Oral Answers to Questions

Liam Fox Excerpts

Thursday 7th February 2019 Commons Chamber

[Mr Paul Sweeney (Glasgow North East) (Lab/Co-op)]

1. What assessment he has made of the potential merits of including human rights protections in new trade agreements.

[The Secretary of State for International Trade and President of the Board of Trade (Dr Liam Fox)]

The United Kingdom has a strong and proud history of promoting our values globally, including on human rights. We are considering all options in the design of future trade agreements, including human rights provisions. We recognise the need to maximise the benefits of trade while being true to our values.

[Mr Sweeney]

I am one of the 38 Co-operative MPs in this place. We are the third largest party in Parliament and we have a long-standing campaign against modern slavery. There is a particular need to emphasise any safeguards against modern slavery in our supply chains, which is an insidious aspect of international trade. Will the Secretary of State take cognisance of that urgency in ensuring that the scourge of modern slavery is outlawed in our legislation and trade agreements?

[Dr Fox]

I am grateful to the hon. Gentleman for reminding me that a party within a party is in fact normal practice in the Labour party—

[Hon. Members]

Behind you!

[Mr Speaker]

Order.

[Dr Fox]

The hon. Gentleman raises an extraordinarily important point. Modern slavery is far more widespread than is recognised. It is a pernicious, wicked practice and it is something that this Government have taken the lead on internationally. It will certainly be reflected in all the values of this Government, including our trade policy.

[Alex Burghart (Brentwood and Ongar) (Con)]

11. Scrutiny of our trade deals is vital as we leave the EU. Given the Government’s commitment to an inclusive and fair trade policy, will the Secretary of State seek a debate in this place to talk about the scrutiny of our trade deals?

[Dr Fox]

On the consultations that we have already had in public on Australia, New Zealand, the comprehensive and progressive agreement for trans-Pacific partnership —the CPTPP—and the United States, the Government have a commitment to hold such a debate in the House of Commons. Assuming the agreement of the business managers, I hope that we will have that debate in the House within the next two weeks.

[Nick Smith (Blaenau Gwent) (Lab)]

What assessment has the Secretary of State’s Department made of the role of British businesses in tackling abuse and exploitation in global supply chains?

[Dr Fox]

As I said in answer to a previous question, we take such abuses very seriously. This country operates its international trade policy with one of the highest levels of ethics of any country globally, and the Government are always keen to ensure that those ethics are upheld in every way.

[Several hon. Members rose—]

[Mark Menzies (Fylde) (Con)]

9. I would be foolish not to accept such a generous offer, Mr Speaker. Fylde is one of the biggest exporters of any constituency in the country and, with Brexit fast approaching, trade deals are more important to the sector than ever. What has been done to ensure that future trade deals are processed with the least possible delay and with the best interests of business in mind?

[Dr Fox]

In terms of the continuity of our existing agreements, the best way to ensure full continuity is to have a deal. All those who talk about the pitfalls of no deal would do well to remember that in voting against the deal they make those pitfalls all the more likely. My hon. Friend is right to suggest that it is not only trade agreements that are important but trade itself, including trade promotion for our exports, and I congratulate him on the work he has done to promote this country’s interests abroad.

[Mr Alistair Carmichael (Orkney and Shetland) (LD)]

The persecution and mass incarceration of the Uyghur community in the Xinjiang province of China is facilitated by companies such as Hikvision, which manufactures and supplies much of the surveillance equipment that is used there. Hikvision has an expanding presence in this country. Can the Secretary of State assure me that the trade deals that we might have post Brexit will not encourage trade of that nature?

[Dr Fox]

As I have said, any future trade agreements that we have beyond the European Union will be subject to public consultation, to debate in this House and, I hope, to rigorous processes that I may set out in due course about how we can increase scrutiny of those agreements. Members across the House will place different types of emphasis on different constituencies and different sectors of the economy, but I think that the whole House will share those concerns about ethics. I hope that the design of the scrutiny of those trade agreements that I will be able to bring to the House in greater detail soon will give the right hon. Gentleman the reassurance that he seeks.

[Sir Desmond Swayne (New Forest West) (Con)]

Is not championing global free trade the best way of promoting human rights?

[Dr Fox]

We all need to remember that the great success of free trade over the last generation has been the truly historic achievement of taking 1 billion people out of abject poverty. That has been the benefit of free trade, and in this era of protectionism we should realise that economic nationalism is a way of rolling back what has been an enormously beneficial human trend.

[Judith Cummins (Bradford South) (Lab)]

Two weeks ago, the Joint Committee on Human Rights heard how the Canadian Government had to make a substantial pay-out and issue a public apology to a chemicals company after they were sued for taking a public policy decision to ban a chemical additive to protect human health. The Committee was told that investor-state dispute settlement provisions in trade and investment agreements can

“impact very negatively on human rights.”

Does the Secretary of State recognise that danger? If so, will he rule out such ISDS clauses in future trade agreements? If not, what counter-evidence will he present to the Joint Committee on Human Rights?

[Dr Fox]

I have made clear our concern about human rights, but the idea of banning such agreements is nonsensical. This country has £1.3 trillion of stock overseas. Our investors are important in providing development in a lot of these countries, yet they are not given sufficient legal protections, which they would normally get under systems such as the UK’s. That is why those provisions are put in—to protect our investors overseas.

[Liz McInnes (Heywood and Middleton) (Lab)]

2. What support his Department provides to British businesses investing overseas.

--- Later in debate ---

[Douglas Chapman (Dunfermline and West Fife) (SNP)]

6. What recent estimate he has made of the value of the European single market to UK service exports.

[The Secretary of State for International Trade and President of the Board of Trade (Dr Liam Fox)]

In 2017, 46.8% of UK services exports went to the European single market—including the European economic area and Switzerland—worth around £130.5 billion. That represents around 21% of total UK exports. Leaving the EU gives us the freedom to pursue an independent trade policy with countries around the world that reflects our unique strengths in services.

[Douglas Chapman]

I thank the Secretary of State for his response, but last week the Office for National Statistics published the international trade and services statistics for 2017, which showed that financial services proved to be the largest service product exported globally by UK businesses and that the EU made up nearly half the UK’s service exports. A key part of business relationships with clients in the EU is the ability to travel freely, known as passporting rights. Has the Secretary of State made an assessment of what the end of freedom of movement, including for labour, will mean for services under the Prime Minister’s deal?

[Dr Fox]

Actually, the share of our exports to the European Union accounted for by services is less than our average exported to the rest of the world. In fact, the future of our services will be dependent on global services arrangements, and outside the EU we will have a golden opportunity to shape the global services agenda in a way that suits the United Kingdom’s best interests. It is time that we in this House started to reflect the optimism and confidence of the British public who voted to leave the EU.

[Jessica Morden (Newport East) (Lab)]

8. What steps he is taking to ensure that the UK steel sector can continue to trade without disruption after the UK leaves the EU.

[The Secretary of State for International Trade and President of the Board of Trade (Dr Liam Fox)]

We are working closely with the UK steel sector to provide as much continuity as possible in trading arrangements after we leave the EU. This includes establishing the Trade Remedies Authority to help to prevent unfair trading practices and identifying more than half a billion pounds’-worth of opportunities for UK steel producers.

[Jessica Morden]

When the all-party group on steel met key voices in the industry this week, it was made clear that there is a real lack of engagement from the Government on steel safeguard measures for the UK market in a no-deal scenario. Will the Minister commit to meet UK Steel urgently to discuss this critical detail for an industry that contributes £1.6 billion to the economy?

[Dr Fox]

I do not recognise that description; the Government are indeed involved in talks with the industry about safeguards. The hon. Lady will know that the best way to avoid the problems she identifies is to support the Prime Minister’s deal. Those who keep talking about the pitfalls of no deal but keep voting against a deal are making those pitfalls more likely.

[Kevin Hollinrake (Thirsk and Malton) (Con)]

Does my right hon. Friend agree that our future trade policies must protect UK businesses, including in the steel sector, against unfair competition from abroad? It cannot be right for Parliament to expect our businesses to respect high standards on the environment, workplace or welfare and then compete freely with businesses abroad that do not.

[Dr Fox]

That is exactly why, in the Trade Bill, the Government introduced the Trade Remedies Authority to ensure that we have protections against unfair global competition in future. It seems absolutely inexplicable that the Labour party keeps talking about protections but voted against the Trade Bill and the establishment of the Trade Remedies Authority.

[Stewart Hosie (Dundee East) (SNP)]

Currently, 15% of steel export consignments are subject to tariffs; in the event of no deal, 97% of export consignments would be subject to tariffs. If one considers non-tariff barriers and domestic concerns—the shortage of warehousing was reported yesterday—is this not the time to support an extension of article 50 and to reach out and get a real compromise and an acceptable deal? Otherwise, the Conservatives risk being seen as the party prepared to sacrifice the steel industry on the altar of right-wing ideology.

[Dr Fox]

What the time is right for is reaching an agreement with the European Union, as the Prime Minister has set out, that will give us that certainty. Those who consistently vote against that deal are the ones putting industries at risk.

[Bill Esterson (Sefton Central) (Lab)]

The very fact that the Secretary of State is even considering zero import tariffs threatens the survival of our steel, ceramics and tyre industries. There will be no incentive for our partners to negotiate new trade deals, or to renegotiate existing ones, as the Secretary of State will have given away the shop before negotiations start. Thousands of workers whose jobs will have gone will no longer be the consumers he says will take advantage of cheap imports. When is he going to admit he is wrong?

[Dr Fox]

The Government have made no decision on this. When we do so, we will communicate it to stakeholders, the public and Parliament. Of course, the best way to avoid any of this scenario is for us to have a deal with the European Union. Whipping up fear over people’s jobs is simply the humbug that has become the hon. Gentleman’s hallmark.

[Luke Graham (Ochil and South Perthshire) (Con)]

T1. If he will make a statement on his departmental responsibilities.

[The Secretary of State for International Trade and President of the Board of Trade (Dr Liam Fox)]

My departmental responsibilities are to have foreign and inward direct investment, to establish an independent trade policy and to promote the United Kingdom’s exports. I am pleased to announce to the House this morning that UK Export Finance will provide £49 million of support for Darlington-based firm Cleveland Bridge to construct 250 bridges for rural Sri Lankan communities.

[Luke Graham]

International trade is a reserved power. What steps is my right hon. Friend taking to engage MPs in the devolved nations to ensure both that they are helping to form policy and that the DIT is properly resourcing devolved nations?

[Dr Fox]

My hon. Friend is right that trade is a reserved power, but we work with parliamentarians across the House through our regular briefings with MPs, which MPs from all parties attend, our international events programme, online services and the Board of Trade, which I established, to ensure that the benefits of trade are equally felt across all the parts of the United Kingdom.

[Barry Gardiner (Brent North) (Lab)]

Many British companies are currently part of trade disputes put forward by the EU at the World Trade Organisation. After 29 March they will be able to continue those disputes, utilising the evidence already submitted, but only if the Government accept a regional approach of 27 plus one countries, which is specifically allowed for under WTO rules. That would avoid the time and cost for businesses and for the taxpayer of having to resubmit evidence in a separate case. Why have the Government refused to adopt that simple solution? Why will they not support British business and ensure that trade disputes do not drag on for longer and at far greater cost than absolutely necessary?

[Dr Fox]

We will not want to see trade disputes drag on longer than necessary, and we will want to co-operate with our European partners in that regard. Of course, the best way to ensure that we have the highest level of co-operation on the disputes that are currently under way is to agree to the Prime Minister’s deal.

[Mr Robert Goodwill (Scarborough and Whitby) (Con)]

T2. What progress on trade reform and WTO reform was made at the recent World Economic Forum annual meeting? In particular, was consideration given to continuity arrangements with countries such as Turkey so that Ford engines can continue to be fitted to Ford Transits built in Turkey?

[Dr Fox]

A number of issues were discussed with Trade Ministers in Davos, including those of continuity. They also included how complex global value chains will be dealt with in the future, because, as my right hon. Friend has said, when the WTO was created the global economy was not so dependent on them. We need to look at how we deal with the question of tariffs and multiple, repeated taxation in industries such as the car industry.

[Mr Speaker]

I call Lloyd Russell-Moyle. Not here—where is the fella? I hope that he is not indisposed; that would be most unfortunate. Well, who is here? Nic Dakin is here.

--- Later in debate ---

[Rachael Maskell (York Central) (Lab/Co-op)]

T4. Employment rights are human rights, so what is the Minister doing to ensure that no trade agreement is signed that undermines our standards in employment rights, health and safety rights and equality rights?

[Dr Fox]

We set out in the trade agreement that this House supported on Canada the non-regression clauses that said we would not water down labour rights or environmental standards, or give away Government control on public service regulation, in order to reach agreement. I supported that and my colleagues supported that in the House, but the Labour party voted against it; I do not understand why.

[Mark Menzies (Fylde) (Con)]

Will the Secretary of State update the House on what progress the Government have made on advancing food and drink exports, and particularly on getting some of our exporting countries to reduce their tariffs?

[Dr Fox]

Food and drink is one of this country’s most successful export sectors, but a lot of areas of it, particularly those such as spirits—I had discussions with the Scotch Whisky Association just a couple of nights ago—face very high tariffs in countries such as India and Brazil. They are enormous markets for us, but we face disproportionate tariffs, and that is one of the key areas where we seek unilateral reform in such countries so that they can show that they are genuinely committed to free trade.

[Tom Brake (Carshalton and Wallington) (LD)]

The Secretary of State has shared with business a progress report on trade deals. I have been trying to obtain that information from him for months; is he willing to share that information with Members of the House as well as with business?

[Dr Fox]

I dealt with this extensively at the International Trade Committee yesterday; the right hon. Gentleman might have wanted to attend.

[Tom Pursglove (Corby) (Con)]

Can the Secretary of State update the House on the ongoing trade negotiations and discussions he is having with the United States Administration, not least because the US is our single largest export market?

[Dr Fox]

Our working group with the United States on future trade has met a number of times. There is broad agreement that we should have a free trade agreement with the United States. That would open up huge possibilities for the United Kingdom. There has been a lot of talk in the news this week about the ceramics industry; it would benefit from a free trade agreement with the United States, not least by the removal of the 27% tariffs that it currently faces for UK exports.

[Clive Efford (Eltham) (Lab)]

May I congratulate the Secretary of State on signing a trade agreement with the Faroe Islands? Those must have been tough negotiations. Is he seeking an extension to article 50 to complete the negotiations on the 40 trade deals he promised us he would sign?

[Dr Fox]

The hon. Gentleman mocks the agreement with the Faroe Islands; how typical that is of the Labour party when so many jobs in the fishing and fish processing industry are dependent upon it. He may want to know that when I go to Switzerland on Monday I will be signing the largest of the EU agreements of all. [Interruption.]

[Mr Speaker]

Order. Before we move on, as Humphrey Bogart said,

“I don’t mind if you don’t like my manners, I don’t like them myself”,

but just because the hon. Member for Huddersfield (Mr Sheerman) is sporting a rather splendid and garish Bogart tie, that does not mean that he should descend to that level himself. [Interruption.] He is chuntering from a sedentary position with predictable regularity—