Gender Recognition Act

Kirsty Blackman Excerpts

Monday 21st February 2022 Westminster Hall

[Kirsty Blackman (Aberdeen North) (SNP)]

Thank you, Sir Christopher—I thank Sir George, too—for chairing this debate. I also thank the hon. Member for Carshalton and Wallington (Elliot Colburn). He commented that he needed to be brave to bring forward the debate, or words to that effect, and I appreciate that he chose to do so—it was indeed a brave thing to do.

This is a really important issue. We must make change, especially for the around 500,000 trans people in the UK and their friends and family. What is proposed is a small administrative reform that will have a huge and lasting impact on the lives of trans people in the UK. Clearly, there are differences in the system to obtain a GRC in Scotland—not least that we do not have the spousal veto—but the problems with the two current systems are largely the same, and the changes that need to happen are therefore broadly similar. In Scotland we are undertaking reform, and legislation will be brought forward very soon.

As I stand here making this speech, I am acutely aware of my privilege. I will do my best to amplify the voices and concerns of those I have had the privilege to listen to over the last few years, but that is not a substitute for hearing trans voices directly. We do not have trans people in Parliament. As was mentioned, some of our MPs are unaware of ever having met a trans person. They most certainly have; they are just unaware of it. People who have never met, spoken to or heard from a trans person are not the right people to be making decisions about how gender reform should work. Trans voices are significantly outnumbered in the media on any issue relating to trans rights. That must change, but until it does, it is incumbent on those of us with platforms to make the case for reform on behalf of our constituents and other trans people across the UK.

The current system for obtaining a gender recognition certificate is a failure. The UK Government estimate that there are 200,000 to 500,000 trans people living in the UK, but fewer than 6,000 of them have obtained a gender recognition certificate. Those who have managed to have had to jump through unreasonable hoops in order to get a GRC, and they are in the tiniest minority. The process is bureaucratic, takes too long and includes many outdated and unreasonable requirements. People have to put in reams and reams of paper to do it.

It was said that the reason for those statistics might be that people do not want a gender recognition certificate. That is not the case. I have a passport because I recognise the rights that the passport gives me. I applied for that passport because I did not have to give a detailed description of my genitals in order to get the rights that come along with it. The intrusiveness of the procedure for getting a gender recognition certificate puts off a significant number of people, as do the bureaucracy and the fact there is no appeal process and no ability to find out what has gone wrong if an application is rejected.

Changing the system has no impact on the ability of trans people to correct their gender on their passport or their driving licence; it simply and exclusively applies to birth certificates and issues with pensions. Although it is a small change, it is important for the human rights and the dignity of a significant minority of our population. Birth certificates have an impact on death certificates and marriage certificates. Imagine approaching the end of your life knowing that your death certificate would have the wrong gender on it and that your friends and family would have to live with that, and spending the last moments of your life worrying about that death certificate being incorrect. We need change for that reason alone, let alone the other compelling reasons we have heard.

We have heard about the number of systems with self-ID. I want to talk about the growing number of individuals identifying as non-binary, because it is specifically mentioned in the petition. Like most feminists, I have always been bothered by gender stereotypes and gendered expectations. I can entirely understand how and why people come to the conclusion that they do not comfortably fit in either a male or a female box. None of the Government proposals I have seen go far enough, or sometimes even acknowledge the existence of non-binary people. That has to change. If we want the legislation to be fit for the future, we need to consider the needs of future generations. Many more young people are uncomfortable with established gender stereotypes and moulds. We must therefore allow non-binary people to identify as non-binary.

The extreme level of misinformation and lies pedalled about GRA reform has created an incredibly fertile ground for hate and abuse. The increase in the number of hate crimes with a trans aggravator neatly illustrates that. We must be more honest. We must not allow those in positions of power to mislead the public about the impact of the proposed reforms. The reforms will only affect birth certificates and pensions—not access to spaces, not passports, not names, not driving licences, not access to surgical interventions, not swimming pool changing rooms, not prisons, not hospital wards and not sports. All those are dealt with under the Equality Act or other Acts. I do not understand why people keep going on about swimming pools. I have been in so many swimming pools with my kids, and almost all of them have mixed changing rooms. That is already a thing. They all have cubicles as well.

In the past week I have been approached by three 50-plus women who wished to speak to me about trans rights. They approached me about the issue; it was not an issue that I had raised with them. All three of them had read about the proposed changes, and all three were baffled by the extreme reaction to a simple administrative change. One of them, who has daughters, said to me, “People should be allowed to live their lives. It makes no difference to me what it says on someone’s birth certificate.” That is the reality.

I want to end on a quote that makes it clear why we need change. This was Mr Elliot’s submission to the Women and Equalities Committee when it called for evidence:

“I had to send several private documents to a group of strangers, at the cost of £140, to let them decide whether I am man enough to marry as a husband, be declared a father to my future children or simply die with the respect of being remembered as a man. I was a boy, and I am now a man, and for six years I have been living that truth outwardly and proud with no rejection of this fact from my loved ones, yet I could still be denied my truth by strangers.”

We need change. The Gender Recognition Act needs to be reformed.

[Sir Christopher Chope (in the Chair)]

If we have 15 minutes for the SNP spokesman and 15 minutes for the official Opposition spokesman, that will give us a little more than 15 minutes for the Minister and the short response to the debate. I call Kirsten Oswald.

--- Later in debate ---

[Mike Freer]

The hon. Gentleman asks quite a complex question, so, as he would expect, I do not have the answer now, but I will write to him. I can say that the word “disorder” will be removed; regarding exactly what it will be replaced with and how that will be implemented, I will write to him to give a full answer.

I will just mention the issue about some of the processes we have talked about. On trans health, progress is being made on adult gender identity services. Five pilots in a variety of settings have been developed, and these will be evaluated to give an insight on improving delivery. As I said at the outset, the fact that people have to wait three to five years to access services is simply unacceptable, and we are committed to ensuring that the whole client/patient—whatever term we want to use— process is streamlined and made faster, more effective and client-led.

[Kirsty Blackman]

In Scotland, we have committed to bringing gender identity healthcare into line with national waiting time standards, which we have put in place. I know it is slightly outside his remit, but will the Minister consider bringing in waiting time standards for healthcare?

[Mike Freer]

I am in the enviable position of being able to promise lots because I do not actually have to deliver it—I am not the Health Minister. I can commit to having conversations with colleagues across Government to deliver all the changes in the bits of Government and processes that impact LGBT people. That issue is firmly on my agenda, and I will take away that specific request and discuss it with my colleagues in the Department of Health and Social Care.

The issue of under-18s is often where people have the most concern, but I want to stress that it is the Government’s view that the under-18s are properly supported in line with their age and decision-making capabilities. That is why Dr Hilary Cass is leading an independent review into gender identity services for children and young people. We will receive the interim recommendations soon. I have met Dr Cass and her team to discuss their work, which is rightly independent of Government. I believe that many concerns that Members and the public have about services for under-18s, which are firmly an NHS responsibility, will be addressed by the interim report by Dr Cass.

EU Trade Agreements: Replication

Kirsty Blackman Excerpts

Wednesday 13th February 2019 Commons Chamber

[Dr Fox]

The process continues, but it is worth pointing out that we have reached agreement with Switzerland, which is by far the biggest of all the agreements under this section of our trade. The trade agreement that we have signed with Switzerland this week is, by value, more than 20% of all 40 of the EU agreements. If it is possible to do it with the biggest one, it should be possible to do it with others.

[Kirsty Blackman (Aberdeen North) (SNP)]

In the unlikely event that the Prime Minister’s deal is agreed, the EU is going to write to the countries that it has agreements with and say, “Please could you agree to treat the United Kingdom as a member of the EU for the transition period?” Will the Secretary of State now admit to the House that there is no guarantee that all those third countries will agree to that request?

[Dr Fox]

All I can say is that I am not aware—nor, as far as I know, is the European Union—of a single country that has said it does not want to continue with the trading arrangements that it currently has with the United Kingdom and the European Union. Why would they?

European Union (Withdrawal) Act

Kirsty Blackman Excerpts

Monday 14th January 2019 Commons Chamber

[Dr Fox]

Perhaps the hon. Lady was not listening to the answer I gave earlier, but that process is getting to the point where we are likely to be signing some of those agreements in the very near future, at which point we will put them to the House of Commons.

Not only has there been a revolution in e-commerce, but Britain’s consumers have embraced it, with about 20% of all goods in the UK bought online. At the same time—this is less well known—of all goods sold online, the UK is third globally behind only China and the United States. Last year, one in seven global online shoppers bought UK goods. It is therefore essential that we are able to operate an independent trade policy, allowing us to access the EU market, which remains hugely important to us, without tying our hands in relation to our ability to access markets in some of the world’s fastest-growing economies.

This deal enables us to develop a trade policy that will mean we can make the most of the opportunities of new technologies and the changing shape of the global economy, striking a balance between protecting the markets we already have and tapping into new and rapidly expanding markets elsewhere.

[Kirsty Blackman (Aberdeen North) (SNP)]

Specifically on e-commerce, the Government promised that in early 2019, the new online service for overseas businesses sending parcels to customers in the UK would be available. Will the Secretary of State tell us when it is going to be available?

[Dr Fox]

The Department for International Trade is putting increased resources into improving the elements we have to enable businesses to operate online, and we will continue to do so.

We must have a policy that is flexible and nimble, with which we can make the most of the opportunities of new technologies and the changing shape of the global economy. We can boost productivity, raise living standards and promote competitiveness. Working with Parliament, business, civil society and the devolved Administrations, this deal allows us to have an independent trade policy for the first time in over 40 years.

Of course, we have not got everything that we want in this deal, but neither has the EU. There is give and take in any negotiation, and compromises have had to be made. Today, however, I would just like to emphasise what this agreement and the political declaration do. They give the United Kingdom the freedom to decide for ourselves who comes here, how to support our farmers and who fishes in our waters, as my right hon. Friend the Environment, Food and Rural Affairs Secretary set out to the House the other day. They also give us the freedom to open up new markets to world-class British goods and services around the globe.

The political declaration sets out a clearly agreed vision for the UK’s future relationship with the EU and provides instructions to negotiators. What the political declaration does is set out an unprecedented arrangement for UK-EU economic co-operation, provide ambitious arrangements for services and investment, and ensure that our relationship is far more comprehensive than any other free trade agreement the EU has signed to date.

--- Later in debate ---

[Kirsty Blackman (Aberdeen North) (SNP)]

It is an honour to speak for the Scottish National party on the second-to-last day of our second meaningful vote debate. The SNP positions on Brexit and the Prime Minister’s deal are probably pretty obvious to everybody in this House, but I will explain them just for the avoidance of doubt.

The Prime Minister said today that she wants to deliver on the result of the vote. The people of Scotland voted to remain in the EU. Therefore, the SNP will continue to fight for us to remain in the EU. We want to deliver on the vote that Scotland took in that referendum. The best future for us all is to remain a member of the EU. If we cannot remain a member of the EU, we need single market and customs union membership. I know that many Members from across the House believe that that would be the best way for us to go forward economically, and the Prime Minister needs to go away and extend article 50 so that we can have a people’s vote. We should give the people the choice to remain in the EU, because the SNP believes, as do many across the House, that they would make a different choice.

I want to talk about several things, many of which have been mentioned today, but I will start by discussing the economy, as the House would expect from the SNP’s spokesperson on the economy at Westminster. Mark Carney from the Bank of England said that Brexit has already cost each family £900. Given that we have had so many years of austerity, that is £900 that few can easily afford. The Chancellor himself said that remaining in the European Union would be a better outcome for the economy, and that is absolutely the case. We will be poorer as a result of the UK choosing to leave the EU, which is why organisations such as the CBI say that they are looking on in horror at the foreseeable economic catastrophe that the UK is choosing to bring upon itself and the ham-fisted way it is going about it.

An awful lot of people have come out with an awful lot of stats around Brexit, and I want to highlight a few of them. The Bank of England said that, with the Prime Minister’s deal, we are looking at a potential interest rate of 4%, and I want to unpack that a little bit. People who are my age, people who are a little bit older than me, and people who have been in the property market for a relatively short period of time have never seen interest rates anywhere like 4%. It is incredibly difficult for young people nowadays to buy property as it is. If we see a massive increase in interest rates, it will be absolutely and completely impossible for the vast majority of young people to buy property—even more than it is today—because it will be difficult for people to borrow money. That will have an effect not just on individuals, but on companies that are looking to borrow money. Our small businesses will therefore be less able to trade and to grow as a result of the changes that are potentially coming.

Speaking of businesses, the University of Bristol said that the decision to leave has meant that the value of UK companies has already been reduced by 16%. We have not even left the EU yet, but the value of UK companies has been reduced by 16%, and we are continuing to go down this route. Jaguar Land Rover has already cut 1,500 UK jobs and is looking to cut another 4,500, most of which will be in the UK, and it has cited Brexit concerns as a major factor.

On the subject of car manufacturing, I want to talk about what just-in-time manufacturing actually means, because it is quite difficult for people to get that concept into their heads. Does it mean that the car production plants or factories have maybe a day’s worth of widgets sitting there that can be put together to make a car or whatever is being made? No, it means that they have an hour’s worth of widgets. If Honda wanted to have nine days’ worth of stock for its Swindon plant alone, it would need a UK warehouse of roughly 300,000 square metres. It would be one of the largest buildings on earth, and that is for nine days’ worth of widgets in order to make cars. It would be absolutely impossible for the UK to find enough warehouse space to store all the widgets that it would need for all the manufactured things that we produce. The Secretary of State for International Trade was talking earlier about all the brilliant manufacturing that is done in Britain, but a huge amount of that is done with components imported from the EU.

[David T. C. Davies]

In the early 1990s, I worked in the haulage industry as a lorry driver making just-in-time deliveries of brake parts for Lucas Girling across the whole of Europe—in and out of the EU. There was never a problem, because the paperwork could be turned around in the time it took to have a coffee and a cigarette. It was not a problem then, and we did not even have a computer in the office.

[Kirsty Blackman]

Things were a bit different in 1993 from how they are now. We have customs checks that are required to be done. We have these production lines, and the storage time is much shorter because we have frictionless movement. If frictionless movement is so unimportant, why have the Government been prioritising it in the potential future relationship with the EU?

This is not just about the EU. The UK Government have also failed to set out exactly what the future relationship with Turkey is going to look like, for example.

Will widgets still be able to come in from Turkey in the event of a no-deal scenario?

The Secretary of State for International Trade was pressed earlier on whether free trade agreements with third countries will roll over. The UK Government have absolutely failed to let us or businesses know which countries have agreed to sign up for their free trade agreement to be rolled over in the event of a no-deal Brexit. Given that the largest manufacturing companies are preparing for a no-deal Brexit, the Government need to be up front and honest about how many of those free trade agreements will actually roll over. I have heard that, potentially, only 10 of them are ready to be rolled over. If that is the case, the Government need to tell us which 10 so that the companies exporting to or importing from those countries can make plans.

[Seema Malhotra]

Does the hon. Lady agree it is surprising we did not have a clearer answer on that from the Secretary of State? This is of paramount importance for businesses like those in my constituency that are trading under multiple trade agreements and exporting across the world.

[Kirsty Blackman]

I agree that it is absolutely vital. It is interesting that the Secretary of State was unable to give that answer. I have a named day question on this subject and am expecting a response tomorrow. I am aware of at least one organisation that has been asking the Secretary of State for Business, Energy and Industrial Strategy for the list since November and still has not received it. If the Government intend us to leave the EU on 29 March, and if they intend that we leave with no deal if this deal is not voted through, they need to tell companies about the scenario in which they will be operating after we leave the EU in those circumstances. The Government are wilfully making the situation worse by their refusal to come forward with this information.

[Chris Law (Dundee West) (SNP)]

My hon. Friend is making a powerful speech. Following BMW-Mini and Toyota, the Honda plant in Swindon is preparing for six days of closure as a result of this Brexit deal. Does she agree this is complete chaos and that the Government now need to end any opportunity for no deal?

[Kirsty Blackman]

It is complete chaos. It is ridiculous that businesses are having to prepare for a no deal because the Government continue to hold it over us, which is why Members on both sides of the House have signed a letter saying that a no-deal scenario is completely unacceptable. As has been said previously, opposition to no deal is one of the few things on which there is a majority in this House.

On the subject of free trade agreements, and on the subject of fantasy economics, the Government’s paper on the deal scenario, the no-deal scenario and the analysis of Brexit costs talks about the potential for signing free trade agreements with the US, Australia, New Zealand, Malaysia, Brunei, China, India, Brazil, Argentina, Paraguay, Uruguay, the UAE, Saudi Arabia, Oman, Qatar, Kuwait and Bahrain, plus rolling over all the FTAs on their current terms. The paper says that all the new free trade agreements will be signed on the basis of there being zero tariffs on everything in the scenarios that were modelled, and of all the FTAs being rolled over despite the bizarre assumptions that no sensible person would think are ever likely to happen. We are not going to have a free trade agreement with India with zero tariffs on everything within 15 years. That is absolutely not going to happen.

Despite all those bizarre assumptions, the UK Government still predict that our trade reduction will be 2.2%. So despite the most ambitious assumptions possible, which no realistic person would think could even vaguely happen, the Government still predict that our trade reduction will be 2.2% of GDP. I do not know how anyone who supports Brexit could stand up and say that we will benefit from increased international trade when it is absolutely clear that we will not, even in the best possible scenario.

One of the things that the Secretary of State for International Trade is very good at is talking about the increase in our trade with countries like South Korea, with which we trade through the EU’s free trade agreement.

[Stephen Gethins (North East Fife) (SNP)]

My hon. Friend is making an excellent speech on the perils. I wonder whether the Chancellor would agree with a huge amount of what she says. It strikes me that the Scottish Government have outlined their economic analysis of what will happen, yet the UK Government have tried to keep theirs secret. Does my hon. Friend have any thoughts on why that is the case?

[Kirsty Blackman]

I think the UK Government are trying to say as little as possible about the economic analysis because they know that Brexit will damage the economy.

I am specifically focusing on the economy, but I will talk about other things in a few moments. Investors have pulled $1.01 trillion out of UK equity funds since the 2016 referendum. That is an eye-wateringly large figure, and it comes as a direct result of the referendum according to Emerging Portfolio Fund Research, a data provider.

The Scottish Government have said that our GDP would be £9 billion lower under a free trade agreement—that is not under a no-deal scenario—than if we stayed in the EU. Amazingly, the figure is significantly more than even the most Unionist of commentators said that independence would cost the Scottish people. We are stuck with the UK, which is making terrible decisions and cutting more off our GDP than even those least in favour of independence said that independence would cut from our GDP.

[Patrick Grady (Glasgow North) (SNP)]

My hon. Friend is making a fantastic point. Is not the core of her argument that nobody, however they voted in the 2016 European referendum, voted to become poorer? That is all the more reason to put this to the people again in a people’s vote so that folk can have their say now that they know what the consequences of Brexit actually are.

[Kirsty Blackman]

My hon. Friend is absolutely right. People were told stories about unicorns and mermaids. They were told that there would be amazing economic largesse in the event of Brexit, and they have been told that for a huge number of years, and not just in relation to the Brexit vote. People have been told by politicians that those who choose to come to live and work in this country make us poorer, which is an absolute lie. Those people contribute to our GDP, they contribute to reducing our public sector net debt and they contribute to our economy, and that is without going into the cultural and social benefits.

[Hannah Bardell (Livingston) (SNP)]

It is interesting to watch the faces of Conservative Members as my hon. Friend lays out, in stark detail, the impact on the economy. I have met Hologic, a life sciences company in my Livingston constituency that does diagnostic testing, a number of times since the Brexit vote, and it has raised significant alarms. The company tests the safety of medicines for consumers not just in the UK but in the EU, and it has highlighted to me the catastrophic effect of the UK Government’s plans. Does she agree that we are heading towards catastrophe if this Government continue going this way and their motion is passed?

[Kirsty Blackman]

My hon. Friend must have read my mind, because I was just about to move on to medicines. The Nuffield Trust has said:

“The longer term arrangements envisioned in the agreement and political declaration generally entail leaving the single market. Unless negotiating positions fundamentally change, this will produce extra costs for medicines and other supplies.”

Every single month 37 million packs of medicine travel from the EU to the UK, and 45 million packs of medicine travel from the UK to the EU. If we are outside the single market and the customs union, that medicine will take longer to travel across the border in both directions. That medicine will require extra testing in both jurisdictions. If we do not test it, when we are outside the single market and do not have a common rulebook, we would be putting individuals at risk by allowing them to use medicine that has not been tested and does not fit with our regime. A no-deal scenario would be disastrous and cannot be allowed to happen.

I wish briefly to mention a couple of things that will not be ready in the event of either a deal or no deal. I have mentioned the online system for those exporting from the EU to the UK via postal packages. It is important that the Treasury gets itself into gear and sorts this out. It promised to do so in a VAT notice that was put in place in August, but it needs to establish this online system so that individuals or companies exporting from the EU to the UK by post can do so. It was particularly telling that the International Trade Secretary talked about e-commerce, given that he proposes to take us out of the digital single market—that was unfortunate.

Let me move on to other things that are not ready. The postponement scheme for VAT does not appear to be ready, or if it is ready, companies do not how to use it. Again, the Treasury and Her Majesty’s Revenue and Customs need to get that scheme set up so that VAT that is changing from acquisition VAT to import VAT can be postponed, meaning that companies will not have to pay that money up front, because otherwise the situation will spell financial disaster for a huge number of companies.

Lastly, the customs declaration system is also not ready. It has not been widely rolled out—it has not been rolled out to everybody yet—but companies will have to use it. Some 145,000 companies have never exported outwith the EU and they will be reaching this system for the first time. It is important that they use it, and that everybody is able to use it before April so that any glitches in the system will be gone. It will not be a situation involving queues of lorries—we will not even be able to load the stuff on to lorries if this system does not work, so it needs to be fixed in advance.

I wish to talk a little more about the human cost. Last week, the British Retail Consortium announced more figures on the cost of food after Brexit. It has said that a no-deal scenario would see households in Scotland paying £55.30 more each week for food and that the least well-off 10% of households across the UK would be paying £38.50 more each week. That would represent a 6.4% increase in the amount of their income that they would have to spend on food. Given the Government’s squeeze on families at the bottom of the pile, it is incredibly important that the Government do what they can to ensure that no deal is taken off the table. I do not know why we are even still discussing this. Why is no deal still on the table? Why does the Prime Minister not just say that if her deal gets voted down tomorrow, which it will, she will not have no deal happen to us and that 6.4% increase for people will not take place.

I have not yet touched on migration. The 2017 Red Book said that reducing net migration by 20,000 would increase public sector net debt by 0.2% by 2022—that is a fact. Presumably the Government stand by the fact that it is a fact, because it was in their Red Book. People who choose to live and work in this country—on these islands—are net contributors to our economy. As a group, they are net contributors to our economy. They make a contribution, so we will be poorer—economically and fiscally—if net migration is reduced by any significant number. The hospitality sector needs 100,000 new EU entrants per annum—some people go away, so that is not a net figure. If we are to be a global Britain and a country that wants people to come to enjoy it as tourists, we need people to work in that sector. Given our ageing population in Scotland, we need people to come to live and work in our country even more. That is why the UK Government must change their plan on the £30,000 cap and the cap on numbers. If they are unwilling to do that, they must devolve immigration to Scotland. If they do not devolve immigration to Scotland, they make the case for Scottish independence ever stronger.

There are EU workers in our care, manufacturing and agri-food sectors, and those sectors rely on them. Today, NFU Scotland said:

“We cannot feed our nation without this labour.”

That is incredibly serious. If we do not have enough people coming to work in our agri-food sector, we will lose the ability to be the world-leading country that we are. We will lose the ability to feed even people who live here, let alone to export and to bring in the tax revenue that we get from exporting.

Free movement of people is a good thing—a brilliant thing. People my age and younger have benefited from it. We have been able to live and work in EU countries. People from those countries have been able to come to live and work next door to us, and we have benefited from that. It is devastating to think that this Government propose that my children should not benefit from the same rights of freedom of movement as we have had. I do not believe that any Member should reasonably be celebrating the end of freedom of movement, as its end costs us our rights and money in the Government’s coffers. As the Archbishop of Canterbury said, proceeding with Brexit caused a moral issue, and the biggest place where that moral issue stands is that politicians—not all, but some—have done what they can to demonise immigration and people who are born in other countries. We would not be in the place we are today if that had not happened.

This situation is an absolute shambles. I was pleased to see that the Financial Secretary was in the Chamber earlier. I hope he managed to find some food, given the note he had saying “No food” and “No channel tunnel” when he left the earlier Cabinet meeting. I hope that those things are slight exaggerations, but given the increase in the cost of food in the event of no deal, no food would be a reality for many families. We cannot operate like this. As the CBI said, businesses are watching in horror. The Prime Minister needs to remove the threat of no deal. The Government are limping on and the whole world is watching in horror. There is no good being done in this place just now. No other things are being done here—we are entirely focused on Brexit. We are not able to do the things that a global Britain should be doing. We are unable to have any kind of positive impact on the world because we are so unbelievably inward looking, fighting in this place.

The word “thrawn” is used in the north-east of Scotland—it sounds slightly different depending on where you are in the north-east. Someone who is thrawn is determined to proceed with something, in the face of all opposition and all sanity, and despite all evidence to the contrary and every expert telling them that they are wrong, because they have said they are going to do it. Someone who is thrawn is trying to go through with it because they cannot bear going back on something they have said. I have said a number of times that the Prime Minister needs to remove the threat of no deal. When she comes to speak to us tomorrow, she needs to say that in the event that her deal is voted down, she will go to the EU to ask for an extension of article 50 in order for a people’s vote to be held, so that we can remain in the EU and we will not have this economic, social and cultural catastrophe put upon us.

[Several hon. Members rose—]

Oral Answers to Questions

Kirsty Blackman Excerpts

Thursday 13th September 2018 Commons Chamber

[George Hollingbery]

Last time I stood at this Dispatch Box, I said that I was not entirely sure I understood a particular question.

We will negotiate free trade agreements that are to the benefit of the United Kingdom—we have offensive and defensive interests—and, when we conclude those agreements, I have no doubt they will be good for the United Kingdom.

[Kirsty Blackman (Aberdeen North) (SNP)]

I apologise on behalf of my colleague, who is not here and for whom I am standing in.

This 14-week consultation period is probably the only period in which the public will have a chance to have their say on the free trade agreement. Does the Minister agree it is vital for those people who are concerned about changes in food regulation, and for those people who are concerned about the diminution of the high standards we have here, that they take the opportunity to input into this consultation and make their voices heard, as they did so successfully in previous campaigns on, for example, the Transatlantic Trade and Investment Partnership?

[George Hollingbery]

I absolutely agree with the hon. Lady. It is right that members of the public should feed in all their concerns. One of the reasons why we are running this consultation is for exactly that purpose. I back her encouraging people to take part in the consultation. Indeed, when I was in Scotland recently to meet the Scottish Government, I also met Trade Justice Scotland to discuss exactly these sorts of issues.

Trade Bill

Kirsty Blackman Excerpts

3rd reading: House of Commons & Report stage: House of Commons
Tuesday 17th July 2018 Commons Chamber

[Stewart Hosie]

That is a reasonable question, and I will answer it properly. Clearly we cannot tell precisely where the problems will arise, because we do not yet know precisely what the UK Government might do. Having said that, the Bill gives back to Ministers discretionary powers over procurement. In Scotland, because of the actions taken there, 78% of publicly procured contracts go to small and medium-sized enterprises, 60% to Scottish SMEs. The UK Government figure is 20%. If that power is taken back, and if oversight is retained by Westminster, there would be a real risk that we could lose that economic diversity and that fantastic achievement in a real-life area. That is a real concern that I hope the right hon. Gentleman will share.

I shall turn briefly to the amendments. Amendments 25 and 26 seek to address an issue in the Bill that has a direct read-across to clauses in the European Union (Withdrawal) Act 2018 that confer powers on UK Ministers in devolved areas without any form of devolved consent. No amendments have been made to the Act to alter that approach or to require the consent of Scottish Ministers when UK Ministers make regulations in devolved areas. Amendments 25 and 26 seek to ensure that the UK Government seek consent from devolved Ministers before amending legislation in devolved areas.

Before I move on, I meant to say that I recognise that Government amendments 64 and 66, and consequential amendments 65 and 67, now require Scottish Ministers only to consult and not to seek consent in certain areas. However, the number of areas is limited, and the amendments do not address all the problems.

Amendment 27 requires the Secretary of State to consult Scottish Ministers before deciding whether, or for how long, to prolong the period during which implemented powers can be used. That is important because there is no equivalent provision in the European Union (Withdrawal) Act 2018, and because no amendment has been made to the existing provisions in the Trade Bill that allow the UK Government unilaterally to alter the powers of Scottish Ministers in relation to grandfathering trade arrangements for further periods of up to five years at a time.

At present, it is envisaged that the powers in the Trade Bill relating to the grandfathering of existing free trade arrangements with third countries would have to be used in only a very small number of cases that could not be dealt with under the European Union (Withdrawal) Act—for example, for reasons of timing. However, with so much uncertainty around the ease with which existing agreements will be rolled over, it is possible that this restriction could have a more significant impact, not least because many of the 24 areas likely to be subject to the clause 11 regulations—that is, the power grab—are highly relevant to the world of trading and trade deals. If left unamended, or amended only along similar lines to the amendments in the withdrawal Act, this provision in the Trade Bill would in effect allow the UK Government to change the law in devolved areas to allow for the implementation of these arrangements, which might not necessarily remain exactly as they are at present. In essence, that is close enough to having an ability to implement a new trade Bill with almost no consultation or consent at all. Our amendment 28 deals with that problem.

Amendment 29 is small and seeks a direct read across from the European Union (Withdrawal) Act 2018. It would replace the need for consent from UK Ministers in certain circumstances with the need only to consult. As I said, I note the Government amendments in that regard.

We are not arguing for vetoes for Scotland nor for any sense of Scottish exceptionalism; we are simply looking at the facts, understanding what is going on and what needs to happen. If Scottish Ministers are required to consult or seek consent when Scottish parliamentary responsibilities intersect with UK responsibilities, we are simply arguing that UK Ministers should be under the same obligation to consult or seek consent where UK policy responsibilities intersect with those of the devolved Administrations. It was said in the last debate that that happens with the Parliaments of Belgium, and it also happens with the Canadian provinces. The world does not collapse when proper respect and statutory weight is given to the rights and responsibilities of sub-state administrations. It is common sense. We are trying to improve the situation to make it work and to ensure that our voices and our national interests are protected and that the rights of the devolved Administrations are respected.

Time is short, and we do not want many votes on this group so as to allow time for the last group, particularly new clause 18, which needs to be properly debated, but I hope to press amendment 25 to a vote.

[Kirsty Blackman (Aberdeen North) (SNP)]

I will not speak for long because our Front-Bench spokesperson, my hon. Friend the Member for Dundee East (Stewart Hosie) has covered the issues well, but I want to talk briefly about why it is important that the Scottish Parliament, Scottish Ministers and the Scottish people in general should have more of a say in deals going forward than is proposed by the UK Government.

In recent times, the UK Government have not had responsibility for signing off and negotiating trade deals. They have not been the key player. Therefore, they have not been able to undertake some of the practices that we think they could undertake, so it is understandable that the Scottish people are worried given that we have been monumentally badly served by the UK Government over decades. Just look at the roll-out of universal credit, the bedroom tax, the rape clause and the passage of the European Union (Withdrawal) Act 2018—legislation that happened despite the Scottish Parliament refusing consent. All those things show the ways in which the UK Government are badly serving Scotland.

Until I was an MP, I genuinely thought that the UK Government were, at times, probably trying their best. When I got elected to this place, I discovered that when the UK Government propose legislation and we say to them, “Have you thought about how this will affect Scotland?” the answer is not that they are trying to do anything bad, it is just that they forget we exist. They just do not even consider the views of Scotland or the differences in Scotland. Look at how the common fisheries policy has been negotiated by the UK Government, for example. The way that the Government negotiated swaps removed quota rights from Scottish fishermen to the benefit of fishermen in the south of England. Such choices made by the UK Government have a direct negative impact on Scottish people. On that basis, it is understandable that we are worried that the UK Government will not take decisions in Scotland’s best interests because they may simply forget that we exist.

[John Redwood]

Does the hon. Lady understand that the common fisheries policy and international trade deals have been entirely in the power of the European Union? To the extent that they do not suit Scotland, it is the EU’s fault. Can she not see that power is coming back to the benefit of Scotland and the United Kingdom?

--- Later in debate ---

[Kirsty Blackman]

Perhaps the right hon. Gentleman did not hear what I said. The issue is that the UK Government have chosen to negotiate swaps that directly disadvantage Scottish fishermen. The concern is that the weight of the population in the south of England will mean that the UK Government continue to take decisions that improve life for people in the south of England without taking account of the fact that those decisions are detrimental to people in Scotland.

The amendments we have tabled would therefore ensure that, in decisions that are taken in this place—decisions on which the UK Parliament will have more power than it has had in recent decades—the voice of Scotland is heard, because we need decisions that do not disadvantage the people of Scotland.

[Angus Brendan MacNeil]

You catch me finishing off a Trebor extra-strong mint, Madam Deputy Speaker, and very nice it was, too.

At a time when the House is investigating bilateral trade agreements, my hon. Friend the Member for Aberdeen North (Kirsty Blackman) made the fantastic point that for 40 years the UK Government stipulated in their bilateral trade agreements, “London airports only.” It was only when they demanded that Iceland should fly to London airports and Iceland said, “There is no way we’re flying to a London airport to get the sleeper back to Glasgow,” that some change was brought about—that was relayed to me by the Icelanders themselves.

Trade agreements, by their very nature, require trade-offs, and there should be aggregate gains to the two parties involved. Within those aggregate gains, there will be people in certain sectors who lose. My International Trade Committee heard about that from Kevin Roberts of Meat Promotion Wales. He told us that some 80% of Wales is either upland hills or pasture and is suitable only for livestock farming, which is a fragile sector. About 80% of the net farm incomes of Wales come from EU subsidies, which is another matter.

Let us consider a situation in which the UK Government find themselves in a trade negotiation with somebody who says, “Do you know what? See if you could let us have some access to your market for our lamb and we’ll give you something else.” Wales would lose out. The aggregate gain to UK GDP would be increased—the right hon. Member for Wokingham (John Redwood) spoke on this point—but there would be a loss to Wales and there would be resentment in the UK to fiscal transfers back to Wales, which had sacrificed and given up things for the aggregate gain of the UK as a unit. That is one reason why many countries do not have the control freakery of the Labour and Conservative parties and allow territories, states and subnational Governments to have a voice at the table.

We should remember that Wales is not a member of the UK in the same way as Ireland is a member of the European Union. Ireland, as we have seen week in and week out, day in and day out, month in and month out, and hour in and hour out, has a real voice in Europe. In fact, some Brexiteers complain that Ireland is now the tail that wags the EU dog. If only that were a possibility for Wales, Scotland or Northern Ireland within the UK, there might not then be the concerns that my hon. Friend the Member for Dundee East (Stewart Hosie) raised. That is why there should be some responsibility and some form of acknowledgement from the big beast of the UK—England, or the south-east of England—that it might gain from a free trade agreement at the expense of other places. We need some counterbalancing measures.

In a way, the Brexiteers are constitutional gold dust, because I want to see Scotland catching up with Ireland at the top of the EU growth league, rather than being at the bottom with the UK. This is putting a strain on the United Kingdom. As Laura Dunlop, QC, told the Exiting the European Union Committee:

“At the moment, there is a sense of a double-whammy: that the international arrangements, whatever they are going to be, will be negotiated by the UK Government, and then the UK Government will be telling the devolveds what they have to do to comply with them. The participation is minimal.”

That is an unsustainable way forward. It does not respect the words we heard in 2014, “Scotland, stay in and lead. Do not just be a part; lead the UK.” When push comes to shove, as we have seen all the way through the European Union withdrawal process, Scotland is shoved to one side. It is all rhetoric. If the Government had the grace to put some of their rhetoric into action, they would be accepting some of the amendments here today. This is not big stuff in any other country, so why is it a big deal in the centralised UK, both to the Tory Government and, sadly, to the Labour Opposition, who feel that they must also adopt the centralising approach? It is really disappointing from both of them.

Oral Answers to Questions

Kirsty Blackman Excerpts

Thursday 29th March 2018 Commons Chamber

[Graham Stuart]

I am afraid the right hon. Gentleman is a member of the same club. I hate to share this with the House, but exports to China were up by 30% last year.

[Kirsty Blackman (Aberdeen North) (SNP)]

rose—

[David Linden (Glasgow East) (SNP)]

rose—

[Mr Speaker]

Order. There is something of an internal Scottish National party competition. I do not know whether one of them is thought to have greater seniority, but not in my mind. I call Kirsty Blackman.

[Kirsty Blackman]

Many of our small and medium-sized enterprises are involved in premium manufacturing and other forms of high-value production. Will the Minister ensure that, in discussions with the EU, those things are taken into account when negotiators are discussing origin and the calculation of origin?

[Graham Stuart]

All such issues are taken into account. Of course, the Department for Exiting the European Union leads on the negotiations on our exit from the EU.

--- Later in debate ---

[Amber Rudd]

The hon. Lady will know, because we have spoken about this, how much I care about it. I thank her for bringing the matter forward. The consultation has concluded, and we are now looking at it. I will make sure that she is one of the first to know when we decide how to bring it forward.

[Kirsty Blackman (Aberdeen North) (SNP)]

Gender pay gap reporting has made me angry, not just because companies need to do more but because we all need to do more. Does the Secretary of State agree that we should all check whether we have gendered expectations, particularly of children, and that those of us with influence should be very careful about how we treat young people?

[Amber Rudd]

The hon. Lady is absolutely right. One of the benefits of gender pay gap reporting is that it reveals what has been hidden before. In a lot of issues to do with gender, this is about making certain elements much more transparent than they were before. The hon. Lady might be angry, but I take the view that we need to take action. Taking action will do more than being angry.

Taxation (Cross-border Trade) Bill (Fifth sitting)

Kirsty Blackman Excerpts

Committee Debate: 5th sitting: House of Commons
Tuesday 30th January 2018 Public Bill Committees

[Jonathan Reynolds]

Good morning, Ms Buck. It is a pleasure to begin the second week of our Committee’s consideration of the Bill.

The amendments, like many that the Opposition have tabled, concern the democratic deficit in the Bill. As we have covered in numerous evidence sessions and in our discussions so far, the Bill is far too reliant on secondary legislation. The scrutiny of Delegated Legislation Committees—especially those that consider instruments laid according to the negative procedure, as the majority will be—is insufficient for taxation matters of such potential magnitude. Parliament will have the option to raise objections to the instruments, but they will not be debated on the Floor of the House as a matter of course.

The amendments are important because the Bill introduces an even more troubling concept: that of making law by public notice. After Second Reading earlier this month, the House of Lords Delegated Powers and Regulatory Reform Committee published a report that probed the most worrying aspects in detail. The report emphasises that the concept of public notice, on which the Bill is heavily reliant, is effectively a modern form of rule by proclamation that removes the opportunity for parliamentary scrutiny. It states:

“For Ministers and others to make law by ‘public notice’, without any recourse to Parliament, is highly unusual and such provisions should attract strict surveillance by Parliament.”

It also notes that

“the Treasury’s Delegated Powers Memorandum says that such notices will only make provision that is purely technical or administrative in nature. Nonetheless, clause 32(9) of the Bill allows anything that can be done under public notice to be done by regulations, implicitly acknowledging the importance of things done by public notice.”

It identifies the Bill as a throwback to the Statute of Proclamations 1539, which

“gave proclamations the force of statute law…it was repealed in 1547 after the death of Henry VIII”.

We should all be grateful for the institutional memory of the House of Lords.

Equally problematic are the mechanics by which public notice takes place. As the Delegated Powers and Regulatory Reform Committee emphasises, under clause 37(5) the only qualification for public notice is that the person who issues it has selected a channel that they consider appropriate, but a definition of “appropriate” is absent from the Bill. Public notice could therefore mean anything from a full-page advert in the Financial Times to a small ad in a trade journal or perhaps even a tweet. Clause 24 permits Her Majesty’s Revenue and Customs to establish a system for making rulings to determine the customs code and the place of origin of particular goods, both of which have an impact on the duty. Other rulings could affect the rights and liabilities of an individual.

The Delegated Powers and Regulatory Reform Committee recommends

“the creation of a generally applicable system for making determinations which are capable of affecting an individual’s legal position should ordinarily be dealt with by legislation, subject to scrutiny by Parliament, rather than by public notice without any such scrutiny”—

checks and balances. The Opposition agree wholeheartedly —hence our amendments.

The Government’s manoeuvres are deeply concerning. We would be failing in our duty of scrutiny if we did not step in to raise our anxieties about how powers of proclamation may be used. We are well aware of the volume of new legislation that needs to be produced to create and implement a new customs code, and of the temptation to create or take advantage of constitutional shortcuts to facilitate the process. However, protecting the rights of the individual must come first. Where matters of taxation are concerned, the parliamentary process is usually more rigorous with respect to the reasons for setting the duty.

As I have already said, the secondary legislation process is not optimal, and we believe that the balance between primary and secondary legislation in the Bill is unsound. However, using delegated legislation for these matters instead of creating regulations by public notice would surely be the least-worst option. It would allow for a bare minimum of parliamentary involvement and oversight of new tax and customs law. Even the negative procedure gives Parliament the option to reject a statutory instrument, although no formal debate takes place. Where possible, more significant matters should surely be considered via the affirmative procedure, so that at least there would be the basis for debate.

The Opposition believe that, without such debate, we will be at risk of setting a dangerous precedent that allows the ruling Executive to make regulation by public notice as it pleases, potentially even beyond the scope of the Bill. Therefore I call upon all members of the Committee to support the amendment, to ensure that we can continue to perform our vital role providing checks and balances in the structure of taxation and customs law in the UK.

[Kirsty Blackman (Aberdeen North) (SNP)]

Thank you for the opportunity to speak and for chairing the meeting, Ms Buck. I would like to speak briefly around the amendments. One of my earliest questions about the Bill was: what is a public notice and how does one justify that it has been made sufficiently public? The Opposition raised that case clearly. On the definition of public notice and the fact that the person making the public notice has to make that judgment call, particularly in relation to clause 13, which concerns the dumping of goods, foreign subsidies and increases in imports, and given that the UK has not had provision to make regulations and rules, it seems sensible to say that a public notice is not the best way. Parliament should have some say. We have raised concerns previously that, although Brexit is apparently about taking back control, it appears that control is being taken back to the Executive rather than to Parliament as a whole. I will therefore support amendments 137 to 139 if they are pushed to a vote.

[The Parliamentary Under-Secretary of State for International Trade (Graham Stuart)]

It is a great pleasure to serve under your chairmanship again, Ms Buck, and to welcome back the hon. Member for Stalybridge and Hyde. This group of amendments would require trade remedies measures to be imposed and given legal effect by regulations. I appreciate the concerns in relation to the use of public notices, which were raised by both Her Majesty’s Opposition and the Scottish nationalist party representative. I am grateful for the opportunity to set out why this is an entirely appropriate procedure for imposing trade remedies measures.

If you were cynical, Ms Buck, you might think that, because the Opposition have decided to make parliamentary scrutiny the central theme of their critique of the Bill, they are leveraging that into every single argument at every single stage. I am not a cynic, and take the concerns at face value, as the genuine ones that I am sure they are.

The imperative is to act quickly once the Trade Remedies Authority has identified the need to tackle injury to UK industry. I would have hoped that Members on both sides of the Committee would recognise that the imperative is to act quickly when injury to UK producers has been identified, and to move as swiftly as possible to put that right. Measures will be calculated and recommended by a fully expert and independent body, following an extensive investigation that is governed by strict World Trade Organisation rules. Our priority has to be to ensure that those recommended measures are imposed quickly, to provide relief to industries suffering injury.

The additional proposed process would delay our ability to apply measures precisely at a time when UK industry is suffering injury, and when it has been independently established that that is so. It would run counter to the calls we have heard from industry for a swift process. The use of public notices to implement trade remedies measures is consistent with the approach taken in comparable WTO countries such as New Zealand and Australia, and is therefore in line with international good practice.

Therefore I say to the hon. Member for Stalybridge and Hyde that, to suggest that this use of public notice is untoward and could lead to further government by proclamation, even outwith the Bill, is disproportionate. The reality is that this set of amendments, as with so many put forward by the Opposition, would in fact undermine the very principles that they say they are interested in: namely, to protect UK industry to ensure that we have a proportionate and speedy response to unfair dumping or use of subsidy and make sure that injury to British industry is put right. It is a shame that, collectively, the Opposition’s amendments suggest that their priorities are somewhere else.

[Graham Stuart]

The hon. Gentleman has been in the House for some time. I would have thought he would be familiar with the calendar of the parliamentary year, with long periods of recess when Parliament does not sit. Why on earth would Her Majesty’s Opposition, so often accused, doubtlessly unfairly, of being in hock to the producer interest and blind to wider society and the interests of the consumer and the ordinary citizen—though I decry that attitude—because of their links to the trade union movement, wish to put delays in place?

The hon. Gentleman knows full well the delays that can come with secondary legislation. To have that at the end of that extensive, independent and exhaustive expert assessment that has established injury, why on earth would the Labour party, or indeed the Scottish nationalist party, want to get in the way of swift, effective and proper defence of British jobs, British workers and British business?

[Kirsty Blackman]

I am pleased that the Government are now concerned with ensuring that such things are put in place incredibly quickly if there is injury to UK industry. In that case, will the Government bring forward amendments to speed up other parts of the process, given that they will now be taking longer than the EU’s similar processes?

[Graham Stuart]

I apologise for getting the name of the hon. Lady’s party wrong—it is the Scottish National party. We have put forward a proportionate and swift system, and hope that we would be able to deliver a speedier, more proportionate and balanced response than that of the EU. That is certainly our aim. I note again that amendments tabled by the hon. Lady’s party and Her Majesty’s Opposition suggest that their priority is entirely different.

--- Later in debate ---

[Peter Dowd (Bootle) (Lab)]

It is lovely to serve under your chairmanship again today, Ms Buck. The Minister has clearly had three or four Weetabix today, given his assertions. I say to him: legislate in haste and repent in court at leisure—for these are the sort of things that will be challenged in the courts. Unless the judges in those courts are going to be enemies of the people, we are best to get it right first-hand. Lord Judge made that very point today, and he was formerly Lord Chief Justice; so we cannot ignore parliamentary scrutiny on this particular issue.

New clause 5 establishes a system of enhanced parliamentary regulations for setting quotas under clause 13 to give effect to recommendations of the TRA, with a requirement for the House to pass an amendable resolution authorising the quota provisions of the proposed regulations. It also requires that certain regulations under schedules 4 and 5 be subject to the affirmative procedure.

I have made this point in the past and make it again. The new clause seeks to introduce a scrutiny role for Parliament in this crucial area of taxation and trade policy. The current provision in clause 13 gives the Secretary of State powers through regulation to introduce a tariff rate quota to determine the amount of import duty applicable to certain imported goods, after he has accepted a recommendation from the Trade Remedies Authority. It also gives the Secretary of State the power to revoke or suspend the tariff rate quota.

New clause 5 would instead ensure a democratic and open process, by making sure that Parliament has that power—not just the Secretary of State. The enhanced parliamentary procedure also ensures that there is a failsafe in the event that the Trade Remedies Authority makes a recommendation for the suspension of a quota and the Secretary of State refuses. In that instance Parliament has the ability to overrule the Secretary of State and side with the expert recommendation of the Trade Remedies Authority if it so decides.

I am sure that hon. Members of the Committee are hearing echoes from last week in relation to the issue of parliamentary scrutiny. We have heard about it today, and that is our job on this side of the Committee. I am not sure whether the Minister thinks we should not do that, but we will continue to do it. We are concerned that if we do not have parliamentary scrutiny and oversight and the expertise that comes with that, we will end up in the courts. The Minister’s wish that things do not get delayed will be thrown out of the window by the approach that the Government seem to be taking.

Suffice to say that, if the Government are arguing that this is a money Bill, which it is, and it goes to the House of Lords— who will probably have to watch it go past as though it was a bus—they are tacitly accepting that the measures contained here are essentially fiscal. It is therefore appropriate that statements made to the House of any regulatory changes in relation to fiscal matters are Parliament’s responsibility and duty, as they have been for centuries, and we believe that there should be a vote if appropriate. The system outlined would provide a very robust means of doing that. I know that virtually every Minister, not just this Minister, would not want to have that level of scrutiny, but it comes with the job; scrutiny has to be there. Of course, an annual fiscal statement, such as that expected in the spring, with subsequent parliamentary authority could also prove a mechanism for us to test it out.

I hope that Conservative Members will not take a blasé approach and brush aside the issue of parliamentary democracy on the grounds that the Opposition somehow want to drag the matter out in the future. We do not; we want to make sure that this works properly. We all accept that we have to have a process in place, but let us get it right and hold Ministers to account.

[Kirsty Blackman]

The Government have asked for an awful lot of trust. They are asking us to trust them to make the right decision. Given that they do not have a track record of making such decisions over a very long number of years, it is very difficult for us to trust the Government on that. There is also the fact that the Government said that they would table amendments to clause 11 of the European Union (Withdrawal) Bill, and then they did not.

I do not think that the Conservative Government have quite recognised what they are doing with all their decisions to hold power in the Executive over any number of things. When the Conservatives are inevitably no longer in government there will be another Government in place, and they will be in opposition saying, “Why are so many decisions being made by the Executive without parliamentary scrutiny?”

The UK is at a point where we are choosing how our future looks in relation to Brexit. We are choosing how things will go in this Parliament, and into the future. We are choosing how much say we will have over trade policy, so it is vital how we decide to go about this. The way that the Government are setting this up is absolutely wrong. There should be parliamentary scrutiny of such things, and democratically elected Members should have the opportunity to look at them, to have an input and not just have them done by public notice.

[Graham Stuart]

The Opposition parties protest too much. As we all know, the point of a trade remedies system is to be balanced, proportionate and move swiftly to protect British industry. That is why we are setting up, through the Trade Bill, the specialist body to do that: the Trade Remedies Authority. We are talking about the implementation of the Trade Remedies Authority’s recommendations. Why on earth, after that exhaustive effort, with the appropriate, balanced tests in place, would anyone want to create burdensome, parliamentary oversight? It does not make any sense.

The TRA makes the decision. If the Secretary of State disagrees with it, they will have to come to Parliament and make a statement, so there will be the opportunity to deal with that. When the TRA has made an assessment and wants to help British industry, why on earth would the Opposition parties want to make a wider political point about lack of scrutiny, just for the sake of it, when it is totally inappropriate for this measure? I leave outsiders to judge whether that is for political interests or for the interests of either British consumers or producers.

[Kirsty Blackman]

If the Trade Remedies Authority will be so good at making decisions, why will the Government simply have to make a written statement to the House if they disagree with it, rather than go through some kind of regulation procedure? If the Trade Remedies Authority is set up in such a great way that it will always make the best decisions, why will the Minister be allowed to disagree with it simply by written statement, and not by any sort of parliamentary procedure?

[Graham Stuart]

The legislation makes it clear that the Secretary of State should look at it, and various people who have commented on the structure have said that it is right that, although the main body of work should be conducted by experts, ultimately it should be a politician accountable to Parliament, part of a democratic process, who should make that decision. Were they in any way to disagree, they would have to come to Parliament to make a statement. That is appropriate and proportionate, and why on earth the Opposition parties would want to go to such lengths to try to stop us bringing in effective remedy to protect British producers, I cannot imagine.

--- Later in debate ---

[Anneliese Dodds]

We tabled the amendments because the proposed market share requirements will not only put us out of step with comparable nations but stop action being taken to prevent uncompetitive disruption of infant industries. According to the Government’s proposals, applications to the TRA for an investigation will be subject to a UK market share threshold. As with so much in the Bill—as we have been discussing—we do not know how the threshold will be determined nor what its range is likely to be, let alone the actual value for different industrial sectors. The Government have given as their explanation for the measure the filtering out of cases with little chance of success. Yet, as already discussed in Committee, the Government have already set out a range of tests that must be passed before any action can be taken—tests that are already more stringent than is the case under EU legislation, and considerably stronger than those that the EU is moving towards.

I normally agree fully with every word that is uttered by my hon. Friend the Member for Scunthorpe, but I did not completely agree when he said that he was pleased to hear the Government saying, or hinting at least, that we would have a system at least as favourable to British industry as the existing one. With the different tests to do with economic interest or public interest, whether those applied by the TRA or the Secretary of State, that regime is far more stringent than that applied by the EU.

In addition, I am concerned that the measure proposed in the Bill could cause a lot of ambiguity and be problematic for the TRA. We are informed that the TRA must accept an application that meets the UK market share threshold, although of course both it and the Secretary of State can then decide not to proceed as a result of their overly stringent tests once they get into the investigation—but let us leave that aside. If an application does not meet the UK threshold but does meet WTO thresholds, the TRA may use its discretion as to whether to accept it. However, we can legitimately ask why the TRA should be put in a potentially difficult position, especially when legal action could be levelled against it by the company that is deemed to have engaged in dumping precisely because the TRA has used that discretion.

In addition, I do not understand why the UK has decided to adopt an apparently higher threshold of market share before applications may be accepted when, according to the stakeholders I have talked to, no other country seems to have adopted that approach. This is not about criteria within the investigation: it is about the criteria necessary before an investigation is allowed at all. As with the unique electoral system that led to the hanging chad problem in the US, there is a clear reason why this approach is so unique: it is not workable. The Minister rightly referred to learning from best practice, so it would be helpful for us to know which countries have that test in place before an investigation can be started and why it was believed that this is best practice. I have so far not been able to find any countries that operate such a system. If there are some, it would be wonderful to hear about them.

The Minister suggested in his previous remarks that, much of the time, all the Government are doing is simply transposing WTO requirements. However, the terms of the general agreement on tariffs and trade enable countries to take action, particularly to prevent uncompetitive disruption to infant industries. That could be prevented by this kind of test before an investigation can even be started. That process of uncompetitive disruption to infant industries is known as material retardation, which is quite a well-known concept when it comes to trade disputes and is interpreted quite broadly.

Rules within the Mercosur agreement—the South American trade agreement—state that countries can take measures, first, to ensure that infant industries can be established, but also that there can be, without uncompetitive disruption, the establishment of a new branch of production in an existing industry, the substantial transformation of an existing industry or the substantial expansion of an existing industry supplying a relatively small proportion of domestic demand. That is a very wide reading of what measures against material retardation can enable, and a broad reading of the concept of an infant industry as well. Those rules are already in action in the Mercosur agreement, so I hope the Minister will clearly explain why the UK should deny itself those kind of powers that other countries seem keen to avail themselves of.

I hope he will also indicate how he envisages that market share restriction working, which will be used even before investigations start. I read the “Trade Remedies Research” paper, produced by Van Bael & Bellis and Copenhagen Economics, which I am sure other Members have looked at as well. They looked in great detail at some of the methodological issues relating to the use of trade remedies and they indicated in detail the variety of considerations relevant to calculating market share that the EU has used once an investigation has opened—not as part of a test to determine the opening of an investigation but as part of determining the harm caused by dumping.

They indicated the potential drawbacks of, for example, setting a quantitative measure on the evolution of import volumes in relative terms—in comparison with domestic consumption—in order to determine how the market share of foreign exporters against UK industry has changed over time following dumped imports. That is because our market in the UK is small, and so domestic consumption can vary dramatically from year to year because the number of industry operators tends to be more concentrated.

There are some very difficult methodological issues here when it comes to calculations that might be involved in an investigation. We are talking about the TRA having to carry out calculations potentially with a similar level of methodological difficulty, even before an investigation is opened. Will the Minister indicate what kind of methodology he proposes to avoid those problems? Above all, will he please let us know why our country seems to be adopting this approach, which, as I say, I cannot find any analogue for in comparable nations?

[Kirsty Blackman]

I will say just a few things to follow on from the shadow Front Benchers on this. It is strange that market share is being used in this regard as something that will be taken into account. It is almost as if the TRA cannot be bothered to investigate a company if it does not have a certain market share. For that industry, and for manufacturers in particular, it does not matter what their percentage of market share is; what matters is the injury that is being done to them by dumping. Market share is not relevant, and I do not understand why it is included in the Bill. It may be relevant to the Treasury because it affects the tax take it gets from the industry, but it is not relevant to the protection we should be affording to the industry.

This proposal has geographical implications, given that these new goods will be made in the industrial north of the country. Those products may not meet the market share threshold, but they may be incredibly innovative and may improve productivity and make this country a better place to be. Those things will not be taken into account.

I have argued previously that if the fishing industry is decimated as a result of Brexit, that is a geographical issue for the affected communities. It does not have a massive implication for the Treasury’s tax take, but it does for those communities. I fear that this market share test is not only unnecessary, but has implications for the choices that communities make.

[Nic Dakin]

The communities that are the most vulnerable to that disadvantage are often those that voted most strongly to leave because of their fear that they are not getting a fair deal at the moment.

[Kirsty Blackman]

Absolutely, and conversely they are the ones that have been getting the most European funding, so the choice they thought they had to make because of the inequality and uneven economic growth in the United Kingdom will make them lose out in more than one way.

On the issue of new good and fledgling industries, we cannot predict what the world will look like in 20 years’ time. Who could have predicted the rise in the need for electric vehicle charging points, for example? If something suddenly becomes a thing, the effects cannot be predicted. For example, companies making paper straws in the UK are probably seeing their shares going through the roof. We cannot predict the market share of those companies and how quickly it will grow as a result of changes in the culture of the country. I do not think the market share test is appropriate. It is strange to have it in the Bill, and the Government need to rethink it.

[Graham Stuart]

I thank hon. Members for their contributions. I hope I can reassure them about the issues they raised. Perhaps there has been some misunderstanding, which I can clear up.

Amendment 32 and its consequential amendments 34 to 38 seek to eliminate a market share threshold that we have designed to make sure businesses have a transparent benchmark for judging whether their complaint is likely to be successful. On the question of why we have the threshold, an independent evaluation of the EU system suggested that the system should focus on producers’ market share as a way of informing inquiries.

I was also asked which other countries have the threshold. We understand that other countries consider whether cases are likely to result in measures at the point of applications, but they tend to use rather opaque systems. The market share threshold is intended to give industry greater certainty in a more transparent way about how the system will operate in this country. We are learning from experiences in other countries and are seeking to improve on them to the betterment of our system.

The provisions for the market share threshold fit with the industry’s calls for the TRA to focus on the cases that matter most. For instance, the British Ceramic Confederation said in its response to our White Paper that the TRA

“should not spend its time investigating vexatious complaints and needs to focus on cases where there is a real UK manufacturing interest.”

The market share threshold will be part of providing that.

--- Later in debate ---

[Graham Stuart]

I thank the hon. Lady for that comprehensive intervention. As I said in reply to the hon. Member for Bootle, our aim is to make improvements. We want a better system that provides greater certainty for UK industry, and one that makes the TRA focus, as the industry has requested, on the cases of greatest import, not an opaque system as in other countries. The TRA may quickly respond to someone with a de minimis market share who comes forward with no real case and tell them that they have no chance, but what we are doing is creating a system that is much easier to understand and more transparent.

I hope the secondary legislation we implement will include other world firsts, too. So long as what we do is based on a proportionate, balanced approach that is fully compliant with the WTO and better tailored to the needs of British industry, I shall be proud to see us innovate. I am not afraid to innovate if it is in the interests of British industry and a better system. We should aspire to doing that.

[Kirsty Blackman]

The Minister argues that, in the case of a producer with a small market share in the UK, there may be a disproportionate effect on UK consumers. Given that an economic interest test takes into account the impact on consumers, is the market share test necessary?

[Graham Stuart]

For the reasons I have set out, I think the market share test is an eminently sensible part of our regime. I hope the Committee will agree.

--- Later in debate ---

[Graham Stuart]

New paragraphs 12A and 11A, introduced by amendments 39 and 70, would require the recommendations made by the TRA under schedule 4 to be made available to relevant Select Committees of the House of Commons, along with an account for the evidence base of those recommendations. Let me begin by stating that transparency is one of the four design principles set out by the Government for the trade remedies framework. The inherent assumption of a lack of scrutiny implied by the amendments is simply untrue.

To protect the TRA’s status as an independent public body, its recommendations to the Secretary of State should not be subject to political influence before a decision to accept or reject them has even been taken. Those recommendations will be made on the basis of the framework set out in this legislation and underpinned by technical and procedural details to be set out in secondary legislation. Giving the Select Committee a role in that process will undermine the impartiality of the process—an impartiality which is supported by industry. Publishing the recommendation in advance of the decision by the Secretary of State could also further undermine impartiality by increasing lobbying of Ministers by the affected parties, and could also lead to unnecessary disruption of the markets affected.

The Bill provides for public scrutiny of both the TRA and the Secretary of State’s decisions. Whether the Secretary of State accepts or rejects the recommendation, the evidence base for the TRA’s recommendation will be made available to the public, as is required under the terms of the WTO agreements. Furthermore, if the Secretary of State rejects the TRA’s recommendation to apply measures, he or she must lay a statement before Parliament setting out the reasons for that decision. Parliament will then be able to hold the Secretary of State to account if it considers the reasons to be unsound.

[Kirsty Blackman]

It would be lovely if the Minister could explain how parliamentarians can hold Ministers to account if they make a written statement.

[Graham Stuart]

The hon. Lady has been a Member of this House for some time and will know that there is a series of means by which that can be pursued. Making a statement to the House provides the initial spur to start that scrutiny, if that is what the Select Committee or others decide. There are urgent questions, Adjournment debates, Backbench Business Committee debates—I will not list them all, as the hon. Lady is probably rather better on parliamentary process than I am. She will know that there is a huge number and they can all be used. Her Majesty’s Opposition or the SNP and their spokesmen have other means by which to raise the issue.

On that basis, I ask the hon. Gentleman to withdraw the amendment.

Taxation (Cross-border Trade) Bill (Sixth sitting)

Kirsty Blackman Excerpts

Tuesday 30th January 2018 Public Bill Committees

[Graham Stuart]

Three groups of amendments need a response. I will start with amendments 45 and 54, which seek to impose a two-week time limit on the Secretary of State’s decision to accept or reject the TRA recommendation. I will then turn to amendment 47, which seeks to create a presumption of five years as the normal, rather than the maximum, duration of definitive measures. Finally, I will address amendments 48 and 53, which seek to ensure that the duration of definitive measures is not affected by the length of any provisional measures that might have been applied against the same imports.

On amendments 45 and 54, on receipt of the TRA recommendation, it is the responsibility of the Secretary of State to respond in a timely manner, while ensuring that the public interest aspect of their role is given due weight. We fully recognise that a swift response is crucial to UK industry, as the hon. Gentleman said, so that the injury being caused by unfair trade practices can be halted. However, in some cases there will inevitably be difficult matters that the Secretary of State will need to reflect on. Although we expect that such matters will be rare, it is important that he has full opportunity thoroughly to consider the issues in making his decision. That might lengthen the process, but it is important to do the job well rather than quickly. To place an arbitrary two–week time limit on the Secretary of State is, therefore, not appropriate. Even though that duration might be sufficient in most cases, the legislation must provide flexibility for cases in which complex considerations must be made in the public interest.

As the hon. Gentleman is aware, once the investigation has been concluded and measures have been proposed by the TRA, the pressure on the Secretary of State quickly to come forward with the adoption of the measures to protect British industry will be great. I perhaps lack the hon. Gentleman’s imagination, but I find it hard to imagine a situation in which the pressure on the Secretary of State to get on with it would not be much greater than a pressure to delay and put it into the long grass, as the hon. Gentleman said. I think we can be confident that any Secretary of State under any Government would wish to make the decision as quickly as reasonably possible.

For those reasons, I do not agree with an arbitrary two-week limit. I understand why the hon. Gentleman has tabled the amendment and I hope it is a probing one. I understand what lies behind it, but I hope I have reassured him.

On amendment 47, it is important to note that the WTO agreements set out that measures may remain in force for up to five years. They do not provide that five years is the default. In fact, they specifically set out that measures should remain in force only for as long as, and to the extent, necessary to counteract the dumping or subsidisation that is causing injury. The TRA analysis may suggest that a period shorter than five years will be sufficient to counteract injury, and in such cases the TRA should set an appropriate duration accordingly.

On request, the TRA will initiate an expiry review before the termination of any measures, provided that UK industry can demonstrate that injury would continue or recur if the measures were to expire. If the review finds that continued application of measures is required to maintain sufficient protection for UK industry, the measures will be continued. I assure the hon. Gentleman that industry is adequately protected without the need for the amendment and I ask him to consider withdrawing it.

Finally, on amendments 48 and 53, I understand the hon. Gentleman’s concerns, but I have to reassure him that that which he fears is not the intention of the provisions. The WTO agreements allow in certain circumstances for trade remedies to be applied from a date prior to the date of the application of definitive measures. The purpose of the provisions is to allow us to reflect that in secondary legislation, not to shorten the duration of definitive measures. We are not seeking to shorten the duration of definitive measures, but are seeking to allow trade remedies to be applied from a date prior to the date of those measures.

The unintended consequence of the Opposition amendments would be to prevent the TRA from collecting duties for a period before the date of the section 13 notice, even though this is permissible under the WTO agreements in limited circumstances. I entirely understand why the hon. Gentleman tabled the amendment and what he was seeking to probe. I hope my explanation has been sufficient to make him see that that which he desires will not be delivered by the amendments.

We believe that this is a necessary provision. We have been clear that we want to incorporate all of the protections permitted under WTO rules into the UK’s trade remedies framework. Removing the ability to do that could be detrimental to the protections available to UK industry. It is on that basis that I ask him to consider withdrawing the amendment.

[Kirsty Blackman (Aberdeen North) (SNP)]

I express the Scottish National party’s support for the Opposition amendments. It is sensible that we are asking the Secretary of State to make a decision within a relatively short time period because, as has been stated, we do not want that to be dragged out for any significant length of time. It is reasonable that, after a significant investigation has taken place—and the TRA’s investigations will be significant—the Minister will quickly review the evidence presented and make a decision in the shortest possible time.

On amendment 47 and the five-year period, I have the Department for International Trade call for evidence on the current EU trade remedy measures. I can see possibly one that is in place for less than five years. In fact, many have been place for over a decade because they have been renewed. It is very unusual in that document, which lists all the trade remedy measures currently in place, for any of them to have a review date of less than five years. It is completely reasonable that the Opposition are asking for the starting period default to be five years, and for the TRA to decide on a lesser period in compelling circumstances. Given the number of these measures that have been extended and how few of them have fallen at the five year period, I suggest that five years is likely to be a reasonably short period for trade remedies to be in place, and that it is sensible for them to extended as a result.

We are talking about the trade remedies body doing substantive investigations and coming up with a huge amount of evidence. Asking it to do so on more than a five-yearly basis would probably be adding to their workload unnecessarily. The Opposition’s suggestion is incredibly sensible in that regard. The presumption should be five years, and the TRA should make decisions for it to be less if it believes that that would be appropriate.

[Jonathan Reynolds]

I appreciate the Minister’s response but it is our intention to move these amendments to the vote.

In respect of amendment 45, the Minister has already talked about the political pressure that has almost certainly been brought in the event of the TRA making a determination. However, it is also true that there are many examples we could go through of Governments resisting such political pressure. We should bear in mind that, in our discussions earlier, the Government effectively brought back a new constitutional procedure in order to stress the need for speed of announcements. Therefore, it does not seem consistent this afternoon to say that there is very little flexibility offered by the need for speedy resolution of cases.

Amendment 47 offers flexibility where five years would not be appropriate, but as the hon. Member for Aberdeen North just said, given the standard length of time these measures tend to be in place, this is—as industry has told us—a fairly modest measure, making it consistent with industry practice. We will press the amendment to a vote, Mrs Main.

--- Later in debate ---

[Anneliese Dodds]

It is a pleasure to serve with you in the Chair once again, Mrs Main.

Like many of the Opposition’s amendments, amendments 55 and 56 try to improve the legal certainty in the Bill. They would ensure that reviews could not normally be opened into measures that were less than one year old, in line with EU practice, and that duties remained in place while reviews were conducted. With no restriction on the time period before which reviews can be initiated, the UK again appears to be ploughing its own furrow and going against the international direction of travel. I note from much of the previous debate and the comments from the hon. Member for Aberdeen North, who rightly indicated that the average cycle for this kind of remedy is five years, that it is a long-term cycle, and without the expectation of review before the remedy having been in place for one year.

Since reviews can be initiated after an interested party asks for one, WTO rules require a reasonable time to have elapsed since the imposition of definitive measures, and that has almost always, from what I can see, been interpreted as being at least one year. The only exception seems to be the US, where the standard review period is one year, but that is apparently unusual. In the EU, at least a year must have passed.

The problem with earlier reviews is that they could be administratively costly, after having put a remedy into action, and that they would reduce the predictability of the trade remedies regime. The latter is surely essential for the long-term health of British manufacturing, which needs to know that the business environment will not change radically in the very short term. With uncertainty appearing to be one of the factors underlying the current low levels of private sector investment in the UK, we surely must ensure that trade remedies are proportionate and do not make our British firms less secure than if they were based in other industrialised countries.

[Kirsty Blackman]

The hon. Lady makes a compelling case and I want to reassure her that Scottish National party Members will support the Labour party in the incredibly sensible move it looks to make, particularly with amendment 55.

[Anneliese Dodds]

I am grateful to the hon. Lady for the SNP’s support. The amendments focus on trying to provide the certainty that the Bill lacks but which is present in other trade remedies systems. Will the Minister indicate whether the Government have considered inserting such a provision in the Bill, in line with international practice? If not, will he say why not, given that no other country seems routinely to allow a review before a year has passed?

--- Later in debate ---

[Graham Stuart]

Schedule 5 sets out the provisions that will apply in cases where UK industry finds itself being harmed by unforeseen surges in imports. The WTO agreement on safeguards set outs the requirements that must be met for the UK, as for other members, to be able to impose safeguard measures. Through this schedule, we are adopting the key principles into UK law and setting out the broad elements of the safeguard process that will be operated by the TRA.

As we have already discussed, there will be a need for more detail. This will, rightly, be set out in secondary legislation. The schedule also provides the necessary powers for the Secretary of State to make regulations to do this, including, for example, to define what is meant by “increased quantities”, “UK producers” and “like goods”. Paragraph 19 of schedule 5 provides that regulations can be made to set out the process for reviewing safeguard measures. The regulations will set out, among other things, the circumstances in which measures can be continued.

Amendment 74 seeks to require UK producers to provide evidence that they are adjusting to increased imports before a safeguard measure can be extended beyond four years. It also aims to add into primary legislation that safeguard remedies may only be in place for a maximum of eight years. As I explained earlier, once we leave the EU, the UK clearly needs to be able to take action where our industry is being harmed by unfair trade from other countries, whether that is by dumped or subsidised goods, or as a result of fairly traded but unforeseen surges in imports. The safeguard provisions set out in schedule 5 achieve this. Unlike anti-dumping and countervailing measures, safeguards relate to fair trade and apply globally. Therefore, it is especially important that these measures balance the interests of producers and downstream consumer industries by facilitating adjustment.

We have already discussed adjustment plans when considering the previous group of amendments. As I said, these are a vital tool in ensuring that safeguard measures not only provide protection, but allow those affected the opportunity to make necessary adjustments. It is not appropriate to introduce a requirement for producers to provide evidence of adjustment when seeking to extend measures beyond four years.

I ask the Committee to consider for a moment that we have measures in place—a safeguard—because of a massive surge on imports. The TRA has done its work. In an entirely novel process—I am aware of no parallel anywhere—Her Majesty’s Opposition, doubtless supported by their allies in the Scottish National party, want to impose a bureaucratic and burdensome measure—[Interruption.] I notice that the SNP Members are shaking their heads. For once, perhaps, they will strike out and not support something that is so clearly damaging to the interests of Scottish producers. Why on earth would the producers have to provide evidence of their adjustment when the main issue should be other aspects and criteria? It is a strange innovation that the Labour party has put forward.

Introducing a requirement for producers to provide evidence of adjustment when seeking to extend beyond four years would undermine the need for flexibility in our approach, which recognises—this is worth reflecting on—that adjustment is not always dependent on a producer’s own efforts. Yet, under the amendment, protection measures would cease if producers were not able to provide evidence that they were adjusting. Adjustment plans are a more suitable way of building in that flexibility and ensuring that there is a commitment to adjustment from as early as the initiation stage. Finally, with regard to the eight-year rule, the Government intend to be WTO-compliant by setting that out in secondary legislation.

[Kirsty Blackman]

I would appreciate it if the Minister let us know where it says that UK producers are supposed to produce that evidence. My reading is that the TRA has to find the evidence rather than the producers submitting it.

[Graham Stuart]

The hon. Lady will find that the evidence of adjustment by UK producers is unlikely to be provided by anyone other than UK producers. It is a rather strange innovation to insert that into legislation for the continuation of measures that are put in place because of the injury caused and the massive surge on imports. It is an entirely novel concept. I am not aware of its being anywhere in WTO schedules although, admittedly, after so little time in the job I cannot claim to know them inside out. If any Member of the Opposition, who after all came up with the extraordinary innovation, has evidence of a basis in WTO law or anywhere else, I would be fascinated to hear it. Perhaps the hon. Lady will support the amendment anyway, even though there is no evidence for it, legally or otherwise but I hope that she, like me, will oppose the amendment if it is pressed to a vote.

--- Later in debate ---

[Kirsty Blackman]

I beg to move amendment 110, in clause 14, page 9, line 45, at end insert

“following consultation with relevant stakeholders including consumer representatives and agricultural producers.”

This amendment requires consultation before the making of regulations to increase the customs tariff for agricultural goods.

[The Chair]

With this it will be convenient to discuss the following:

Clause 14 stand part.

New clause 6—Additional import duty on agricultural goods: enhanced parliamentary procedure—

“(1) No regulations may be made by the Treasury in exercise of the power in section 14(1) except in accordance with the steps set out in this section.

(2) The first step is that a Minister of the Crown must lay before the House of Commons—

(a) a statement of the reasons for proposing to make the regulations; and

(b) a draft of the regulations that it is proposed be made.

(3) The second step is that a Minister of the Crown must make a motion for a resolution in the House of Commons setting out, in respect of proposed regulations of which a draft has been laid in accordance with subsection (2)(b)—

(a) the proposed additional amount of import duty; and

(b) the proposed period for the purposes of section 14(1)(a);

(c) the proposed trigger price for the purposes of section 14(1)(b).

(4) The third step is that the House of Commons passes a resolution arising from the motion made in the form specified in subsection (3) (whether in the form of that motion or as amended).

(5) The fourth step is that the regulations that may then be made must, in respect of any matters specified in subsection (3), give effect to the terms of the resolution referred to in subsection (4).”

This new clause establishes a system of enhanced parliamentary procedure for regulations setting additional import duty on agricultural goods, with a requirement for the House of Commons to pass an amendable resolution authorising the rate of import duty on particular goods and the relevant conditions.

[Kirsty Blackman]

I rise to move amendment 110, but I will mention now that if new clause 6 is moved at the appropriate stage, we will support it, because an enhanced parliamentary procedure seems sensible.

Clause 14 is headed “Increases in imports or changes in price of agricultural goods” and deals specifically with special agricultural safeguards and what can be put in place in relation to them. Our amendment is a very short one, but it is designed to require that the Secretary of State consult with consumer representatives and agricultural producers when making any decisions relating to special agricultural safeguards.

The Minister, when he spoke earlier about safeguarding, said that the decisions taken are about balancing the needs of producers with those of downstream consumers. This is exactly the kind of thing we are trying to do: we are trying to ensure that the Secretary of State, when making the recommendation to the Treasury to exercise the regulations, is doing so after consulting both consumer groups and agricultural producers. That is the only sensible thing to do in this case. The Minister has previously been clear that the Government like consulting with people and tend to try to do so wherever they can, but it would be sensible if it were stated in the Bill that they were required to do so in advance of putting in place, via a relatively unusual process, relatively unusual measures that would have an impact on our agricultural producers and consumers.

That is important because Brexit is looming on the horizon and our farmers do not know how they will be supported financially after 2020. I think Ministers have given undertakings to safeguard the money that comes from the EU until that point, and farmers have no certainty beyond that period of time. The UK Government are looking to make their own trade deals, which may change the agricultural landscape in the UK or result in our taking imports we have not previously because because of the trade deals as part of the EU—we have previously discussed things such as chlorinated chicken. Given all the changes on the horizon, both for agricultural producers and for consumers, who are already finding, for example, that the price of butter is going through the roof because of the increase in sterling, it is difficult for the Government to foresee what may happen in the future. If the Government are going to put in any measures related to increasing imports or the price of agricultural goods, particularly through the safeguarding measures, it would be sensible to consult both agricultural producers and consumers in advance of putting those in place.

[Peter Dowd]

The Minister was getting a little bit tetchy and prickly there. There is a quote from “Henry VIII” which, given that we are talking about Henry VIII powers, seems appropriate today:

“Be advised:

Heat not a furnace for your foe so hot

That it do singe yourself.”

The new clause would establish an enhanced parliamentary procedure in relation to import duties on agricultural goods. During our sittings, the Committee has heard serious concerns expressed by multiple witnesses about the democratic shortcomings of the Bill. The Bill is, first, strikingly light on detail, notwithstanding the Minister’s assurances that things will be put into place and more detail will come in due course. The Government are pushing that detail on to secondary legislation, but the delegated legislation process was designed to make administrative changes to laws—in effect, a rubber-stamping process—not for items that will form the material basis of our trade defence policies and so require proper scrutiny and debate. More worrying are the items to be channelled directly through the Executive in an unacceptable concentration of power, which ought to be subject to scrutiny, with Parliament given a say in holding the Government to account. The amendment is one of several in which the Opposition are calling on the Government to put critical decisions on tariffs, quotas and preferential rates in front of Parliament.

The measures in the Bill are at odds with the greater democratic control persistently promised to voters. Bringing back control, as we have said a million and one times, is about bringing back control to Parliament, not to a cadre of Ministers sitting in their offices in Whitehall. The new clause sets out four steps to enhance parliamentary scrutiny: first, a Minister must come to Parliament to explain the intentions of the draft regulations; secondly, a Minister must tell Parliament the import duty amount, as well as the period and trigger price under the relevant section; thirdly, the House must pass a resolution arising from the Minister’s motion; and, fourthly, regulations must be made to give effect to that resolution—all in the cold light of parliamentary scrutiny and sight. It is not for the Government to make decisions single-handedly behind closed doors, nor for the Secretary of State to steer the process unilaterally. Rather, such decisions must be subject to proper democratic accountability, with the essential checks and balances enshrined in law.

As I have said before, the Opposition recognise that the Government must make necessary preparations to create the UK customs and tariff regime post-Brexit, but they cannot have carte blanche. We should not allow, or be considering, a carte blanche process allowing the Government to concentrate all those new powers in the Executive. The Opposition’s view is that in this instance the interpretation of taking back control— moving it from Brussels to the Executive—is not acceptable. That is not only true of the provision before us today, but evident in the European Union (Withdrawal) Bill and the Trade Bill. The Government are attempting to sidestep parliamentary scrutiny, and that is not acceptable.

In our view, tariffs should undergo the same parliamentary process as taxation, with similar levels of parliamentary scrutiny. We will oppose the Government’s attempts to give the Treasury delegated powers to set future customs duties and tariffs away from the public and parliamentary eye. That is not the way we do things in Britain. New clause 6 outlines an enhanced parliamentary procedure for setting additional import duty on agricultural goods, among others, to bring scrutiny to our customs policy.

Our agricultural sector faces an uncertain future with Brexit ahead. It is distinct from other UK industries in possessing a more interwoven relationship with the European Union, given the existence of the common agricultural policy, which provides subsidies to UK farmers that the Government have indicated they will continue. The common agricultural policy provides critical support to UK farming—for example, the Department for Environment, Food and Rural Affairs estimated in 2014 that such payments represented 55% of farm income. As I said, the Government have promised to maintain those subsidies at the existing level until 2022, which I am sure is a huge comfort to the agricultural sector, but there are no guarantees yet on what will occur after a transitional period. Our step-by-step proposed parliamentary process will hold the Government to account for their policies and import duty proposals on agricultural goods.

Given the reliance in some quarters on subsidies and the fact that our EU counterparts will continue to be in receipt of subsidies across the continent, there will be a number of factors to consider when the UK comes to setting tariffs on agricultural imports. It is worth noting that the value of UK agricultural production at market prices was £25.8 billion in 2014, according to official Government statistics, and the farming sector provides 400,000 jobs in the UK. I accept that not many of them are in the constituency of Bootle, but there we are.

As the National Farmers Union has highlighted, the UK trade balance is negative to the tune of £22.4 billion, which makes the UK a net importer of food. Although there is an ambition for that figure to improve as the UK becomes more self-sufficient in food production, it shows that the UK is quite heavily exposed in terms of import dependency. As the NFU also highlights, the UK will be duty-bound to establish its own set of schedules with the World Trade Organisation, once we leave the EU. Although we know the Government have announced their intention to replicate the existing trade regime as far as possible in those new schedules aligned with existing arrangements, we have no guarantees on that front, and that must also be agreed by the other members of the WTO. Given the broad range of potential outcomes here and the importance of the agricultural sector to the UK economy, it is vital that any decisions made on import tariffs are subject to proper scrutiny and debate.

The amendment proposes that the relevant Minister must lay before the House of Commons full statements and drafts of regulations so that they can be properly scrutinised by Members from around the country who can represent the diverse interests of the agricultural community—the producers—and British consumers. It is almost a binary position.

--- Later in debate ---

[Mel Stride]

My hon. Friend is probably raising an issue that would be outside the context of the agricultural safeguarding regime. The regime relates to sudden drops in the price of goods, and indeed certain increases in the volume of goods that are being imported, as opposed to the kind of issues he raises. Phytosanitary issues are outside the context of the Bill but will be subject to the kind of negotiations and measures that we bring into effect in that particular regard.

The Bill introduces a comprehensive framework for a new stand-alone customs regime, which will be underpinned by detailed and technical secondary legislation. The Bill ensures that the scrutiny procedures that apply to the exercise of each power are appropriate and proportionate, taking into account the technical detail of the regulations and how quickly they need to be changed.

As I set out in addressing amendment 110, the effectiveness of the agricultural safeguards regime relies on its responsiveness. The proposed additional procedure would give rise to unacceptable delays, which would not allow the Government to respond quickly to changes in circumstances or to update the measures in a timely manner. The power in the clause is subject to the negative procedure. Given the technical nature and frequency of changes, the Government consider that appropriate and proportionate. I hope the Committee will agree that the clause should stand part of the Bill.

[Kirsty Blackman]

The Minister made a relatively good point in relation to how many technical changes there may be. I will look into the frequency at which changes are likely to occur. If they will be frequent, I will not bring this matter back on Report, but if they will be infrequent, I will consider tabling an amendment. At this stage, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 14 ordered to stand part of the Bill.

Clause 15

International disputes etc

[Kirsty Blackman]

I beg to move amendment 111, in clause 15, page 10, line 18, at end insert—

‘(3) Within three months of the passing of this Act, the Secretary of State must make regulations defining “international law” for the purposes of this section.’.

This amendment requires the Government to define international law for the purposes of Clause 15.

[The Chair]

With this it will be convenient to discuss the following:

Amendment 112, in clause 15, page 10, line 18, at end insert—

‘(3) In this section, “international law” means—

(a) World Trade Organisation treaties,

(b) rules of international public law explicitly referred to in World Treaty Organisation treaty provisions,

and shall be interpreted in accordance with the customary rules of interpretation of international public law.’.

This amendment defines international law for the purposes of Clause 15.

Amendment 113, in clause 15, page 10, line 18, at end insert—

‘(3) Within three months of the passing of this Act, the Secretary of State must lay before the House of Commons a report on—

(a) the relevant international law authorising the exercise of the powers, and

(b) the circumstances in which the Government considers it appropriate to deal with a dispute by varying the amount of import duty payable.’.

This amendment requires the Government to report prior to implementation on its interpretation of relevant international law and its expectations about the circumstances of a trade dispute or issue giving rise to a variation in tariffs.

Amendment 114, in clause 15, page 10, line 18, at end insert—

‘(3) The Secretary of State must lay before the House of Commons an annual report on the exercise of the powers under this section including information on—

(a) the relevant international law authorising the exercise of the powers in each case, and

(b) the matters in dispute or issues arising in each case.’.

This amendment requires the Government to report on the circumstances of, and international law basis for, each variation of tariffs as a result of a trade dispute.

Clause stand part.

New clause 7—Variation of import duty in consequence of international dispute: enhanced parliamentary procedure—

‘(1) No regulations may be made by the Secretary of State in exercise of the power in section 15(1) except in accordance with the steps set out in this section.

(2) The first step is that the Secretary of State must lay before the House of Commons—

(a) a statement of the dispute or other issue that has arisen;

(b) an account of the reasons why the Secretary of State considers that the condition in section 15(1)(b) has been met; and

(c) a draft of the regulations that it is proposed be made.

(3) The second step is that a Minister of the Crown must make a motion for a resolution in the House of Commons setting out, in respect of proposed regulations of which a draft has been laid in accordance with subsection (2)(c) the proposed variation of import duty.

(4) The third step is that the House of Commons passes a resolution arising from the motion made in the form specified in subsection (3) (whether in the form of that motion or as amended).

(5) The fourth step is that the regulations that may then be made must, in respect of any matters specified in subsection (3), give effect to the terms of the resolution referred to in subsection (4).’.

This new clause establishes a system of enhanced parliamentary procedure for regulations varying import duty as a result of an international dispute, with a requirement for the House of Commons to pass an amendable resolution authorising the variation in the rate of import duty.

[Kirsty Blackman]

I rise to speak to amendments 111 to 114 in my name and that of my hon. Friend the Member for Dunfermline and West Fife. I am aware this is a framework Bill, but the clause is particularly short and skeletal. It would have benefited from being a bit longer and fleshed out just slightly, because then the Government could have explained more adequately what they are talking about.

Amendment 111 deals with an issue raised with us by the Law Society of Scotland, which said:

“Clause 15(1)(b) makes reference to international law but it is not clear what is meant by this. It would be helpful were the Minister to explain precisely the circumstances in which the Government would need to deal with a dispute by varying the import duty.”

If would be useful if the Minister, either in summing up or at a later point, could provide a bit of clarity. Amendment 111 would ask the Secretary of State to come back with regulations defining what “international law” is for the purposes of the clause. As has been stated, if the Law Society of Scotland does not think that is clear, perhaps it needs a bit more fleshing out.

Amendment 112 suggests to the Minister what he might mean by “international law.” We tabled the amendment to see if that is what the Government mean. If they do, perhaps they will accept it.

Amendment 113 attempts to do something similar, but we are giving the Government a little more time in which to define what they mean by “international law” in the clause. We ask them to come back within three months of the passing of the Bill, making clear what the relevant international law authorising the exercise of powers would be and the circumstances in which they consider it appropriate to deal with a dispute by varying the amount of import duty. It may be that the Government intend to return to that later anyway but, if they were to accept any of the amendments, they will make their intentions clear at this point.

Amendment 114 has a slightly different purpose: to increase the accountability of Government. The Government have the power on international disputes and the Secretary of State will make regulations in relation to that through the clause, but there does not seem to be any accountability to Parliament about regulations or changes, or ways in which they will deal with international disputes. There seems to be no feedback mechanism to allow Parliament to ensure that the Minister makes the correct decisions or to scrutinise those decisions adequately.

In amendment 114, we have asked the Secretary of State to lay before the House of Commons an annual report on the exercise of these powers, making clear the circumstances in which they have used them, which matters were in dispute and which was the relevant international law in deciding the changes.

Now may not be the time to say this, but I will just make my intentions clear. Depending on what the Minister says about his intentions, it may be that we do not need to press amendments 111 to 113. I would very much like to press amendment 114 when we come to that stage, but on the other three I will wait to see what the Minister says.

[Graham Stuart]

I will endeavour to follow the good example set by the ever-affable hon. Member for Bootle, who gave not only good content, but brilliant quotes that entirely encapsulated the moment and which we all enjoyed.

Clause 15 enables the Secretary of State to vary the rate of import duty when a dispute or other issue has arisen between the UK Government and the Government of another country, and the UK is authorised to do so under international law. The clause replaces equivalent existing powers available to the European Commission. Under the WTO dispute system, WTO members that have been found to be in breach of their obligations must bring their measures into compliance with WTO law. If they do not do so within a reasonable period, the parties can attempt to agree on compensation. Compensation may take the form of a reduction in the import duty on specified goods from the complaining country, although in practice any such reduction would have to be applied equally to all other WTO members in accordance with the most favoured nation rule.

If the parties fail to agree compensation, the complaining member or members may impose retaliatory measures against the member found to be in breach. Such measures typically involve raising the rate of import duty on specified goods from that country to incentivise it to bring itself into compliance. Free trade agreements with third countries also frequently contain dispute settlement mechanisms, many of which follow similar procedures to those of the WTO. In particular, free trade agreement dispute settlement mechanisms often result in a signatory being required to bring itself into compliance with the terms of the FTA, and often allow retaliatory trade measures to be taken against the offending party if it does not do so, and cannot agree appropriate compensation. Authorisation to implement compensation or retaliation measures may also arise in a number of other specific contexts. For example, a WTO member that imposes a temporary safeguard measure to protect its industry, or that modifies its WTO schedules, must seek to compensate any affected countries, failing which retaliatory measures may be imposed against it.

The ability to vary the rate of import duty in response to disputes and other contentious situations is vital to ensure that the UK can operate an independent trade policy after leaving the EU. In particular, the threat of imposing retaliatory duties following a trade dispute can be an effective means of incentivising other countries to comply with their obligations under international law, and can therefore help to preserve and open up trading opportunities for UK firms.

The European Commission is currently responsible for conducting trade disputes and applying enforcement measures on behalf of the UK. Once we leave the EU, the UK will bring and defend trade disputes in its own right. When such disputes are decided, we will require the powers to be able to take action to enforce and respond to their rulings including, where necessary, varying the rate of import duty. The power in the clause ensures that the UK can do just that.

Amendments 111 and 112 seek to provide a legislative definition of international law in the Bill or in regulations to be made by the Secretary of State, as the hon. Lady set out. Amendments 113 and 114 seek to impose a statutory duty on the Secretary of State to report to the House of Commons on that power, either within three months of the passing of the Bill or annually, providing details of the international legal basis for justifying the use of the power.

As I have explained, there are a number of situations under international law in which countries may be authorised to vary their rate of import duty for the purposes of retaliation or compensation, including in disputes under different types of international agreements and, just to make it even more complicated, in other contentious situations that do not involve a formal dispute. Given the different context in which clause 15 would apply, it is sensible to refer broadly to authorisation under international law. Adopting a narrower approach would risk constraining future action in situations that are not currently foreseeable.

--- Later in debate ---

The power in clause 15 is subject to the negative procedure, which is both appropriate and proportionate. The proposed scrutiny procedure would give rise to unacceptable delays that would hamper the UK Government’s efforts to enforce international dispute rulings and to induce other countries to comply with their international obligations. The negative procedure represents a more appropriate balance between the need for parliamentary oversight and the need to act quickly.

[Kirsty Blackman]

I rise to query something the Minister said and to ensure that I heard him correctly. Is it the Government’s intention, at the negative procedure stage, to explain in the explanatory notes the basis in international law and the reason for the measure being introduced?

[Graham Stuart]

It is our intention that the Government, when they seek to make such a change, and they are doing so under international law, would provide evidence of the law upon which they were relying. If the hon. Lady is happy with that, I will leave it there.

In conclusion, after leaving the EU, the United Kingdom will require the ability to vary the rate of import duty to respond to international dispute rulings and other contentious situations. That will ensure that the Government can continue to protect the UK’s economic interests by putting in place, when necessary, effective retaliatory and compensatory measures against other countries. I commend the clause to the Committee and hope that the amendment is withdrawn or rejected.

[Graham Stuart]

I will deal with the questions as best I can and in order.

The EU has four retaliatory duties in place. It is not really possible to predict how frequently this power will be used. In some ways the question is not really the frequency but whether, when it does happen, we have a procedure in place to allow us quickly and effectively to take action to ensure that we put the matter right. That, rather than the frequency, might be the bigger issue.

Although we will be seeking, and will be prepared to use, the WTO dispute settlement mechanism as a way of ensuring that there is a level playing field for UK business to compete on, and we will have the tools available for us to participate fully in international trade disputes where necessary, we have no particular appetite to be more litigious than is required to protect the UK’s interests.

I will write to the hon. Lady and the Committee on the WTO schedules and the process attached to that.

[Kirsty Blackman]

I would appreciate it if the Minister also wrote to me, because I brought that up last week. I am pleased that the hon. Member for Oxford East is pursuing the issue. It is important that the Government have the power to lodge schedules with the WTO and the power to make the technical rectifications that the Minister mentioned—those may or may not end up being technical rectifications to things like quotas, given that some of the countries in the WTO are challenging whether they would be technical rectifications or would constitute modifications.

On our amendments, the Minister has provided some information around how Parliament will be provided with evidence for each of the things that comes up. Therefore, I do not intend to press amendment 111 or amendments 112 and 113, but I do intend to press amendment 114 because I am not yet convinced that the Government will provide enough feedback about how this mechanism is working, and it would be appropriate for them to do so.

Amendment, by leave, withdrawn.

Amendment proposed: 114, in clause 15, page 10, line 18, at end insert—

“(3) The Secretary of State must lay before the House of Commons an annual report on the exercise of the powers under this section including information on—

(a) the relevant international law authorising the exercise of the powers in each case, and

(b) the matters in dispute or issues arising in each case.”

This amendment requires the Government to report on the circumstances of, and international law basis for, each variation of tariffs as a result of a trade dispute.—(Kirsty Blackman.)

Question put, That the amendment be made.

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[Mel Stride]

Clause 19, as the hon. Member for Bootle pointed out, allows for a full and partial relief from import duty. The EU customs regime provides for a relief from import duty on the basis of various factors, including the nature of the goods, their quantity and their value. Those reliefs support trade and address unintended outcomes. They can also be used to address situations in which a change to import duty would have negative consequences, whether for a specific entity or for UK interests as a whole. A relief may relate to a temporary movement, such as a visiting exhibition, or a permanent movement, such as the return of UK materials that were previously exported.

The circumstances in which goods will be eligible for a relief from import duty are carefully defined in EU law. They rely on conditions that ensure that they apply only to achieve the intended outcome. Examples include: where items are imported for scientific, educational or cultural purposes or research; where items are samples, whether for testing or to encourage future trade; where goods are donated or inherited; and where private individuals import goods upon transfer of residence to the United Kingdom due to marriage or for a period of study. The clause also covers goods imported for a specific authorised use that are placed on the home market—aircraft parts, for example, and goods that are temporarily imported, such as those for an art exhibition. Those are dealt with in more detail in the special procedures section.

Reliefs may apply to specific bodies or types of body. For example, reliefs support the operation of organisations such as charities, museums and galleries, as well as private individuals not trading. The changes made by clause 19 will allow the UK to provide full or partial relief from import duty.

Amendments 126 and 127 seek to apply the draft affirmative procedure to regulations made under clause 19. As I have set out and the Committee has had occasion to debate, the Bill ensures that the scrutiny procedures that apply to the exercise of each power are appropriate and proportionate. For the powers under clause 19, the negative procedure is both appropriate and proportionate, given the technicality of the regulations and the frequency and speed with which they may need to be made.

The hon. Member for Bootle raised the House of Lords report. The Government are looking at this issue not just in terms of the scope of the matters at hand and the power that is appropriate on that basis, but from a trading and customs point of view. We are considering the frequency with which we are likely to have to make changes and, accordingly, the ways in which the Treasury and Her Majesty’s Revenue and Customs will have to work.

[Kirsty Blackman]

Clause 19, in effect, gives the Government power to create loopholes—tax reliefs—in the legislation. Given that this is a tax Bill, does the Minister not feel that it would be better for the tax reliefs it creates to be subject to more scrutiny, not less, so that they do not have unintended consequences?

[Mel Stride]

I would not describe the clause as creating loopholes. It simply allows us, by regulation, to ensure the kind of importations to which I referred earlier. The authorised use importation, for example, relates to goods coming into the country for a specific process before typically being exported out of the United Kingdom. Levying an import duty on such goods would clearly not be appropriate, since they get exported shortly thereafter.

The measures facilitate those particular circumstances, or indeed the loan of an artwork. We are told that the French President is suggesting that the Bayeux tapestry might come over here; that particular gesture would be another example where no import duty would be appropriate, and that particular item should be able to come in and out of the country without being bothered by Customs and Excise. I would argue that the measures are important facilitations rather than loopholes.

Each relief provided for under this power will be for a particular purpose and set out the detailed requirements—for example, in relation to the origin of goods or the purposes for which they are imported. The power will be necessary in the first instance to replicate existing reliefs within the EU, to give certainty to traders directly following our exit from the European Union. However, as circumstances change it may be necessary to adapt our system of reliefs to give UK businesses and individuals the support they need to flourish, and to do so in a timely and flexible manner. For any future reliefs, the Treasury would follow established processes, consulting on draft legislation.

[Peter Dowd]

The hon. Member for Aberdeen North made some valid points. The reality is that this, to all intents and purposes, is a tax relief. It can be dressed up in whatever way the Minister would like, but it is de facto a tax relief. We already have something like 1,400 tax reliefs, which ordinarily would come to Parliament for their ratification. This seems to be a potential slew of tax reliefs—I will not comment on whether they are good, bad or indifferent—that will be given the imprimatur of a Minister or the Treasury without Parliament having any say whatsoever in that tax raising. That is not a power that Parliament should give away lightly, so I am afraid we cannot accept the Minister’s explanation that these are somehow technicalities and nothing to do with tax and raising money, which is the prerogative of Parliament.

[Kirsty Blackman]

I am concerned that this is a tax relief, and about the unintended consequences that might flow from it. The Minister almost seemed to say that the Government will make decisions on a case-by-case basis, but that should not be their intention. They should lay out the circumstances in which each kind of widget falls into each category. They are not deciding whether the Bayeux tapestry should be exempt from this duty, but whether artworks should be exempt. Those are pretty significant and major decisions, and I do not think they will be made with the frequency that the Minister suggests.

It might be that in 10 years’ time the world will have changed dramatically and we will be quite a different country, importing things that will need relief in a different way. That is fair enough, but the situation will not require regular change. Given that the measure seeks to encourage industry to flourish and to allow artworks to come to this country to be displayed, it will have a real impact on the UK’s future, so it is completely reasonable to ask the Government to allow more scrutiny. Such instances will not be that frequent, and the measure will have a big impact.

[Mel Stride]

I point the hon. Member for Aberdeen North to my earlier remarks. We believe that the measure is proportionate, particularly taking into account the frequency of the relevant changes. She is absolutely right about the Bayeux tapestry and the import of artworks; the measure sets the regulations by which those kinds of items will come in and go out of the country. There is no doubt that, in this arena of imports and these kinds of facilitations, changes are certain to occur through time, often of a highly technical nature and on a fairly frequent basis. On that basis, in terms of proportionality, there is a strong argument that we should stick with what is in the Bill.

Question put, That the amendment be made.

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Customs agents

[Kirsty Blackman]

I beg to move amendment 115, in clause 21, page 14, line 15, at end insert—

“(9) Within three months of the passing of this Act, the Chancellor of the Exchequer must lay before the House of Commons a report on the proposed exercise of the power of the HMRC Commissioners to make regulations under subsection (7), including in particular—

(a) the proposed criteria for appointment of Customs agents, and

(b) the proposed standards which persons must meet to be approved for appointment.”

This amendment requires the Government to report on the proposed use of regulations to prescribe standards for Customs agents.

[The Chair]

With this it will be convenient to discuss clause 21 stand part.

[Kirsty Blackman]

This is another amendment to try to get the Government to provide more information on the framework of the Bill. As I have said, I understand that it is a framework Bill, but more information could have been provided, particularly in the context of companies already having to contend with the move from CHIEF to CDS and the massive changes in customs that will be introduced. It would be good for companies to have an understanding—sooner rather than later—of customs agents and the hoops that those agents will need to jump through to be approved.

The amendment asks for the Government to produce a report in relation to

“the proposed criteria for appointment of Customs agents, and…the proposed standards which persons must meet to be approved for appointment”

within three months of the passing of the Bill. That will provide a level of certainty to companies about what criteria customs agents will be expected to meet in future. It is an incredibly uncertain time for businesses that export; they do not know what will happen next. This would give them a bit more understanding about the landscape that they will face.

[Mel Stride]

Clause 21 allows importers to appoint an agent to act on their behalf in respect of their import obligations. Currently, there is widespread use of customs agents who act on behalf of importers and exporters of goods, including by submitting customs declarations on their behalf. They provide a valuable service to importers and exporters.

There are two types of agent—direct and indirect, which are treated differently to represent the different relationships between them and those who appoint them. Direct agents make declarations on behalf of the importer, whereas indirect agents make declarations in their own name. Direct agents make their declaration using the importer’s identifier and they more often represent a domestic importer against whom any debt can be enforced. Indirect agents often represent overseas importers against whom any debt cannot easily be enforced. The changes made by clause 21 will allow the two classes of agent to be appointed.

The clause allows HMRC to make regulations about how the appointment is notified as well as withdrawn, which may be as little as confirming the appointment on the declaration. It also sets out the circumstances in which the agent is jointly liable for import duty.

Amendment 115 seeks to commit the Chancellor of the Exchequer to produce a report for the House of Commons regarding the introduction and regulation of customs agents under clause 21(7) within three months of the Bill’s enactment.

Clause 21(7) seeks to allow HMRC to introduce formal regulation regarding customs agents over and above the current requirement for them to adhere to customs procedures. The UK has authority to further regulate customs agents under the existing customs regime. There are currently no plans to introduce such additional regulation on customs agents, so requiring a report to be produced is unnecessary and will impose an administrative burden at a time when the UK is focusing on its future relationship with the EU. I would hope that the hon. Lady might reflect on my comments about no plans for change and withdraw the amendment.

[Kirsty Blackman]

I appreciate the Minister’s clarification and I hope to be able to share that with businesses and organisations that are concerned about the possible change. In that spirit, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 21 ordered to stand part of the Bill.

Clause 22

Authorised economic operators

[Peter Dowd]

I beg to move amendment 128, in clause 22, page 14, line 17, leave out “HMRC Commissioners” and insert “The Treasury”.

This amendment provides for the power to make regulations under Clause 22 to be exercisable by Treasury Ministers rather than HMRC.

[Peter Dowd]

Amendment 128 would confer powers on the Treasury to act as authorised economic operators instead of HMRC commissioners, for whom the clause currently creates powers.

Clause 22 allows the setting up of an authorised economic operator scheme, which is an internationally recognised quality mark indicating that an operator has met recognised standards of compliance. The status could give special access to some customs procedures and the right, in some cases, to fast-track shipments through customs. Clause 22 gives HMRC the powers to make regulations to not apply sections of part 1 of the Bill to those with such a status, or to ensure that the status is recognised procedurally in other ways.

Once again, this is a very wide power given to HMRC commissioners to ignore large sections of the Bill in relation to certain operators. Under the amendment, we hope to shift the powers from HMRC commissioners to Treasury Ministers. There is a simple reason for that: Treasury Ministers are democratic agents, accountable to the general public. We cannot allow a situation where unelected officials can disapply large sections of parliamentary legislation with no democratic recourse or public oversight. The clause would effectively give HMRC power to refuse to apply all of part 1 of the Bill, from clause 1 all the way to clause 38. Surely this sweeping power, if it has to be created, should be held by a Minister of the Crown—ideally with additional parliamentary scrutiny, as we have tried to ensure throughout other parts of the Bill.

The clause highlights yet another case where democracy is being brushed aside for the purpose of expediency. Our amendment seeks to restore accountability. I hope that members of the Committee will support it today.

Amendment 129 and consequential amendment 130 seek to amend clause 22 and clause 32 respectively. In both cases, the amendments would add a requirement for the Government to introduce affirmative regulations to make further policy. Under clause 22, that is for the purposes of setting up an authorised economic operator scheme.

The use of the negative procedure in that case was commented on in the Lords Delegated Powers and Regulatory Reform Committee report, which addressed the matter of regulations made under the negative procedure under clause 22 as follows:

“Clause 22 allows HMRC Commissioners to make regulations ‘disapplying or simplifying’ any of the law relating to import duty made by or under Part 1 of the Bill (clauses 1 to 38) in relation to “authorised economic operators”, a term that will be amplified in regulations and which essentially covers operators who meet internationally recognised standards of compliance. Bearing in mind that clause 22 covers the other 31 regulation-making powers found in Part 1 of the Bill, its scope is very wide. Given the width of this power enabling HMRC to waive compliance with the law, we consider that these regulations should be subject to an affirmative procedure.”

Again, the Lords are bringing home the point about democratic accountability.

Amendment 129 seeks to amend the Bill, following the advice of that cross-party Committee, because of another example of the Government sidestepping parliamentary scrutiny. We want—we will say this time and again—to reintroduce some measure of scrutiny into the process. Similarly, amendment 130 brings the notes under clause 32 into line with the changes made in clause 22, as I described earlier. It is therefore a consequential amendment in ensuring that the Bill properly reflects the comments made by the Delegated Powers and Regulatory Reform Committee. As I am sure everyone will agree, the proposals are all about parliamentary scrutiny in the important area of customs policy.

[Kirsty Blackman]

It is most unusual to hear the Lords held up as champions of democratic accountability, but the work of the Delegated Powers and Regulatory Reform Committee on the Bill has been incredibly useful, and it has allowed us to have a more knowledgeable debate on the subject. It was quite reasonable of the Opposition to have brought forward their amendments.

I will speak to amendment 116, which I intend to press to a vote. It is about authorised economic operators, which is what the clause covers, because I have real concerns about the system. I am not the only person to have concerns—they have been expressed previously—about how the UK manages the AEO scheme within the UK. The UK scheme is managed dramatically differently from schemes in other countries, which is a real concern for businesses.

The Government’s customs White Paper mentioned that people could be authorised economic operators, and basically suggested that that would solve all their woes. Given how difficult it is for companies to become authorised economic operators, and given HMRC’s shortcomings in overseeing the process and ensuring that it is as smooth and quick as possible, I have real concerns that the system cannot be used effectively by many businesses as a way to ensure—slacker customs procedures is not the right term—slightly different customs procedures that would allow things to move a bit more smoothly.

In the amendment in my name and that of the hon. Member for Dunfermline and West Fife, we are looking for the Government to provide more information. Part of that is about giving businesses certainty further in advance, and part is about ensuring that the Government think about how the authorised economic operators scheme will go forward.

Among the various things we are asking for in the amendment is

“the proposed criteria to be applied in determining whether or not any person should be an authorised economic operator”.

Part of that is to do with the issue that the UK Government and HMRC have had with requiring companies to have someone with three years of customs experience in order to be approved as an authorised economic operator. That is how things have been applied and work now, but if we suddenly include the, I think, 130,000 new companies that have not previously had to do customs checks, we will need a different system, because those companies will not have someone who has been working for three years in a customs-related role. The Government will have to agree that some sort of external company can take on the role of that person, or that the companies can have a differentiated system until they have had that three years of experience in exporting. It is reasonable to expect the Government to be a bit more flexible.

Our proposed new paragraph (b) asks for

“an assessment of the structure of the authorised economic operator system in Germany, Austria and such other countries as the Chancellor of the Exchequer considers relevant”.

Although the scheme is internationally recognised, the way in which it is implemented and the way in which the equivalents of HMRC oversee it varies wildly by country. In some places, the system is much quicker, and it is much easier to get through the process. Companies receive more assistance and guidance to get them through the process, and the officials make a determination about applications more quickly.

It is important for the Government to look at other countries. The British Chambers of Commerce said that Austria and Germany do this in a much smoother way; that is why those countries are included in the amendment, but it would be completely reasonable for the Government to include any other countries that they think are relevant.

Paragraph (c)—

“the proposed differences between the structure that is proposed to be established by the first exercise of the power to make regulations under subsection (1) and each of those structures described in accordance with paragraph (b)”—

would again require the Government to provide us with more information in advance. Paragraph (d), on

“the level of proposed resources to be allocated by the HMRC Commissioners for the authorisation of new authorised economic operators”,

is pretty critical. Given that I assume the Government expect to see a dramatic increase in the number of applicants for authorised economic operator status because of the number of companies that will be exporting for the first time, it is reasonable that they should report on how they intend to ensure that sufficient resources are allocated to seeing the process of authorised economic operators through.

Paragraph (e) is about

“the target timetable for the authorisation of…new authorised economic operators in each class, and…authorised economic operator certification renewals in each class.”

We have heard concerns that the renewal process for an authorised economic operator can take 12 months. If that is so—that may be an outlier—that is a ridiculous length of time for a renewal. The Government may decide that they want a first application to take that long, but I would contend that even that is pretty excessive. It would be incredibly useful for the Government to set out what the targets are, so that companies know, when they are going into the system, how long the Government intend to take in making a decision. When a company is considering, for example, exporting to a new market or changing the way it does it exporting, it should be able to look at the Government’s timeline and plan on the basis of how long it will take them to process the authorised economic operator approval or renewal.

It would be sensible for the Government to come back with all those answers. Businesses would be very happy if the Government gave them more certainty about all those matters. This is a pretty comprehensive amendment, and it relates to a number of aspects of the authorised economic operator scheme that I have concerns about. I hope the Minister will provide a degree of certainty about all of them. If he cannot, I will be keen to press this amendment to a vote.

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Amendment 116 would require the Chancellor of the Exchequer, within three months of the passage of the Bill, to undertake a review of the AEO scheme that HMRC proposes to implement. That review would include the criteria HMRC will use to determine whether a trader qualifies for AEO status, comparison with the way other countries set up and run their AEO system, and HMRC’s plans to process applications for AEO status.

[Kirsty Blackman]

The amendment does not call for a review at all; it calls for a report to be provided. It is not about concerns being raised about the current operation of the scheme, but about how HMRC will look at the scheme going forward.

[Mel Stride]

I thank the hon. Lady for that clarification. She is right: I said “review”. However, my comments are equally relevant to a report on how it is going and thoughts on how we move forward.

The inclusion of clause 22 reflects the feedback from businesses enjoying the benefits of the current AEO regime. In responding to calls for continuity in that regime, it will help to minimise any potential disruption. What is more, HMRC has already committed to improving the authorisation process for traders and has been meeting with businesses, as I outlined, since last autumn to consider practical improvements to the process. The process is ongoing and includes drawing on the best practice of other countries.

On the amendments, the draft regulations will make clear what the authorisation criteria for AEO status will be. It will largely be the same as the current EU criteria. Those regulations will also set out the details of AEO status, which will largely be the same as the current system.

[Kirsty Blackman]

It would be very useful to know whether the Minister has any idea when the regulations will come forward. Part of my concern was the lack of advance notice for businesses.

[Mel Stride]

That will be determined to a large degree by the negotiation that is in play with the European Union and by whether we have an implementation period. We are hopeful that such a period will be seen to be in our interest and that of the European Union. The measures will be brought in at the appropriate time, as and when we require our own stand-alone system, so that we are ready on day one and have the regulations that will allow us quickly and effectively to introduce AEO status. It is not about having a one-size-fits-all model. It is about having different classes so that we are able to be helpful in particular to the small and medium-sized enterprises that we recognise may benefit from a different approach from that for larger businesses.

Amendments 129 and 130 would apply the draft affirmative procedure to all regulations made under clause 22. The Bill ensures that the scrutiny procedures that apply to the exercise of each power are appropriate and proportionate considering the nature, length and technicality of the regulations and the frequency with which they are likely to be made. The Government believe that using the negative procedure under clause 22 provides a sufficient level of parliamentary scrutiny, while having regard to the technical nature of the regulations. The regulations may, for example, be used to specify the criteria and processes that HMRC uses when determining whether a business can be authorised as an AEO. Regulations may also set out where and when HMRC must take account of AEO status when administering the customs system. Adopting the draft affirmative procedure for these types of regulations will affect the expediency and efficient administration of the customs regime. For those reasons, I urge the hon. Lady to withdraw the amendment.

Commonwealth: Trade

Kirsty Blackman Excerpts

Wednesday 22nd February 2017 Westminster Hall

[John Howell (Henley) (Con)]

It is a great pleasure to serve under your chairmanship, Mr Davies. I congratulate my hon. Friend the Member for Rossendale and Darwen (Jake Berry) on securing the debate. I want to use the example of one country to illustrate some of the points that he and other Members have made. The country is Nigeria, where I am the Prime Minister’s trade envoy. [Hon. Members: “Hear, hear!”] I thank hon. Members for that endorsement of my role. My appointment was a pre-Brexit one, although admittedly it has relevance in a post-Brexit world, which goes to show how much this country values the relationship it would like to have with Nigeria. Trade is of mutual benefit—it benefits not just one but both of the countries concerned. We can do enormous good when we operate in a country if, as well as ensuring that our own markets are fulfilled there, we ensure that that country’s markets are also developed.

Nigeria’s size is significant in that respect—with 170 million people it is, I think, the most populous Commonwealth country in Africa—but it also has enormous regional importance. At a dinner organised for me in Lagos recently, the common theme around the table of Nigerian and British businessmen was that it was impossible to see sub-Saharan Africa taking off without the development of Nigeria. Anything we can do to help Nigeria to develop will bring stability to that part of the world. We need to show that we are doing that, as a good member of the Commonwealth family. It is an important part of the message we want to give.

I am trying to do something about the status of our trade relations with Nigeria, which are currently abysmal because they are based on one factor—oil and gas—that has seen an enormous drop. We and the President of Nigeria are determined to diversify the economy to ensure that British companies across the board have a role to play in the Nigerian market.

In terms of the way of doing business, there is a tremendous amount of low-hanging fruit. I am happy to gather that low-hanging fruit as I go, but I am more interested in the long-term business relationships that will cement the UK-Nigerian way forward.

[Kirsty Blackman (Aberdeen North) (SNP)]

Will the hon. Gentleman give way?

[John Howell]

I will not. We are too pressured for time.

I know from my experience in central and eastern Europe that those business relationships take a tremendous amount of management time to get right.

There is a way of doing business that depends on getting people together to hunt as a pack, to ensure that all views are known and that we do not act for just one company. I have gathered those companies together in an advisory group that I have set up, with PwC as the secretariat. That group is just about to have its first meeting, and will take forward the approach of operating as a UK group in Nigeria, as our French and German colleagues do with their companies.

I echo the comments made about the diaspora. We have the second largest Nigerian diaspora in the world in this country and I recommend that we make the best use of that.

--- Later in debate ---

[Kirsty Blackman (Aberdeen North) (SNP)]

It is a pleasure to serve under your chairmanship, Mr Davies. I congratulate the hon. Member for Rossendale and Darwen (Jake Berry) on securing this really important debate. I hope we can continue the debate over the next two years in the main Chamber of the House of Commons, because it is really important, particularly in the light of statements that were made in advance of the EU referendum about how strong our links with the Commonwealth are going to be.

Coming to debates on any issue surrounding Brexit, it is particularly interesting to hear about the wonderful fantasy world in which some people live. I obviously campaigned for remain, and I believe we are economically, as well as culturally, better off as part of the European Union. I do not believe in the wonderful land of milk and honey and beautiful free trade arrangements that is being proffered to us for a number of really good reasons. The European Union has free trade agreements with 32 of 51 Commonwealth countries, so we are going to have to renegotiate those 32 trade agreements. It is not as though we will be suddenly free to negotiate with the Commonwealth; we will lose those trade agreements when we leave the EU. Why would those countries choose to give a better deal to the UK, which has a population of 65 million, than they give to the EU, which has a population of 500 million?

We will also be negotiating under time constraints, because we will be desperate to ensure we can export. We will have a time imperative that the EU did not have when it was negotiating its deals, so for us to get a good deal will be more difficult .

[Dr Daniel Poulter (Central Suffolk and North Ipswich) (Con)]

I voted the same way as the hon. Lady in the referendum, but I am sure she accepts that the EU sometimes made trade deals with Commonwealth countries on terms that were not always favourable to the United Kingdom, such as on the free movement of medical professionals. For example, medical professionals from Australia and New Zealand, nurses in particular, were prevented from coming to the UK by prohibitory EU rules on training requirements. There will be advantages to Britain being able to negotiate its own trade agreements with some countries.

[Kirsty Blackman]

I absolutely agree that some small areas for some industries in some sectors have been disadvantaged by some of those EU trade deals. Some companies talk about how disadvantaged they have been, such as Tate & Lyle because it imports cane sugar, but it is important to note that in any trade deal with another country we might still have to cede some of our sovereignty, because that is how trade deals work—we have to concede some things and to compromise when we make a trade deal. That is what such deals are about—a level of compromise—so we will lose some of the ability to make our own decisions, because it will be wrapped up in the trade deals.

I tried to intervene on the hon. Member for Henley (John Howell) to mention this, but I have a huge Nigerian population in my constituency because so many people have come to Aberdeen North to get involved in the oil and gas industry. If the Government are truly keen to create better links with such Commonwealth countries, however, they need to have better relationships now, because in 2015, the most recent year for which figures are available, the UK Government refused 33% of visitor visas from Nigeria. If the UK Government want better relationships, they need to up such numbers—they only approved 57% of visitor visa applications from Ghana and 50% from Pakistan. Members were talking about special Commonwealth lines at airports and so on, but we need to change the high levels of visitor visa refusals, which are continuing and getting worse, if we want to have a better relationship with those countries and eventually to make free trade agreements with them.

The other point about free trade agreements was mentioned by my hon. Friend the Member for Edinburgh North and Leith (Deidre Brock) and was in connection with the private Member’s Bill promoted by my hon. Friend the Member for Kirkcaldy and Cowdenbeath (Roger Mullin). The Double Taxation Treaties (Developing Countries) Bill sought to look at the tax treaties we have historically signed with countries to their disadvantage. A number of Commonwealth countries are affected. If we want to pave the way for smooth, positive trade deals, we need to look at the ways in which we have created disadvantage for those countries. A good way to generate some positive feeling would be for the UK Government to look at things such as tax treaties, because that would encourage those countries and increase the likelihood of a favourable trade deal.

The World Trade Organisation has requirements for what should be included in a free trade arrangement in order for it to be a free trade arrangement and not simply something that falls into the most favoured nation category. A free trade arrangement cannot be made for only one type of good or service—that is not acceptable to the WTO—but needs to be much wider. We will not easily be able to make agreements with New Zealand on lamb, for example, or on any such specific; we will need to make much more wide-ranging free trade agreements in order for them to be acceptable and not challenged in the WTO. Furthermore, the WTO is not dissimilar to the European Union in that, for schedules to be approved and so on, the WTO members need to agree them. The WTO road is not smooth, but bumpy, and a huge number of problems will be in our way, not least the cliff edge we are likely to fall off.

Finally, I want to talk about the historical links with the Commonwealth. For people my age or younger, in many ways our only link with the Commonwealth is the Commonwealth games. That is pretty much the only thing. I do not know whether this is generational, but some people believe that the empire was a sort of wonderful, historical panacea and an amazing relationship, but people of my age do not think that. We do not hark back to those days of empire; we look back to the subjugation that we—

[Sir Hugo Swire]

The hon. Lady must know enough to know that some countries in the Commonwealth were never part of the British empire.

[Kirsty Blackman]

That is the case, but most countries in the Commonwealth were. My point is that we will be trying to make trade deals with countries with which we have not necessarily always had a positive relationship. Fair enough, we have the Queen as a figurehead, but that is not necessarily enough for us to give them a positive trade deal, or for them to give us one, and it is not enough for the WTO to agree that we should give preferential agreements to each of those countries. The WTO will not agree to that unless we have given them to all countries.

Oral Answers to Questions

Kirsty Blackman Excerpts

Thursday 3rd November 2016 Commons Chamber

[Dr Fox]

It is not a question of punishment; it is a question of what we have signed up to and our duty to fulfil the obligations we have entered freely into.

[Kirsty Blackman (Aberdeen North) (SNP)]

Has the UK managed to get the World Trade Organisation’s 160-plus members to agree that we will be a continuing member, rather than a new member, of the WTO? If the UK is not able to have negotiations just now, how will it get that agreement?