Draft EU-Canada Trade Agreement Order

Philip Hollobone Excerpts

Tuesday 26th June 2018 Commons Chamber

[Dr Fox]

I have set out what I believe are the principles, but the mechanism may well be different. The Commission has not yet finished its work on the technical detail of the ICS. We have reservations about the ICS as a system, but, as I have set out, we believe that there needs to be protection for investors. What we cannot do as a country is say that our investors should be protected overseas when they make investments of UK money, but a reciprocal agreement should not be in place for others. We have to ensure that this is fair and equitable, and that is what we seek to do. I have to say to the right hon. Gentleman in all candour that I am not terribly attracted by the ICS, but we want to see the detail that the European Commission comes to and, when we leave the European Union, we will want to discuss with Canada what we think, on a bilateral basis, the best disputes resolution system might be.

It is also important to note that the customary international right to regulate has been re-emphasised in this agreement. Moreover, the agreement explicitly provides that member states should not reduce their labour or environmental standards to encourage trade and investment, ensuring that our high standards are not affected by this agreement. Let me say that nothing in CETA prevents the UK from regulating in the pursuit of legitimate public policy objectives.

Such objectives include the national health service. This Government have been absolutely clear that protecting the NHS is of the utmost importance for the UK. The delivery of public health services is safeguarded in the trade in services aspects of all EU free trade agreements, including CETA. Neither will anything in CETA prevent future Governments from taking back into public ownership—should they be crazy enough to do so—any services currently run by the private sector. The legal text makes this clear, if Labour Members would like to read it, although I have to say that the fear of nationalisation is the No. 1 issue that potential investors currently give for thinking twice about the UK as a foreign direct investment destination.

In fact, robust protections in CETA are covered in a number of related articles and reservations in the text. A key article is article 9.2, in chapter 9 on cross-border trade in services, which excludes services supplied in the exercise of governmental authority from measures affecting trade in services. In addition, in annex II on reservations applicable in the European Union, the UK has gone beyond the EU-wide reservations and has included additional national reservations for doctors, privately funded ambulances and residential health facilities, and the majority of privately funded social services. The UK Government will continue to ensure that decisions about public services are made by the United Kingdom, not by our trade partners. This is a fundamental principle of our current and future trade policy.

[Mr Philip Hollobone (Kettering) (Con)]

Given these extensive labour and public sector protections, which I congratulate my right hon. Friend on negotiating, could this EU-Canada agreement not serve as a template for a UK-EU trade agreement on our exit?

[Dr Fox]

As the Prime Minister has made clear, we hope, given we are starting from the position of complete regulatory and legal identity with the European Union and given the size of our trade with the European Union—not least the fact that the European Union has a surplus in goods with the United Kingdom of almost £100 billion—that we would be able to negotiate an even more liberal agreement than CETA. That is of course a decision not just for the United Kingdom Government, but for the other 27 Governments, who need to look not to political ideology, but to the economic wellbeing of their own citizens.

Let me say something on scrutiny. We have committed, through our White Paper published last year, that we will ensure appropriate parliamentary scrutiny of trade agreements as we move ahead with our independent trade policy. The Government can guarantee that Parliament will have a crucial role to play in the scrutiny and ratification of the UK’s future trade agreements, and we will bring forward proposals in Parliament in due course.

I would like to provide further reassurance to the House about the Government’s ongoing commitment to openness and transparency. Indeed, we have scheduled a debate on the Floor of the House on the EU-Japan economic partnership agreement, which the Minister for Trade Policy—it is a pleasure to welcome my hon. Friend the Member for Meon Valley (George Hollingbery) to his position on the Front Bench—will be leading straight after this debate. This is already over and above the engagement required for EU-only trade agreements.