The National Health Service

Matt Western Excerpts

Wednesday 23rd October 2019 Commons Chamber

[Barry Gardiner]

I cannot give way because of time.

It is this legislation that now exposes our NHS to foreign competition and undermines our public healthcare system. It is Donald’s door into our NHS. Some 170,000 people already know this, and they have signed a parliamentary e-petition calling on this Government to introduce safeguards that will protect it from new trade deals. Trade agreements lock in privatisation, and open up access to foreign investors and speculators. That is why we need safeguards.

[Matt Western (Warwick and Leamington) (Lab)]

Does my hon. Friend agree with me that one of the great threats to our NHS is a trade deal with the US that, as happened in Australia 10 years ago, will drive up the price of medicines significantly?

[Barry Gardiner]

I agree with my hon. Friend.

In 2007, Slovakia wanted to move from a private health system, modelled on the USA’s, to a system more like ours. Slovakia was sued for millions of euros by a Dutch company that thought the move might affect its future profits. Trade deals often contain clauses that give foreign investors the right to sue Governments for decisions that might affect their profits. These investor-state dispute settlement—ISDS—clauses are common in modern free trade agreements.

Policy decisions such as legislating for the plain packaging of cigarettes have been subject to ISDS claims. Labour believes the UK should be free to make public health policy based on the health needs of the British people. We should not have to bend to some company that is profiting from keeping our people ill, whether from tobacco, polluted air or too much sugar.

More than 750 cases are known to have been brought under ISDS clauses in other countries, and more than half resulted in compensation for foreign investors or in financial settlements out of court. Labour will not sign up to any free trade agreement that uses these ISDS-style rules, which are wrong in principle and, even where they are not used, can lead to regulatory chill.

Incredibly, the right to sue the Government under these ISDS clauses does not extend to our own UK companies, only to foreign companies in separate private courts. Labour has confidence in our courts and thinks foreign companies should have no greater rights of redress than British companies.



Free trade agreements also typically include market access clauses and national treatment provisions. These would set out the extent to which overseas businesses can operate in our markets, and they would insist that we afford at least the same treatment to foreign businesses as we do to our own businesses. In the past that was done by listing all those services that had been agreed. If an NHS service was not on the list, it could not be the subject of foreign competition. Agreements used to set out only those services that we were prepared to open up to competition, but modern trade agreements do not work that way.

Instead, modern trade agreements adopt a negative list system that says every service is opened up to competition unless it is placed on the negative list. Anything missed off the list is automatically open to competition. Once missed, a service can never be put back on the list. Any new service that comes as a result of technological or scientific breakthrough, if it is not on the list, is automatically open to foreign competition.

Imagine if we had agreed a negative list before the age of the internet and before digital technology had changed how patients can be screened and tested. If we lose our capacity and skill to provide these services directly, we will become a captive market and vulnerable to the abuse of private monopoly and spiralling costs.

Governments cannot intervene where there has been a clear failure in the sector or where patient health has been compromised. We need legal guarantees that no such negative list trade agreement will be concluded. That is why Opposition Members sought to introduce measures into the Trade Bill to achieve this protection. Conservative Members voted down every single one.

When their lordships secured essential provisions for proper scrutiny of trade agreements and a defined parliamentary procedure for ratification, what did the Government do? They abandoned the Bill entirely. Now they want to bring back the same legislation, but without those safeguards.

A potential deal with the US is of major concern to those who care about our health service. The American model is renowned for its pursuit of profit and its indifference to the poor. The US ambassador told national TV that the NHS would be on the table and that the US had already looked at all the components of the deal. President Trump confirmed it, and the Office of the US Trade Representative has published its list of negotiating objectives for any such deal. One objective is to stop the NHS using its bulk purchasing power to negotiate lower drug prices. The US Secretary of Health and Human Services actually said that the US would “pressure” other countries in trade negotiations so that Americans pay less and we pay more.

The USA wants to stop the UK regulating the pharmaceutical industry unless the US industry has agreed. So much for taking back control. In one of their first acts after establishing the Department for International Trade, this Government opened three new offices in the US, in Raleigh, in Minneapolis and in San Diego—biopharma hubs where major healthcare providers, biotech, pharmaceutical manufacturers and health insurers are headquartered. What made those cities so attractive if it was not an attempt to attract players from those sectors into our NHS? The Labour party created the NHS. We will not allow this Government’s trade agreements to damage it. Under Labour, the NHS will remain a universal service, free at the point of use, and based on medical need, not ability to pay.