Kelvin Hopkins
Main Page: Kelvin Hopkins (Independent - Luton North)Transatlantic Trade and Investment Partnership
Kelvin Hopkins Excerpts
Mr Peter Lilley (Hitchin and Harpenden) (Con)
I congratulate the hon. Member for Swansea West (Geraint Davies) on securing the debate and on raising some very important points that this House should consider seriously.
As the last Member in this House, I think, who was involved in negotiating a successful international trade round—the Uruguay round, when I was Secretary of State for Trade and Industry—I am extremely in favour of free trade. I believe there is a strong case for unilateral free trade, although that is not easy to sell to the electorate. A priori, therefore, I approach the TTIP agreement from a position of strong support. I am very suspicious of critics of TTIP who are often simply against trade, simply against markets, simply against choice, simply against business and simply against America.
Mr Lilley
I will not, because the hon. Gentleman may find in a minute that I have answered his question.
I am especially hostile to all those people who press the button on 38 Degrees campaigns that relate to anything against trade and business. I was rather surprised, therefore, to find myself sympathising with four people who appeared in my surgery and announced, to a groan from me, that they were members of 38 Degrees and had concerns about TTIP. They actually raised some very important points that resonated with me from my experience of past negotiations.
I am, of course, totally in favour of removing tariffs, but that is a relatively minor aspect of what TTIP is about. Over the years, we have been hugely successful in removing tariffs and straightforward barriers to trade. They averaged 40% back when the general agreement on tariffs and trade was set up. They were still around 15% when I was negotiating. The tariffs now between the United States and Europe average less than 2%. Half of all goods traded between the two continents are entirely tariff-free. That means, of course, that those that are subject to tariffs can be higher. On clothing, the tariffs are up to 30% and on cars the US levies a tariff of 2.5%. The EU, under the influence no doubt of German car manufacturers, levies a tariff of 10% on imports of cars from America.
Abolition of the remaining tariffs is worth having and would be the final success of GATT. TTIP goes far beyond that, however, and into harmonisation of regulation, rules on investment and rules on procurement. It is true that those sorts of rules can, either by intent or by accident, be used to inhibit trade. We should avoid using them in that way and we should seek, if we can, agreements to anti-discrimination rules so that neither in the business of investment nor procurement would either the United States or the EU be allowed to discriminate against firms from the other side.
My concern, and the concern of my constituents who declare themselves to be members of 38 Degrees, is that we may be creating a bureaucratic and legal process that may escape proper democratic control and may be subject to improper corporate influence. It is also symptomatic, although this is the least important point, of bureaucracies that perpetuate their existence even when the task they were established to do is largely complete. Literate Members of this House—we are all literate—will remember Dickens describing the circumlocution office, whose chief, Lord Tite Barnacle
“had died at his post with his drawn salary in his hand”
defending the existence of an organisation that no longer had any need to exist. Actually, because we have succeeded on tariff negotiations, we should be scaling down, not up, the international bureaucracy and not giving it far more undemocratic powers.
Even during the Uruguay round, I had my concerns. First, I was concerned about accountability to this House. The negotiations were so complex that it was difficult for the House to hold Ministers to account, and it was easy for Ministers to present a fait accompli to this House and say they had achieved the best compromise.
Mr John Spellar (Warley) (Lab)
I declare an interest as the chairman of the all-party European Union-United States trade and investment group and as an unashamed supporter of trade. Over the centuries, trade has been of huge benefit to this country, particularly to the west midlands, which grew on the back of trade. Indeed, the west midlands is the only region of the UK that has a positive trade balance with China. Equally significantly, trade has been the engine by which hundreds of millions of people around the world have been lifted out of poverty. We need only look at the growth of China. I will come back to some aspects of that, as they were mentioned by my hon. Friend the Member for Swansea West (Geraint Davies). Hundreds of millions of people in China have seen their lives changed dramatically as a result of trade.
In debating these trade deals, there have historically been those in this House and in British politics who are opposed to trade. This is not a recent argument.
Kelvin Hopkins
My right hon. Friend will know that all the nations that have achieved dramatic improvements in their economies have done so with a degree of protection. The Chinese have used a massive devaluation of their currency against the western currencies behind which they have seen their economy develop rapidly. Protectionism works.
Mr Spellar
I am pleased that my hon. Friend wants us to move towards a more rules-based system that will enable us to develop more effectively. Trade has worked in that regard, and I am glad that he concedes that.
A great mythology is being developed around this. When I asked my hon. Friend the Member for Swansea West how many agreements the UK has had that involved ISDS, he was reluctant to reveal that the answer is 94. How many cases have been taken against the UK on that basis? My understanding is two. How many of those cases have been successful? My understanding is none. Mention is made once again of the very long-running Philip Morris so-called case. It is absolutely true that Philip Morris said it was lodging a case. Has it gone anywhere? Has it stopped the Australian Government taking action? Of course it has not. One of the more regularly cited cases is that of Slovakia’s health insurance system. We are often told that a Dutch insurance company managed to secure substantial damages from the Slovakian Government. That is true, because the case was about whether, under the existing contract, it could repatriate its profits to Holland. In a second case, which everybody seems to forget, the Slovakian Government won, and also got costs, because the tribunal held that the company was not empowered to intervene in the democratic processes of a sovereign state.
I particularly take issue with the Government over the fact that while the Leader of the House might talk about left-wing groups campaigning with scare stories, Ministers will not take on the myths so that we can get back to arguing about the issues that my hon. Friend rightly raised. The Government just hide away engaging in the negotiations and will not take these issues on.
Helen Goodman (Bishop Auckland) (Lab)
I wish to begin by congratulating my hon. Friend the Member for Swansea West (Geraint Davies) on securing this debate. I am very grateful to him for asking me to support his application to the Backbench Business Committee for this very important debate, and I agreed with everything that he said about the risks of TTIP and about the need for us to think more deeply about the institutional architecture as we move forward, so that trade, environment and labour standards are all put on an equal footing.
I also want to say what an excellent speech my hon. Friend the Member for City of Chester (Christian Matheson) made. He drew out the problems that similar arrangements have caused in developing countries. The point that he made demonstrated that those of us who are raising questions are fully in the tradition of all those who back the human rights and democratic values of Europe and America.
The Department for Business, Innovation and Skills has analysed the benefits of TTIP. Its estimate is that the gain in this country by 2027 in terms of higher GDP would be £7 billion. When one hears the figure of £7 billion a year, that sounds like quite a lot, but let me put it in the context of the amount of trade we have in this country and the huge uncertainties about the forecasts as we go forward.
Kelvin Hopkins
I just want to make the point that statistics are bandied about for political advantage. My hon. Friend is quite right about the £7 billion, but how would it compare with the £62 billion of trade deficit with the European Union? Those are the kind of figures that make £7 billion very small indeed.
Helen Goodman
The point that I was going to make was that the Office for Budget Responsibility, in its forecast of GDP out to 2020, has an uncertainty of 6% in GDP. That is £160 billion, so we lose the £7 billion of economic benefits in the rounding. I am not saying that there will not be some economic benefits, but we should consider how significant they are and weigh them against the disadvantages that other hon. Members have mentioned. Will this have a significant benefit for our level of exports? By way of comparison, the impact on the level of growth in the markets to which we export is expected to be £338 billion over the next five years. If we have variations in the exchange rate, that will be far greater than the possible benefits we can get from this trade deal.
I am resting my case on the analysis from the Minister’s Department. On the assumption that the Department has got this right, each person in this country would benefit to the tune of £110 a year, or about £2 a week. It is very nice to have £2 a week and I am sure that we would all rather have it than not, but if the price that has to be paid is a loss of working conditions, labour standards and potential improvements in the national minimum wage or national living wage, the benefits will not in practice accrue to ordinary people in this country. That is why people have doubts about this.
Colleagues have raised the concerns about the national health service, the environment and food standards. I think that the carve-out in the European Commission’s negotiating mandate secured by the French on audio-visual services is extremely important; it is also important that we maintain our cultural resources.
Let me come to the big downside of TTIP, which is the loss of sovereignty inherent in the investor-state dispute settlement. The intellectual integrity and honesty displayed in the speech of the right hon. Member for Hitchin and Harpenden (Mr Lilley), a former Secretary of State for Trade and Industry, made it a very important contribution to the debate.
Kelvin Hopkins (Luton North) (Lab)
I congratulate my hon. Friend the Member for Swansea West (Geraint Davies) and other colleagues on securing this important debate. I also congratulate my hon. Friend the Member for Bishop Auckland (Helen Goodman) on her speech. Like her, I agree with much of what the right hon. Member for Hitchin and Harpenden (Mr Lilley) said in a very honest speech.
I am of the left. The Conservatives accuse some of those who oppose TTIP of being on the left. Well, I am of the left. I call myself a democratic socialist, but as our party defines itself in its constitution as a democratic socialist party, I think I am in the right party and I am happy and proud to be so.
Those who support TTIP should read “Fighting TTIP, CETA and ISDS: Lessons from Canada” by Maude Barlow on behalf of the Council of Canadians. Everything they say will be shown to be wrong when they read that.
TTIP must be opposed with all possible force as a dangerous attempt to negate meaningful democracy. It is designed simply to hand economic power to global corporations and to prevent democratically elected Governments from acting in the interests of their peoples. It has been negotiated largely in secret between private corporate representatives and bureaucrats, with no real democratic political involvement and certainly no representation from workers and their trade unions. On the continent of Europe millions of workers are aware of the dangers, and it is vital that the people of Britain, especially the working people of our country, also become properly aware of the dangers before it is too late.
I mentioned Europe and have seen evidence of the growing resistance to TTIP there. I was recently in Brussels, on the day of the European Council, when the Prime Minister announced his intention to write his famous letter to Donald Tusk. What was also significant on that day was the complete lock-down of the political centre of Brussels to protect politicians from a massive anti-TTIP demonstration. There were police road blocks at every turn, with water cannon at the ready and public transport services in the area closed down. I could not persuade a taxi driver to take me anywhere near my destination, and the metro was not stopping at the station serving the political district. Most significantly, there seemed to be an effective news blackout of the demonstration, so the political and bureaucratic establishment was doing its bit to protect the interests of the corporate capitalist world.
There will, of course, be all sorts of public reassurances from that same political establishment that TTIP will be benign and beneficial. That is a lie. If TTIP eventually becomes established, there may be some superficial qualifications, which will simply be pushed aside when the private corporations get their way. There is a parallel in the European Union’s hypocritical and empty commitment to workers’ rights and trade union rights—the sham of so-called social Europe. The Viking and Laval cases show that when push comes to shove, employers’ rights override any supposed worker rights. The Greek bail-out required the Greek Government to restrict trade union and worker rights as a condition of the bail-out, and there is more of that to come.
Now we see the nomenklatura of the European Union seeking to sell out workers’ rights, trade union rights and citizens’ rights to control their own lives and their societies through their elected democratic Governments. We are moving towards the referendum on Britain’s EU membership, and millions of trade union votes will be a significant factor in that referendum. The TUC is strongly opposed to TTIP and my own union, the GMB, is likely to recommend a vote to leave the EU if TTIP goes ahead. If 6 million public sector trade unionists fear that TTIP is going to happen, with the likely threat of privatisation of our public services without redress, and the threat to the services they provide and their livelihoods, they will vote to leave the EU.
I have argued that the EU is fundamentally anti-democratic, although some of my colleagues may disagree. If the Commission does a deal with the US and the corporations, that will confirm what many of us believe—that the EU is an agent of the global private corporate world.
Patricia Gibson (North Ayrshire and Arran) (SNP)
The hon. Gentleman talks about the threat to public services. Given that the people of Scotland were told by the Better Together campaign that the best way to protect Scotland’s NHS was to vote no in the independence referendum—the People’s NHS is organising a very effective campaign in Scotland—does he agree with the position of the First Minister, who has asked the Prime Minister specifically to exempt the NHS from TTIP?
Kelvin Hopkins
I would certainly support that.
Over 10 years ago Tony Blair wined and dined American health corporations in Downing Street as a prelude to what has been happening. Private companies, with the connivance of the current Government, are even now buying into bits of the national health service to make a profit, cherry-picking the most profitable bits and leaving the difficult bits for the public sector. I believe that it is time for us all, especially in the Labour party, to wake up to the dangers and reject TTIP before it is too late.
Kevin Brennan (Cardiff West) (Lab)
First, I want to say well done to my hon. Friend the Member for Swansea West (Geraint Davies) for securing the debate. If I counted correctly, there have been 16 Back-Bench contributions. I hope I have not missed anyone out. The speech from my hon. Friend the Member for Swansea West was followed by a very important speech from the right hon. Member for Hitchin and Harpenden (Mr Lilley). His thoughtful and important points about international bureaucracies outside democratic control resonated across the House. My right hon. Friend the Member for Warley (Mr Spellar), the chair of the all-party parliamentary group on European Union-United States trade and investment, put the case in his typically robust style and in a very effective manner.
We also heard speeches from the hon. Member for Aberconwy (Guto Bebb), my hon. Friend the Member for City of Chester (Christian Matheson), the hon. Members for Newark (Robert Jenrick), for Glenrothes (Peter Grant) and for Brigg and Goole (Andrew Percy), my hon. Friend the Member for Bishop Auckland (Helen Goodman), the hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards), my hon. Friend the Member for Luton North (Kelvin Hopkins), the hon. Members for Inverclyde (Ronnie Cowan) and for Kirkcaldy and Cowdenbeath (Roger Mullin), my hon. Friends the Members for Edmonton (Kate Osamor) and for Cambridge (Daniel Zeichner), and the hon. Member for Foyle (Mark Durkan). Finally, we heard from the hon. Member for Livingston (Hannah Bardell), speaking from the Front Bench for the Scottish National party. All those speeches made for a very interesting debate, and I look forward to hearing the Minister’s response to it.
There have been several debates on this subject in the House over the past couple of years and I am sure that they have helped to shape the debate about TTIP and to influence the negotiations in a positive way. There is general cross-party support for trade, and for a good trade agreement, but, as we have heard, there is also a great deal of controversy and concern, and in some cases outright opposition.
A comprehensive trade agreement between the EU and the USA has huge potential benefits. The CBI has described it as a global economic game changer, but of course for that to be true we have to get it right. The hon. Member for Livingston pointed out the Government’s dismal record on trade. I can tell her that new figures have come out today on the UK trade deficit in goods and services which show that the figure had risen to £4.1 billion in the three months to October 2015, which is £2.4 billion higher than in the previous three months. If that is not clear evidence that we need to improve our trade and export performance, I cannot imagine what is.
Kelvin Hopkins
Does my hon. Friend agree with Anthony Hilton, who has written in the Evening Standard that the disaster facing us is in fact a trade deficit disaster, and that this Government and future Governments will have to address it?
Kevin Brennan
Yes, my hon. Friend is absolutely right. When the Government discuss deficits, they seem not to want to talk about the trade deficit at all. It is extremely important, however, because it will in effect become a tax on every household in the country if we allow it to persist. We have to do much better, and this point simply highlights the difference between the Government’s rhetoric and the reality of what is happening in our economy.
Estimates commissioned by the Government, and others, suggest that the potential gain from TTIP to British output could be between £4 billion and £10 billion, or 1% and 3% in exports. We must, however, be cautious about the overall figures, as they have been questioned. It would be helpful if the Government could do more to explain their case. In particular, given the wide range of contributions to today’s debate from Members representing constituents in all the nations and regions of the UK, it would be helpful if they could break down a little further what the potential benefits would be across the nations and regions.
I put a written parliamentary question to the Secretary of State for Business, Innovation and Skills, which the Minister for Small Business, Industry and Enterprise answered recently. My question was about the potential benefits of TTIP to various parts of the UK economy. The part of the question that the Government could not answer was the part relating to the benefits for the economy of each region and nation. It would be useful if the Government did that work if they want to convince the public across the United Kingdom of the benefits of the process.
We support the core objectives of a good deal—job creation, better wages, higher standards and consumer benefits—but as the debate has shown, there are still legitimate concerns that the Minister needs to address in her response. The desire to get the deal through is understandable, particularly given the US presidential election in 2016. Europe and the US are Britain’s most important markets. The US is already the UK’s largest export market, but more can be done to tackle barriers to trade and to improve market access—hence the need to reach a deal. However, any trade deal must filter down to employees, to small and medium-sized enterprises and to consumers. The business case for TTIP must be more than a case just for business. That point will be crucial in assessing any final deal.
We have set out four tests in the past and I want to repeat them today. The first key test is the ability of the deal to deliver jobs and growth. The second is that it should be open and accountable. The third is the aim to achieve the highest possible standards regarding social and environmental concerns and, of course, wages. Fourthly, the agreement must allow enough space for national Governments to act in their own interests and according to their own democratic mandates. We have been monitoring closely the negotiations between the EU and the US, and the UK Government’s input into them, through the prism of those tests. We want the benefits that businesses experience to be passed on to consumers through better choice or lower prices.
I am sure the Minister will argue strongly for the benefits that TTIP can bring, and it would be useful to hear whether she thinks it would be in Britain’s interest to leave the European Union, given that we are negotiating this agreement. Can she explain what would happen to TTIP if the UK left the EU? Reports suggest that the Prime Minister is considering recommending such a course of action if he cannot get his way in the negotiations. Labour Members strongly believe that it is in the UK’s interest to stay in the European Union, and I hope the Minister will echo that in her response to the debate.
Real concerns have been raised about the ISDS, and many of our Labour colleagues in the European Parliament have pressed hard on that issue. The current European Parliament resolution calls for the ISDS to be replaced by a
“new system for resolving disputes between investors and states”
that is
“subject to democratic principles and scrutiny.”
The text does not address the issue of having a separate judicial system that is available only to foreign investors. The European Commission responded to the European Parliament’s demand by publishing on 16 September a proposal for a new mechanism called the investment court system, which would be used as a reference for TTIP and all future trade negotiations. Labour MEPs are considering that proposal closely and have expressed strong reservations about it.
It would be helpful to hear a strong statement on the NHS from the Minister, given the concerns that have been raised by constituents and by right hon. and hon. Members today. When does the Minister believe that the TTIP agreement is likely to be concluded? What representations have Ministers made to the European Union about ISDS, and what are the Government doing to engage better with businesses, charities, consumer groups and trade unions to improve public understanding of TTIP and counter the view that it is all being done behind the public’s back?
The prize of a successful agreement must be shared among all—businesses, employees and consumers—and not just large corporate interests. Labour will continue to push for transparency so that the benefits of this major deal are clear to all. As hon. Members have mentioned, there are concerns about the impact of TTIP on working people and public services in the UK. Our major concern is that the trade agreement has the potential to dilute workers’ rights, and given the Government’s record on that—not least the Trade Union Bill in the other place—those concerns are understandable. What assurances can the Minister give about labour and workers’ rights, and will she assure the House that the agreement will not be used to block future attempts to bring a health service back towards public ownership?
Time is limited, so in conclusion we believe it right that this important issue be debated in Parliament, and we agree that the proposals deserve proper scrutiny at UK and EU level. Labour supports trade agreements that can bring significant benefits through boosting trade and growth, securing and creating jobs, and bringing down costs and extending choice for consumers. However, we want to hear the Government’s response to the legitimate concerns that have been raised in the House today about TTIP.