Draft Public Procurement (international trade agreements) (amendment) regulations 2021

Julia Lopez Excerpts

Wednesday 16th June 2021 General Committees

[The Parliamentary Secretary, Cabinet Office (Julia Lopez)]

I beg to move,

That the Committee has considered the draft Public Procurement (International Trade Agreements) (Amendment) Regulations 2021.

It is a pleasure to serve under your chairmanship, Mr Pritchard. This statutory instrument will ensure that domestic public procurement regulations give legal effect to the UK’s international procurement obligations—specifically, those covered in the UK third party international trade agreements signed with non-EU countries that had an agreement with the EU before exit day, 31 January 2020. Therefore, when contracting authorities carry out public procurements, that could be covered by an international agreement. If so, suppliers from those countries are required to be treated no less favourably than suppliers in the UK. It also means that UK businesses will continue to benefit from access to public procurement markets overseas.

We have an agreement with the devolved Administrations for this instrument to be laid on behalf of Wales, Scotland and Northern Ireland. That will ensure legislative efficiency and consistency across the four nations.

We are implementing this change because the UK Government, following our exit from the EU, have, as far as possible, committed to providing continuity of existing trade and investment relationships with our existing international partners. We have already helped to ensure a continuation of global procurement through the World Trade Organisation’s Government procurement agreement, following the UK’s accession to the agreement as an independent member, and we have laid separate legislation to implement that. Without this instrument, the UK would not be able to implement its international procurement obligations in trade agreements with third countries. That would leave the UK Government open to legal challenge and damage our reputation as an international trading partner.

This instrument will be made using powers set out in section 2 of the Trade Act 2021. The instrument will create within existing procurement regulations a new schedule listing the international agreements signed by the UK. It will be limited to UK trade agreements with countries that had a preceding agreement with the EU before exit day. Of the agreements in effect, those with substantive procurement provisions and to be listed in the schedule are with Albania, the Andean countries, Canada, the CARIFORUM states—the Caribbean Forum of African, Caribbean and Pacific States—central America, Chile, Georgia, Israel, Japan, Kosovo, Mexico, Moldova, North Macedonia, the Republic of Korea, Serbia, Singapore, the Swiss Confederation, Ukraine and Vietnam. This instrument is uncontroversial, each of those agreements having already been scrutinised via the procedure set out in the Constitutional Reform and Governance Act 2010.

Furthermore, parliamentary reports have voluntarily been laid alongside each continuity trade agreement. They explained our approach to delivering continuity with each partner as the UK left the EU. If we have made any significant changes to the trade-related provisions of our existing agreements through entering into the new ones, we have explained those in the reports.

Further affirmative statutory instruments will need to be laid, using the powers in section 2 of the Trade Act, each time that the UK signs a new trade agreement with a third country, or any of the agreements mentioned here are updated, in order to give them legal effect. Future trade agreements with countries where there was no free trade agreement with the EU before exit day—that could include Australia and New Zealand—are not covered in the Trade Act and would require separate legislation.

I commend this instrument to the Committee.

--- Later in debate ---

[Julia Lopez]

I am grateful for the hon. Lady’s comments. I am glad she agrees with us on the importance of social value in procurement. She mentioned some of the challenges we faced in procuring PPE during the crisis. I set out in Westminster Hall in quite some detail some of the challenges. I was trying to be as transparent as possible about those challenges, so that we can understand the true lessons rather than go on a wild goose chase about cronyism, which, from what I understand about how things were operating, is a misplaced concern.

I agree very much that we need a better system for procurement, and we are introducing one. We have a very ambitious Green Paper, which she will have seen, and the relevant Bill was introduced in the Queen’s Speech. We have a very good free trade agreement with the EU, so I hope that her businesses are now benefiting from that.

The reason why the draft regulations are introduced today is that the provisions were covered by other legislation, but that expires at the end of the year. That is why we have introduced this statutory instrument now that the Trade Act has had Royal Assent.

Legislation and scrutiny of new trade agreements will take place on the Floor of House. That will be led by my trade colleagues rather than the Cabinet Office. We will make sure that any new procurement regime that we put forward will be compliant with WTO rules. In having our own seat at the table now, separate from the EU, we will have our own unique voice on some of the debates about public procurement. I am sure that it will be an area where we will make our voice heard.

The hon. Lady mentioned digital. We are very keen to work with states such as Singapore and Australia to advance the digital agenda, which has stalled in recent years.

She mentioned some very important issues on supply chains and social value. There is a lot we want to try to do in this area, including making sure that we are procuring with firms that are employing apprentices, taking on disabled employees and adhering to high environmental standards. The hon. Lady mentioned human rights and made a particular suggestion. I am happy to take that away and look into it if she would like to write to me in further detail.

I hope that colleagues will join me in supporting the draft regulations, which I commend to the Committee.

Question put and agreed to.