Transatlantic Trade and Investment Partnership (EUC Report)

Lord Stevenson of Balmacara Excerpts

Tuesday 17th June 2014 Lords Chamber

[Lord Stevenson of Balmacara (Lab)]

My Lords, I congratulate the chairman, the committee and, indeed, all the staff on a very comprehensive and informative report. Noble Lords may be aware that there has been a bit of a run on it in the Printed Paper Office. You can no longer get first editions; we are now on to second editions, so that proves something. Given that it was published only about a month ago, it is clearly something in which we should all take a great deal of interest. I thank all speakers who have contributed to the debate, including those who were not on the original committee. Again, that shows the wider interest in the topic, even though, as has been said, it will not catch the casual passer-by very easily. That will change, I think. There are things here that will reach out and become important.

We have heard tributes to the chairman, which I am sure were correct. He has become a friend and I am aware of his abilities in this respect. The committee has done its work very diligently by taking a huge amount of evidence, both here and abroad. That evidence is available and I have read quite a lot of it. It is extremely interesting and well marshalled into the report. Again, this sets our committee structure at the very heart of what we do. Something that does not get enough publicity, perhaps, are the efforts that the House makes to do a job properly, efficiently and in a timeous way so that the work is available for people to use as the debates move forward.

It is a pity that the government response has not been made available but I am sure that the Minister will explain what the issues are there. Given that both he and his predecessor gave evidence, perhaps we are not missing too much but it would be nice to get a sense of where the Government are coming from, particularly in relation to the pleas to pick up some of the main points from the report and use them to help get through the rest of the process.

It was said earlier in the debate that this issue had cross-party support. I am happy to confirm that from this side of the House, if it has not been obvious from the speakers who have contributed to the debate today. We take the view that TTIP has huge potential, and we very much support the principles behind the negotiations. We hope that it will lead in turn to job creation, higher wages for employees and a better deal for consumers. Europe and the United States are our most important markets today; indeed, the US is the UK’s biggest export market, and the UK economy attracts a significant level of FTI from across the Atlantic.

Crucially, as I have said, the benefits of the trade deal should filter down to employees and consumers. We would be concerned, having given our support for this, if any deal that emerged from it led to a watering down of workers’ rights, for example, or if in some sense the benefits that flowed did not get passed on to consumers through increased choice and reduced prices. However, as my noble friend Lady Henig said, does the whole experience of this process not rather prove the point that the UK’s national interest lies in remaining at the heart of a reformed EU, using our special links with the United States to achieve something that will be for everyone?

A number of noble Lords have said that the problems that are inherent in the TTIP as it currently stands—its weakness, as it were—is that it is almost too ambitious, and that it is probably the most complex trade and investment package we have ever attempted to put together. People have also argued, though, and I agree with them, that that is also a strength. The agreement’s scale is enormous; Europe and the US together account for nearly half of world trade in terms of GDP, although that will change as new markets develop in China, India and other places. The point has also been made by several noble Lords that the issues in play here relate not just to tariffs but to non-tariff barriers to trade. In some senses, and this is important for the future as well, the deal that might result from TTIP could become a template for a new generation of 21st-century trade and investment agreements, so, as many noble Lords have said, it has a strategic dimension.

As the noble Earl, Lord Sandwich, reminded us, attention needs to be paid to third-world accessions to either this agreement or ones similar to it. TTIP should be not simply a free-trade model but something that works against protectionism wherever it comes across it. It is also possible that in the process of developing this trade agreement, other desirable policy objectives could be obtained. For instance, while I do not think that this is necessarily a negative in terms of the debate, it is important to recognise that the US has still ratified only two of the eight major conventions of the ILO—conventions that we and all our EU partners have ratified. If it is possible to use the process of debate to bring forward desirable policy outcomes such as ratification within the ILO, that is also a plus.

I turn to some of the detail of the report. We are encouraged that the report says that in the committee’s view it should be possible to make progress on UK objectives in relation to TTIP—for example, with regard to the motor industry and geographical indications. That sense of a possibility emerging and a chance that it will come through is important for those who have to carry forward the negotiations. However, it is certainly true that there will be some difficulties in US public procurement, where there will be difficulties in obtaining agreement at the sub-federal level. The noble Lord, Lord Jopling, made an important point when he warned about cherry picking. The noble Lord, Lord Tugendhat, said that he wanted odds—actually he asked what price it was, but I suspect that he was thinking of a betting analogy rather than a straight cash transaction—on whether the sub-federal level would be included. I would be grateful if the Minister could give us his thoughts on that. The noble Lord, Lord Lamont, said that he thought four states were ready and willing to come into this, but I hope that there will be a higher number than that.

The question of whether financial services are included is important. It will be in the interests of the UK, rather than necessarily in the EU’s more general interest, for that to be resolved quickly. I have heard the argument about it being impossible to have negotiations without all cards being on the table, but maybe we should not be too restrictive on that; there may be things that can be done within the overall scheme that will help some way down the line. Confidence and experience need to be built up but, from the UK’s position, financial services are clearly very important and this will be one of the hardest-fought issues.

There are others which must concern us. For example, the audio-visual sector is a global success story in terms of the UK’s involvement, not just because of creativity or the level of investment, which is now very good, but because it delivers public value to domestic audiences as well as global ones. This comes because we have a very vibrant ecology comprising both public and private sector organisations. They are supported in turn by a complex set of policy interventions designed primarily to address market failures and to act increasingly as a counterbalance to the inherent asymmetry between the sizes of the audio-visual markets in the UK and in the US.

I say that because I am aware that there have been concerns about audio-visual activity in other parts of the EU. I will be grateful if the Minister, when he responds, could say where we are with audio-visual and whether that is also to be treated differently from other areas, as financial services may be. I should also like to know whether he recognises that there are some concerns about, for instance, the BBC and public service broadcasting in relation to that, which we would need to have preserved if we were going forward on this.

My noble friends Lord Radice and Lord Giddens mentioned the issues about the living agreement idea, which did not get much discussion elsewhere in the debate. I think it is a rather interesting idea. Clearly, getting to an agreement of such complexity will be hard enough but finding a way of constantly updating it may well be another difficulty. It is not something to which there is an easy answer. When the Minister responds, I would be grateful if he could update us on where he thinks the mechanism for that would exist. It is obviously in everybody’s interest if he can find one. I am just not quite sure if everybody even has the language to describe what it would be—whether it would be continual sessions around the negotiating table in order to update and change it or whether there would be some lock-step or other agreement that would allow us to do it.

My final two points concern the publicity for this issue, as we all, I think, share a sense of worry that the good things that are involved in TTIP do not get picked up, either in the press or in general debate. Who are the proponents of this? How can we convince them that the purposes or the possible gains from TTIP need to be put forward in a compelling way? This task, I think, cannot be left to the officials concerned. It has to be picked up politically. Trade Ministers will do it, I am sure, but a wider conspectus is required if we are to get a real sense of a communications strategy involving Ministers, involving the public and getting support for this.

Finally, a number of noble Lords have mentioned the political window and how difficult it will be to find it. I am certainly encouraged if it is as much as 18 months. My feeling is that it will be rather less than that as the issues that need to be addressed include the requirement of the US Administration to secure a trade-promotion authority. We have to anticipate both the mid-term and the presidential elections in relation to that. With all those out to play, there are obviously some issues. It is certainly difficult for negotiators even to get to the point where they can say that there is an agreement to sign, but if it is done within a very constrained timetable that would be very difficult. When the Minister responds, it would be interesting if he could respond on this particular point.