Employment and Trade Union Rights (Dismissal and Re-engagement) Bill

Debate between Geraint Davies and Barry Gardiner

2nd reading
Friday 22nd October 2021 Commons Chamber

[Barry Gardiner]

The hon. Gentleman is absolutely right to say we need to ensure that, from time to time, businesses can cope with the changes that they experience and can restructure appropriately. I think the point my hon. Friend the Member for Brighton, Kemptown (Lloyd Russell-Moyle) was making is that, when they seek do that, it should be done through a proper process of consultation and negotiation, and not holding the sword of Damocles over the heads of their workers.

[Geraint Davies (Swansea West) (Lab/Co-op)]

My hon. Friend may know that in Germany workers are much better protected from being fired and that productivity in Germany grew between 2015 to 2020 at twice the level it has in the United Kingdom. Does he therefore agree that, given the option of either firing someone or increasing their training, productivity and technology, Germany chooses to train people and raise productivity and Britain, if we allow this to go on, will choose to sack people and reduce productivity? So it is imperative to increased productivity that this is agreed.

[Barry Gardiner]

My hon. Friend makes a very significant wider point about the productivity and the relative productivity of the UK. I think that is a matter of very deep concern to Members across the House.

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[Barry Gardiner]

The hon. Lady’s point was somewhat drowned out on the Labour Benches, but I think it was by people who were agreeing about the importance of training and skills.

[Geraint Davies]

Does my hon. Friend agree with the Productivity Institute report of March 2021 that

“The widespread, one-sided flexibility of the UK labour market has locked in a low productivity mode of work”?

People in the gig economy simply have not got the security or the money to invest in themselves. Employers need to and they will do it more in the event that they cannot simply fire and rehire people willy-nilly, which they cannot in Germany.

[Barry Gardiner]

My hon. Friend has, again, touched on a really important point. It is about what sort of society we want and whether we want a society where work is an insecure fact of life.

Future Free Trade Agreements

Debate between Geraint Davies and Barry Gardiner

Thursday 21st February 2019 Commons Chamber

[Geraint Davies]

Does my hon. Friend think it is a cruel irony that Margaret Thatcher was instrumental in creating the single market and getting Japanese car companies to come here as a platform to access that market? The EU-Japan trade deal is one of the reasons they have gone there. The other imperative is that, had we not been Brexiting, those car manufacturers would in all probability stay in the EU, in Britain, where they are already. Given that car workers who voted to leave are now finding that they voted to leave their jobs, should they not have a final say on whether we leave at all? They certainly did not vote to lose their jobs. It is completely farcical.

[Barry Gardiner]

My hon. Friend tempts me into a discussion about Brexit, but I am sure that if I were to be tempted, Madam Deputy Speaker, you would be on my case in a flash, urging me to deal with the matter of future free trade agreements instead.

This debate was originally promised at the last International Trade oral questions on 7 February, but anyone reading Hansard will not have been blind to the fact that the commitment was made as a response to an entirely different question. We did not ask for a general debate on putative trade deals with specific countries. What was asked was when the Government would bring forward a debate about the scrutiny of trade deals. Even if the Secretary of State has not yet got round to reading my eight-page letter of 21 January on the subject—there are many copies on this side of the House if he wants a spare—he cannot have been unaware of the matter, because, to his embarrassment, the Trade Bill’s progress in another place has been delayed as the Government lost a crucial vote.

Their lordships required the Government to set out their proposals for the process, the consultation, the mandate and scrutiny of making international trade agreements in the first place, including:

“Roles for Parliament and the devolved legislatures and Administrations in relation to both a negotiating mandate and a final agreement.”—[Official Report, House of Lords, 21 January 2019; Vol. 795, c.506.]

The House will note that no such proposals have yet been brought forward, so perhaps the Secretary of State will tell us what progress he has made in this respect and when he intends to introduce such a debate.

Today’s debate certainly cannot be considered to constitute that important discussion. It is a general debate on a Thursday, in a week that was intended to be recess, talking about potential agreements before Parliament has even debated the whole process of consultation, impact assessment, negotiating mandate, parliamentary debate, transparency of negotiation, ratification and subsequent review and periodic appraisal that should constitute a framework within which the Government intend to bring such agreements into being.

Furthermore, people watching today’s debate will be incredulous that, given that just last week the Secretary of State was forced to come to this House and admit that he had thus far failed to replicate the 40-odd trade agreements that he promised would be ready to sign one second after midnight after Brexit, last week only five had been agreed, nine were off track, 19 were significantly off track, four were said to be impossible to complete by 29 March and two were not even being negotiated. If there has been progress since then, I will happily give way to the Secretary of State if he wishes to advise the House. No. In that case, I take it that his silence is an acceptance that that is the state of play of the agreements that we currently have. Indeed, the fact that we are instead discussing a host of entirely new trade agreements when we have yet to secure trade continuation with all the countries with which we already enjoy a trade agreement by way of our EU membership rather calls into question the Government’s priorities at a time when businesses are screaming for certainty, clarity and continuity.

Draft EU-Canada Trade Agreement Order

Debate between Geraint Davies and Barry Gardiner

Tuesday 26th June 2018 Commons Chamber

[Barry Gardiner]

The hon. Lady makes a false premise. Many parts of this deal would be welcomed, but there are essential parts of it that cannot be welcomed and which would stop us, therefore, being able to ratify it in the way she suggests.

The ISDS mechanisms give superior legal rights only to foreign investors to raise disputes against our Government to petition for compensation when their profits, or even their potential profits, are impacted by legislative or public policy decisions. This effectively allows companies to sue Governments when they are legislating in the public interest; for example, by introducing plain packaging for cigarettes, national insurance, minimum wages or even banning fracking. These provisions have become increasingly commonplace in new-generation trade agreements and this is what has resulted in such widespread international public outcry against deals such as the Transatlantic Trade and Investment Partnership, the Trans-Pacific Partnership and CETA.

The proliferation of investor-state dispute settlements can encourage treaty shopping, whereby investors restructure their activities to establish in countries where they may benefit from ISDS mechanisms, should they seek to effect policy change or petition for compensation. While the Government have previously argued that the UK has only ever been subject to four such dispute cases, and that the UK never lost such a case, it begs the question: why does the Secretary of State feel that this mechanism needs to be incorporated in a deal with a country such as Canada?

[Geraint Davies]

Will my hon. Friend give way?

[Barry Gardiner]

I will give way to my hon. Friend in just a second.

The Secretary of State spoke about the need to give investors protection and security and he has boasted many times in the past 12 months about the record number of FDI deals that he has been able to achieve. Unaccountably, he failed to report that those deals, though record in number, showed a 92% drop in value. Today’s figures also reveal a drop in the number of deals, and the number of jobs saved by such investments is down by 54% year on year, according to his website.

Indeed, many Canadian companies have used investor-state dispute provisions in trade agreements to challenge foreign Governments, whether it has been the closing down of mines in El Salvador following a moratorium to protect unpolluted drinking water, or the Obama Administration’s decision to suspend the Keystone pipeline over concerns about potential damage to the environment. The very threat of facing such a case, even when the chance of winning is in the Government’s favour, can clearly act as a deterrent to Governments from pursuing actions in the public interest—a regulatory chilling effect. This may well have been President Trump’s view when he reversed his predecessor’s decision and greenlighted the Keystone pipeline, thus avoiding costly legal action and the chance of a substantial payout.

Having watched cases taken against the Uruguayan and Australian Governments by the tobacco giant, Philip Morris, many countries are cautious about introducing plain packaging in tobacco product laws. It is not just European Governments who have expressed concerns about ISDS.

EU-Japan Economic Partnership Agreement

Debate between Geraint Davies and Barry Gardiner

Tuesday 26th June 2018 Commons Chamber

[Barry Gardiner]

I will not, because Madam Deputy Speaker wants me to press on to allow hon. Members to make their own contributions.

The car industry is far from the only sector involved in what is a comprehensive trade deal. Food and drink producers are also implicated, not least as regards the protection provided in the agreement for products with specific geographical indications. Once again, the Government have failed to defend the interests of British producers on overseas markets. France, Spain and Italy have each listed dozens of their national products for special protection in annex 14-B of the deal and Japan has listed 48 of its products for protection, yet the UK Government could only be bothered to list four products under the geographical indications provisions of the deal—Scottish farmed salmon, west country farmhouse cheddar, Stilton and Scotch whisky.

[Geraint Davies]

What about Welsh lamb?

[Barry Gardiner]

Indeed. As my hon. Friend says, what about Welsh lamb? What about Scotch beef, Dorset blue, Yorkshire Wensleydale, Cumberland sausage and Melton Mowbray pork pies? Can the Minister explain why we failed to register geographical indications to protect more of our UK food produce?

The European Scrutiny Committee raised many further crucial issues relating to the deal that remain unanswered. Under the negative list approach, all service sectors that are not explicitly exempted from liberalisation are included. It is considered to be a particular threat to public services, as it may prove impossible to shield them from liberalisation effectively once they have been committed to an international trade treaty. It means that any emergent sector in the future will be automatically subject to trade liberalisation even where there may be a clear need for Government regulation or intervention. We cannot possibly predict what those will be prior to their emergence, but what is the point of using such “negative lists” to reduce the capacity of the Government to regulate in the future?

Annex 1 allows countries to list existing non-conforming measures that enjoy some protection. Annex 2 is a stronger protection, in that it permits countries to protect service sectors into the future by allowing for the introduction of reforms that would otherwise contravene the EPA rules. As the Minister said, the UK has entered annex 2 reservations for cross-border auditing services, manpower planning for doctors in the NHS, privately funded ambulance services, and residential health facilities services other than hospital services. I repeat: other than hospital services. In other words, they are, and will forever remain in future, subject to liberalisation and competition under this agreement, in contradistinction to the implication that we heard earlier. I therefore repeat the Committee’s question: will the Minister confirm whether he is content with the proposed provisions enabling Governments to regulate in the public sector?

Do the Government intend to negotiate the UK’s future trade partnership and its future investment relationship with Japan at the same time, as one agreement—another question posed by the hon. Member for Stone and by my hon. Friend the Member for Crewe and Nantwich—or will the separate EU-only trade agreement constrain the UK’s ability to negotiate and conclude an integrated trade and investment agreement? The House will be rightly concerned that the Government have simultaneously inserted into the Trade Bill sweeping Henry VIII powers to implement such a future trade agreement without any proper scrutiny or oversight. Will the Minister confirm that no such investment chapters will be included in any future trade agreement with Japan?

Let me be clear: Labour would like to see a trade agreement with Japan. We have an incredibly strong trade and investment relationship between our two countries, and we believe that we can continue to build on that. We want a positive, dynamic relationship that elevates standards, boosts opportunities to benefit from advances in technology and research and development, and continues to support growth and investment in our high-tech manufacturing sectors and world-class services sector. But we cannot be expected to rely on this Government’s quiet promises alone, and it is imperative that Parliament has the proper opportunity to scrutinise and debate these trade agreements well in advance of their being signed.

It is worth noting that this deal has yet even to go through the full scrutiny process in the EU, with INTA—the Committee on International Trade—not scheduled to hold a public inquiry until 9 and 10 July and the European Parliament scheduled to vote on whether to give consent to the agreement in December. If the motion before us is voted through, it will allow Ministers to endorse the agreement without proper scrutiny by the House, and even before the full scrutiny process of the European Union has been properly applied. That sets a dangerous precedent for future trade agreements and makes a mockery of the idea that any future trade agreements to which the Trade Bill applies will have received proper scrutiny by this House.

Trade Bill

Debate between Geraint Davies and Barry Gardiner

Tuesday 9th January 2018 Commons Chamber

[Barry Gardiner]

I will deal with issues around devolution later in my speech. Indeed, that is something that my hon. Friend the Member for Sefton Central (Bill Esterson) will be addressing in his winding-up speech.

Having set the context, let us look at the detail. The Bill’s opening clause sets the tone for the power grab that is to come. It gives Ministers the power to implement regulatory changes as a consequence of any country acceding to or seceding from the WTO’s government procurement agreement. This is not a temporary power. It is not simply to facilitate our transition from a member under the wing of the EU to a member in our own right, as the explanatory notes to the Bill claim, but a power in perpetuity without the requirement for any scrutiny by Parliament.

The Government will use the sweeping powers of the Constitutional Reform and Governance Act 2010 to push through the UK’s independent membership of the GPA without a vote in Parliament. The Bill confirms that any future changes to the terms of the GPA will go the same way. We can talk about the merits of the GPA—I am sure that we will find much common cause across the Dispatch Boxes—but the Secretary of State said that we would be acceding on the “existing terms of participation”, if I wrote that down correctly. That is something that Members should be free to scrutinise and debate. The United States, Canada, South Korea and Japan have all put annexes to their schedules for the GPA that allow them to set aside and disapply regulations on behalf of small businesses and other organisations. That is something that we might wish to consider. It would be quite proper for us to do so, to boost trade for our small businesses, but the Bill, as currently formulated, would not allow that.

I have to confess that when I first looked at the GPA, I wondered what material difference this might make to British business. I was quite impressed to find that the Government’s explanatory notes showed that the GPA opened up £1.3 trillion of contracts to UK business—we should all rejoice in that—but when I checked the Bill’s impact assessment, I learned that the total cross-border earnings of our businesses from GPA contracts outside the UK is just £1.2 billion, which is less than 1% of that amount. I also learned that the total earnings by foreign companies from the £68 billion of GPA contracts inside the UK was £16.7 billion, which is about 24.5%. Will the Minister explain what the saving to the public purse was from this procurement agreement that merited £16.7 billion going to foreign companies while just £1.2 billion came back to the UK? There might well be a very good answer, but is this not precisely the sort of issue on which Parliament should have a proper role of scrutiny and holding the Executive to account? Of course, the Bill denies us the capacity to do so.

Clause 2 gives the Secretary of State the most far-reaching powers to implement new international trade agreements without the need for even a debate in Parliament. As his Department has confirmed, the clause includes the Henry VIII power to modify primary legislation without a vote. On that point, we were treated to the extraordinary spectacle of the Secretary of State resorting to the letters page of a national newspaper to deny what is printed in black and white—actually in black and green—in his own legislation. He must have been piqued by a number of articles in response to the Bill’s publication in November that accused him of appropriating powers that should, by rights, lie with Parliament. He responded on The Guardian website on the evening of 20 November, saying:

“In an editorial (13 November) you claim that the trade bill is ‘effectively granting ministers the power to write law behind parliament’s back’ with ‘Henry VIII powers’. This claim is repeated in a column by George Monbiot (18 November). This is untrue. The powers in the bill will only allow for amendment of secondary legislation covering existing trade agreements, and secondary legislation is still subject to parliamentary oversight.”

Yet it was not The Guardian that was wrong; the Secretary of State was wrong. He knew that he was wrong, although he did not correct his remarks, because clause 2 of the Trade Bill, which he had published just two weeks earlier, states quite clearly that the powers in the Bill make provision not only for the amendment of secondary legislation, but for “modifying primary legislation”. Lest there should be any doubt about this, the delegated powers memorandum published by the Secretary of State’s Department to accompany the Bill, which was quoted by the right hon. and learned Member for Beaconsfield (Mr Grieve) with such devastating effect earlier, states on its very first page:

“The Bill contains 6 individual provisions containing delegated powers. Two of these, clauses 2(1) and 7(3), include a Henry VIII power.”

This was not the case of a Cabinet Minister misspeaking or being ambushed in a broadcast interview; this was a written communication that the Secretary of State placed in a national newspaper in the cold light of day that contradicted plain fact and the considered explanation of his own officials. I will happily give way to the Secretary of State if he would care to come to the Dispatch Box and explain himself by putting on the public record why he chose to suggest that there are no Henry VIII powers in this Bill when his own Department had already confirmed the opposite to be the case. I cannot claim to have served with Henry VIII. I cannot claim that Henry VIII was a friend of mine. But, to misquote Senator Lloyd Bentsen’s remark to Dan Quayle, I can say, “Secretary of State, you are no Henry VIII. This Bill is an affront to the dignity of your office and to the authority of this House.”

Clause 2 provides the Secretary of State with unprecedented powers to implement international trade agreements without a vote in Parliament. It is perhaps the most egregiously anti-democratic provision of the Bill, in that it allows the Secretary of State to engage in secret negotiations with a trading partner of the EU, to lay the results of those negotiations before Parliament without the need for a debate or a vote, and to proceed to incorporate the resulting treaty into UK law without the need for a vote either.

The Government have tried to justify this power grab with the sham argument that these are simply roll-over agreements—existing agreements that are just being grandfathered. They claim that the corresponding agreements between 60-plus countries and the EU have already been through the process of scrutiny, meaning that the UK’s new agreements can go through on the nod. Yet the Government have been forced to admit that the UK’s new trade agreements are legally distinct from those previously negotiated by the EU. They are new agreements in international law. If we allow the Bill to go through as it stands, the Secretary of State, as the Government have acknowledged, will be given carte blanche to agree substantively new obligations with third countries and to implement them without a vote in Parliament.

The Government are aware of the magnitude of what they are attempting. The delegated powers memorandum could scarcely disguise its shame with regard to this part of the Bill. It says:

“It is recognised that Parliament will want considerable assurances from the Government that this power will not be used beyond what is necessary to ensure a seamless transition of the agreements in scope.”

The Government have given that assurance, but they cannot deny that the power is there. In the next breath, the memorandum claims, apparently without irony:

“The Department considers that this power is appropriate for the negative procedure.”

The negative procedure is the least rigorous procedure available to this House, as it allows the Government to bypass the need for a debate or a vote, or the possibility of amendment—there is nothing.

I ask the Minister to come clean and confirm to the House that the delegated powers memorandum is correct. Will he assure us that the Government will bring forward their own amendment in Committee to ensure that these new internationally binding agreements must go through a due process of proper scrutiny by Parliament, rather than being signed off by Ministers without a vote?

[Geraint Davies (Swansea West) (Lab/Co-op)]

I applaud my hon. Friend’s speech. The Government are making out that this is all about roll-overs and business as usual. Does he accept that what will actually happen is that countries will want to negotiate new terms of trade because we will be a small minnow compared with the EU giant? What is more, when an EU quota is involved, countries within Europe such as Spain may want to take some of our quota. We will keep our quota only if we give better terms of trade, with lower standards, lower prices and a worse deal for us. That is why we must have scrutiny in this place.

[Barry Gardiner]

The honest answer to my hon. Friend is that I do not know, although I share his suspicion that that might well be the case. The point is that the Bill shows that the Government’s expectation is that these are not simply roll-over agreements and that, precisely as he suggests, third countries may demand additional features in new agreements. On that point, he is absolutely right and the Secretary of State is absolutely wrong.

EU-Canada Comprehensive Economic and Trade Agreement

Debate between Geraint Davies and Barry Gardiner

Monday 6th February 2017 General Committees

[Geraint Davies]

Thank you, Sir Edward.

The view of the European Scrutiny Committee is that in the light of the unfortunate lack of scrutiny, all members of the Committee should find it in their heart and mind to add the words in the amendment to the motion so that we can all come together and agree it. The Government might say, “Sorry, we don’t want more scrutiny; we want to take control, but we want to take it in the corner without other people having any involvement”, but I am afraid that I will certainly not vote for a motion that does not require extra scrutiny, given that the Secretary of State has given a solemn undertaking to provide it.

I will give some of the reasons for further scrutiny given the concerns about CETA, particularly when the ICS is introduced to it. The key debate in Europe has been about why we need the ICS, and the answer that has been given is that it is to protect investors. However, we must ask how investors are protected at the moment. Are they adequately protected? The answer is that they are. In Europe they are protected by county courts, national courts and national law, European law and the European Court of Human Rights. In Canada there are provincial courts, appeal courts and the Supreme Court. The United States has a similar legal system. It is not surprising that our long-established systems of public law, contract law and commercial law balance the interests of the investor against the wider public interest.

That is particularly important in examples such as the balance of investor and environmental interest in fracking. Or perhaps an investor such as a fizzy drinks manufacturer might come along and the Government might say, as the right hon. Member for Tatton (Mr Osborne) did, “Actually, we’re about bit worried about diabetes and obesity; 45% of sugar consumption by teenagers is from fizzy drinks, so we’ll put a tax on them.” If that went to court, the court could say, “We’ve got to balance the public interest with investor interest”. However, an arbitration court is all about the interest of the investor and whether a particular law has had an impact on the future profitability of a legitimate investor. In the narrow case in Mexico that I mentioned, of course the court, using that narrow definition of investor interest, ruled that the tax had reduced the investor’s sales and profitability, and the public had to pay the price. That is outrageous, and we should not just nod that sort of thing through.

We have systems of law that protect both the investors and the public. The precursor to the ICS—the so-called investor-state dispute settlement—was introduced in 1957 in an agreement between Germany and Pakistan, because the Germans thought that there was some risk to their investment. I do not have anything against arbitration courts per se if they are about, for instance, European countries investing in high-risk countries with undeveloped judiciaries and unstable political environments. That means that investors can take necessary risk and the arbitration court can take a view on unreasonable sequestration.

That is not what we are talking about here. We are talking about mature economies, judiciaries and democracies that already trade enormous amounts of goods and services. The great advantage of CETA is that it will pave the way for the regulation and harmonisation of standards—there are concerns about standards, incidentally, but I will come to that in a moment. The opportunity is something like 0.5% of GDP, so it is not overwhelming. Most of the problems are about tariffs, but the big problem has been about the ICS. I know that the Minister says we have set that to one side, but it will be a problem downstream. Issues such as this are fundamental to democracy, the rule of law and human rights, so we will need a proper debate. If the ICS comes in downstream and intimidates Governments into not introducing laws to protect their citizens, it will be a major problem for democracy itself. That is why there has been such a big debate among the 47 countries of the Council of Europe, above and beyond the European Union.

[Barry Gardiner]

I am listening carefully to my hon. Friend’s points and I agree with a great deal of what he says. Does he consider that there is an irony in the fact that we are leaving the European Union in order to come out from supranational institutions that can override national Parliaments and courts, yet at the very same moment we appear to be signing up to an agreement that will give us a supranational court that sits over us?

[Geraint Davies]

More than an irony—a tragedy. The view of some, apparently, is that we should move out of the orbit of the European Court of Human Rights, which supports the fundamental values of human rights, democracy and the rule of law, and into the orbit of arbitration courts whose basic remit relates to the interests of the investor, as opposed to the wider interests of the environment. If the Minister has looked at the detail of the chapters of CETA, he will have observed that the investor chapter is armed with arbitration courts that trump national and international law, but that there are no such teeth in the environment chapter, for instance. There is no enforceability of the Paris agreement that we have all signed up to in order to save the planet. Nor, for that matter, is there any enforceability of labour rights.

We need a debate, because ICS is down the road—I accept that it has not yet come in and we can do the other bits first, but there is a concern that that is an unnecessary and dangerous prospect. I do not want to run through hundreds of cases, but there was a famous case in which Obama said to TransCanada, “We don’t want this sand oil pipeline coming in from Canada to the US, because it is a breach of the Paris agreement.” As I understand it, the case has now been dropped because Donald Trump has taken over the presidency, but TransCanada was going to sue the US for $15 billion. My hon. Friend the Member for Brent North mentioned ratcheting and reassurances about health services; there was a case in which Slovakia attempted to renationalise part of its health service and was penalised in court with fines. Hon. Members may remember that at the last election the Labour party stood up and said that it wanted to freeze energy prices; one may or may not like that idea, but Argentina was sued for $1 billion under ISDS by energy companies from America and Europe for doing exactly that. Philip Morris, famously, has been pursuing a case against Australia and Uruguay to stop plain tobacco packaging, which was introduced to reduce deaths from cancer.

The problem with these courts is that they are secret, they have a narrow remit, they are run by commercial lawyers, they are inconsistent in outcomes and they do not normally have appeals. Under the new ICS they will have appeals, but they will not adopt the doctrine of precedent, so one court’s verdict may not inform the next court. The Council of Europe, which I mentioned earlier, has therefore said, “Hold on—we are very concerned about the investment court system, but if and when it does come in, it should be subject, as a minimum, to a number of constraints. In accordance with the European Court of Human Rights, there should be one-year opt-outs with six-year investor protection, and there should be actual damages rather than the fantasy projections of profit that have been sued for.”

I have already mentioned the problems with secrecy and lack of accountability. The Secretary of State seemed to think that it was marvellous that we should be able to go into a library on our own and have a look at the CETA documents, without taking photocopies. Obviously, no one can really understand what they are looking at and gain a meaningful view in the amount of time they are given. It seems to have been a bit of a joke, to put it mildly.

There are other issues that the Minister may want to respond to. There is widespread concern about European standards, for example, in relation to genetically modified food and other food standards, so can he give us any assurances that we will not be slipping to the lowest common denominator in health and equality standards? There are concerns that the precautionary principle, which has been a principle of EU law, has not in fact been instilled into CETA.

People are also concerned that there is a move away from openness in clinical trials. As Members may be aware, the clinical trials directive requires pharmaceutical companies to go public with the outcomes of their clinical trials. As I understand it, CETA will give private companies the right to withhold the outcomes of clinical trials. For example, if a company such as the one that manufactured thalidomide found that half the trials for a certain drug were negative and half were positive, it could publish only the half that were positive. What does the Minister have to say about that? What about the issues relating to trade secrets in CETA? He may think that these are minor points, but I want some reassurance.

I am trying to make the case that, given that there are so many issues, we need a proper debate. Parliamentarians are concerned. When we look at VW fixing emissions, for example, we see that there are new opportunities in CETA for trade secrets. If an employee blows the whistle because they discover that their company is harming public health, for example with diesel emissions, or a drug that harms babies—whatever it is—they can be punished by the company. These are issues of concern that require clarity and debate.

There are concerns about labour rights and whether there will be an assurance that International Labour Organisation conventions will be fulfilled. There are concerns about level playing fields and whether procurement will be equal and apposite. There are concerns about winners and losers, which the European Scrutiny Committee has also debated. We are told that there will be an overall GDP gain of something like 0.5%, but which sectors will win and which will lose? Will small companies lose out? The Prime Minister has already said that she will back certain winners, so perhaps motor manufacturers will get a good deal, but there is some fear that Welsh lamb producers could face a 40% tariff after Brexit. We also have the concern, raised by my hon. Friend the Member for Brent North, about geographical indicators. Welsh lamb was not a geographical indicator originally, so in theory someone could sell in Britain lamb that had been produced in Canada and call it Welsh lamb. That is a real problem.

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[Barry Gardiner]

The hon. Gentleman is right that all Members of the House have the right to attend the Committee, but he will have noticed that this one and only opportunity for them to do so was deliberately timetabled at the same time that the European Union (Notification of Withdrawal) Bill is being considered in Committee on the Floor of the House. I do not believe that is a coincidence. I do not believe that is a mistake. I believe that it is part of a deliberate attempt to stop proper scrutiny. The hon. Gentleman talks about scrutiny and about moving this debate on to substantive issues within CETA, but the debate on the motion and amendment is precisely about whether this matter should go to the Floor of the House. That is why the process is important. We need to see that proper process has been kept, and sadly it has not.

[Geraint Davies]

Will my hon. Friend give way?

[Barry Gardiner]

I want to respect the Chair’s stricture.

[Geraint Davies]

Does my hon. Friend agree that in the three and a half months that the Government have had to hold the debate, this is probably the best time for them to have it in terms of hiding bad news under the noise of the Brexit debate? This is clearly pre-planned to stop proper scrutiny, public debate and media coverage.

[Barry Gardiner]

I wholeheartedly agree. We must now move forward. The Government said that it was of the utmost importance to have the debate on the Floor of the House, yet we find ourselves 68 days later with a debate up in Committee Room 10.

The European Scrutiny Committee issued the Government with a waiver, to allow them to sign CETA at the Council of Ministers. The Committee made it clear that the waiver did not extend to the provisional application or conclusion of CETA. The Secretary of State chose to disregard the Committee. We have heard from the Minister today the reason why: because it was bundled. It is important that we hear from him whether the UK made any objection or moved any procedural motion during the Council of Ministers to unbundle it, so that the Secretary of State could observe the protocols that he had undertaken to the Committee.

I can only concur with the Chairman of the European Scrutiny Committee, who said that it was a “serious” breach when the Secretary of State failed to honour the waiver he had been given. That stands in stark contrast to the many statements made by the Government in recent days to assure us of their commitment to respecting parliamentary scrutiny and accountability.

In the same vein, there has been a marked failure to present CETA for consultation before the devolved Administrations, despite the fact that their Departments are all listed in the annex of entities covered by the public procurement rules of CETA and are thus exposed to CETA’s strictures on central and sub-central Government entities alike. I call on the Government to remedy that failure as a matter of urgency, before initiating the process for ratification of CETA in the House. I hope that the Minister feels that he can give an undertaking on at least that level.

With regard to process, the Government failed to meet their own successive promises to bring CETA forward for a full debate on the Floor of the House. The Secretary of State was, at best, disingenuous in the statements made to the Chairman of the European Scrutiny Committee. He explicitly broke the waiver that the Committee had given to him, when he approved both the provisional application and the conclusion of CETA, and his Department has failed to engage with and consult the devolved Administrations in respect of an agreement that has specific application to them. Those are serious procedural failures that show a disregard for the proper scrutiny of Parliament, and they provide, in themselves, a compelling case for the Committee now to insist that the Government bring that full debate to the Commons. However, there are substantive reasons as well as procedural ones and, in many respects, they are more compelling.

I turn, therefore, to the content of CETA. It will be a surprise to the Committee to learn that the Government have not commissioned any research on what the impact of CETA might be on the UK economy. That should be a matter of concern, because the Government have repeatedly claimed, as the Minister did in his opening remarks, that CETA will bring up to £1.3 billion extra to the UK economy. Let me straightaway say that I would be the first to cheer if that were a credible prospect, but the Government admitted in their explanatory memorandum of July 2016 that it simply took a projection of overall gains to the EU and divided it by the UK’s share of EU GDP to come up with that figure. That is back-of-an-envelope calculation. It has to qualify as one of the crudest and least credible methodologies ever adopted to project the impact of a major trade agreement.

Only one study to date has disaggregated the prospective impacts of CETA on individual EU member states, and it concluded that countries such as France, Germany and Italy would indeed see an increase in their exports as a result of CETA. However, the study is clear that the UK would experience a decrease in both its exports and its balance of trade. At a time when the UK balance of trade is already under so much pressure, the very possibility that we might suffer a loss of exports should give us pause for proper scrutiny. At the very least, a proper impact assessment of how the agreement will specifically affect the UK needs to be conducted. That further underlines the need for the promised debate on the Floor of the House.

Members will also be surprised to learn that the Government have failed to list in annex 20 to the agreement a single one of the dozens of great British food products that qualify for protected geographical status. The UK is the only major EU member state that failed to secure such protection in CETA for its food businesses. The “Geographical Indications” annex of CETA is page after page of products listed for protection by France, Germany, Italy, Greece, Spain, Romania, Austria, Hungary and the rest, but there is not a single one from the UK. There is no protection for Scotch beef, Scotch lamb, Scottish farmed salmon, Welsh beef, Welsh lamb, Cornish pasties, west country farmhouse cheddar, blue Stilton, or white for that matter. More than 50 other British products that should qualify for protected geographical status are simply not protected. How can the Secretary of State have failed to protect a single one of our products under CETA? No wonder he does not want the matter to be discussed on the Floor of the House of Commons.

CETA is also remarkable in its complete disregard for the interests of small and medium-sized enterprises. Even TTIP contained a dedicated chapter outlining the support measures that the EU and the USA would introduce for SMEs. By contrast, in all the 2,255 pages of CETA there is not one single commitment to further the export interests of SMEs.

In recent times, we have heard much talk of the Government’s commitment to parliamentary sovereignty. The Prime Minister has declared that leaving the EU will allow Britain to be a fully independent, sovereign country once again, no longer subject to

“supranational institutions that can override national parliaments and courts.”

Likewise, the Secretary of State for International Trade has given us his vision of

“Britain as an independent sovereign nation, with a parliament beholden to no one”.

Yet, if we look at last week’s White Paper, it spelled things out very clearly. It has an annex about CETA—it creates a framework of supranational institutions that are precisely designed to override national Parliaments and courts. Along with the CETA Joint Committee, which will have binding powers over sovereign Parliaments in future, CETA includes the investment court system, the latest form of the ISDS mechanism, to allow foreign investors to sue host Governments over public policy measures that undermine their profits. Under CETA, a foreign company will have the right to bypass the domestic courts and avail itself of its own privileged commercial judicial system to challenge any regulatory reforms that run counter to its “legitimate expectations” as a profit-making enterprise, claiming vast sums in compensation even when Parliament has approved the reforms.

We in the Labour party are opposed to any system that grants foreign investors private justice in their own private courts. As noted in the charter for progressive trade deals that we adopted last year, we uphold the basic principle of equality before the law, which requires foreign investors to abide by the same rules as everyone else, in the same judicial system as everyone else. Foreign investors can have full confidence in the British legal systems to obtain redress where their interests have been unfairly harmed, and the British people can have confidence that the courts will then balance the competing interests of foreign companies and the public good when making their judgments. A company, however, does not even have to win its case in the investor court system to undermine UK sovereignty. The very threat of a legal challenge and the scale of both costs and potential damages can make Governments back away from regulation that would be in the public interest, and can exert its own regulatory chill on Government plans for new legislation. It was a legal technicality that prevented Philip Morris from obtaining billions of dollars of compensation that it sought in its case against Australia’s law on plain packaging for cigarettes. That did not stop other countries backing away from introducing similar measures for fear of being hit with their own claims.

EU Referendum: Energy and Environment

Debate between Geraint Davies and Barry Gardiner

Tuesday 12th July 2016 Commons Chamber

[Barry Gardiner]

I always try to look at the motion in front of me on the Order Paper and make a judgment on it when I see what it says. I have done so for the past 19 and a half years, and I suspect I shall probably do it for the next few years as well.

Even the Government-dominated Select Committee has warned that what it calls the “hiatus” in project developments could threaten the UK’s ability to meet its energy and climate security targets, so when the Department’s own figures show the need for £100 billion of investment by 2020 to make our electricity infrastructure fit for purpose, the Secretary of State really does have to explain where she believes that investment is going to come from, given that investor confidence in her Department is at an all-time low.

Before the Secretary of State does so, however, perhaps she will confirm whether she instructed her Department not to prepare in any way for a leave vote, as the Prime Minister apparently directed. If that is so, can she explain why, because that is what business leaders out there are asking? It seems incomprehensible to them that the Prime Minister took such a gigantic risk with their future—a risk that will increase their cost of capital and the cost of energy to bill payers, both corporate and domestic alike—yet made absolutely no preparations for what might happen when that risk went the wrong way.

The IIGCC—Institutional Investors Group on Climate Change—a group of institutional investors representing over €13 trillion in assets, said in the aftermath of the vote to leave that it had brought

“considerable uncertainty and market turmoil.”

That only goes to prove that the art of litotes is not yet dead!

[Geraint Davies (Swansea West) (Lab/Co-op)]

In the light of that dramatic uncertainty, does my hon. Friend agree that one thing the Government should do is to give a cast-iron guarantee that they will honour, post-Brexit, the environmental standards and undertakings that we have made in the EU to date?

[Barry Gardiner]

My hon. Friend, who takes a consistent and committed interest in these matters, is absolutely correct, and the precise intention of this motion is to flush out those issues and ensure that the Government do precisely as he says.

In the aftermath of the leave vote, the Government’s own external adviser has stated that a future for the Hinkley C nuclear power station is now “extremely unlikely”. Vattenfall has said it is now reassessing the risk of working in the UK, which could jeopardise its plans for a £5.5 billion wind farm off the east coast of England, while Siemens has announced that it is putting a freeze on its future—not its current—clean energy investments in Hull as a result of what it called the “increased uncertainty” from the leave vote.

I must say that for all the talk from the Minister of State, Department of Energy and Climate Change, the hon. Member for South Northamptonshire (Andrea Leadsom), about the “sunlit uplands” of the post-Brexit world, there is really no use in the Secretary of State trying to pretend that she thinks the vote is anything but a disaster when she herself is on record quoting the analysis of Vivid Economics warning that the result of an exclusion from the EU’s internal energy market could cost the UK up to £500 million a year by the early 2020s. The stock response of the right hon. Lady that Labour Members should not “talk Britain down” will simply not serve, given that these quotations come from her own advisers, industry leaders and, indeed, her!

Bloomberg New Energy Finance was not scaremongering when it said of the upcoming Brexit negotiations that they were

“likely to cause project investors and banks to hesitate about committing new capital, and could cause a drop in renewable energy asset values”.

That was an authoritative, independent commentator telling the unvarnished truth.