Trade Bill

Stewart Hosie Excerpts

Report stage & 3rd reading & 3rd reading: House of Commons & Report stage: House of Commons
Monday 20th July 2020 Commons Chamber

[Madam Deputy Speaker (Dame Eleanor Laing)]

Order. In case the House is not already aware, after the next speaker, we will have a time limit of four minutes on Back-Bench speeches, which, of course, does not apply to Mr Stewart Hosie.

[Stewart Hosie (Dundee East) (SNP)]

There are four significant flaws with this piece of legislation: the absence of devolved consent, real protections for the NHS, the preservation of food standards and meaningful parliamentary scrutiny. I believe that our amendment 10 and new clauses 7 and 8 deal with the first three, and that new clause 4, tabled by the hon. Member for Huntingdon (Mr Djanogly), deals with the final issue.

I wish to speak to amendment 10 and new clauses 7 and 8, which are in my name, and I will start, slightly in reverse order, with amendment 10. It relates to the powers of the devolved Administrations, or as I said in Committee,

“more accurately, the ability of the UK Government to make regulations under subsection (1), which makes provisions within devolved competencies, without the consent of Scottish or Welsh Ministers or a Northern Irish devolved authority”––[Official Report, Trade Public Bill Committee, 23 June 2020; c. 237.]—

granting consent. It strikes me as fundamental that if we are to genuinely respect the devolved settlement in the UK, Ministers must self-evidently gain the consent of the devolved Administrations before making changes to regulations that directly affect them, possibly in a negative way, or in a way that runs counter to those Governments’ policy objectives.

I am aware that in the previous Trade Bill, under consideration between 2017 and 2019, there was a problematic provision for regulation-making powers to be available to the UK Government, but the good news is that those provisions have been removed from this Trade Bill. It is the case, however, that there remains no statutory obligation for the UK Government to even consult, let alone seek the consent of, Scottish Ministers before exercising the powers in this Bill in devolved areas.

I know that the Minister has said that these powers would not normally be used without seeking consent, and his predecessor did offer a number of a non-legislative commitments to the Scottish Trade Minister Ivan McKee in March. I am genuinely pleased that the Minister, during the Bill Committee, committed to honouring those non-legislative commitments. He said:

“I restate the commitments made by my right hon. Friend, when he was a Minister, in his March letter to the Scottish Minister Ivan McKee”,

and that is genuinely very welcome. However, he went on to say, in opposing what was then amendment 8 and similar Labour new clauses that dealt with the same issues:

“In short, we are already delivering the engagement envisaged by proposed new clause, and we have achieved that while continuing to observe the important constitutional principles enshrined in the devolution settlements.”––[Official Report, Trade Public Bill Committee, 23 June 2020; c. 240-241.]

I disagree. Giving the UK Government the ability to directly effect devolved powers without the statutory requirement to even seek consent is not observing the devolved settlement.

[Jim Shannon]

Our trading ability is something that concerns each and every one of us across the whole United Kingdom of Great Britain and Northern Ireland. Would the hon. Gentleman be prepared to support new clause 4, which would give the authority to the devolved Assemblies and the Scottish Parliament, and further, would mean that proposals came to the Floor of the House for ratification? Surely supporting new clause 4 would be a step to making that happen.

[Stewart Hosie]

I am more than happy to support new clause 4, not least because I have signed it, but it is a slightly different thing.  Ensuring parliamentary scrutiny, about which I shall say a little more later, is important, but it is different from the seeking of consent from those Administrations whose policy direction may be affected by a UK Government decision.

When we debated the identical new clause in Committee, the Minister went on to say that

“this proposed new clause would give the devolved Administrations a statutory role in the reserved area of international trade negotiations, which would be constitutionally inappropriate.”––[Official Report, Trade Public Bill Committee, 23 June 2020; c. 241.]

He was partly right, in that it would give the devolved Administrations a statutory role, but only in so far as the provisions of a trade deal affected devolved competences. That is not constitutionally inappropriate; it is a matter of good administration and respect.

The Minister’s key argument against what was proposed was that it was not “practical”. He said:

“It would lock us and the”—

devolved Administrations—

“into prescribed ways of working under the existing intergovernmental memorandum of understanding, a document last updated in 2013.”––[Official Report, Trade Public Bill Committee, 23 June 2020; c. 241.]

Well, that may be an argument for revisiting the MOU, and it might also be an argument to say that the Government should adhere to the terms of the MOU under any circumstances, but it is a strange argument for opposing this amendment. Surely it is better to base negotiations on an agreed framework, or better still an agreed statutory framework, rather than to leave them to chance, make up the rules on the hoof and give an impression of UK Government acting in an arbitrary way.

The Minister’s key argument was as follows:

“As parts of these agreements touch on devolved matters, this legislation will create concurrent powers. We have sought to put in place concurrent powers to provide greater flexibility in how transitional agreements are implemented”.

So far so good; however, he went on to say:

“This approach permits greater administrative efficiency, reducing the volume of legislation brought through the UK Parliament and through the devolved legislatures.”––[Official Report, Trade Public Bill Committee, 23 June 2020; c. 241.]

It cannot be right that the UK Government intend to legislate, or can legislate, in areas of devolved competence for the sake of administrative efficiency. There are far bigger and wider principles at stake than that.

Let me turn to new clause 7, tabled in my name. We know that trade deals can put pressure on food standards and lead to the importation of low-standard food. For example, the US Administration has made it clear that they want the UK to lower its food and animal welfare standards. The new clause includes a ban on the importation of food that is produced to standards lower than that in the UK. We know that the US and other countries have far lower animal welfare standards and adopt practices—including chlorine-washed chicken, hormone-fed beef and the use of various pesticides and GM crops—that are illegal in the UK for health and environmental reasons. None of that is a great surprise to anyone in the House. We believe that the quality of Scotland’s food and drink produce and, indeed, of food and drink produced elsewhere in the UK, and the related standards, are essential to the maintenance of our established international reputation in those areas.

[Steve Brine]

I wonder whether the people in Scotland, like the people in England and in my constituency in Winchester, might not be way ahead of the politicians. Ultimately, will not the consumer decide? Just recently, we heard Waitrose make it clear that it would not be selling any imported product that was produced to a lower standard than we currently enjoy in this country, with its new boss citing chlorine-washed chicken. I just wonder whether the public might be ahead of us on this already.

[Stewart Hosie]

I want to be careful in how I answer that. I hope the hon. Gentleman understands that perhaps those who can afford to shop in Waitrose—the Minister boasted in Committee that he was Waitrose fan—have a choice; perhaps somebody who is counting every penny and does not have access to anything other than the cheapest food is not in the position to make the same choice.

In effect, new clause 7 would do two things: it would affirm the UK’s rights and obligations under the SPS agreement—that is, the application of the sanitary and phytosanitary measures in annex 1A of the WTO agreement; and it would prohibit the import of food into the UK if standards in the exporting country were lower than those in force in the UK. I do not think there is anything contentious about that.

It is not just campaign groups like the Trade Justice Movement that back this. It is not just Scottish Land and Estates and the National Farmers Union that back measures like this one. The British Medical Association has weighed in, saying:

“The Bill presents an opportunity for the UK to present itself as a global leader on standards on food imports for the benefit of human, animal and plant health, and the environment. To fulfil this opportunity, it is vital that our current high standards are upheld and protected in any trade deals.”

It suggests that new clauses 7 and 11 should be backed in order to achieve that.

It is also necessary to have this on the face of the Bill because the Government’s approach to protecting food standards is slightly confused. In Committee, the Minister said:

“This Bill is about…continuity… Imports under continuity agreements must continue to comply with our existing import standards.”

I welcomed that. However, he added:

“Decisions on those standards are a matter for the UK and will be made separately from any trade agreements.”––[Official Report, Trade Public Bill Committee, 25 June 2020; c. 305-6.]

There is the point of concern, right there. The UK could, if it wished, lower standards, opening the door to all sorts of imports. Let us make sure that that is not possible, at least in the roll-over arrangements, by including the UK’s obligations under the WTO phytosanitary agreement in the Bill. That is important because although the purported objectives of the Bill are about roll-overs, the definition of “trade agreement” is very wide and the long title does not restrict its use only to roll-overs.

New clause 8 would ensure that the UK Government have a duty to restrict market access to healthcare services, including medicines and medical devices. We tabled the new clause precisely because trade deals potentially have a negative impact on health services. While the UK Government have repeatedly pledged that the NHS is not on the table in trade negotiations, leaked documents detail conversations between UK and US negotiators and reveal that health services have been discussed, including the US probing the UK’s “health insurance system”, and the US has made clear its desire for the UK to change its drug pricing mechanism. The new clauses therefore include specific carve-outs for the NHS, all relevant services and regulation, meaning that it would be illegal for the Government to conclude a trade agreement that altered the way that NHS services are provided, or liberalised further, or opened up to particular sorts of foreign investment.

There could be no use of negative listing because such clauses require that all industries are liberalised in trade agreements unless there are specific carve-outs, and it is not always easy to define what services count as health services. For example, digital services may seem irrelevant to health, but NHS data management and GP appointment systems are increasingly digitised. There could be no standstill or ratchet clauses, because these provisions mean that after the trade deal has been signed, parties are not allowed to reduce the level of liberalisation beyond what it was at the point of signature.

There are many examples of real-world potential impacts; I will give just one. The Scottish Government had private cleaners in the NHS and quite a high degree of hospital acquired infection. The private cleaners were replaced by NHS cleaners, and the level of hospital acquired infection fell dramatically. Had a ratchet been in effect, let alone ISDS, it might not have been possible to do that, with detrimental mortality and morbidity consequences for real patients. The clause also states that there should be investor-state dispute settlement clauses in trade agreements. They only allow private investors to challenge Government policy when it affects their profits. The BMA piled in to this debate, as well, saying:

“The Bill must rule out Investor Protection and Dispute Resolution mechanisms which undermine the supremacy of UK courts and risk deterring, delaying or blocking public health improvement measures.”

We have seen examples around the world of where that has happened. It is fundamentally quite wrong for large corporations to be able to use ISDS-type arrangements to sue Governments simply for taking steps to protect the wellbeing of their citizens, or for enacting public health measures that they believe to be right and for which they may well have an electoral mandate.

[Barry Gardiner]

The hon. Gentleman is making a fine speech. Does he agree that it seems a considerable irony that those Government Members who were so determined that this country should not be subject to any supranational court system should hereby, in an ISDS clause, enable our Government to be sued by foreign companies in specialist supranational courts in a way that is not even accessible to our own domestic companies?

[Stewart Hosie]

Yes, and I made that point. It is wrong for these provisions to be available only to investors in the way that has just been described. If we want a supranational body that adjudicates, arbitrates and works, let us have the UK Government put some pressure on their friends in the United States and get the WTO appellate body back up and running and functioning again. That would be the best thing for trade around the world.

New clause 8 would also instruct that there should be no changes to drug pricing mechanisms, which could also happen through intellectual property and non-patent exclusivities. That would be bad news for patients, taxpayers, health boards and trusts around the country, and our view is that trade deals should not be used to facilitate it.

In opposing a new clause like this one in Committee, the Minister said that

“the NHS is not, and never will be, for sale to the private sector”.

Fine. He said:

“We have always protected our right to choose how we would deliver public services in trade agreements, and we will continue to do so.”

Fundamentally, his argument was that “however laudable” the new clause was, it was “unnecessary”. He went on to explain that the UK already had

“rigorous checks and balances on the Government’s power to negotiate and ratify”

trade agreements

“via the Constitutional Reform and Governance Act 2010”.––[Official Report, Trade Public Bill Committee, 25 June 2020; c. 315.]

There are two big issues that jump out, given what the Minister said—and I have it in full if he wants to re-read it. First, there is absolutely no practical reason why protections for the NHS demanded by the public should not be included in the Bill. Secondly and more importantly, because the so-called “rigorous checks and balances” in CRAG amount to little more than a take-it-or-leave-it choice at the end of the negotiations, the need to protect the NHS from the outset in legislation is paramount.

I commend amendment 10 and new clauses 7 and 8 to the House, and I hope—time permitting—that we can press new clause 7 and amendment 10 to a vote.

[Madam Deputy Speaker (Dame Eleanor Laing)]

Order. We now have a time limit of four minutes.