NHS: Future UK Trade Deals

Baroness Thornton Excerpts

Thursday 4th July 2019 Lords Chamber

[Baroness Thornton (Lab)]

I so enjoy these flashing lights on the clock. I crave the indulgence of the House for a moment before I respond to this debate, as I need to take the opportunity to correct something I said in a debate on 6 June when the House was discussing the treatment of those with learning disabilities at Whorlton Hall. At col. 219, I said that Mr Simon Stevens had in the past worked for Universal Health Services, the owners of Whorlton Hall. This was not correct. Mr Stevens in fact worked for a completely different company, UnitedHealth Group, as medicare CEO. I took my information from a newspaper article; that will teach me to not believe anything I read in a newspaper, as I thought I already knew. I apologise to Mr Stevens for my mistake.

I refer noble Lords to my entry in the register of interests. I thank my noble friend for initiating this very important debate and all noble Lords who have participated in it. I also thank the Library, the British Medical Association, the NHS Confederation, the Trade Justice Movement, UNISON and others for their briefing. I am sad that the noble Baroness the Minister is not with us today, but I am sure that the noble Earl, Lord Courtown, will do his best to make a health-related trade speech and answer the questions which have been posed in this debate.

As noble Lords have said, this debate has been made even more important since the recent visit of Donald Trump, and I was reminded when preparing for this speech what a great job this House did—as the noble Baroness, Lady Brinton, has said—in amending the then Healthcare (International Arrangements) Bill to decrease its scope to the European Union and Switzerland only. I have been reflecting on that Bill and how dangerous it would have been to our National Health Service in the trade negotiations that are coming down the track. She is absolutely correct: that Bill was paving legislation which would have put our healthcare in great jeopardy during trade negotiations. It is important to remind ourselves that this was brought forward by this Government. We certainly feel that we need to be at least vigilant in what happens next.

Managing the flow of goods and services across borders in a way that promotes economic growth while protecting—and ideally enhancing—public goods, including health, is of vital importance in an increasingly interconnected world. If the final Brexit deal involves the UK leaving the European single market and customs union, we will need to negotiate a significant number of trade agreements to maintain favourable access to global markets and limit the economic cost of Brexit. The noble Lord, Lord Purvis, is quite right. Like him, I look forward to the amended Trade Bill reaching the statute book and the locks that it contains.

As the UK Government look to develop their independent international trade policy beyond Europe, it will be critical to balance the potential economic benefits of trade against the protection of public health and safety. It is quite clear that the US will drive a hard bargain in any future negotiation with the UK. That should come as no surprise to us. The truth is that only the European Union, and perhaps China, has the economic heft to negotiate on near-level terms with the Americans, and even it struggles. The US objectives for its negotiation with the UK were published in February—with the caveat that they were largely produced for a domestic American audience, shorn of any notion of compromise—and they were strikingly ambitious in their demands. For example, alongside normal talk of tariff and quota removal, the UK must jettison food hygiene rules that deal with pork, chicken and dairy; the rules stipulating products that qualify for tariff-free treatment under the agreements must specifically incentivise production on US territory; and the agreement should include mechanisms allowing the US to take appropriate action if the UK negotiates an agreement with a non-market economy. We should also look at pharmaceuticals and equipment, as the noble Lord, Lord Lansley, mentioned. He is quite right to warn us about the need for caution here, because the US objectives seek provision on intellectual property rights that reflect current US legal standards, which are generally more favourable to rights holders than the European standard.

What worries us is whether, if we crash out of the European Union, it is possible that that could cajole Conservative MPs and the Government into holding their noses and signing on Trump’s dotted line after no-deal Brexit, and that the subsequent upheaval and economic uncertainty of no deal would see the UK grasping for anything that looks like an economic lifeline. The noble Lord, Lord Purvis, was quite right to give examples of the American President not being trusted. Look what happened with Mexico: even though it recently agreed to revamp its existing trade agreement with the United States and Canada, the President has now threatened to levy a 5% tariff on all Mexican exports into the US unless illegal immigration comes to a halt. If no-deal Brexit happens, and a lopsided US-UK free trade agreement is concluded, we can be pretty sure that the President will immediately come back asking for more.

I will address two issues that have been mentioned. First, as we know, many international trade agreements include investor protection on dispute resolution mechanisms. As noble Lords will be aware, these mechanisms allow foreign private companies to sue national Governments for compensation if they believe that their investments have been negatively impacted by public policy decisions. These legal challenges take place outside the normal court system and judgments generally cannot be appealed. We believe that there is a significant risk that these mechanisms could have a particularly negative impact on health and the development of new models of health and care.

There is a precedent for this: a Dutch private healthcare insurance firm sued the Slovakian Government under an investor protection agreement. The Slovakian Government lost the case and was ordered to pay €22 million in damages to the company. More recently, the tobacco company Philip Morris used a dispute resolution mechanism to sue the Governments of Australia and Uruguay. Those were not successful, but they were very expensive. That alone can have a chilling effect on policy development in countries which are not as well off and sophisticated as we are.

Despite the reassurances that the Government have already given on this, we need it on the record yet again that we will not enter into these agreements. The noble Baroness, Lady Brinton, is quite right: let us put down the existing European rules that have protected us and make sure that they are on our statute books. I say to my noble friend Lord Desai that that is not the least bit romantic: it is the hard-headed thing we need to do.

My second point concerns the issues raised by the noble Lord, Lord Freyberg, on the use and potential value of NHS data. Noble Lords will be aware that comprehensive longitudinal datasets controlled by the NHS represent a significant opportunity. I absolutely accept that the Government are, as it were, on the case. They know that there needs to be action, and I am intensely interested and concerned that Her Majesty’s Government move to set up an appropriate regime to ensure that the exploitation of NHS data benefits the NHS.

However, the question in this debate is how to ensure these measures are in place to protect healthcare data assets in the context of a non-EEA data protection regime post Brexit. How do we prevent large corporates extracting value unfairly from the NHS? Those are the questions we need to address.

To protect our NHS, we are calling for a hard carve-out on the provision of healthcare services, particularly the NHS, in any future trade agreements. That is the assurance I seek from the Government today. The Minister has been asked many fundamental questions here on how to protect our NHS in the future, and I look forward to his answers.