Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Bill [Lords]

Liam Byrne Excerpts

Report stage
Tuesday 19th March 2024 Commons Chamber

[Sir Iain Duncan Smith]

I enjoy the idea that my hon. Friend puts such trust in Government never to take other arrangements into consideration. We know how that works. It will be fine today with my right hon. Friend the Minister here, but there may be others in charge in future, and I am not sure I would always want to rest my defence in Ministers.

[Liam Byrne (Birmingham, Hodge Hill) (Lab)]

I am grateful to the right hon. Gentleman for giving way and for this new clause. Was he as surprised as I was that when we asked the Secretary of State whether she would block China’s accession to CPTPP she was unable to give us an unequivocal answer?

[Sir Iain Duncan Smith]

I think the right hon. Gentleman makes my point. I sat in Government and all I can say to him is that one cannot always say that Ministers will necessarily do the right thing; rather, they will do the right thing by the Government, which is sometimes not the same. I do not mean to cast aspersions on my party’s Government by any means, but that has happened in the past. I simply want to make the point that China’s potential accession has huge implications for all sorts of things, including because of its immense economic and political influence in the region and the pressures on the UK if we were almost isolated in our observations.

China is not a likeminded party—there may be other countries that are rather similar. It openly seeks to revise the liberal, open and rules-based order and establish itself as a regional hegemon. If admitted, it would be the largest economy and dominant economic and trading partner in the CPTPP, with unrivalled political influence. It could block a future US entry. As we join it is important for us to make way for the US and bring it in, which will help in a whole range of areas. China’s accession would help to cement Beijing’s desired leadership in global trade. I will remind the House that China is next up for the CPTPP, so this is not something conjured up.

China’s entry also risks further increasing economic dependence on it, which is already too high, and building resilience into the Chinese economy to weather sanctioning should tensions over Taiwan escalate, which they almost certainly will. That would run counter to the UK’s strategic efforts to de-risk and maintain the status quo in the region. Serious human rights abuses are and continue to be embedded within Chinese supply chains. China is the most egregious offender in this regard, with its actions on religion in Xinjiang and in Tibet, where slave labour is also practised. Slave labour undercuts the World Trade Organisation and normal trade. Those are good commercial reasons why the membership of any country with the views China happens to have would have a real impact.

China’s accession is unlikely to drive economic reform in the country. There is no political ability to drive such reform under President Xi, who has moved China further away from the spirit of the CPTPP on labour rights protections.

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[Sir Iain Duncan Smith]

It is, although I cannot follow my hon. Friend through Lithuania and the atolls of the far east, because I would be ruled out of order by the Chair. I hope he will forgive me, but he makes a strong point.

I say gently to the Opposition spokesperson, the hon. Member for Harrow West (Gareth Thomas), that it was a Labour Member, Lord Leong, who tabled the amendment in Committee in the Lords. Labour said that it would whip for the amendment if it were reworked to not mention China. Strangely, the new clause does not mention China, so I would have hoped that Labour would support it, but it does not. I understand that Labour has tabled its own new clause.

Parliament should be able to make its voice heard on a matter of such national significance. The new clause does not overturn constitutional conventions by a long way. Having a report, a debate and a non-binding vote would not determine Government policy, but it would determine the House’s view on the elements of this particular trade deal. I note that Opposition new clause 4 also seeks to look at this, but there are other issues that I will not bring up now.

There are elements in the Government who believe that debate is not a bad thing, because it allows them to make their case for why such a trade deal is important. I urge the Government to be positive about this, because being positive about debate in the House of Commons is a restatement of democracy. It allows people to decide whether they agree. More importantly, this is about accession. If those who follow us in seeking to join the treaty are defined as a threat, as they are in the review, that will at least inform the Government. It will also allow the House to pressure the Government over its real concern about what they might be doing. In future, a Government from either side of the House or of whatever form may choose, under pressure from China over economic issues, to let it accede to the treaty. Who knows? I do not say that that is the mood, but it is for Back Benchers to make their point about what the Government should do and for them to take note. In that regard, I commend my new clause to the House.

[Liam Byrne]

It is a pleasure to follow the right hon. Member for Chingford and Woodford Green (Sir Iain Duncan Smith). I will speak in support of new clause 1, which he tabled, as well as the new clauses tabled in the names of my right hon. and hon. Friends.

I welcome this debate and the new clauses and amendments that have been tabled, but I lament the fact that we have not been permitted a full debate on the treaty—something the right hon. Gentleman argued for very eloquently. We needed a debate today not merely on the three chapters of the CPTPP covered by the Bill, but on the full 30 chapters of the treaty, with all the associated annexes and bits of analysis and argument.

I do not want to detain the House for very long, because the Business and Trade Committee went to the length of writing and publishing a report earlier this year. However, I want to underline the point about the lack of scrutiny. Of course, it was the Government themselves, in the Grimstone rule, who said that no new free trade agreements would be ratified by His Majesty’s Government without a full debate on whether we should agree to them. When I asked the Secretary of State on 23 January whether she would agree to a debate under the terms of the CRaG process, she said she would be “happy to support” such a debate. Her officials then wrote to the Clerks on the Select Committee to say that such a debate had been requested, only to be told by the Leader of the House that no time was available. The Leader of the House confirmed that in writing to me last week in a letter in which she said:

“it has not been possible to find time for a debate in Government time.”

The House of Lords is having a debate on the treaty today on the recommendation of the International Agreements Committee, so why can’t we? Are we second-class representatives in this House? Are we unqualified to have a debate on all 30 chapters of the treaty? Are we not qualified to speak, on behalf of the people we came into public life to represent, about how the treaty will affect their future? I think we are. I think we should have a debate on the full treaty.

And I cannot believe that we are out of time. Members will have seen the report in the Financial Times last week, which said that the working day in this Chamber

“has been shorter on average this parliamentary session than in any other in the past quarter century”.

Are we seriously saying that we have not been able to find time for a debate, which it is the Government’s policy to support, on one of the only free trade agreements that His Majesty’s Government have been able to bring forward since we left the European Union?

On Twitter, the Minister—I am a keen follower of the Minister on Twitter, he will be pleased to hear—said last week that there have been four parliamentary debates on the treaty, but I wonder if he is sure about that. When I asked the Clerks on the Select Committee to check that, they were left scratching their heads a little bit. They could not find all four that the Minister referred to. We have to accept that there is no shortage of controversy in the Bill, not least because the Secretary of State herself resiled from the figures that describe the benefits of the treaty to the country.

[Anthony Mangnall]

I thank the Chair of the Select Committee for giving way. It is a pleasure to serve on the Committee with him. I thought I might just throw a bone in the form of cross-party support on this point. Having a debate is not just about pointing out controversies; it is about having the opportunity to justify and debate things about which our constituents care. These trade deals make a difference not only to the businesses, but to the services and agriculture sectors in our respective constituencies. That is why it is damaging not to have a debate: it fails to allow us the opportunity to persuade people that trade deals can be a force for good.

[Liam Byrne]

The hon. Gentleman is absolutely right and I commend his contribution both to the Committee and to the report that we published on the CPTPP earlier this year.

There are a number of important new clauses and amendments not only about the future expansion plans of the CPTPP and what our policy on those might look like, but also, in the names of my right hon. and hon. Friends, about investor-state dispute settlement. This is important because in all the fanfare, arguments and passionate bits of literature and speeches offered by the Government about the virtues of the treaty, it was always positioned as a gateway to the fastest-growing economy on Earth that will represent a significant fraction of economic growth in the future. Of course, what was often missing from those eloquent descriptions was a recognition that the countries in the CPTPP represent only about a fifth, at best, of the Indo-Pacific region.

We are surely right to worry that there could well be a Government drive to expand the orbit of the treaty to a much wider group of nations. If the Government really want to take aim at the biggest economies on Earth, they may well encourage China to join. However, when I asked the Secretary of State whether it was her policy to agree to or block China’s accession, she said that that was not something we could discuss on the Floor of the House or in the Select Committee. That is why safeguards are needed. We might even be so bold as to merely ask for a little bit of clarity on the Government’s future strategy. That is why the amendments on the future pathway of the treaty are so important and why I hope we will have a vote on some aspect of that today, even if it is not on the new clause tabled by the right hon. Member for Chingford and Woodford Green.

I will talk briefly about new clause 3, which relates to ISDS. It is important, because His Majesty’s Government have agreed side letters with a number of countries to take us out of the ISDS process. That is not an exemption or safeguard that we saw when it came to agreeing to the treaty, yet the treaty includes countries such as Canada—I think we are just about on fraternal terms with Canada at the moment; we may have failed to agree an FTA with it, but quite why is a matter of some dispute between the Canadian Government and the Secretary of State. Canada is home to some of the biggest pension fund investors on the planet and we know that those funds are especially litigious. Although the Minister was right, when he answered these questions in earlier conversations, to say we have never lost an ISDS case, the reality is that many fear there will be a chilling effect on the regulations we bring forward because of a fear of the peril of ISDS procedures.

[Lloyd Russell-Moyle]

My right hon. Friend is speaking very well on some of the new clauses I have tabled on ISDS. It is of course true that getting the side letters for all member states was good enough for New Zealand, so it was protected more—not fully protected, I grant him. If it was good enough for New Zealand, it should have been good enough for us. Is it not a sign that Ministers have lacked ambition, or is it a sign of complacency?

[Liam Byrne]

My hon. Friend is absolutely right. Perhaps it is because we did not want to overly annoy the Canadians, but the truth is that the talks with the Canadians have broken down—at a cost, by the way, to the UK automotive industry. In fact, UK cars will be hit on average by a £3,000 tariff in about a month or two, because of the breakdown of those talks. It is important for us to have a vote on why we do not have those procedures, why we do not have those safeguards and why we do not have those side letters.

Finally, I want to underline the point made by the right hon. Member for Chingford and Woodford Green. As a House, we must become far more skilled, far more ready and far more adroit at debating the kinds of treaties we will be asked to sign. Once upon a time, when the Berlin wall came down, we promised ourselves that we could look forward to a new world of free trade, and we hoped that that free trade could bring political progress and a democratic process—Wandel durch Handel, as the Germans liked to say.

However, that reality is now smashed; that era ended with the second invasion of Ukraine. We are now in new times, when we have to debate not just military security but economic security, and economic security questions are always freighted with dilemmas. We are a small nation and our adversaries are big, so we must always act with our allies, but not all our allies are good, and many of our friends would prefer not to pick a side. Our adversaries plan for self-sufficiency, but we cannot. We prefer open, free trade, but global supply chains are risky. We like markets to decide, but security always requires state action. We know that we need to work proactively to shape the long term, but democracies frequently entail a short-term change of Government, and too often our politics is reactive.

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[Gareth Thomas]

My hon. Friend is generous in his description of my speech—I am grateful to him—and absolutely right about the importance of Labour’s plan for the creative sector.

Reform of the UK’s copyright framework should not be taken lightly, and it should only follow proper and well-considered consultation. Otherwise, we risk endangering our gold standard of protection for our vital creative sector. I gently suggest to the House that the reforms allowed for under clause 5 should not have been shoehorned into this Bill, and certainly not without a thorough consultation having taken place first. In that regard we are sympathetic to the merits of new clause 12, tabled by the hon. Member for Chesham and Amersham. We will continue to scrutinise developments in this area, and we hope that Ministers will reach a final decision, after the consultation, that will not have the adverse impact that is feared by some outside the House.

As I have said, I share the concerns expressed by my hon. Friend the Member for Brighton, Kemptown in new clauses 2 and 3, and I therefore hope he will join us with enthusiasm in the Lobby later today. Similarly, I share the desire of my right hon. Friend the Member for Hayes and Harlington for much greater adherence to the conventions of the International Labour Organisation. We raised this issue in Committee, and as I said earlier, I share his frustration—and that of other Members—that Ministers have not allowed the House a substantive debate under the CRaG process.

[Liam Byrne]

My hon. Friend, who is making an excellent speech, is right to underline the point about ILO obligations. In the 2022 Queen’s Speech we were promised an updating of the Modern Slavery Act 2015 that would have required much stronger action and transparency on supply chains in order to eliminate forced labour. That measure seems to have disappeared, so we must insist on more robust action in our trade agreements if we are to wipe out the scandal of modern slavery.

[Gareth Thomas]

My right hon. Friend is absolutely right. Ministers will have heard his point; whether they will act on it remains to be seen, but I certainly hope they do. If we are lucky enough to be elected at the next general election, we will certainly work with the ILO to try to drive better adherence to its conventions.

Last but not least, I share the ambition of my hon. Friend the Member for Walthamstow, who made a powerful speech, for a much more open dialogue on trade and the axing of more of the red tape, bureaucracy and barriers to trade with European markets thrown up by the poor negotiating skills of the last Prime Minister but two.

There remain, in particular, serious concerns about scrutiny of trade agreements and about the damage that ISDS provisions could do, so we will, with the leave of the House, press new clauses 4 and 5 to a vote.

[The Minister for Trade Policy (Greg Hands)]

I thank colleagues for their contributions to the debates on this important Bill. Let me begin with the new clauses relating to new accessions to the CPTPP: new clause 1, tabled by my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith)—who always demonstrates his passion on this important matter—new clause 4, tabled by the hon. Member for Harrow West (Gareth Thomas), and new clause 11, tabled by the hon. Member for Chesham and Amersham (Sarah Green).

As the House may know, there is no rule within the CPTPP that requires new applicants to be dealt with on a “first come, first served” basis. Rather, it has been agreed within the group that applicant economies must meet three important criteria—called the Auckland principles—and it is on those key principles that applications will be assessed. Applicants must: first, be willing and able to meet the high standards of the agreement; secondly, have a demonstrated pattern of complying with their trade commitments; and thirdly, be able to command consensus of the CPTPP parties. Those strong criteria will be applied to each accession application. It is right that we in the United Kingdom, as a new member of the CPTPP group, work within the principles of the group to achieve a consensus decision.

I remind the House that while the UK rightly participates in discussions on this topic with CPTPP parties, we will only have a formal say over an application post-ratification and entry into force of the agreement. It is therefore crucial that we ratify the agreement and become a party, so that we can work with CPTPP members decisively on each current and future application. With that in mind, it would not be appropriate for the Government to give a running commentary on individual applicants, not least because to be drawn on individual applicants now, ahead of the UK becoming a party to the agreement, could have an impact on our ability to achieve that important goal of ensuring that the CPTPP enters into force. I should also make it clear that our own accession process has set a strong precedent. The robust experience that the UK has undergone has reinforced the high standards and proved that the bar is not easy to meet for any aspirant.

Regarding the scrutiny of any hypothetical future accession, I can assure the House that any accession of a new party to the CPTPP would require an amendment to the terms of the CPTPP. Therefore, as with the UK’s accession protocol, our firm intention is that such a future accession would be subject to the terms of the Constitutional Reform and Governance Act 2010—the CRaG process. I assure the House that CRaG is applicable to plurilateral agreements such as the CPTPP. The Act makes no distinction between bilateral, plurilateral or multilateral treaties as outlined in section 25 of CRaG.

[Liam Byrne]

The Minister is being characteristically generous in giving way. We obviously sought a debate under CRaG for this treaty. The Secretary of State, who is now in her place, told our Committee that she supported that, but the Leader of the House then refused to make Government time available for that debate. What further assurances can the Minister give us that there would indeed be a debate if the treaty was changed in the way that he described?

[Greg Hands]

The Government’s position is unchanged. It is always the desire of the Government, as expressed by the Secretary of State in writing to the House and to the right hon. Gentleman as Chair of the Select Committee, to urge and to ask for there to be a debate, but that will always be subject to the availability of parliamentary time. In a little bit, I will discuss the opportunities that there have been to scrutinise the CPTPP, which have been manifold in recent years.

[Greg Hands]

I will give way a little later.

The Act makes no distinction between bilateral, plurilateral and multilateral treaties. In addition to Parliament being able to make its views clear through the CRaG process, let me remind the House that, as a dualist state, any legislation necessary to implement the treaty—such as alterations to tariffs legislation, to take a hypothetical example—would need to be fully scrutinised and passed by Parliament in the usual way. It is the long-standing policy of His Majesty’s Government not to ratify international agreements before all relevant domestic legislation is in place. Were Parliament to refuse to pass any necessary implementing legislation, ratification of an agreement would be delayed.

I thank my right hon. Friends the Members for Chingford and Woodford Green and for North Somerset (Sir Liam Fox) for their opening speeches. Both are strong supporters of the UK joining the CPTPP. Indeed, my right hon. Friend the Member for North Somerset, who is the former Secretary of State, initiated these talks back in 2017 with me at his side, and successive Secretaries of State have given maximum priority to doing so. I am now in my fourth stint in this role, and it is fantastic to see his and my vision in 2017 now nearing fruition and being very close to UK ratification.

My right hon. Friend the Member for Chingford and Woodford Green and I know that Parliament is perfectly capable of expressing a view on an international agreement and whether a country might join it, and the Government of the day would be very likely to take notice. In debates in this House over some years now, he has made clear his views on trade with China, has gained support and attention, and been effective in doing so. Indeed, he has helped to achieve changes in policy in relation to supply chains in Xinjiang, and I agree with his support for Taiwan —a full member of the World Trade Organisation—as an important trade partner for the UK. We are positive about this kind of debate in the House.

The right hon. Member for Birmingham, Hodge Hill (Liam Byrne), who chairs the Select Committee, mentioned the scrutiny that there has been in this House for the CPTPP agreement, and he doubted whether there had been four debates. I had a slightly nagging feeling that I may actually remember each of the four debates, so I went back and checked the four debates, which started with the very first one that I responded to in April 2021. There have been four debates in this House and in the other House on the CPTPP. There have also been two oral ministerial statements and 16 written ministerial statements, and five separate Select Committees have taken evidence from Ministers and senior officials on the matter. There has been a Trade and Agriculture Commission report and a section 42 report. This is not an under-scrutinised trade agreement—rather the opposite. As has always been clear, we want the CPTPP to expand to fast-growing Asia-Pacific economies. I also agree with the Auckland principles.

[Liam Byrne]

rose—

[Greg Hands]

Of course I will give way—if the right hon. Gentleman first concedes that this has been a well-scrutinised trade deal.

[Liam Byrne]

Not quite. I am grateful to the Minister for setting out the full history, but will he accept that the Secretary of State believed that we should have had a debate, under the CRaG principles, on the full treaty? This Bill covers only three of 30 treaties. It is a matter of disappointment to many of us in the House that even though the Secretary of State no doubt argued vigorously and passionately for the debate, the Leader of the House was unable to grant us time. That is not necessarily the precedent that we want to establish for further trade treaty scrutiny.

[Greg Hands]

Of course, the right hon. Gentleman was a Minister in the last Labour Government, and he will remember that there are the vagaries of time available. Making an application to say that we would like there to be a debate is not the same as those who run the parliamentary timetable agreeing to there being one.

Let me move on to the new hon. Member for Kingswood (Damien Egan), who made a very accomplished and well delivered maiden speech. He spoke fondly of predecessors whom I know and like, such as Roger Berry and Rob Hayward. He won a keenly contested by-election—I have been to a few by-elections in recent years, and I was grateful to be given a bit of time off and to not go to Kingswood. None the less, I have great admiration for those who win by-elections. I have seen at close hand that they are a different kind of contest.

The hon. Gentleman spoke of his support for free trade and for rewarding hard work, and expressed sympathy for the Government, who have faced the challenges of covid and Ukraine. I agree with him on all of those issues, and the Government do too. I look forward to his continuing the tradition of an independent-minded Member for Kingswood—but please do not tell the Labour Whips Office.

As ever, my hon. Friend the Member for Totnes (Anthony Mangnall) spoke passionately about trade and CPTPP. He is always probing on those issues.

Various amendments and new clauses that have been tabled ask for additional impact assessments. Before addressing some of those amendments directly, I would like to reassure the House that the Government will publish a biennial monitoring report and a comprehensive evaluation report of the agreement within five years of our accession.

Amendment 1 and new clause 12 would introduce commitments to publish impact assessments on the performers’ rights provisions in this Bill, and I will set out why we consider them to be unnecessary. The impacts of the rules depend in large part on how they are applied in particular cases through secondary legislation made under the Copyright, Designs and Patents Act 1988. That secondary legislation may restrict or extend particular rights to particular countries. Wherever the Government intend to make significant changes to the secondary legislation, we will engage with affected industries and carry out an impact assessment. The Intellectual Property Office has done that recently with its consultation and its assessment of the impact of potential secondary legislation on the broadcasting and public playing of recorded music. A commitment to assess the impacts of the measures in this Bill is therefore unnecessary, and risks overlooking the effects of the secondary legislation.

I will now turn to new clauses 2 and 6, which broadly focus on environmental and other standards. I can provide assurance that the UK will continue to uphold our high environmental standards in respect of all our trade agreements, including CPTPP. As I have previously mentioned, the Government intend to publish a comprehensive ex post evaluation of the agreement within five years of the UK’s accession, and I can confirm that this evaluation will include an assessment of the environmental impacts of our accession. In addition, the independent Trade and Agriculture Commission was asked to scrutinise the UK’s accession protocol and produce a report. The TAC concluded in its advice, published on 7 December 2023, that

“CPTPP does not require the UK to change its levels of statutory protection”

in relation to the aforementioned areas.

Post Office Legislation

Liam Byrne Excerpts

Wednesday 13th March 2024 Commons Chamber

[Kevin Hollinrake]

I thank my hon. Friend for his question and all his work on this subject. Our engagement with him throughout the process has been very important. He has much expertise in this area.

We agree that this is unprecedented and undesirable, but we believe it is the least worst option. We want to see this delivered more quickly as, of the 790 or so sub-postmasters whom we believe this legislation will affect, only around 100 convictions have so far been overturned. We think that situation is untenable, which is why we decided to take this route. Of course, I will continue to work with him and listen to his wise advice.

I think I am right in saying that, for convictions overturned by the Court of Appeal, the record is marked “Overturned by the Court of Appeal”. We foresee these records being marked in a similar way—“Quashed by Parliament” or something along those lines. Again, I am happy to engage with my hon. Friend to make sure we get it right.

[Liam Byrne (Birmingham, Hodge Hill) (Lab)]

I welcome the Minister’s statement and thank him for the collegiate way in which he is working across the House to try to secure justice for those who have suffered.

This is a welcome step forward. I am glad to see the Minister taking on board some of the recommendations made in the Business and Trade Committee’s report last week, setting out how we can deliver fair, fast and independent redress. The Government have today proposed how they will overturn convictions. They have taken the Post Office out of some, but not all, claim processing and, crucially, they have increased the number of people who can apply for fixed-term remuneration. However, the Post Office is still handling the claims of at least 100 people with overturned convictions when it is patently not fit for purpose.

For those who seek to contest their claim, the Minister says there will be no legally binding timeframe between the submission of a claim and an initial offer being made by his Department, which is a problem. There is no standard tariff proposed for compensation under key heads of terms, such as loss of reputation. That, too, is a problem. The Bill is far more than a half measure, that is true, but it is not yet a full solution.

I leave the Minister with the words of Jo Hamilton, who messaged me last night to highlight the plight of the GLO litigants, in particular, and the way in which they

“have to justify every last penny even if some of their claim is for actual monies stolen from them by the Post Office… Why can’t the Government do the right thing before even more victims die?”

Those words need to ring in our ears as we seek to perfect this Bill.

[Kevin Hollinrake]

I thank the right hon. Gentleman for his comments and collaboration. It is important that we listen to his Committee’s recommendations and its very informative evidence sessions—I sat through all five hours.

At this point, we believe the Post Office should continue its work on the 100 or so cases before it. We currently have no capacity in the Department to handle those claims, although we clearly will by the time the Bill comes into effect. We do not want to pause between the Bill coming into effect in July and compensation payments being made. We think we can get those payments to people in August using that route.

There may be some people left in the first tranche of overturned convictions, for people who have been through the Court of Appeal. We will certainly look at the Committee’s recommendations on whether we should bring those cases back in-house or leave them with the Post Office. We will keep an open mind on that.

We already have fixed timescales to respond to offers or service level agreements in the GLO scheme. We commit to responding to 90% of full claims within 40 days of submission. I am happy to look at how we might put some benchmarks in place to make sure the new scheme has a similar speed of response. I am sure the right hon. Gentleman heard what I said about our new pilots under which lawyers can submit claims without forensic accountants and medical reports. That may do something along the line he says, and I will happily have an ongoing conversation with him.

Thus far, 128 of the 490 claims have been submitted to the GLO scheme, and 110 of them have been settled. To my knowledge, only one claim has gone to independent dispute resolution before going to the independent panel, which hopefully indicates that, generally, the offers are fair and have been accepted almost straightaway.

I understand what Jo Hamilton says, and I met her to discuss some of the processes she had to go through to prove her claim. We are determined to reduce those frictions and evidence requirements, certainly for things that are not essentially material. There are three things that we have to get right in delivering compensation: we have to be fair to the individuals and families affected; we have to be fair to all the other sub-postmasters to make sure there is consistency across the scheme; and, of course, we have to be fair to the taxpayer. There is no cap on what we will pay people, as long as it is fair.

Oral Answers to Questions

Liam Byrne Excerpts

Thursday 7th March 2024 Commons Chamber

[Mr Speaker]

I call the Chair of the Business and Trade Committee.

[Liam Byrne (Birmingham, Hodge Hill) (Lab)]

The Secretary of State will have seen the recommendations that our Committee set out this morning for ending the circus of the Post Office administration of the redress schemes for victims of the Horizon scandal. I know that she takes this incredibly seriously and so I know that she will study our cross-party recommendations for the new legislation that she is about to bring before the House. The question for today is this: if we put all the ongoing investigations to one side, on the basis of the facts as they are known today, does she still have full confidence in Nick Read as the chief executive of the Post Office to run the redress schemes currently under way?

[Kevin Hollinrake]

We thank the right hon. Gentleman for his work. I have taken a quick look at the report, although it was only issued this morning. All the recommendations he makes in that report we have either fixed or are fixing with the assistance of the Horizon compensation advisory board. We agree with him that we need to bring the compensation schemes in house. The GLO—group litigation order—scheme is already being delivered by the Department for Business and Trade. We believe that further compensation will flow from our overturning of convictions. We will be overturning hundreds of convictions through legislation in this House very shortly, as quickly as possible, and that will provide a flow of hundreds of millions of pounds in compensation for those individuals. That will be done by the Department for Business and Trade.

Post Office Board and Governance

Liam Byrne Excerpts

Wednesday 28th February 2024 Commons Chamber

[Mr Deputy Speaker (Sir Roger Gale)]

I call the Chairman of the Select Committee.

[Liam Byrne (Birmingham, Hodge Hill) (Lab)]

I am grateful to the Minister for joining us for most of the five hours of hearings yesterday, but he will know as well as I do that what we saw yesterday was complete chaos at the top of the Post Office, when what we needed was a clarity of purpose about paying redress fast and fairly. Not a single witness yesterday said that they were satisfied with the speed of any one of the three processes. In fact, the lawyers for the claimants said that it may now take one to two years in order to complete the payment of redress, and we heard evidence of offers being made that were, frankly, insultingly low. That is true across each of the three schemes.

Most worryingly, we heard that the Post Office chief executive had not had regularly meetings with the Secretary of State or received a clear written instruction to accelerate every one of the three schemes; there were no deadlines and no targets, and there are no incentives to get the redress schemes done and dusted. That is not good enough. Will the Minister again reflect, when he brings his Bill before the House, on the need to eliminate the Post Office from this process to the maximum possible extent and ensure that there are a legally binding set of timescales under which claims are given the information they need and processed, with offers made and offers settled? I say that, because we cannot go on like this.

[Kevin Hollinrake]

I do think the chaos was caused by one individual. I sat through the whole session; for the bit I was not in the room with the right hon. Gentleman, I was watching on television. It is right for people to be able to say that they are not satisfied with the speed of compensation. I have said that time and time again from this Dispatch Box, and we are keen to accelerate the process and make sure it is fast and fair.

We are aware of the recommendations from the right hon. Member for North Durham (Mr Jones) on an appeals mechanism for some of the schemes where people feel the compensation is too low. We are looking and will continue to look at that. Every compensation scheme I have dealt with, such as the Royal Bank of Scotland global restructuring group scheme and the Lloyds-HBOS scheme, has been too slow, because of some of the complexity involved. We heard some good suggestions yesterday about how we might remove some of that complexity, which I am very keen to do. We heard some positive remarks from the individuals concerned, for example, from some of the solicitors, and from the Post Office on the fixed-sum awards—the £650,000 for the overturned convictions and the £75,000 for the GLO scheme. We heard how that was reducing the amount of disclosure that was required—that is one of the limiting factors. This should mean that the timescales that some people put on the table of one to two years should be rapidly reduced, and I am very keen to build on that work.

As the CEO confirmed to the right hon. Member for Birmingham, Hodge Hill (Liam Byrne) yesterday, I meet him every month, and we speak about the need to accelerate compensation every single time. We have targets for when to pay the compensation by: August for GLO cases, and for all cases ideally by the end of the year. As we heard yesterday, 1,000 new claimants have come forward since the ITV series, which makes it difficult to put deadlines on payment. I am aware that the right hon. Gentleman wants a legally binding target. I am happy to discuss that with him, but we have just removed one legally binding target because not everything within the process is within our gift.

Post Office Horizon: Compensation and Legislation

Liam Byrne Excerpts

Monday 26th February 2024 Commons Chamber

[Mr Deputy Speaker (Sir Roger Gale)]

I call the Chair of the Business and Trade Committee.

[Liam Byrne (Birmingham, Hodge Hill) (Lab)]

May I put on record my gratitude to the Minister for the speed and attention he is paying to this issue? The bottom line, however, is that redress is too slow and the offers are too low. Papers that the Select Committee is publishing this afternoon show that at the core of the problem is a toxic culture of disbelief of sub-postmasters, which still persists at the top of the Post Office. Indeed, the board minutes for March last year show that board members lamented that the board was tired and constantly distracted by historical issues and short-term crises. I am afraid that that is not good enough when only 40% of the allocated budget for the Horizon scheme has been paid out and only 4% of the budget for the overturned conviction scheme has been paid out. When the Minister brings forward his Bill, will he make sure that the Post Office is now taken out of every single one of the compensation schemes, and that a hardwired instruction to deliver, with a fixed, legally binding timetable to deliver compensation agreements, is written on the face of the Bill?

[Kevin Hollinrake]

I thank the right hon. Gentleman for his points, his kind words earlier, and his work on this matter. I know that he will be chairing a Select Committee session on it tomorrow, and I look forward to his recommendations.

I agree that compensation has been delivered too slowly. We are trying to accelerate its delivery every single day, and we are, I think, doing good work with the advisory board to ensure that that happens. I do not accept that the offers are too low, although I am not saying that there are no exceptions; no compensation scheme will be 100% perfect. In respect of the GLO scheme, for example, 58 full claims have been submitted and 41 have been accepted without reference to the next stage of the process, involving the independent panel, which would seem to indicate that the offers that have been made are fair. Of course people will not take my word for it—they will only accept it when those cases have been resolved—and there are bound to be high-profile cases, as indeed there have been, in which people say that the offers are too low. However, we are determined to ensure that everyone has full compensation that is also fair to the individual, fair to the other individuals within the schemes and, of course, fair to the taxpayer.

As for the people who are running the scheme, as the right hon. Gentleman knows, the Horizon shortfall scheme was set up as a scheme run by the Post Office, with an independent panel including eminent KCs such as Lord Garnier. I have met its members, as has the right hon. Member for North Durham (Mr Jones), and we have confidence in it. Nevertheless, we are looking at recommendations from the advisory board for an independent appeal process. The GLO scheme is independent of the Post Office; it is within our Department, and we are working to ensure that the offers are fair. As the right hon. Gentleman suggested, we are considering bringing the overturned conviction scheme back in-house, and we will have more to say about that in due course.

The right hon. Gentleman mentioned 40% of the budget. We set a maximum budget of £1 billion—not a cap, but a maximum budget at this point. Part of the reason why only 4% of overturned convictions claims have been settled is the fact that the convictions have not in fact been overturned, which is why we are legislating in this way. Once those hundreds of convictions have been overturned, en masse, people will have access to rapid compensation via either the fixed-sum award, whereby compensation takes only days, or the full-assessment route, which takes longer.

The right hon. Gentleman spoke about a legally binding route, and of course we will look at all the various suggestions that are made. We have just legislated to extend the timescale for GLO compensation because we did not want to be bound by an arbitrary date, and I think he supported our legislation. I would therefore caution him against suggesting a legally binding date, because not everything is in our gift, in terms of when we receive a claim and how fast it can then be processed.

Post Office Horizon Scandal

Liam Byrne Excerpts

Thursday 22nd February 2024 Commons Chamber

[Mr Speaker]

I call the Chair of the Business and Trade Committee.

[Liam Byrne (Birmingham, Hodge Hill) (Lab)]

I associate myself with the words of praise for the Minister’s speed and attention on this issue. I think a legally binding instruction for the Post Office and the Department to deliver at speed is a necessity in the new Bill. The Minister has told us today that about £160 million has been paid in compensation, but there is provision for about £1.2 billion, which means that only 13% of the money has been paid out. He updated the House on the number of claimants, and there were 555 people in the GLO group and 700 who were convicted. As the Minister told us, only 73 people have had their final compensation fully paid, which is only 6% of the two groups.

The confusion at the beginning of the week about who said what to whom shows there is confusion about the instruction to deliver at speed. When the Bill comes before us, will the Minister reflect on the necessity for a legally binding deadline under which the Post Office must make information available in 20 to 30 days and an offer must be made to settle within 20 to 30 days, with a legally binding deadline for final resolution? Otherwise, frankly, I worry that the ambiguity will still cause delays. He knows as well as I do that justice delayed is justice denied.

[Kevin Hollinrake]

I thank the right hon. Gentleman for paying regular attention to this issue. I know that the Committee has a session next week and will be asking some of those questions.

We are keen to get compensation to victims as soon as possible. We are somewhat at the mercy of claims, and we cannot offer compensation if claims do not come in. Like others, I am very keen for people to come forward to submit a claim. One of the reasons why we put forward the fixed-sum awards of £600,000 for overturned convictions and £75,000 for members of the GLO scheme is to try to accelerate the payment of compensation, which contradicts the claim that people are trying to slow things down.

I am meeting the Horizon compensation advisory board this afternoon to look at its recommendations for accelerating compensation. We have taken nothing off the table, and I remind the right hon. Gentleman that the House recently voted to extend the compensation deadline from 4 August, on the recommendation of Sir Wyn Williams, because we do not want people to be timed out of compensation. The maximum budget for compensation has, thus far, been set at £1 billion.

One of the issues we are trying to resolve urgently is the fact that people are reluctant to come forward to have their convictions overturned by the Court of Appeal, which is one of the reasons why we have not compensated enough people with convictions. We cannot compensate them until we overturn their convictions, which is exactly why we have proposed the legislation. Once we have done that, the door will be opened for compensation to flow freely. That is exactly what the right hon. Gentleman and I want to see.

There has never been any confusion in our mind about the need to deliver this quickly. I have focused on that every single day, both since I have been in office and before. I have never been resisted by anyone in my Department or in other parts of Government. There may be confusion, but I promise that there has been no confusion in Government.

UK Accession to CPTPP

Liam Byrne Excerpts

Thursday 22nd February 2024 Commons Chamber

[Liam Byrne]

I am grateful for the chance to make a brief statement about an excellent report that the Business and Trade Committee published on Monday, to coincide with the opening of the period of reflection, under the Constitutional Reform and Governance Act 2010, on the comprehensive and progressive agreement for trans-Pacific partnership.

It is timely for me to make this statement because, like many in the Chamber, I am old enough to remember that a major Brexit benefit was, allegedly, the freedom for us to negotiate free trade agreements more quickly than the EU, and to sign those free trade deals in a way that suited the UK. It is fair to say that, since Brexit, we have learned some hard truths about the difficulties of negotiating free trade deals, not least because the world has changed since then. Economic security is now a much more significant issue, which makes trade barriers harder to bring down. We have to navigate new imperatives on economic security and there are new dilemmas, which is why statements such as this are so important.

The Government have discovered that they cannot just rely on bluff, bluster and a bit of boosterism to get trade deals over the line. I remember the manifesto produced by His Majesty’s Government at the last election, which said that 80% of our trade would be covered by trade deals. We are at about 60% now. The Government promised around £1 trillion in exports by 2030—I am not sure that we are on track to hit that. The Australia trade deal was criticised by UK farmers for being a giveaway, and the Canadian trade talks are in a state of some confusion. The India trade deals, after 14 gruelling rounds, have some hurdles before the Indian elections. The broad point is that we have all learned a lesson about how difficult trade deals are. That is why it is important that the Government do not oversell the deal before us. The role of the Select Committee is to throw some light on what has been put before us, so that we can have a proper debate in this House.

I have five brief points that I want to draw from our report. The first is about precise gains, which in the short term are hazy, and in the long term are hazier still. Without doubt, geostrategic gains are to be had from joining the CPTPP. That was the objective set out in the integrated review, and it is a good and real one. There is a prize there. The impact assessment on economic gains said that the boost to UK GDP would be about £2 billion a year—less than one tenth of a per cent. by 2040. Even that number is in doubt, because in the evidence we took from the Secretary of State, she resiled from the models used by her Department and was unable to give any alternative numbers.

We heard evidence from exporters that the treaty would be good for export growth, but we noted that it would be limited because we already have many trade agreements in place with CPTPP members. Some UK sectors could lose out because of international competition: electronic equipment, transport equipment and semi-processed food. In our conclusion, we asked the Government to explain what steps they will take to ensure that UK businesses fully exploit the treaty.

The second point is about the future. Much has been made about the future possibilities of the CPTPP because it is a gateway to the wider Indo-Pacific region, which is expected to account for the majority of global growth between 2021 and 2050. We made the point that the members of this particular trade treaty account for about 15% of the Indo-Pacific market. That is quite small. Perhaps we were expecting to hear more about the Government’s game plan for using this treaty to grow. China will apply to join, but the Secretary of State is not willing to go on the record to explain the Government’s road map for expanding this trade agreement in future, or say whether they would endorse or block China’s application, if it materialises. We are at risk of willing the ends and not the means, which is not necessarily good policy. In our report, we asked that the Government update their trade model, give us some numbers to look at and set out their idea of what a future road map might look like. If the great prize in the Indo-Pacific tilt is economic trade of the future, let us understand how we will use the CPTPP in a strategic way to cover a bigger fraction of that market with free trade agreements for our country.

Thirdly, we looked at trade standards and food standards. We took lots of evidence and noted the Trade and Agriculture Commission’s advice to the Secretary of State. We noted that there was lots of evidence about the risks of maintaining UK bans on imports on beef and pork. We noted that the Trade and Agriculture Commission was pretty confident that existing protections could be kept in place. We also noted that protections on imports using more pesticides were unlikely to be diluted. There was evidence on either side of the argument about increases in palm oil, although the Minister addressed that rather well in the Bill Committee on Tuesday.

The fourth point on which we took evidence was the investor-state dispute settlement. That was the subject of lively debate in the Bill Committee on Tuesday. Again, we flagged that there are arguments on both sides of the debate. The Government are within their right to say that they have not lost a case like this, but the big strategic concern is that if such provisions are in a treaty, it may have a chilling effect on regulatory innovation in the UK. The point is that there is an argument to be made.

That brings me to my fifth and final point. Whatever the merits and drawbacks of the UK joining the trade agreement, the Government must allow that House to play a meaningful role in scrutinising trade policy. There are contentious issues raised by this treaty—there is no doubt about that. That is why my Committee recommended that Government should permit the House a debate on the ratification of the accession protocol. That debate, we said, should be on a substantive motion; it should take place during the 21-day scrutiny period under CRaG, which would give the House the option of exercising its power under that legislation to delay ratification. When we asked the Secretary of State about this in evidence, she said that she was happy to support a general debate. I very much hope that those are not hollow words, and that the House will get to debate this treaty in the way that was initially envisaged when CRaG was passed by this Parliament.

Those are the key five points; I hope they are of use to the House. Let me conclude by thanking, on behalf of my Committee, all the trade officials at the Department for Business and Trade for the hard work they have put into getting this treaty signed and over the line. It is in the national interest, and it is appreciated. I commend this report to the House.

[Mr Tanmanjeet Singh Dhesi (Slough) (Lab)]

On behalf of the Labour party, I thank my right hon. Friend and indeed the other members of the Business and Trade Committee for their sterling work. We referred to much of the Select Committee’s work in the Bill Committee earlier this week. The Minister will be aware of some of the amendments tabled by Labour, and of the concerns not just of the Labour party, but of civic organisations and bodies such as the Trades Union Congress, on issues such as workers’ rights and investor-state dispute settlement. I hope that the Minister will take on board all those various points.

Does my right hon. Friend agree that it is imperative that before the CPTPP is finally ratified—Labour is firmly of the view that that would be in the national interest—it is important to iron out those concerns? To do otherwise would be to the detriment of our country. We also look to the Minister for clarification on issues around parliamentary scrutiny, on which there was an amendment in Committee.

[Liam Byrne]

I am grateful to my hon. Friend for that question. I think the Minister made the point in the Bill Committee on Tuesday that this is not necessarily an under-scrutinised treaty, as it has been the subject of quite a lot of debate; my Committee has certainly taken lots of evidence on it. However, when we left the European Union, one of the big arguments made was that this Parliament would reassert its sovereignty and—in those infamous words—take back control. That means that this House needs to have a strong hand in scrutinising trade agreements.

We hope that there will be many more free trade agreements to come. I know that they are getting harder, but this House none the less needs to develop expertise in scrutinising free trade agreements, so that we can ensure they are genuinely in the national interest. That is why I hope the Government will, within the 21-day CRaG period, find Government time for debate on an amendable motion, to give the House the opportunity to delay ratification, if that is the judgment we all come to. That is the process; we have to test it, use it, and make sure it works.

We have to get much better as a House at navigating the dilemmas of free trade in a world where economic security is a much sharper imperative than before. That means we have to have better debates, but also better numbers. We cannot have a situation where we produce models using very old data—going back to 2017 in the case of the models used for this treaty’s impact assessment —and when the Secretary of State comes to our Committee, she resiles from the models of her own Department. That is not a good way of producing evidence-based policy.

I hope we can have a discussion across the House on how to ensure that the economic models that we use are good. Free trade agreements are choices, and sometimes free trade agreements in one part of the world rule out those in other parts of the world. We have to judge what is in the best interests of the country, and it is difficult to do that if the numbers are flaky.

[Sarah Olney (Richmond Park) (LD)]

I would like to pick up on the point from the hon. Member for Slough (Mr Dhesi). During the passage of the Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Bill through this place, many concerns have been raised about investor-state dispute settlement arrangements. It is good to see that the Select Committee is calling for a debate to resolve some of the contentious issues around that. However, does the Select Committee Chairman consider the provisions of the CRaG legislation to be sufficient, or might this be an opportunity to look again at how the specific requirements of trade deals are dealt with by Parliament?

[Liam Byrne]

That is an excellent question. The hon. Lady may have seen a really good report produced by not our Committee, but the Public Administration and Constitutional Affairs Committee, on 29 January 2024, which makes precisely that point. We need a better way of scrutinising trade agreements. The CRaG structure allows us to delay things, but not necessarily veto them. When CRaG was introduced back in 2010, it was an innovation, because in the past, that was something that Governments did without any scrutiny whatsoever. Now we are in a different kind of world, in which we are signing free trade agreements at, I hope, increasing pace. However, the House will still have to navigate when we want open trade, when we want to de-risk trade, and when we put economic security first and free trading second. These are dilemmas in which there is not an obvious answer. We cannot prejudge the answers to those questions; they will have to be debated case by case. It could well be that a Government will come to the wrong conclusion about that balance between open and free trade and maximising our economic security as a country, and therefore we in this House must be able to apply a brake —put a hard stop—to trade deals that we think are ultimately not in the national interest.

[Richard Foord (Tiverton and Honiton) (LD)]

I represent a rural constituency in Devon. Farmers in the west country were alarmed at the sorts of concessions made in the Australia and New Zealand trade deal. Until yesterday, we thought that the UK and Canada were negotiating a roll-over trade agreement. Canada is a member of the CPTPP and it will be crucial, if the UK-Canada trade talks resume, for the UK to avoid paying twice, because we will want to avoid further market access concessions. Can the right hon. Gentleman offer any reassurance that, through CPTPP accession, we will not open up our markets to unmanageable volumes of produce that will damage British farming and put farming businesses in danger of going out of business?

[Liam Byrne]

The way that we approached our analysis was to look at food standards and whether they would be diminished by our joining the treaty. The Trade and Agriculture Commission looked at three questions, which are talked about in paragraphs 40 to 42 of the report. We reported the Trade and Agriculture Commission’s advice, which was that there would not be a diminution in the statutory protection of food standards in this country, and that we would, in fact, be allowed to reinforce some of those protections.

However, as the hon. Gentleman importantly flags, we are now finding that sometimes the devil is in the detail. Despite having joined CPTPP with Canada, we now appear to be struggling to get in place a free trade agreement with Canada. The Canadian Government are very clear that technical discussions have stopped. I understand that the Secretary of State, or a spokesman for her, told the Financial Times yesterday that discussions were ongoing, but discussions are not trade talks. If discussions were trade talks, we would be having trade talks with the entire world right now, because our diplomats around the world are in constant engagement with their counterparts in different parts of the planet. The hon. Gentleman is absolutely right to flag that issue. The reassurance that I can give him is that we do not see this treaty lead to a softening of the trade standards that we so treasure in this country.

[The Minister for Trade Policy (Greg Hands)]

I welcome the right hon. Member for Birmingham, Hodge Hill (Liam Byrne) and his report. I think that this is the first time that I have had an interaction with him since my return to the Department and since he became the Chair of the Select Committee. Of course, as two former Chief Secretaries to the Treasury, we are well used to a bit of sparring over the years. His report is good, strong and constructive, and he makes some strong points about FTAs being, of course, choices. I welcome his statement that CPTPP has been well scrutinised in this House.

I do not intend to give an answer to any general questions raised, because it is not me who is being asked. However, I point out to the hon. Member for Tiverton and Honiton (Richard Foord) that the National Farmers Union does welcome the UK joining CPTPP. I say to the right hon. Member for Birmingham, Hodge Hill that a new FTA implementation unit in the Department for Business and Trade is looking at the important point he raised about how, post-signature, we ensure that the agreements work for British businesses and British consumers. On investor-state dispute settlement, nothing prevents a right to regulate in this country and it can be of benefit to British businesses overseas, guaranteeing jobs at home.

My only question for the right hon. Gentleman is really just a clarification. He says that CPTPP represents 15% of the Indo-Pacific area, which I think is true in the sense that China and India are not in CPTPP, and that therefore it is quite a small economic bloc. But if I can just take issue with him, CPTPP is currently about 12% of global GDP and the UK joining would make that 15%. So he is not wrong in what he says, but if he could just acknowledge that the part of global GDP in CPTPP is also 15%, not just a portion of the Indo-Pacific trade.

[Liam Byrne]

I am grateful to the Minister for that question and for welcoming the report. We look forward to welcoming him before the Committee at some point in the near future to talk about some of our forthcoming reports on export-led growth. The point he makes is right and I am glad that, for once, he and I agree on the numbers—that has not always been the case. The reason we wanted to flag it is that the Government’s impact assessment states:

“CPTPP membership acts as a gateway to the wider Indo-Pacific region which is expected to account for the majority…of global growth between 2021 and 2050.”

We appreciate that all Governments need to hard-sell their policy achievements—that is the nature of the game we are in—but it is important that we do not oversell the treaty. The reality is that it accounts for only quite a small fraction of the Indo-Pacific market, which is trumpeted in the impact assessment and in the integrated review as one of the treaty’s virtues. We must be clear-eyed and hard-headed about precisely what gain comes from this treaty specifically, and it would help us all, frankly, if the Government set out their road map for growing the treaty in future.

[Mr Deputy Speaker (Mr Nigel Evans)]

I thank the Chair of the Select Committee for making his statement and responding to questions.

Post Office Ltd

Liam Byrne Excerpts

Monday 29th January 2024 Commons Chamber

[Mr Speaker]

I call the Chair of the Select Committee.

[Liam Byrne (Birmingham, Hodge Hill) (Lab)]

Leaving the Post Office rudderless now, when people are literally dying before they get redress, is not a situation we can put up with. The key question for the Minister is this: where is the Bill to expedite redress for those who were wrongfully convicted? Will he commit this afternoon finally to making sure that we have pre-legislative scrutiny of that Bill so that it is as strong as it can be, and will he commit to a hard deadline enshrined in law in the Bill to make sure the payments are made as rapidly as possible? Frankly, Mr Bates and the other sub-postmasters who have been wronged for so long should not be made to wait a moment longer.

[Kevin Hollinrake]

I thank the right hon. Gentleman for his question, but I do not accept his premise that the Post Office is rudderless. The chief executive is still there and I spoke to him a few moments ago, prior to the urgent question. As I have said, we are looking to appoint an interim chair as soon as possible and a permanent replacement shortly after that, and meanwhile the daily work of the board will continue.

On our commitment to overturn convictions on a blanket basis, I appreciate the right hon. Gentleman’s previous constructive collaboration and engagement with our Department, and I hope that continues. I am keen to engage with him on our approach. These are legal matters that need to be considered carefully and we had a number of meetings last week on this very issue, so I am keen to engage with him, but in a way that does not slow down the process of bringing the legislation forward. He will find us contacting him and knocking at his door in the coming days to talk about how we will go forward with that legislation.

I should point out that Mr Bates’s compensation is not related to the overturning of convictions, because he was never convicted. That is not what is getting in the way of Mr Bates’s compensation, although it is getting in the way for something like 900 other people, and we are keen to resolve that as quickly as possible.

Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Bill [Lords]

Liam Byrne Excerpts

2nd reading
Monday 29th January 2024 Commons Chamber

[Kemi Badenoch]

My right hon. Friend is correct. We would not have been able to sign this agreement had we not left the European Union, but we are now able to enjoy the benefits of this free trade agreement as well as the one that we have with the European Union.

[Liam Byrne (Birmingham, Hodge Hill) (Lab)]

Many of the figures that are sometimes cited about the future size and scope of the Indo-Pacific market include the size and growth of China. Has the Secretary of State reflected further on the evidence that she gave to the Select Committee last week, and can she tell the House whether, if China decides to try to join the CPTPP and meets the technical standards, the UK will block that or welcome it?

--- Later in debate ---

[Kemi Badenoch]

I agree with that statement. I would just like to highlight the significant contribution that our trade envoys, including my hon. Friends the Members for Wyre Forest (Mark Garnier), and for Gloucester (Richard Graham), are making to our debate on trade. They are getting out there, bringing business to the United Kingdom, selling all that is great about our country, and making a valuable contribution to trade policy in the UK, and I want to take this opportunity to thank them for all the work they are doing, travelling around the world and banging the drum for British trade.

[Liam Byrne]

Before the Secretary of State moves off the subject of cars, I want to make an intervention about our trade with Canada, which involves more than £745 million-worth of exports. We currently benefit from tariff-free trade because of the extended accumulation of origin rules. That tariff break will end at the end of March, and because talks have broken down, we face a situation where our car exports are about to be hit by tariffs. Can she tell the House a bit more about how she plans to avoid a tariff war hitting UK car exports at the end of March?

[Kemi Badenoch]

This is a good opportunity for me to state explicitly that the talks have not broken down. We are having multiple discussions with Canada on cheese, in which we have not come to an agreement. However, the quota that we have under CPTPP with Canada is 16.5 kilotonnes, which is more than the 2 kilotonnes we are selling to Canada at the moment, so we are not particularly concerned about that, although it is disappointing. We have an ongoing rules of origin discussion, and we have an FTA discussion, which I have paused, for reasons that the right hon. Gentleman will know—

--- Later in debate ---

[Liam Byrne]

indicated dissent.

[Kemi Badenoch]

Well, he should know them, because I believe I referred to them in the Select Committee; I hope he was listening. The point I am making to the Chair of the Select Committee is that trade is dynamic. On some issues that we are negotiating and discussing with our partners, we have differences of opinion; and others are going swimmingly. This is not a reason for us to cast aspersions on our trade relationships with the countries in question.

Joining this partnership will deliver for our manufacturers, but crucially it will also deliver for our globally renowned services sector. The UK is already the world’s second largest exporter of services, behind only the US, and services exports are at record levels. CPTPP, with its modern and ambitious rules on services and digital trade, plays to the UK’s strengths, given that almost 80% of our economy is services-based. It will reduce market access barriers, such as data localisation requirements; British businesses will not have to set up costly servers or data centres in each member country, and that will save them significant time, money and other resources. This agreement will help flagship British businesses such as Standard Chartered and BT to gain smoother access to markets in Singapore, Vietnam and Malaysia, strengthening our trade with those nations for years to come.

We also have a ratchet mechanism for the first time with Malaysia, Chile, Mexico, Peru, Singapore, Brunei and Vietnam, meaning that if those countries relax rules for a particular service, restrictions cannot then be reintroduced in future. That is another clear example of how this agreement will unlock smoother, simpler trade. The director general of the Institute of Export and International Trade, Marco Forgione, has rightly said:

“This is all good news for UK businesses, giving them greater access to one of the fastest growing regions in the world”.

The issue is not just the benefits that joining this partnership will bring over the short term. This is a growing agreement, designed to expand and bring in more markets and more opportunities for UK businesses in the long run. As the first acceding country, we will be ideally placed to take advantage of that future growth.

--- Later in debate ---

[Gareth Thomas]

One set of figures the Secretary of State’s Department definitely did not put together were those that the Office for Budget Responsibility produced. It now expects only a 0.04% increase in our economic growth, after a decade, from joining CPTPP. As we already have free trade agreements in place with nine of the other 11 CPTPP members, formally joining CPTPP feels rather thin compensation for Ministers’ many other failures on trade.

[Liam Byrne]

In the light of the news that the figures that have been tabled by the Department are not accurate—I can barely believe it—would my hon. Friend, like me, have expected there to be a new impact assessment alongside the Bill, with the latest departmental assessments set out clearly therein?

[Gareth Thomas]

It would have been an excellent idea if the Secretary of State had published those. Perhaps she might be willing to publish them at the same time as giving us a statement about what exactly is going on in the negotiations with Canada. We will have to use the review of CPTPP in 2026 to try to increase more markedly the benefits of membership for British jobs, British consumers and growth.

--- Later in debate ---

[Liam Byrne (Birmingham, Hodge Hill) (Lab)]

I suppose I should start by declaring an interest, because nearly 10 years ago I wrote a book called “Turning to Face the East: How Britain can prosper in the Asian century”, which was an encouragement for exactly this kind of initiative. I am a supporter of CPTPP and I am grateful to the Secretary of State, who is no longer in her place, for joining us at the Business and Trade Committee last week, along with others, to provide evidence on the treaty. The Committee hopes, if its members are amenable, to publish a report on CPTPP over the next couple of weeks, and certainly before Committee stage of this Bill, to try to maximise opportunities to build cross-party consensus on something very important to all our futures.

I want briefly to say a word about size, a word about standards, and a word about settlement of investor disputes, but it behoves us all in this House to recognise the point we start from: trade and export growth is not where it needs to be, or where Members on both sides of the House want it to be. We know the old joke: not all fairytales start with “Once upon a time”; some of them begin with “When I am elected”. Looking back at the Conservative manifesto for the last election, we might be tempted to label it a bit of a fairy story, because it said very clearly that the goal was to set out free trade agreements covering about 80% of British trade, and we are nowhere near that. We are in fact much closer to 60%.

The Secretary of State put most of the onus for that on a change of Administration in America, but the truth is that apart from the cut-and-paste, roll-over trade deals that we have had since leaving the European Union, we have only signed three new free trade deals. I am glad to hear that what would have been the fourth new one, which we hoped to sign with Canada, is not dead, but it certainly appeared to be running into trouble last week. I am sad that the Secretary of State did not come to the House to make a statement about that news today. That would have been appropriate. However, I am grateful that she has made some reassuring noises about it in this debate.

When the Select Committee put the point about the lack of FTAs to the Secretary of State last week, she said that she had “pivoted away” from FTAs. That is not necessarily a good thing, because she went on to say that she, like many economists, thought that FTAs do promote trade. The bottom line is that our export performance is way off target. The Government have set an export target of about £1 trillion by 2030, which interestingly has not been adjusted up for inflation as arguably it should have been, but the Institute of Directors last year said that we need export growth to be getting on for about 3.5%. As the shadow Minister, my hon. Friend the Member for Harrow West (Gareth Thomas), said, we are nowhere near achieving that performance. We have an export growth forecast of roughly 0.1%, 0.2%, or 0.3%.

The Secretary of State very kindly agreed not to have a public argument with the Office for Budget Responsibility last week, and I think we were all grateful for that, but she said there were different models—not alternative facts, but alternative models—in her Department. I have written to her today to ask for the publication of those models so that the Select Committee can scrutinise them before the Bill goes into Committee. Scale is important because our trade performance is off track. Generally speaking, economies that trade more, grow faster, and we want our economy to grow faster, because we all share an interest in raising the living standards of our constituents. That is why my the first point, about the scale of CPTPP in the future, is so important.

The Secretary of State has stacked up a lot of her argument on our needing to go in future to where the growth is. She said that if we cannot do trade deals where the growth is today—for example, with our partners in America—we should go to where the growth will be tomorrow. That is a reasonable argument, and Asia-Pacific countries accounted for over 70% of global GDP growth in the decade up to 2023. However, China accounted for about one third of global GDP growth. That is why I pushed the Secretary of State again, as I did last week, to at least show us how we will have a conversation about how this country will make a rational decision with partners on whether to agree to ratify China, if it met the technical standards. We have similar questions to resolve on Taiwan, but in his public pronouncements, President Xi has made it very clear that he is ambitious for China to meet the technical standards. The question is therefore whether, if China met the technical standards, we would stand in the way of ratification, or whether other important geopolitical considerations would inspire us to block it.

Looking beyond China to the CPTPP’s future more generally, given that we have set such store by this treaty, what is our vision for its future? Where is the road map? The Department published a document a year or two ago on the strategic benefits, but the Secretary of State resiled from all the numbers in that report last week. I do not think that is a good way to make public policy, but let me put it this way: our debate about trade policy and strategy ahead of the election would be much stronger if we had good figures on the table about the options and choices confronting our country. We will certainly do our bit in the Business and Trade Committee to supply those figures, but it would be fantastic if the Secretary of State could commit to doing something similar.

The question that follows on from size is about standards. There were controversial topics that we took evidence on last week, and we will capture what we learned in the report that we publish. There were questions about environmental and climate impacts; there are general provisions about those in the treaty, but they are not enforceable and there is not much mention of net zero. If we think about the treaty as something that is fairly marginal for trade today—it represents about a 0.09% GDP uplift over nine years—but is geopolitically important, we need to think about how it becomes a load-bearing structure for more of our ambitions in the world, such as the race to net zero. Maybe when the Minister is winding up he could say a bit more about how we can freight this treaty with some of our other national interests.

The point about food production standards has already come up. No changes to UK standards are entailed in the treaty, but there were concerns about sanitary and phytosanitary rules, based on the precautionary principle. The evidence we heard said that they could be challenged. It is a legally murky area and, on balance, the challenges seem unlikely to succeed, but that is none the less something to explore in the Bill Committee. It could well be that that Committee wants to ensure that further safeguards are written into the Bill over the course of its passage.

There will be an increase in imports of agrifood goods produced to lower standards than UK standards. That is true when it comes to pesticides, genetically modified organisms and animal welfare, but not to antimicrobials. On pesticides, the Trade and Agriculture Commission found some basis for weaker standards; on GMOs it found some basis for concern. On environmental laws and policies, palm oil imports are obviously controversial, particularly when it comes to deforestation in Malaysia, but the TAC found that the concerns were, if not non-present—there are concerns to be had—then perhaps slightly overstated.

The final point is about investor-state dispute settlements. Again, the treaty extends the application of ISDS to Canada, Japan and Brunei. One way in which that has become such a big issue is that organisations such as the Canadian teachers’ pension funds are some of the biggest investors in the world, with significant investments in the UK water industry. There have been 1,300 or 1,500 of those cases around the world. The evidence we heard suggested that the UK was likely to be able to successfully defend such cases. One consideration about which we should hear a little more is whether the presence of those clauses in the Bill creates a chilling effect on the way in which we regulate our markets here. If we wanted to regulate the water industry differently in future, would we not bring forward those regulations because of fear about what would happen and how we might be challenged?

The gains from the treaty, as drafted, are modest. They generally come from the fact that we have a new FTA, as part of the treaty, with Malaysia and Brunei. That is good for whisky, for cars and for chocolate, such as that made in Bournville. A single set of rules of origin and a single cumulation zone are good things. Access to some of the agrifood quotas, such as Canadian dairy, is a good thing. Some of the progress made in the digital chapter, about which the Secretary of State did not talk much, could be quite useful and can be built on more generally.

We have to conclude that the trade benefits as of now are no substitute for ironing out the difficulties that bedevil trade between the UK and our close neighbour, the EU. Across the House, we should collectively ensure that we are doing what we can to advance the prospect of a UK-US trade deal. These are modest trade benefits but an important geostrategic step forward.

It is good to have this Second Reading debate, which I welcome. Like the hon. Member for Totnes (Anthony Mangnall), I very much hope that the Government will make time for us to have a debate under the CRaG principles about whether the treaty as a whole goes forward. We would welcome the opportunity to have an amendable motion on that, as the other place did recently on the Safety of Rwanda (Asylum and Immigration) Bill. The Public Administration and Constitutional Affairs Committee has published an excellent report today about how we can better consider treaties. In this new world, Parliament as a whole must get a lot better at studying these kinds of trade agreements and ensuring that they dovetail with other aspects of our economic and national security. I look forward to the debate in the Bill Committee, which I hope will benefit from the report that our Select Committee will supply.

--- Later in debate ---

[John McDonnell (Hayes and Harlington) (Lab)]

I will raise three issues: the scrutiny process, ISDS and my ongoing concerns about the impact of the measures.

I am a member of the Public Administration and Constitutional Affairs Committee. I am the sole Committee member present in the Chamber because the others are on a delegation to Berlin at the moment—I am sure that they are working hard at this time of night, and not having a dinner. As has been mentioned, we published our report today; it is a comprehensive report, agreed by all parties. We have been looking at the overall parliamentary scrutiny process for treaties and free trade agreements and, to be frank, we have unanimously found that the current process is unfit for purpose.

At the moment, Parliament—I do not disparage the Government for this; it has happened consistently in the past—is treated as an afterthought in trade policy. We have not been able to find any meaningful mechanism by which Parliament can influence the negotiating objectives at the beginning of the overall process or oversee negotiations as they proceed, and we are never guaranteed a vote on the final agreement at the end of the process—a point that has been made on a number of occasions by Members across the House.

That contrasts with what happens in other legislatures, particularly the US Congress, where legislators play an incredibly proactive role. I do not think the Government should see the parliamentary process as an imposition with regard to future treaties, but as a method of improving the trade negotiations by allowing Members of Parliament to have an early and ongoing voice in those discussions. It is interesting that other Members—including the former Secretary of State for Environment, Food and Rural Affairs, the right hon. Member for Camborne and Redruth (George Eustice)—made exactly the same point during a debate in this House on the Australia free trade agreement, way back in November 2022. The right hon. Gentleman set out how during talks with Japan, the Japanese negotiators used parliamentary motions that their Government could not breach to protect their country’s interests.

People will see from the report that we have put forward a fairly comprehensive process by which the House can efficiently and effectively engage itself in such negotiations, with a sifting committee and a scrutiny committee. The House would always have the right to a vote at the end of the day, but more importantly, it would have an influence at the beginning of the negotiations when the overall objectives are set. The proposed process is part of an overall attempt to create greater transparency and, indeed, greater interest within the House in trade negotiations. I hope that the Government will take the Select Committee report away and come back with a positive response, because it contains some very constructive recommendations.

I now turn to the much discussed investor-state dispute settlement procedure. In debates in recent years, Members from across the House have expressed concern about the investor-state dispute mechanism, and those concerns have moved into the mainstream—not just in this country, but in other countries that are moving away from that system. As we have heard, Australia and New Zealand have committed to exclude the ISDS procedure from future trade agreements on the basis that in many instances, that procedure is not in the public interest. I cite the energy charter treaty. That has been the biggest vehicle for ISDS claims, and it is collapsing, with France, Germany, the Netherlands, Spain and others withdrawing. President Biden has now come out and criticised the ISDS procedures, and has basically excluded them from any future US trade agreements.

As the Minister knows, I have raised this matter in the House a number of times. I am sometimes perplexed: we are told that the Government are committed to the ISDS process, but on the other hand, they have acceded to both Australia and New Zealand exempting themselves from that process with regard to the UK. The last time I raised this issue, the Minister responded by saying—exactly as the Chair of the Business and Trade Select Committee, my right hon. Friend the Member for Birmingham, Hodge Hill (Liam Byrne), noted—that the UK has never been successfully challenged under ISDS. That is true, but there is an element of hubris in that position.

[Liam Byrne]

My right hon. Friend is making an excellent speech, and he is absolutely right to flag this issue. The UK Government have not hitherto been successfully challenged under ISDS, but for the first time, countries with very significant foreign direct investment into the UK are involved in this treaty. The figure for Canada alone is $56 billion. When it came to Japan—the other big investor—ISDS was excluded from the UK-Japan bilateral investment treaty. We need an awful lot more reassurance from the Government on this point, given the scale of investment from countries such as Canada in our country in general, but in sectors such as the water industry in particular.

[John McDonnell]

I do not know how excellent my speech is—I will just ramble on as usual, I think.

The argument that was put to me by the Minister responding today, the right hon. Member for Chelsea and Fulham (Greg Hands), was that if we cannot trust Canada in these deals, who can we trust? That is precisely the point, though: Canada will now have a parallel system, and Canadian firms will be able to take legal action in their own country. As a result of that statement by the Minister, I went away and had a look at the figures for Canadian firms under this process, and those firms stand out as being particularly litigious. They have brought over 65 ISDS cases in recent years. I therefore think that there is a chilling effect, exactly as the Chair of the Select Committee said, which at the end of the day can have implications for the UK’s right to regulate. If a number of cases are waged against the UK, that may undermine our ability to act more freely when it comes to regulation of the water sector, and also policy development, particularly on issues around water and future public ownership.

Again, I have previously raised this matter with the Secretary of State. What I cannot completely understand is that at the same time that the UK Government are defending the ISDS process with regard to the CPTPP, in the negotiating process for the bilateral free trade agreement they set out a specific objective to exclude the provisions of the ISDS system. That is a contradiction, and the Government’s thinking on that matter has not yet been explained to me. As the Minister will also know, there is a remarkably broad range of concern about the ISDS: in October 2023, a letter was submitted to the Government—supported by 30 non-governmental organisations and trade unions and over 50 academics and legal professionals from both the UK and Canada—calling for the immediate negotiation of a side letter between the UK and Canada to disapply the ISDS provisions between the two countries. That is exactly what happened with regard to New Zealand and Australia, and for the life of me, I cannot understand why the Government have not gone down that path for this particular negotiation.

I also want to express some concerns that have been raised about environmental issues and about labour standards. The CPTPP includes a number of countries where abuses of labour rights are widespread. To give a few examples, independent trade unions are banned in Brunei and Vietnam, while forced labour has been widely documented in Malaysia in various pieces of research, and a number of CPTPP member states have not ratified some of the core International Labour Organisation conventions.

The protections for labour rights within the CPTPP are particularly weak: a member state can only challenge another member state over a failure to uphold labour rights if it can be demonstrated that such a failure affected trade, which is notoriously difficult to prove in such cases. The ineffectual nature of that chapter is demonstrated by the fact that since the agreement’s conclusion in 2018, no Government have challenged another for abusing rights. The TUC has described the risk of CPTPP making it

“easier for unethical companies and investors to do business with countries where it’s easier to exploit workers”—

a risk that it considers to be significant. I do not think we have addressed that issue sufficiently.

There are also concerns regarding standards in partner countries. For example, as has already been said, pesticide standards could be undermined. Some 119 pesticides that are banned in the UK are allowed for use in one or more CPTPP member states. Although accession to the CPTPP does not necessitate any lowering of UK standards in this regard, when the peers debated this issue, there were really practical questions about the sufficiency of the UK’s border testing regime in keeping banned substances out. Again, it is an issue that needs further consideration in more detail as we go through the whole process.

The issue has been raised—and I know that the Chair of the Select Committee said that this may well have been exaggerated or overestimated in some of the debates—that the UK has acceded to Malaysia’s demand to lower tariffs on palm oil to zero. I have to say that the evidence I have seen and the representations I have received from the Trade Justice Movement and others is that this is highly likely to increase palm oil exports and, with that, the risk of deforestation, which will serve to undermine indigenous and local community land rights and threaten natural habitats for species such as orangutans. We have seen the various research and the range of evidence mounting on this particular issue. Again, it was debated in the Lords in the context of the potential protections afforded by the UK forest risk commodities legislation, under section 17 of the Environment Act 2021, but it is unclear when these regulations will actually come into effect, and therefore many believe that the protections are not in place at this stage.

There is also a view that accession to the CPTPP will bring risks of the erosion of preferences, under which current preferential trade agreements afforded to exporters in one country will bring negative development impacts on others. One example cited by the Trade Justice Movement is that Afruibana, the association representing banana exporters across Africa, has set out concerns regarding the potential impacts of tariff liberalisation in South and central America for those they represent.

Finally, one of the reports sent to me was a health impact assessment produced by Public Health Wales. It identified a range of diverse potential impacts, including the worsening of global air pollution due to transport distances for goods, the loss of employment for some population groups and, of course, the risk of ISDS cases being brought against regulations that seek to support public health outcomes. It is an important impact assessment that needs further scrutiny and examination. It leaves me with the impression overall that there has been a lack of impact assessments, so I look forward to the Select Committee report, which will go into further depths on this.

I come to the conclusion that, with all the risks involved and with such doubt surrounding the CPTPP, it will achieve what we could not even describe as a marginal economic gain over the length of time it will be in place, and I fear to tread on treaties and agreements of this sort. I just think that, although there is not going to be a vote tonight, I might be tempted at a later date to vote against the Bill—so I had better let the Labour Whips know that.

Post Office Horizon Scandal

Liam Byrne Excerpts

Wednesday 10th January 2024 Commons Chamber

[Mr Speaker]

I call the Chair of the Business and Trade Committee.

[Liam Byrne (Birmingham, Hodge Hill) (Lab)]

I thank the right hon. Member for Haltemprice and Howden (Sir David Davis) for securing the urgent question. I am very much looking forward to cross-examining the Minister when he comes before the Business and Trade Committee next Tuesday, when we will be hearing evidence from Mr Bates and his colleagues. We will also be putting questions to Fujitsu. Can I push the Minister on the point I made on Monday night? Three years after the landmark case, 85% of convictions have not been overturned, only 4% of the cases have resulted in a full and final settlement, and we have heard evidence from victims this week already that even when settlements have been made, the cash has not yet been handed over. Can I ask the Minister again what his target is? What is his goal, approximate or otherwise? When will those wrongfully prosecuted have their full and final settlement delivered, in cash?

[Kevin Hollinrake]

I am very much looking forward to appearing before the right hon. Gentleman’s Select Committee and hearing some challenging questions, which I would welcome. To be clear, 64% of all those affected by the scandal have received full and final compensation. He talks about the smaller cohort who have come forward in relation to convictions. Only 95 have had convictions overturned. In order to try to expedite the payment of compensation to those people, we have introduced the fixed-sum award route, which is proving very successful. I am not aware of his point about people not actually receiving the cash, but I am very happy to engage with him on that, because there is every intention that once a decision has been taken to go down the fixed-sum award route, the sum is paid pretty much instantly. I am very happy to find out what exactly is happening in those cases. Where people have gone down a full assessment route, that is understandably more complex, as various considerations about loss, financial forensic information, health and reputational loss—a key facet in most of these cases—will be taken into account.

The right hon. Gentleman asked for a date. We have always intended to deliver all the compensation by August this year, and that is still the case. We would like to do it more rapidly, and for many people we will do it more rapidly, but not everything within the timescales is in our gift, because people are required to go down a full assessment route in order to compile a claim to which we can then respond. However, we have set ourselves some criteria relating to time and service levels to enable us to respond to claims in a timely fashion.