given the increase in meat consumption in Asia why would Australia want to switch to exporting mass-market, high-volume, low-cost meat products to the UK, with ever more expensive transport costs? My hon. Friend the Member for Penrith and The Border (Dr Hudson), in a thoughtful speech, suggested that Australia might stop trading with China and then start flooding our markets as a result. One can argue that, as it is possible, but it is highly unlikely, given the number of other meat-hungry countries that are close to Australia.

[Angus Brendan MacNeil]

It is good to have these sorts of discussions. To paraphrase, the hon. Gentleman is saying, “The UK is opening the door to Australia but it is not going to come through the door because it has got so much going through other doors.” That raises the question, first, as to why Australia would want this door to be open, because it seems that it does not want it. Is it because of some of the cuts? Or is it because this is an insurance policy: a parachute market if something goes wrong in the future in some other sphere? If that is the case, it leaves somebody else very vulnerable.

[Mr Djanogly]

I think it is because there are many people in this world, including myself, who fundamentally believe that the starting point should be free trade and that the peoples of the world improve their lot generally by having free trade.

In any event, we are facing a revolution in the meat sector and it is looking increasingly likely that within 15 years cultured meat will have almost replaced low-value minced meat, chicken and pork. Furthermore, I think it unlikely that UK producers of pricey high-end meat products, particularly ones selling to local markets with strong local followings, need to fear Australian meat imports.

--- Later in debate ---

[Mr Djanogly]

I think 15 years is a very long car crash. There will be time to regularise, and the world will be a very different place in 15 years. I take the hon. Gentleman’s point on the CPTPP. It was made at the right moment, because I was about to come on to it.

A further reason for supporting the free trade agreement, as the Secretary of State mentioned, is the more strategic one. If we consider that world growth over the next century is going to be dominated by Asia-Pacific, we need to be in on the action there. Negotiations for the UK’s accession to the CPTPP have now started and Australia, New Zealand and Canada are parties to that agreement. Clearly, if we had not settled a deal with Australia and New Zealand, not least given their Commonwealth status, we could have had a much weaker pitch with which to start negotiations with CPTPP. I see this Australia FTA as helping to set out our Pacific stall, enabling us to then move on.

[Angus Brendan MacNeil]

I am interested in the hon. Gentleman’s philosophy and approach to trade. He said it was a 15-year lead-in to almost complete openness. Would he want that to be quicker? Would he want it to be 15 months? Would he want it to be slower? Would he have wanted the deal to be more like the Australian deal? I am genuinely interested in his trade philosophy, given what he said about free trade. He sounded like he wanted it to be open immediately.

[Mr Djanogly]

I do not have any objection to the 15-year period. I would be interested to have heard from his Committee whether more or less would have been preferable, and I am going to come on to scrutiny right now.

I have explained why I support this deal in outline. We need to appreciate that with an FTA, the devil will always be in the detail—something that the hon. Gentleman said himself earlier. These deals do get very detailed, which is why scrutiny of them is so important. I wish now to explain why I believe that not only has the FTA scrutiny process been flawed within the current scrutiny system on this FTA but it has shown up an urgent need for reform of the system itself, as many of us predicted would be required during consideration of the Trade Bill 2021. I thank my hon. Friend the Member for Totnes (Anthony Mangnall) for his kind and generous recognition of that.

At that time, the Government argued, as they do now, that the existing Constitutional Reform and Governance Act 2010 process would be adequate. In reality, the process, which itself was based on an outdated 1920s convention, was little regarded before Brexit as our trade agreements were then negotiated and predominantly scrutinised and voted on by the EU. As has been described, the CRaG process basically provides a period of 21 sitting days, after but not before a Government have signed a trade deal, to debate and possibly delay ratification, although in practice no delay has ever been voted for.

Before the recess I wrote to the Secretary of State on the scrutiny process for the Australia FTA and she kindly sent me an explanation, but one that frankly did not fill me with confidence. Australia has not yet ratified so there is no pressing urgency here. At the time of the Trade Bill and before signing of the Australia deal, ministers said that there would be full Committee scrutiny pre-signing, and the CRaG consultation with a debate post signing; so why did the Government start the CRaG 21-day clock ticking before the International Trade Committee report came out - effectively stymying the opportunity for debate? The scrutiny of this Bill, I am sorry to say, has been a poor performance on behalf of Ministers. Surely we urgently need to review this outdated and inept system now and move to a similar scrutiny system as used in other democracies. In the US, Japan and the EU, for example, scrutiny, including a final vote on the deal in Parliament, is what happens before signing the FTA, not just before its ratification. The bizarre reality is that, post-Brexit, the UK has given more power to Ministers and has less accountability and scrutiny over its trade deals than when we were in the EU. Now we have a new Government in place, this should be the perfect time to move on and update this creaking system.

European Union (Withdrawal) Act

Debate between Jonathan Djanogly and Angus Brendan MacNeil

Wednesday 9th January 2019 Commons Chamber

[Mr Jonathan Djanogly (Huntingdon) (Con)]

If the referendum were rerun today, everything that I have seen over the last two years—not least as a member of the Brexit Select Committee—would still lead me to vote to stay within the European Union. Having said that, I do respect the result of the referendum as a valid expression of the will of the people, but to me this means leaving the EU in a way that secures the best economic deal available with the EU and that maximises the potential for retaining the close cultural, educational, justice and security relationships that we have developed with our closest partners and allies. The referendum was “in or out”, but it did not, as some wrongly insist, dictate the terms of our leaving, nor the terms of our future relationship with the EU once out. Both of those questions were left for Parliament to resolve, and that is what MPs must now do. It is for this primary reason that I would oppose a second referendum, which would be indeterminate, complicated to implement and very divisive.

[Angus Brendan MacNeil]

The hon. Gentleman will probably be aware that the Prime Minister spoke to 200 MPs in one of the rooms in Portcullis House last night. Again, she ruled out a second referendum, but she said that if the deal does not get through, there are two options left: a no-deal Brexit or no Brexit at all with the revocation of article 50. Businesses up and down the country are going to have to start thinking about how they react once the deal is voted down. Will the hon. Gentleman venture his view on what he would do in that scenario?

[Mr Djanogly]

I was at that meeting, which I thought was a good expression of joint interests from all parties to the Prime Minister. I hope that we saw within that meeting the start of what could become a consensus, moving forward after what might be a defeat next week. Having said that, I do not discount a second referendum, as the Prime Minister did not. I am simply saying that I think it would be a very poor second best and a sign that this place had failed, but I do not dismiss the possibility.

As for the Prime Minister’s deal, on balance I find it to be a fair one and practical in the overall circumstances of the hand that we had to play; it has my support. To criticise the deal as not being as good as what we have with the EU now is a facile argument, if only because the EU was never, ever going to allow us to leave on the same or better terms than apply to the remaining 27 countries, no matter how many German cars we bought. The deal was always going to have to represent a compromise of views within the Conservative party, within Parliament and certainly with the EU. The deal reached does not represent my optimum position, but no one was ever going to get everything they wanted.

That is not to say that I do not share some of the criticisms of the deal, including many that can be found in the Brexit Committee’s report on the deal. For instance, despite assurances from two Secretaries of State, the financial settlement has not been included in the withdrawal agreement as being wholly or even partially conditional on securing a binding future relationship. To my mind, this has been a failure of negotiation that will undoubtedly reduce our leverage in future relationship negotiations due to start in March 2019 if we have a deal. Furthermore, the lack of detail in the future relationship political declaration means that there will still be another cliff edge as we reach July 2020, when we will need to decide either to head towards the backstop or to extend the implementation period, and there will still be a level of uncertainty for business as to the final form of the deal, although much less so than if we crash out with no deal.

So, on balance, we should take the deal on offer. The mess and upset that would be caused by a hard Brexit is unacceptable. Yes, the legalities can be brought to the fore on things like the backstop, but the legal cart should not be leading the commercial horse.