Greg Hands contributions to the Trade Bill 2019-21


Mon 20th July 2020 Trade Bill (Commons Chamber)
3rd reading: House of Commons
Report stage: House of Commons
52 interactions (4,286 words)
Thu 25th June 2020 Trade Bill (Seventh sitting) (Public Bill Committees)
Committee Debate: 7th sitting: House of Commons
21 interactions (2,897 words)
Thu 25th June 2020 Trade Bill (Eighth sitting) (Public Bill Committees)
Committee Debate: 8th sitting: House of Commons
68 interactions (7,696 words)
Tue 23rd June 2020 Trade Bill (Sixth sitting) (Public Bill Committees)
Committee Debate: 6th sitting: House of Commons
88 interactions (10,773 words)
Thu 18th June 2020 Trade Bill (Fourth sitting) (Public Bill Committees)
Committee Debate: 4th sitting: House of Commons
50 interactions (4,258 words)
Wed 20th May 2020 Trade Bill (Commons Chamber)
2nd reading: House of Commons
Money resolution: House of Commons
Programme motion: House of Commons
3 interactions (1,020 words)

Trade Bill

(3rd reading: House of Commons)
(Report stage: House of Commons)
Greg Hands Excerpts
Monday 20th July 2020

(4 months, 2 weeks ago)

Commons Chamber

Read Full debate Read Hansard Text Bill Main Page
Department for International Trade

Brought up, and read the First time.

Greg Hands Portrait The Minister for Trade Policy (Greg Hands)
- Hansard - -

20 Jul 2020, midnight

I beg to move, That the clause be read a Second time.

Nigel Evans Portrait Mr Deputy Speaker (Mr Nigel Evans)
- Hansard - - - Excerpts

20 Jul 2020, midnight

With this it will be convenient to discuss the following:

Government new clause 6—Offences related to disclosure under section (Disclosure of information by other authorities).

New clause 1—Report on proposed free trade agreement—

“(1) This section applies (subject to subsection (2)) where the United Kingdom has authenticated a free trade agreement (“the proposed agreement”), if —

(a) the other party (or each other party) and the European Union were signatories to a free trade agreement immediately before exit day, or

(b) where the proposed agreement was authenticated by the United Kingdom before exit day, the other party (or each other party) and the European Union were signatories to a free trade agreement on the day the proposed agreement was authenticated by the United Kingdom.

(2) This section applies only if the proposed agreement is not binding on the United Kingdom as a matter of international law unless it is ratified by the United Kingdom.

(3) Before the United Kingdom ratifies the proposed agreement, a Minister of the Crown must lay before Parliament a report which gives details of, and explains the reasons for, any significant differences between—

(a) the trade-related provisions of the proposed agreement, and

(b) the trade-related provisions of the existing free trade agreement.

(4) Subsection (3) does not apply if a report in relation to the proposed agreement has been laid before Parliament under section [Report to be laid with regulations under section 2(1))2].

(5) The duty imposed by subsection (3) applies only at a time when regulations may be made under section 2(1)(see section 2(7)).

(6) In this section a reference to authenticating a free trade agreement is a reference to doing an act which establishes the text of the agreement as authentic and definitive as a matter of international law.

(7) In this section—

“the existing free trade agreement” means the free trade agreement referred to in subsection (1) (a) or (b);

the “trade-related provisions” of a free trade agreement are the provisions of the agreement that mainly relate to trade.”

This new clause reinserts a Government amendment made to the Trade Bill in 2018 and requires a Minister to lay a report before Parliament before the UK ratifies a new free trade agreement with a country that (before exit day) had a free trade agreement with the EU. The report must explain any significant differences between the proposed new agreement and the existing agreement with the EU.

New clause 2—Reporting requirement not to apply in exceptional cases—

“(1) Section [Report on proposed free trade agreement] does not apply to a free trade agreement if a Minister of the Crown is of the opinion that, exceptionally, the agreement needs to be ratified without laying before Parliament a report which meets the requirements of subsection (3) of that section.

(2) If a Minister determines that a free trade agreement is it be ratified without laying before Parliament a report which meets the requirements of section [Report on proposed free trade agreement] (3), the Minister must, as soon as practicable after the agreement is ratified, lay before Parliament—

(a) a report which meets those requirements, and

(b) a statement indicating that the Minister is of the opinion mentioned in subsection (1) and explain why.”

This new clause provides that the reporting requirement under section [Report on proposed free trade agreement] would not apply if a Minister takes the view that, exceptionally, the agreement should be ratified without the reporting requirement being met.

New clause 3—Report to be laid with regulations under section 2(1)—

“(1) This section applies where a Minister of the Crown proposes to make regulations under section 2(1) for the purpose of implementing a free trade agreement to which the United Kingdom and another signatory (or other signatories) are signatories.

(2) A draft of the statutory instrument containing the regulations may not be laid before Parliament unless, at least 10 Commons sitting days before the draft is laid, a Minister of the Crown has laid before Parliament a report which gives details of, and explains the reasons for, any significant differences between—

(a) the trade-related provisions of the free trade agreement to which the United Kingdom and the other signatory (or other signatories) are signatories, and

(b) the trade-related provisions of the existing free trade agreement.

(3) Subsection (2) does not apply if, at least 10 Commons sitting days before a draft of the statutory instrument containing the regulations is laid, a report in relation to the agreement has been laid before Parliament under section [Report on proposed free trade agreement](3).

(4) In this section—

“Commons sitting day” means a day on which the House of Commons begins to sit;

“the existing free trade agreement” means the free trade agreement to which the European Union and the other signatory (or other signatories) were signatories immediately before exit day;

the “trade-related provisions” of a free trade agreement are the provisions of the agreement that mainly relate to trade.”

This new clause reinserts a Government amendment made to the Trade Bill in 2018 and requires a Minister to lay a report before Parliament at least 10 Commons sitting days before regulations implementing a new free trade agreement are laid in draft under clause 2(1). The report is required to explain any significant differences between the new agreement and the existing agreement with the EU.

New clause 4—Parliamentary approval of trade agreements—

“(1) Negotiations towards a free trade agreement may not commence until the Secretary of State has laid draft negotiating objectives in respect of that agreement before both Houses of Parliament, and a motion endorsing draft negotiating objectives has been approved by a resolution of both Houses of Parliament.

(2) Prior to the draft negotiating objectives being laid, the Secretary of State must have—

(a) consulted with each devolved authority on the content of the draft negotiating objectives, and

(b) produced a sustainability impact assessment including, but not limited to, an assessment of the impact on food safety, health, the environment and animal welfare.

(3) The United Kingdom may not become a signatory to a free trade agreement to which this section applies unless a draft of the agreement in the terms in which it was to be presented for signature by parties to the agreement has been laid before, and approved by, a resolution of both Houses of Parliament.

(4) Before either House of Parliament may be asked to approve by resolution the text of a proposed free trade agreement, the Secretary of State must—

(a) consult with each devolved authority on the text of the proposed agreement, and

(b) lay before both Houses a report assessing the compliance of the text of the proposed agreement with any standards laid down by primary or subordinate legislation in the United Kingdom including, but not limited to, legislation governing or prescribing standards on food safety, health, the environment and animal welfare.

(5) In this section—

“devolved authority” has the meaning given in section 4(1) of this Act, and

“free trade agreement” means any agreement which is—

(a) within the definition given in section 4(1) of this Act, and

(b) an agreement between the United Kingdom and one or more partners that includes components that facilitate the trade of goods, services or intellectual property.”

New clause 7—Import standards—

“(1) A Minister of the Crown may not lay a copy of an international trade agreement before Parliament under section 20(1) of the Constitutional Reform and Governance Act 2010 unless the agreement—

(a) includes an affirmation of the United Kingdom’s rights and obligations under the SPS Agreement, and

(b) prohibits the importation into the United Kingdom of agricultural and food products in relation to which the relevant standards are lower than the relevant standards in the United Kingdom.

(2) In subsection (1)—

“international trade agreement” has the meaning given in section 2(2) of this Act;

“relevant standards” means standards relating to environmental protection, plant health and animal welfare applying in connection with the production of agricultural and food products;

“SPS Agreement” means the agreement on the Application of Sanitary and Phytosanitary Measures, part of Annex 1A to the WTO Agreement (as modified from time to time).”

This new clause would ensure that HMG has a duty to protect the quality of the domestic food supply by ensuring that imported foodstuffs are held to the same standards as domestic foodstuffs are held to.

New clause 8—International trade agreements: public health services—

“(1) A Minister of the Crown may not lay a copy of an international trade agreement before Parliament under section 20(1) of the Constitutional Reform and Governance Act 2010 if any provision of the agreement—

(a) would have the effect of, or could reasonably be expected to have the effect of, altering the way in which a service is provided by a specified body,

(b) would have the effect of, or could reasonably be expected to have the effect of, opening any part of a specified body to foreign investment,

(c) would open part or all of a specified body to market access but without any accompanying provision for the UK Government to reduce the level of market access in future,

(d) does not specify sectors or subsectors of a specified body to which the agreement would enable market access,

(e) includes investor-state dispute settlement mechanisms in relation to a specified body, or

(f) includes changes to mechanisms for the pricing of medical or pharmaceutical products for purchase by a specified body.

(2) The specified bodies, for the purpose of subsection (1), are—

(a) NHS England,

(b) NHS Wales,

(c) a health board in Scotland, a special health board in Scotland or the Common Services Agency established by section 10 of the National Health Service (Scotland) Act 1978, and

(d) HSCNI.

(3) In subsection (1), ” international trade agreement” has the meaning given in section 2 of this Act.”

This new clause would ensure that HMG has a duty to restrict market access to healthcare services, including medicines and medical devices.

New clause 9—International trade agreements: climate and environmental goals—

“(1) An appropriate authority may not take action in relation to an international trade agreement unless nothing in the international trade agreement restricts the ability of that or any other appropriate authority to take action in pursuit of the UK’s climate and environmental goals.

(2) In subsection (1) “action in relation to an international trade agreement” means—

(a) laying the agreement before Parliament under section 20(1) of the Constitutional Reform and Governance Act 2010 (treaties to be laid before Parliament before ratification),

(b) making regulations under section 2 for the purposes of implementing or facilitating the implementation of the agreement, or

(c) making subordinate legislation under any other enactment for those purposes.

(3) In subsection (2) “laid”—

(a) where the appropriate authority is a Minister of the Crown, means laid before Parliament;

(b) where the appropriate authority is the Scottish Ministers, means laid before the Scottish Parliament;

(c) where the appropriate authority is the Welsh Ministers, means laid before Senedd Cymru; and

(d) where the appropriate authority is a Northern Ireland department, means laid before the Northern Ireland Assembly.

(4) In conducting trade negotiations and in other related activity a Minister of the Crown—

(a) must give priority to nations that are fully implementing relevant multilateral environmental agreements; and

(b) must take all reasonable steps to facilitate the achievement of the UK’s climate and environmental goals (including, in particular, by pursuing where appropriate the introduction, amendment or application of rules within the World Trade Organisation and other international trade forums).

(5) In subsection (4) “trade negotiations” means—

(a) negotiations with a view to entering into an international trade agreement; or

(b) negotiations in connection with the implementation or alteration of an international trade agreement, or otherwise connected with international trade.

(6) In subsection (4) “relevant multilateral environmental agreements” means, so far as geographically applicable, any of—

(a) the United Nations Framework Convention on Climate Change done at New York on 9 May 1992 and Paris Agreement done at Paris on 12 December 2015,

(b) the United Nations Convention on Biological Diversity done at Rio de Janeiro on 5 June 1992 (including its protocols),

(c) the Convention on International Trade in Endangered Species of Wild Fauna and Flora 1973,

(d) United Nations Convention for the Law of the Sea 1982,

(e) the Aarhus Convention 1998,

(f) the United Nations Economic Commission for Europe Convention on Long-Range Transboundary Air Pollution 1979,

(g) the Convention for the Protection of the Marine Environment of the North-East Atlantic (OSPAR) Convention 1992, or

(h) the Basel Convention 1992.

(7) The Secretary of State must lay before Parliament in each financial year a report about compliance with subsection (4).

(8) In this section “the UK’s climate and environmental goals” means—

(a) the target of achieving net zero carbon emissions by 2050;

(b) any other target set under or for purposes connected with any enactment (including devolved legislation and retained EU law) relating to the environment or climate change;

(c) any target to which the UK is committed by virtue of being party to a relevant multilateral environmental agreement; and

(d) the United Nations Sustainable Development Goals.”

This new clause aligns the UK’s trade policy with the UK’s climate and environmental agenda. It would ensure that the negotiation of trade agreements facilitates the achievement of the UK’s domestic climate and environmental goals and would help prevent trade agreements from restricting action in pursuit of these goals.

New clause 10—Availability of agreement texts—

“(1) The text of any proposed international trade agreement which is being negotiated shall, so far as it is agreed or consolidated, be made publicly available within ten days of the close of each round of negotiations.

(2) Every—

(a) document submitted formally by the United Kingdom government to the negotiations, and

(b) agenda for each new round of negotiations

shall be made publicly available by the Secretary of State.

(3) All other documents relating to the negotiations and not falling within the descriptions provided in subsections (1) and (2) shall be made publicly available by the Secretary of State, subject to subsection (4).

(4) The Secretary of State may withhold from publication any document of a kind falling within the description in subsection (3) but must publish a statement of the reasons for doing so.

(5) In the case of any document withheld under subsection (4), the Secretary of State shall provide full and unfettered access to that document to—

(a) any select committee of either House of Parliament to which, in the opinion of the Secretary of State, the proposed agreement is relevant, and

(b) any other person or body which the Secretary of State may authorise.

(6) In the case of a document to which access is provided under subsection (5), the Secretary of State may specify conditions under which the text shall be made available.

(7) The Secretary of State shall maintain an online public register of all documents published under subsections (1), (2) and (3) or withheld under subsection (4).”

This new clause would give select committees access to more confidential negotiating documents and would provide a process for further transparency of negotiating texts beyond that.

New clause 11—Import of agricultural goods after IP completion day—

“(1) After IP completion day, agricultural goods imported under a free trade agreement may be imported into the UK only if the standards to which those goods were produced were as high as, or higher than, standards which at the time of import applied under UK law relating to—

(a) animal health and welfare,

(b) protection of the environment,

(c) food safety, hygiene and traceability, and

(d) plant health.

(2) The Secretary of State must prepare a register of standards under UK law relating to—

(a) animal health and welfare,

(b) protection of the environment,

(c) food safety, hygiene and traceability, and

(d) plant health

which must be met in the course of production of any imported agricultural goods.

(3) A register under subsection (2) must be updated within seven days of any amendment to any standard listed in the register.

(4) “Agricultural goods”, for the purposes of this section, means anything produced by a producer operating in one or more agricultural sectors listed in Schedule 1.

(5) “IP completion day” has the meaning given in section 39 of the European Union (Withdrawal Agreement) Act 2020.”

This new clause would set a requirement for imported agricultural goods to meet animal health and welfare, environmental, plant health, food safety and other standards which are at least as high as those which apply to UK produced agricultural goods.

New clause 12—Review of free trade agreements—

“(1) The Secretary of State shall lay before Parliament a review of the operation and impacts of each free trade agreement to which this Act applies.

(2) Each such review shall be laid before Parliament no later than five years from the day on which the agreement comes into force.

(3) A further review of the operation of each agreement shall be laid no later than five years after the day on which the previous such review was laid before Parliament.

(4) Each review shall be conducted by a credible body independent of government and shall include both qualitative and quantitative assessments of the impacts of the agreement, including as a minimum—

(a) the economic impacts on individual sectors of the economy, including, but not restricted to—

(i) the impacts on the quantity and quality of employment,

(ii) the various regional impacts across the different parts of the UK,

(iii) the impacts on small and medium-sized enterprises, and

(iv) the impacts on vulnerable economic groups;

(b) the social impacts, including but not restricted to—

(i) the impacts on public services, wages, labour standards, social dialogue, health and safety at work, public health, food safety, social protection, consumer protection and information, and

(ii) the government’s duties under the Equality Act 2010;

(c) the impacts on human rights, including but not restricted to—

(i) workers’ rights,

(ii) women’s rights,

(iii) cultural rights and

(iv) all UK obligations under international human rights law;

(d) the impacts on the environment, including but not restricted to—

(i) the need to protect and preserve the oceans,

(ii) biodiversity,

(iii) the rural environment and air quality, and

(iv) the need to meet the UK’s international obligations to combat climate change;

(e) the impact of any investor-state dispute settlement which forms part of the agreement;

(f) the impacts on animal welfare, including but not restricted to the impacts on animal welfare in food production, both as it relates to food produced in the UK and as it relates to food imported into the UK from other countries; and

(g) the economic, social, cultural, food security and environmental interests of those countries considered to be developing countries for the purposes of clause 10 of the Taxation (Cross-border Trade) Act 2018, as defined in Schedule 3 to that Act and as amended by regulations.

(5) The elements of the review to be undertaken under (4)(f) must be sufficiently disaggregated so as to capture the full range of impacts on different groups of developing countries, and must include both direct and indirect impacts, such as loss of market share through trade diversion or preference erosion.”

This new clause would introduce a review of the functioning of each FTA to which the UK is a signatory to be brought forward after five years and again after a further five.

New clause 13—Role of Joint Ministerial Committee—

“(1) The Joint Ministerial Committee is to be a forum—

(a) for discussing—

(i) the terms upon which the United Kingdom is to commence negotiations with respect to any international trade agreement;

(ii) proposals to amend retained EU law for the purposes of regulations made under section 1 or section 2;

(b) for seeking a consensus on the matters set out in subsection (1)(a) between Her Majesty’s Government and the other members of the Joint Ministerial Committee.

(2) Before Her Majesty’s Government concludes an international trade agreement, the Secretary of State must produce a document for consideration by the Joint Ministerial Committee setting out—

(a) Her Majesty’s Government’s objectives and strategy in negotiating and concluding an international trade agreement;

(b) the steps Her Majesty’s Government intends to take to keep the Joint Ministerial Committee informed of progress in reaching an international trade agreement;

(c) the steps Her Majesty’s Government intends to take to consult each member of the Joint Ministerial Committee before entering into an international trade agreement and for taking the views of each member into account.

(3) Before concluding an international trade agreement the Secretary of State must produce a document setting out the terms of the proposed agreement for consideration by the Joint Ministerial Committee.

(4) In this section, “the Joint Ministerial Committee” means the body set up in accordance with Supplementary Agreement A of the Memorandum of Understanding on Devolution, between Her Majesty’s Government, the Scottish Government, the Welsh Government and the Northern Ireland Executive Committee.”

This new clause would put on the face of the Bill a joint ministerial committee, and give it powers to discuss international trade issues with the devolved Administrations.

New clause 14—Animal welfare and sentience—

“Regulations may only be made under section 2(1) if the provisions of the international trade agreement to which they relate are compatible with—

(a) any provision in UK law (including retained EU law) relating to animal welfare standards and the welfare of animals in the production of food; and

(b) any obligations relating to animal sentience by which the UK is bound, or any principles relating to animal sentience to which the UK adheres.”

This new clause would ensure that any animal welfare or sentience regulations arising from trade agreements are aligned with existing commitments in UK and retained EU law.

New clause 15—Statement on equalities legislation—

“(1) This section applies where a Minister of the Crown proposes to make regulations under section 2(1).

(2) Before a draft of the statutory instrument containing the regulations is laid before either House of Parliament, the Minister must make a statement as to whether the statutory instrument would, if made, modify any provision of equalities legislation.

(3) If a Minister expresses a view in a statement under subsection (2) that the draft statutory instrument would, if made, modify any provision of equalities legislation, the Minister must explain in the statement what the effect of each such modification would be.

(4) If the Minister fails to make a statement as required by subsection (2), the Minister must make a statement explaining why.

(5) A statement under this section must be made in writing and published in such manner as the Minister making it considers appropriate.

(6) In this section, “equalities legislation” means the Equality Act 2006, the Equality Act 2010 and any subordinate legislation made under either of those Acts.”

This new clause would oblige the government to publish a statement outlining whether any equalities legislation would be modified by the proposed regulations.

New clause 16—UK participation in EU and EEA organisations—

“(1) The Secretary of State must seek to negotiate an international trade agreement with the EU which will enable the United Kingdom to continue to co-operate closely with the bodies listed in subsection (2).

(2) The bodies are—

(a) the European Medicines Agency;

(b) the European Chemicals Agency;

(c) the European Aviation Safety Agency;

(d) the European Maritime Safety Agency.”

This new clause would oblige the Secretary of State to negotiate close cooperation with the four mentioned agencies.

New clause 17—International trade agreements: health or care services—

“(1) Regulations under section 2(1) may make provision for the purpose of implementing an international trade agreement only if the conditions in subsections (2) and (3) are met in relation to the application of that agreement in any part of the United Kingdom.

(2) The condition in this subsection is that no provision of that international trade agreement in any way undermines or restricts the ability of an appropriate authority—

(a) to provide a comprehensive publicly funded health service free at the point of delivery,

(b) to protect the employment rights or terms and conditions of employment for public sector employees and those working in publicly funded health or care sectors,

(c) to regulate and maintain the quality and safety of health or care services,

(d) to regulate and control the pricing and reimbursement systems for the purchase of medicines or medical devices, or

(e) to regulate and maintain the level of protection afforded in relation to patient data, public health data and publicly provided social care data relating to UK citizens.

(3) The condition in this subsection is that the agreement—

(a) explicitly excludes application of any provision within that agreement to publicly funded health or care services,

(b) explicitly excludes provision for any Investor-State Dispute Settlement (ISDS) clause that provides, or is related to, the delivery of public services, health care, care or public health,

(c) explicitly excludes the use of any negative listing, standstill or ratchet clause that provides, or is related to, the delivery of public services, health care, care or public health,

(d) contains explicit recognition that an appropriate authority (within the meaning of section 4) has the right to enact policies, legislation and regulation which protects and promotes health, public health, social care and public safety in health or care services, and

(e) prohibits the sale of patient data, public health data and publicly provided social care data.

(4) For the purposes of this section—

“negative listing” means a listing only of exceptions, exclusions or limits to commitments made by parties to the agreement;

“ratchet” in relation to any provision in an agreement means any provision whereby a party, if (after the agreement has been ratified) it has unilaterally removed a barrier in an area where it had made a commitment before the agreement was ratified, may not reintroduce that barrier, and

“standstill” in relation to any provision in an agreement means any provision by which parties list barriers which are in force at the time that they sign the agreement and undertake not to introduce any new barriers.”

This amendment would aim to protect the NHS and publicly funded health and care services in other parts of the UK from any form of control from outside the UK.

New clause 18—Trade agreements: approval—

“A Minister of the Crown must not make regulations to implement an international trade agreement unless—

(a) a statement on the terms of the agreement has been approved by the House of Commons on a motion moved by a Minister of the Crown,

(b) a statement on the terms of the agreement has been approved by the House of Commons on a motion moved by a Minister of the Crown,

(c) a motion relating to that statement has been approved by a resolution of Senedd Cymru,

(d) a motion relating to that statement has been approved by a resolution of the Scottish Parliament, and

(e) a motion relating to that statement has been approved by a resolution of the Northern Ireland Assembly.”

This new clause would require the UK Government to secure the approval of both Houses of Parliament and the devolved Parliaments of Scotland and Wales, and the Northern Ireland Assembly before implementing any international trade agreement agreed after the passing of the Bill.

New clause 19—Involvement of judicial systems in trade disputes—

“(1) The United Kingdom may only become a signatory to an international trade agreement if the condition in subsection (3) is satisfied.

(2) The Secretary of State may not lay a copy of an international trade agreement before Parliament under section 20(1) of the Constitutional Reform and Governance Act 2010 unless the condition in subsection (3) is satisfied.

(3) Legal proceedings brought against the United Kingdom under investment protection provisions included in an international trade agreement must be heard by the courts and tribunals system of the United Kingdom.”

This new clause would provide protection for UK firms, public bodies and the Government in the event of proceedings under investment protection provisions such as the Investor-State Dispute Scheme (ISDS).

New clause 20—Multilateral investment tribunal—

“(1) The United Kingdom may only become a signatory to an international trade agreement if the condition in subsection (3) is satisfied.

(2) The Secretary of State may not lay a copy of an international trade agreement before Parliament under section 20(1) of the Constitutional Reform and Governance Act 2010 unless the condition in subsection (3) is satisfied.

(3) The condition under this subsection is that an international trade agreement must include a commitment by all parties to the agreement to pursue with other trading partners the establishment of a multilateral investment tribunal and appellate mechanism for the resolution of investment disputes.”

This new clause would ensure that a multilateral investment process would be used to adjudicate on investor disputes.

New clause 21—Human rights and economic impact assessments—

“(1) Before laying a copy of an international trade agreement before Parliament under section 20(1) of the Constitutional Reform and Governance Act 2010, the Secretary of State must lay before Parliament an impact assessment taking account of short and long-term human rights and economic impacts of that agreement on different sectors including, but not limited to—

(a) gender,

(b) age

(c) race and

(d) class.

(2) The Secretary of State must lay before Parliament reviews of each international trade agreement which has come into effect from January 2021.

(3) A review under subsection (2) must include an assessment of short and long-term economic and human rights impacts on different sectors including, but not limited to—

(a) gender,

(b) age

(c) race and

(d) class.

(4) Reviews under subsection (2) must be laid within two years of the day on which the agreement to which they relate comes into effect, and at intervals of no more than two years thereafter.”

This new clause would ensure that the HMG has a duty to commit to undertaking human rights impact assessments of all trade deals before and after implementation, taking account of short and long-term economic impacts across different sectors, including but not limited to gender, age, race and class.

Amendment 11, in clause 1, page 1, line 16, at end insert—

“(1A) No regulations under subsection (1) may be made until the Secretary of State has entered into negotiations with other parties to the GPA with the objective of enabling greater labour market interventions and compliance with ILO standards in any UK procurement contract to which the GPA applies, and

(a) the Secretary of State has made a statement to the House of Commons that the objective has been achieved either in full or in part, or

(b) the Secretary of State has made a statement to the House of Commons that the objective has not been achieved.”

This amendment would require the Secretary of State to enter into negotiations to secure greater labour rights in procurement contracts that the GPA applies to, and to report back on the outcome of these negotiations.

Amendment 12, page 1, line 16, at end insert—

“(1A) No regulations under subsection (1) may be made until the Secretary of State has entered into negotiations with other parties to the GPA with the objective of securing greater environmental exceptions and carbon considerations in any UK procurement contract to which the GPA applies, and

(a) the Secretary of State has made a statement to the House of Commons that the objective has been achieved either in full or in part, or

(b) the Secretary of State has made a statement to the House of Commons that the objective has not been achieved.”

This amendment would require the Secretary of State to enter into negotiations to secure greater environmental protections in procurement contracts that the GPA applies to, and to report back on the outcome of these negotiations.

Amendment 13, page 1, line 16, at end insert—

“(1A) No regulations under subsection (1) may be made until the Secretary of State has entered into negotiations with other parties to the GPA with the objective of securing greater scope for UK small and medium-sized enterprises in any UK procurement contract to which the GPA applies, and

(a) the Secretary of State has made a statement to the House of Commons that the objective has been achieved either in full or in part, or

(b) the Secretary of State has made a statement to the House of Commons that the objective has not been achieved.”

This amendment would require the Secretary of State to enter into negotiations to secure greater access for SMEs in procurement contracts that the GPA applies to, and to report back on the outcome of these negotiations.

Amendment 14, page 1, line 16, at end insert—

“(1A) No regulations under subsection (1) may be made until the Secretary of State has entered into negotiations with other parties to the GPA with the objective of securing improvements to public health as a consequence of any UK procurement contract to which the GPA applies, and

(a) the Secretary of State has made a statement to the House of Commons that the objective has been achieved either in full or in part, or

(b) the Secretary of State has made a statement to the House of Commons that the objective has not been achieved.”

This amendment would require the Secretary of State to enter into negotiations to secure improvements to public health in procurement contracts that the GPA applies to, and to report back on the outcome of these negotiations.

Amendment 1, in clause 2, page 2, line 10, leave out “is a signatory” and insert

“was a signatory on 31 December 2019”.

The most recent EU FTA which was rolled over, was in December 2019. This amendment would provide that any further FTA entered into would not come under the EU FTA roll over provisions of Clause 2.

Amendment 29, page 2, line 14, at end insert—

“(2A) Regulations under subsection (1) to make provision for the purpose of implementing an international trade agreement may only be made if—

(a) the requirements under subsection (3) and under paragraph 4(1) to (1D) of Schedule 2 have been met;

(b) the requirements under subsection (4) and under paragraph 4(1) to (1D) of Schedule 2 have been met; or

(c) the provisions of section [Parliamentary approval of trade agreements] have been complied with and the requirements under subparagraphs 4A(1) to (1D) of Schedule 2 have been met.”

This amendment would put in place a structure for greater Parliamentary scrutiny of proposed international trade agreements.

Amendment 15, page 2, line 15, leave out subsections (3) and (4) and insert—

“(3) Paragraph 4 of Schedule 2 shall apply to any regulations under subsection (1) which make provision for the purpose of implementing a free trade agreement if the other signatory (or each other signatory) and the European Union were signatories to a free trade agreement immediately before exit day.

(4) Paragraph 4 of Schedule 2 shall apply to any regulations under subsection (1) which make provision for the purpose of implementing an international trade agreement other than a free trade agreement if the other signatory (or each other signatory) and the European Union were signatories to an international trade agreement immediately before exit day.

(4A) Paragraph 4A of Schedule 2 shall apply to any regulations under subsection (1) which make provision for the purpose of implementing any international trade agreement not falling within subsection (3) or subsection (4) above.”

This amendment would apply the provisions of the Bill to trade agreements other than EU rollover trade agreements, allowing the Bill to act as a framework for a future trade policy.

Amendment 16, page 2, line 15, leave out subsections (3) and (4) and insert—

“(3) Regulations under subsection (1) may make provision for the purpose of implementing a free trade agreement only if the other signatory (or each other signatory) and the European Union had ratified a free trade agreement with each other immediately before exit day.

(4) Regulations under subsection (1) may make provision for the purpose of implementing an international trade agreement other than a free trade agreement only if the other signatory (or each other signatory) and the European Union had ratified an international trade agreement with each other immediately before exit day.”

This amendment would mean that a trade agreement would need to be ratified before regulations could be made to implement it.

Amendment 17, page 2, line 23, at end insert—

“(4A) Regulations under subsection (1) may make provision for the purpose of implementing an international trade agreement only if the provisions of that international trade agreement do not conflict with, and are consistent with—

(a) the provisions of international treaties ratified by the United Kingdom;

(b) the provisions of the Sustainable Development Goals adopted by the United Nations General Assembly on 25 September 2015;

(c) the primacy of human rights law;

(d) international human rights law and international humanitarian law;

(e) the United Kingdom’s obligations on workers’ rights and labour standards as established by but not limited to—

(i) the commitments under the International Labour Organisation’s Declaration on Fundamental Rights at Work and its Follow-up Conventions; and

(ii) the fundamental principles and rights at work inherent in membership of the International Labour Organisation;

(f) women’s rights and are in accordance with the United Kingdom’s obligations established by but not limited to the Convention on the Elimination of All Forms of Discrimination Against Women;

(g) children’s rights and are in accordance with the United Kingdom’s obligations established by but not limited to the Convention on the Rights of the Child; and

(h) the sovereignty of Parliament, the legal authority of UK courts, the rule of law and the principle of equality before the law.”

This amendment would ensure that regulations made under the Bill can only be made if the trade agreement which the regulations would implement does not contravene the UK’s international commitments with specific reference to human rights and related treaties, and must respect the sovereignty of parliament.

Amendment 18, page 2, line 23, at end insert—

“(4A) Regulations under subsection (1) may make provision for the purpose of implementing an international trade agreement only if the provisions of that international trade agreement do not conflict with, and are consistent with the United Kingdom’s environmental obligations in international law and as established by but not limited to—

(a) the Paris Agreement adopted under the United Nations Framework Convention on Climate Change;

(b) the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES); and

(c) the Convention on Biological Diversity, including the Cartagena Protocol on Biosafety.”

This amendment would ensure that regulations made under the Bill can only be made if the trade agreement which the regulations would implement does not contravene the UK’s environmental obligations.

Amendment 19, page 2, line 23, at end insert—

“(4A) Regulations under subsection (1) may make provision for the purpose of implementing an international trade agreement only if the provisions of that international trade agreement do not in any way restrict the ability—

(a) to make public services at a national or local level subject to public monopoly;

(b) to make public services at a national or local level subject to exclusive rights granted to private operators; and

(c) to bring public services at a national or local level back into the public sector for delivery by public sector employees.”

This amendment would ensure that regulations made under the Bill can only be made if the trade agreement which the regulations would implement does not contravene the ability of a UK government to take public services back into public ownership.

Amendment 20, page 2, line 23, at end insert—

“(4A) Regulations may only be made under subsection (1) if—

(a) the provisions of the international trade agreement to which they relate are consistent with standards for food safety and quality as set and administered by—

(i) the Department of Health;

(ii) the Food Standards Agency;

(iii) Food Standards Scotland; and

(iv) any other public authority specified in regulations made by the Secretary of State;

(b) the Secretary of State is satisfied that mechanisms and bodies charged with enforcement of standards for food safety and quality have the capacity to absorb any extra requirement which may arise from the implementation of the agreement;

(c) the provisions of the international trade agreement to which they relate are consistent with policy to achieve reduction in the risk of disease or contamination as set and administered by—

(i) the Department of Health;

(ii) the Food Standards Agency;

(iii) Food Standards Scotland; and

(iv) any other public authority specified in regulations made by the Secretary of State;

(d) the provisions of the international trade agreement to which they relate are consistent with achieving improvements in public health through any food policy priorities set and administered by—

(i) the Department of Health;

(ii) the Food Standards Agency;

(iii) Food Standards Scotland; and

(iv) any other public authority specified in regulations made by the Secretary of State;

(e) the provisions of the international trade agreement to which they relate are compliant with policy to achieve targets for farm antibiotic reduction set by the Veterinary Medicines Directorate;

(f) the provisions of the international trade agreement to which they relate are compliant with retained EU law relating to food standards and the impact of food production upon the environment; and

(g) any food or food products to which the provisions of the international trade agreement apply meet standards of labelling, indication of provenance, and packaging specified by the Food Standards Agency or Food Standards Scotland.”

This amendment would ensure that regulations made under the Bill can only be made if the trade agreement which the regulations would implement enshrines UK standards in legislation and adheres to UK standards of food production and food safety.

Amendment 21, page 2, leave out lines 27 and 28.

This amendment would remove Henry VIII powers from the Bill.

Amendment 10, page 2, line 33, at end insert—

“(6A) No regulations may be made under subsection (1) by a Minister of the Crown, so far as they contain provision which would be within the devolved competence of the Scottish Ministers (within the meaning given in paragraph 6 of Schedule 1), unless the Scottish Ministers consent.

(6B) No regulations may be made under subsection (1) by a Minister of the Crown, so far as they contain provision which would be within the devolved competence of the Welsh Ministers (within the meaning given in paragraph 7 of Schedule 1), unless the Welsh Ministers consent.

(6C) No regulations may be made under subsection (1) by a Minister of the Crown, so far as they contain provision which would be within the devolved competence of a Northern Ireland department (within the meaning given in paragraph 8 of Schedule 1), unless a Northern Ireland devolved authority (within the meaning of paragraph 9 of Schedule 1) gives consent.”

This amendment would ensure that the consent of a devolved government is required for regulations under section 2(1) if those regulations contain matters which are within the remit of the devolved government.

Amendment 22, page 2, line 34, leave out subsections (7) and (8) and insert—

“(7) No regulations may be made under subsection (1) in relation to an agreement which meets the criteria in subsection (3) or (4) after the end of the period of five years beginning with IP completion day.”

This amendment would bar any extension to the five-year window for making regulations to implement EU rollover agreements.

Amendment 23, page 2, line 34, leave out subsections (7) and (8) and insert—

“(7) No regulations may be made under subsection (1) in relation to an agreement which meets the criteria in subsection (3) or (4) after the end of—

(a) the period of five years beginning with IP completion day (“the initial five year period”), or

(b) such other period as is specified in regulations made by the Secretary of State in accordance with subsection (8).

(8) Regulations under subsection (7)(b) may not extend the initial five year period or any subsequent period beyond the day which falls ten years after IP completion day.”

This amendment would limit any extension of the window to a maximum of ten years.

Amendment 2, page 2, line 35, leave out “five” and insert “three”.

This amendment reinserts a Government amendment made to the Trade Bill in 2018. It proposes to reduce, from five years to three, the time period during which a) EU FTAs can be rolled over and b) previously rolled over FTAs can be reamended.

Amendment 3, page 2, line 36, leave out “five” and insert “three”.

Amendment 4, page 2, line 39, leave out “five” and insert “three”.

This amendment reinserts a Government amendment made to the 2018 Trade Bill in 2018. If the Government decides to extend the period to make regulations under Clause 2, any such period should not be more than three years.

Amendment 5, page 2, line 41, leave out “five” and insert “three”.

Amendment 27, in clause 4, page 3, line 26, at end insert—

““international agreement that mainly relates to trade, other than a free trade agreement” means a strategic partnership agreement or mutual recognition agreement that is ancillary to a free trade agreement, or an investment agreement”.

This amendment defines what is meant by international agreement that mainly relates to trade, reducing ambiguity.

Amendment 28, in clause 6, page 4, line 22, at end insert “and

(c) analysis of the impact of any exercise by the Secretary of State of the power under section 15 of the Taxation (Cross-border Trade) Act 2018 (as amended by section 94 of the Finance Act 2020) to vary an amount of import duty if he or she considers that it is appropriate to do so.”

This amendment would oblige the TRA to give advice on the impact of the Secretary of State’s actions in reducing import duty under the powers in the current Finance Bill.

Government amendments 6 to 9.

Amendment 24, in schedule 2, page 11, line 26, leave out from “section 1(1)” to the end of line 27 and insert

“may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.”

This amendment would specify an affirmative resolution procedure for regulations under section 1 (1) (Regulations relating to the UK’s membership of the GPA).

Amendment 25, page 13, line 25, at end insert—

“4A (1) A statutory instrument containing regulations of a Minister of the Crown acting alone under section 2(1) in respect of an international trade agreement which does not meet the criteria under section 2(3) or section 2(4) may not be made except in accordance with the steps in subparagraphs (1A) to (1D).

(1A) The Minister shall lay before Parliament—

(a) a draft of the regulations, and

(b) a document which explains why the Secretary of State believes that regulations should be made in terms of the draft regulations.

(1B) The Minister may make an order in the terms of the draft regulations laid under subparagraph (1A) if—

(a) after the expiry of a period of 21 sitting days after the draft regulations are laid, no committee of either House of Parliament has recommended that the regulations should not be made, and

(b) after the expiry of a period of 60 sitting days after the draft regulations are laid, the draft regulations are approved by a resolution of each House of Parliament.

(1C) If a committee of either House of Parliament recommends that the regulations should not be made, the Secretary of State may—

(a) lay before Parliament revised draft regulations, and

(b) after the expiry of a period of 40 sitting days after the revised draft regulations are laid, make a motion for a resolution in each House of Parliament for approval of the revised draft regulations.

(1D) If a motion under subparagraph (1C)(b) is approved by a resolution of each House of Parliament, the Secretary of State may make the regulations.”

This amendment would establish a form of super-affirmative procedure for scrutiny of regulations implementing all trade agreements covered by the bill. The procedure would apply to agreements other than EU rollover trade agreements if amendments extending the application of the bill were agreed to.

Amendment 26, page 13, leave out lines 33 to 35 and insert—

“(3) A statutory instrument containing regulations of a Minister of the Crown acting jointly with a devolved authority under section 2(1) in respect of an agreement which falls within the description in section 2(3) or section 2(4) may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.

(3A) A statutory instrument containing regulations of a Minister of the Crown acting jointly with a devolved authority under section 2(1) in respect of an agreement which falls within the description in section 2(4A) may not be made except in accordance with the steps in subparagraphs (1) to (1D) of paragraph 4A.”

This amendment would extend the super-affirmative procedure under Amendment 25 to regulations where the Minister was acting jointly with a devolved authority.

Amendment 31, page 15, line 21, leave out subsection (3) and insert—

“(3) No person may be appointed as a non-executive member of the Authority under subparagraph (1)(b) unless—

(a) the Secretary of State has first consulted the Chair of the Authority on the proposed appointment, and

(b) the International Trade Committee of the House of Commons has consented to the appointment.”

This amendment would establish a procedure for appointing non-executive members of the Trade Remedies Authority other than the Chair.

Amendment 30, page 15, line 22, at end insert—

“(3A) In making any proposal under subparagraph (3), the Secretary of State must ensure that there is on the Authority a representative of—

(a) producers,

(b) trade unions,

(c) consumers, and

(d) each of the United Kingdom devolved administrations.”

This amendment would ensure that the Trade Remedies Authority includes, among its non-executive members, representatives of stakeholder bodies potentially affected by its recommendations.

Greg Hands Portrait Greg Hands
- Hansard - -

20 Jul 2020, 12:05 a.m.

It is a pleasure to open consideration on Report of the Trade Bill and to speak to new clause 5. This is all legislation that contains key measures that will deliver for UK businesses and consumers across the country, providing continuity and certainty. Amendments have been tabled by the Government and from across the House, and with the permission of the House I will outline the Government’s position on these more than 50 different amendments, and on other amendments tabled, before we hear from hon. and right hon. Members.

On Government new clauses 5 and 6, together with amendments 6, 7 and 9, the Government have been consistently clear that the priority for the UK’s existing trade relationships as we leave the EU is continuity. Our partner countries are clear on that too, and this Bill is about continuity. But it is about more than simply transitioning agreements. It is about ensuring that businesses—UK and partner-country businesses—can continue to benefit from smooth-operating borders once we have become a wholly independent trading nation at the end of the transition period.

The Government have set out our ambition to have a world-leading border by 2050. This will support our aim to make the UK a globally attractive place to do business as we move forward. To achieve that ambition, the Government need to make better use of the data we currently hold, and new clauses 5 and 6 are aimed at doing just that. Unlocking the full potential of the data, without placing any additional burden on businesses, will not only allow us to achieve our vision for the future, but benefit those business and consumers who depend on a frictionless border to ensure continuity of our trading relationships today. The smooth flow of traffic, goods and trade after the end of the transition period and during the introduction of import controls will support the manufacturing sector, especially those using the just-in-time methodology and individuals who enjoy using the online sector.

New clause 5 creates a new legal gateway so that Government data can be used, first, to ensure continuity of trade by safeguarding existing trading relationships in countries both in the EU and in the rest of world so they are not frustrated by friction at the border for goods and services at the end of the transition period; secondly, to provide better services to UK businesses and consumers by supporting the effective management of the end-to-end border process; and, thirdly, to underpin the delivery of a world-leading border—protecting the UK, protecting revenue and growing international trade.

This is an amendment that external border industry stakeholders are very supportive of; indeed, they have been calling for exactly this type of action for a long time. I want to be clear to the House on a number of important issues in relation to the new clause. First, this all relates to existing data; there are no new powers for data collection in these Government amendments. Secondly, it is discretionary and specific: it does not create a data-sharing free-for-all between public authorities. The new clause is carefully drafted to limit the data that can be shared to only that related to trade functions. These are functions that, in the main, are the responsibility of the Secretary of State for International Trade or the Minister for the Cabinet Office. If the information is not required for trade functions, it cannot be requested under the gateway. Before any data can be disclosed, the public authority making the disclosure must also be satisfied that it has complied with its own existing data protection obligations—most notably under the Data Protection Act 2018 and the General Data Protection Regulation.

The Government recognise that there may be concerns about what happens to the data once it has been passed to the Cabinet Office, the Department for International Trade or other Departments. I want to assure all Members of the House that no data will be made available or sold to third parties outside Government—a concern which I know a number of colleagues have raised in the past —nor will it be used to monitor citizens or businesses, or to target individuals to be stopped at the border. These measures are, as I have said, about making sure that border flow is maintained, and that traffic, goods and services are free to flow with as little friction as possible.

Furthermore, new clause 6 makes it an offence to disclose unlawfully any personal data shared under the amendment. The Government have also tabled amendments 6 to 9, which make minor changes to the existing clause 8. These amendments are to enable Her Majesty’s Revenue and Customs data to be shared with all Ministers of the Crown, where HMRC is satisfied that the data may be shared for the Minister’s functions relating to trade. The current drafting enables HMRC to share data with the Secretary of State for the same purpose. The practical effect of the amendments is to enable HMRC to share data with the Cabinet Office, which is not headed by a Secretary of State.

New clauses 1 to 3 seek to replicate the effects of Government amendments brought forward to the 2017-19 Trade Bill. Over the course of this legislation, and its 2017-19 version, I have had constructive discussions with my hon. Friend the Member for Huntingdon (Mr Djanogly) regarding the purpose of the Government’s continuity programme. I would like to thank him for his work and the interactions he has had with me, particularly on the important issue of transparency. His efforts have directly changed the Bill through inserting the use of the affirmative procedure when exercising the power in clause 2, and ensuring that Parliament has transparency in relation to continuity agreements through the laying of parliamentary reports, alongside signed agreements setting out significant changes with the underlying EU agreement.

As Members across the House know, the purpose of our continuity programme is to provide certainty to businesses and consumers by retaining the preferential trading arrangements from which the UK benefits as a signatory to trade agreements that the EU had signed with third countries before exit day. That is why we have now concluded 20 continuity agreements with 48 countries, accounting for £110 billion of UK trade in 2018, which represents 74% of the trade with countries with which we were seeking continuity before the withdrawal agreement was signed. Each of those agreements has been accompanied by a parliamentary report, and I can confirm that we will continue to publish reports for all continuity agreements yet to be signed. As those parliamentary reports make clear, our continuity programme has remained true to its mandate: replicating our existing trade relationships. Let me repeat that standards have not been lowered in these 20 agreements. Unsafe food will not be entering our market, and our right to choose how we deliver public services has been protected.

New clause 3 would stipulate that the parliamentary reports must be published at least 10 sitting days before any statutory instruments are made under this power. As I explained to colleagues in Committee a few weeks ago, and as I think we all know, trade negotiations have a habit of going down to the wire. I have only to remind colleagues of the negotiations surrounding the EU withdrawal agreement as evidence of that fact—although I should point out, before I get people too excited, that that particular negotiation is not included in the scope of this Bill. As such, it is possible that we may not be able to sign continuity agreements until shortly before the transition period ends. That may make it very difficult to leave a period of 10 sitting days before any SIs are brought forward if we want continuity agreements to enter into force on day one after the transition period.

Jonathan Djanogly Portrait Mr Jonathan Djanogly (Huntingdon) (Con)
- Hansard - - - Excerpts

I thank the Minister for his earlier comments. He talks about continuity agreements, but are they still continuity agreements? For instance, the agreement with Japan looks like it will be very different from the one that the EU had, and Canada is saying that it is not going to have the same agreement; it wants to see what we get with the EU first. Why does he still call them continuity agreements? Is this clause not looking at a position that we had two years ago? Should we not now move on?

Greg Hands Portrait Greg Hands
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Let me be clear: we are talking about continuity. My hon. Friend can judge us not just by what I say but by our actions. Of the 20 reports that we have published, five have been called for debate in the other place, and not a single one of those debates has resulted in a motion of regret. He is right about one thing, and that is on Japan. I will come on to examine this shortly, but Japan is different. We have been clear that that will lead to an enhanced free trade agreement based on the original EU agreement, which is why we have put in place different and more considerable scrutiny arrangements for the Japan agreement than for the rest of the continuity programme.

We want continuity agreements to enter into force on day one to avoid a cliff edge for both businesses and consumers. I remind colleagues that all continuity agreements will be subject to the CRAG—Constitutional Reform and Governance Act 2010—ratification procedure. That already provides for a period of 21 sitting days in which agreements, and the parliamentary reports and explanatory memoranda published alongside them, can be scrutinised by parliamentarians before they are formally ratified. I will now address amendments 1 to 5 in the name of my hon. Friend the Member for Huntingdon, as well as amendments 22 and 23.

Barry Gardiner Portrait Barry Gardiner (Brent North) (Lab)
- Hansard - - - Excerpts

Will the Minister give way?

Greg Hands Portrait Greg Hands
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I will give way to the hon. Member for Brent North (Barry Gardiner)—it is great to see him back in trade.

Barry Gardiner Portrait Barry Gardiner
- Hansard - - - Excerpts

The Minister talks of CRAG as if it is a process under which this Parliament has any power. He knows that it is the Government who enable Parliament to have a debate whereby it could vote against what is tabled under the CRAG process. He must look again at the way in which real scrutiny and accountability can be brought to bear in the way that the hon. Member for Huntingdon suggests.

Greg Hands Portrait Greg Hands
- Hansard - -

It is good to see the hon. Gentleman back. I remember that he was originally a Blairite Minister in Tony Blair’s Government, and it has been really instructive to see the journey that he has been on over some time. I saw him take the seat in the extreme corner of the Chamber earlier and thought, “Not only has he taken on the views of the right hon. Member for Islington North (Jeremy Corbyn), but he has now even taken his previous seat.” The hon. Gentleman voted for CRAG in 2010, as did I. [Interruption.] We both voted for CRAG in 2010. CRAG allows Parliament to block a trade deal. It allows Parliament to block international treaties. That was the intention—his Government designed it in that way to give Parliament the ability to block an international agreement, and that remains the case today.

Greg Hands Portrait Greg Hands
- Hansard - -

I will make a little bit more progress.

As I have said, the other place has held debates on six of the agreements, and not one carried a motion of regret. We have also retained the affirmative resolution procedure for regulations that are required to implement single agreements. The Government recognise that there may be concerns that the power in clause 2 could be used to implement completely new agreements with continuity countries, both now and in the future, with inadequate opportunity for parliamentary scrutiny. In Committee we heard suggestions that some of the upcoming continuity agreements, such as those with Canada and Singapore, will go beyond continuity, and will therefore require a more comprehensive scrutiny process—my hon. Friend the Member for Huntingdon made that point.

Let me reassure hon. Members that we view the underlying EU agreements as sufficient, and we are not seeking to enhance those deals or go beyond continuity. These will be technical changes to make the agreements function in a UK-specific context. The Government acknowledge that the UK-Japan agreement, although based on the EU’s existing agreement with Japan, will be an enhanced agreement, and that is an exception.

Jonathan Gullis Portrait Jonathan Gullis (Stoke-on-Trent North) (Con)
- Hansard - - - Excerpts

With ceramics being the fourth largest export to Japan and its industry, does the Minister see an enhanced trade deal with Japan as an opportunity, rather than listening to the doomsayers on the Opposition Benches?

Greg Hands Portrait Greg Hands
- Hansard - -

My hon. Friend is absolutely right. All my interactions, and those of the Secretary of State, with the ceramics industry and with MPs who represent key ceramics constituencies, indicate that the Japan deal is extremely important for this country. I am disappointed that the Opposition parties seem to have no enthusiasm for the continuity of our trade with Japan, or its enhancement.

Greg Hands Portrait Greg Hands
- Hansard - -

I will not give way just now. We are committed to additional scrutiny arrangements for any deal with Japan. We believe that the current sunset provisions in the Bill strike the right balance between flexibility for negotiators and the ability to keep agreements operable, and that they provide sufficient constraints and scrutiny to Parliament.

The Government are aware that during the 2017-19 Trade Bill there was uncertainty and concern in Parliament about the nature of the Government’s continuity programme—indeed, I can testify to that, because I was the Minister at the time—and that is why we have tabled a number of amendments to the Bill. There is, however, a crucial change in circumstance since the previous Bill, because Parliament can now see that we have not strayed beyond our mandate to deliver continuity. The transition agreements have not resulted in new or enhanced trading obligations, standards have not been reduced in any way, and our right to choose how we deliver public services has been protected.

Richard Fuller Portrait Richard Fuller (North East Bedfordshire) (Con)
- Hansard - - - Excerpts

In that context, I understand why there is limited scrutiny for small trade deals, and the Minister has spoken about enhanced scrutiny for the Japan deal. He will know, however, that for many constituents, the US trade deal and the China trade deal will raise the most concerns. Can he give us some assurance that the process of increased scrutiny in Parliament will be higher for those deals than for the ones mentioned earlier?

Greg Hands Portrait Greg Hands
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20 Jul 2020, 12:04 a.m.

I absolutely give my hon. Friend that assurance, and I will come on to discuss those deals in a moment, although they are not within the scope of the current Bill.

My hon. Friend the Member for Huntingdon has tabled new clause 4 on new trade agreements, and that gives me the opportunity to stress the importance that the Government place on parliamentary scrutiny, and the commitments we have made in that space. The House will know that the negotiation and entering into of international agreements is a prerogative power of the Executive. The new clause would give Parliament veto rights over our negotiating objectives.

The Constitution Committee in the other place reported on that issue in 2019, and stated:

“This would impinge inappropriately on the Government’s prerogative power and limit the Government’s flexibility in the negotiations.”

I agree, and as the House will know, there are already rigorous checks and balances on the Government’s power to negotiate and ratify new agreements through the Constitutional Reform and Governance Act 2010. [Interruption.] The right hon. Member for Islington South and Finsbury (Emily Thornberry) is fond of heckling, but she voted for that Act.

Aaron Bell Portrait Aaron Bell (Newcastle-under-Lyme) (Con)
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20 Jul 2020, 6:09 p.m.

I concur entirely with what the Minister is saying. Is it not the case that if we allow further parliamentary scrutiny, we will not get the best deal from these negotiations, and that at present this is the Westminster-style democracy with the greatest parliamentary scrutiny of trade deals?

Greg Hands Portrait Greg Hands
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20 Jul 2020, 6:09 p.m.

My hon. Friend is absolutely correct that our scrutiny offer compares very favourably with Australia’s and New Zealand’s and is at least equal to Canada’s. He is right in other regards as well. Some of these amendments would obligate the Government to publish the text after the end of each negotiating round. At the moment, we publish a written ministerial statement. The idea that we publish the interim text with the United States so that Australia, New Zealand, Japan and all our partners could see it when this Government—this country—are undergoing simultaneous negotiation with different partners is not a sensible way of proceeding.

Barry Gardiner Portrait Barry Gardiner
- Hansard - - - Excerpts

20 Jul 2020, 6:10 p.m.

Will the Minister give way?

Greg Hands Portrait Greg Hands
- Hansard - -

20 Jul 2020, 6:10 p.m.

I am going to make more progress.

This Government understand the desire of Parliament to have effective scrutiny of our FTA programme. That is why we have gone above and beyond the baseline provided by CRAG in committing to publishing comprehensive information ahead of entering into negotiations with partner countries. We have already done this—

Greg Hands Portrait Greg Hands
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20 Jul 2020, 6:10 p.m.

I am going to make progress.

We have already done this for the US, for Japan, for Australia and for New Zealand. This has included publishing negotiating objectives and initial economic assessments. We have also committed to laying final impact assessments once negotiations have concluded and we know the content of the proposed agreement in its entirety.

Greg Hands Portrait Greg Hands
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20 Jul 2020, 6:11 p.m.

I am going to make some more progress.

In addition, the Government have committed to providing regular updates to Parliament on the progress of negotiations. We have already adopted a similar approach for Japan, because that is an enhanced agreement. There is an important distinction that new clause 4 does not make, requiring, as it does, the roll-over agreements not yet signed to be subject to the same scrutiny as new agreements, even though the original EU-third party agreement has been subject to both EU and UK scrutiny.

Matt Rodda Portrait Matt Rodda (Reading East) (Lab)
- Hansard - - - Excerpts

20 Jul 2020, 6:11 p.m.

Will the Minister give way?

Greg Hands Portrait Greg Hands
- Hansard - -

20 Jul 2020, 6:12 p.m.

I am going to make more progress.

For new trade agreements, the Government have already committed to working closely with the relevant scrutiny Committees in both Houses throughout negotiations. This includes providing confidential briefings, as appropriate, to keep them apprised. This approach is in line with the recommendations of the former Member for Blackburn, Jack Straw—who served in government with the hon. Member for Brent North (Barry Gardiner). He said in his evidence to the Lords Constitution Committee that

“it should be for the negotiators to decide how much privacy and confidentiality there should be”

during negotiations

“and certainly not others”.

Finally, when negotiations have concluded, we will work with the relevant Select Committee to ensure, where practical, that there is time for the Committee to produce a report on the final agreement before it is laid in Parliament under CRAG.

Tim Farron Portrait Tim Farron
- Hansard - - - Excerpts

20 Jul 2020, 6:12 p.m.

Will the Minister give way?

Greg Hands Portrait Greg Hands
- Hansard - -

20 Jul 2020, 6:13 p.m.

I am not going to give way further during this section of my speech.

Similarly—this is an important point—if the Committee were to recommend a debate on an agreement prior to ratification, the Government would of course consider that request, subject to parliamentary timetabling. Taken together, this means that Parliament will have comprehensive information, including economic assessments, on our agreements prior to negotiations commencing, at key points during negotiations, and at the conclusion of talks.

Finally on this point—this is extremely important—international agreements cannot themselves alter domestic law, and any changes to UK legislation would need to be scrutinised by Parliament in the normal way. We are strongly committed to transparency, as demonstrated by the steps we have taken to provide comprehensive information to the public and Parliament at the start.

Tim Farron Portrait Tim Farron
- Hansard - - - Excerpts

20 Jul 2020, 6:13 p.m.

rose—

Greg Hands Portrait Greg Hands
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20 Jul 2020, 6:13 p.m.

I will put the hon. Gentleman out of his misery and give way.

Tim Farron Portrait Tim Farron
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20 Jul 2020, 6:14 p.m.

I just want to make a point about the nature of the scrutiny. A few weeks ago, the Government rightly came forward with the Trade and Agriculture Commission to add weight to the scrutiny of trade deals with regard to animal welfare, environmental standards and labour standards. What can the Minister do to give more assurance to farmers, in particular, that these deals will not lead to an undermining of their business and their standards, and put that into the Bill to ensure that those cannot then be let down?

Greg Hands Portrait Greg Hands
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20 Jul 2020, 6:14 p.m.

I thank the hon. Gentleman for that intervention, which allows me to say that the National Farmers Union has been incredibly welcoming of this proposal. Minette Batters said that it is

“a hugely important development in ensuring UK farming’s high standards of animal welfare and environmental protection are not undermined in future trade deals.”

There are three crucial things. First, we have a strong manifesto commitment to have no compromise on Britain’s standards of animal welfare, food safety and the environment. Secondly, we are transposing the EU rules into UK law to take effect on 1 January. The third thing is simply this: it would be for Parliament, if it so wanted, to block any such changes—if anybody thought they would introduce any of these controversial products, Parliament would be able to block that.

Greg Hands Portrait Greg Hands
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No, I will make some progress. The Government are strongly committed to transparency, as demonstrated by the steps we have already taken.

New clause 12 proposes a review of free trade agreements every five years after entry into force. We have already established regular dialogue with the International Trade Committee, and that is perhaps the best forum to provide information and assessment of the UK’s wider trade environment and trade relationships to Parliament.

New clause 18 seeks to give Parliament and the devolved legislatures binding votes on, or vetoes over, international agreements, which would be to fundamentally undermine the royal prerogative and, worse, limit our flexibility to negotiate the deals that will best serve the interests of UK consumers and communities.

Sammy Wilson Portrait Sammy Wilson (East Antrim) (DUP)
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I accept the Minister’s point that for devolved Parliaments to be able to undermine a national trade deal would be wrong. However, will he give us some guidance on the position for Northern Ireland? We may find ourselves having not continuity deals, but new deals, and we could be excluded from some of the benefits of those deals. How will he make an assessment? How will he enable the devolved Administration to have an input into decisions made on those deals if we find that we are disadvantaged by being excluded from them?

Greg Hands Portrait Greg Hands
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I thank the right hon. Gentleman for that intervention. The first thing to say is that I have regular dialogue with his colleague the Minister for the Economy. I am meeting her tomorrow—indeed, I am meeting her twice—to talk about these issues. I reiterate that Northern Ireland remains part of the UK customs area and will benefit from UK free trade agreements. We have been absolutely categoric on both those points. As I say, new clause 18 seeks to give Parliament a veto over those arrangements and to ensure that the Government seek approval from the devolved legislatures on the final agreement. I am in regular contact with the Ministers for the devolved Administrations on these issues.

I will now address new clauses 7 to 9, and others in relation to standards. In answer to the intervention from the hon. Member for Westmorland and Lonsdale (Tim Farron), let me say that we have already given cast-iron commitments, during debate on this Bill and the Agriculture Bill, that we will not be diluting standards in any area, or in any way, following the UK’s departure from the EU.

Peter Aldous Portrait Peter Aldous (Waveney) (Con)
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I acknowledge the undertakings that the Government have given on agriculture and food production, but will the Minister also assure me that future UK trade policy will be fully aligned with our climate change and environmental policies? Will he also assure me that in striking new trade deals we will, at all times, promote low-carbon industries such as offshore wind and will not undermine UK businesses that are working hard to lower their own carbon footprint?

Greg Hands Portrait Greg Hands
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I absolutely give my hon. Friend those assurances. The Government’s climate change agenda—indeed, the whole country’s agenda—is incredibly important for us at the Department for International Trade. We have put a lot of time and effort into promoting our capability and capacity in things such as offshore wind. I am regularly saying to international investors and trade partners that the UK now has the largest offshore wind capacity in the world. This is something we are seeking to export and it is something trade agreements can be helpful in. We are working with some of our key partners on these aspects of trade agreements, but they can also be something that the whole of government can work together on.

Caroline Lucas Portrait Caroline Lucas
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Will the Minister give way?

Greg Hands Portrait Greg Hands
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I am going to make some progress. Let me address matters related to animal welfare, food standards and food safety. I recognise the strength of feeling that those issues generate among colleagues in all parts of the House, but as I have told the House on many occasions, as have the Secretary of State and my Department for Environment, Food and Rural Affairs colleagues, this Government will stand firm in trade negotiations. We will always do right by our farmers and aim to secure new opportunities for the industry, and we will not dilute our high environmental protection, animal welfare and food safety standards.

Steve Brine Portrait Steve Brine (Winchester) (Con)
- Hansard - - - Excerpts

There is not just concern on both sides of the House; my right hon. Friend knows that there is a lot of concern out there among the public and our constituents. We have heard commitments from the Front Bench, and when I was food safety Minister I gave those commitments too, around domestic food standards. Many people want it set out in black and white in the Bill. I suspect that the Minister will go on to say why he will resist new clause 7, for instance, so what assurance can he give me, my constituents and many others who will be listening to the debate that that is not necessary because those standards are protected in law, not just in word?

Greg Hands Portrait Greg Hands
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I thank my hon. Friend for that intervention, which allows me to explain the difference. Some of the amendments seek to dynamically align other people’s methods of production with those that we use in the UK. Yes, we will have, and maintain, exceptionally high standards of domestic production, domestic products and import controls, and we can influence our trading partners.

However, I cannot put into legislation a dynamic regulatory alignment playing field for our trading partners. That would be impractical and it would render inoperable most of our existing trade agreements, and potentially render impossible doing a future trade agreement with the European Union. If all these trading partners had to sign up to dynamically aligning their standards with the UK, that would make it extremely challenging not just to keep our existing trade agreements but to do trade agreements with partners in the future.

Caroline Lucas Portrait Caroline Lucas
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Will the right hon. Member give way?

Greg Hands Portrait Greg Hands
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I will not, because I have gone on for long enough.

Nigel Evans Portrait Mr Deputy Speaker (Mr Nigel Evans)
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Order. May I assist by indicating that so many people want to take part on Report that those who have indicated that they wish to speak and are on the call list should be thinking about four minutes? I call the Minister.

Greg Hands Portrait Greg Hands
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I have much more to say, in relation to 50 different amendments, but I appreciate that there are a large number of other speakers, so I will call it a day there in order to allow other people their say. I think I have covered the main areas, outlining why we have the requirements in new clauses 5 and 6 on data, why we are confident of our robust approach to parliamentary scrutiny, using the CRAG process and enhanced things that we have introduced to ensure that Parliament gets the information and has the say that it needs, and finally our absolute commitment to not compromising on standards for food safety, animal welfare and the environment.

Bill Esterson Portrait Bill Esterson (Sefton Central) (Lab)
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International trade has rarely been more important. It is critical as we forge a new place in the world outside the European Union. It is also critical to how we recover from the pandemic, as it has the power to deliver prosperity at home and abroad, especially in the developing world as we aim towards the sustainable development goals. We will support the Government where they are right and challenge where they are wrong.

There are three key areas to which our amendments to the Trade Bill refer: social, environmental and democratic. First, on social, the Bill has profound implications for workers’ rights, human rights, public services and the economy. Secondly, on environmental, as my right hon. Friend the Member for Islington South and Finsbury (Emily Thornberry) reminded us on Second Reading, international trade agreements have a massive impact on our ability to tackle the climate and environment emergency. Meanwhile, food production and animal welfare standards are matters of enormous concern to farmers and consumers alike. Thirdly, on democratic, the complete absence of scrutiny runs like the Sant Andreas fault through the Bill. [Hon. Members: “San Andreas.”] Thank you—the San Andreas fault.

Break in Debate

Sammy Wilson Portrait Sammy Wilson
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20 Jul 2020, 8:54 p.m.

I know that I have a very short time so I just want to make one point very quickly. I am disappointed that the Government could not find any place in this Bill to give a written assurance that Northern Ireland will be able to participate fully in the international trade deals that we will strike across the world when we leave the EU. That is because they cannot give the assurance that the Northern Ireland protocol will not stop us benefiting from goods that will come into the United Kingdom as a result of trade deals or, indeed, will not make the process of selling abroad so expensive that it puts us at a disadvantage when it comes to selling in other parts of the world. We believe that we have an economy that is competitive, but it is not competitive, because we are tied through the Northern Ireland protocol to the single market and to the European customs territory, and therefore treated differently from the rest of the United Kingdom. The assurances that the Minister gives verbally cannot, unfortunately, override the compelling legal commitments in the withdrawal agreement.

Greg Hands Portrait Greg Hands
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20 Jul 2020, 8:56 p.m.

With the leave of the House, I would like to respond to what has been a wide-ranging and often well-informed debate.

This Bill is mainly about continuity, but also about sending a clear message that we welcome traders—that we are network Britain, not fortress Britain. On standards, I remind the House that none of the 20 continuity agreements that Parliament has ratified has eroded standards in any way. Not one domestic standard in relation to animal welfare, the environment, human rights or labour has been eroded by any of those agreements.

Let me try to deal quickly with four of the myths propagated by the Opposition. First, on ISDS and protection for investment, this is in the UK’s interests. The UK has never lost a case in any of these tribunals, but for 40 years UK companies, with jobs at stake, have brought these cases. Eighty of the cases—about 1,000 overall—were brought by UK companies and UK investors directly, with UK jobs at stake. That is why this can be very important for UK business and for the jobs of our constituents in making sure that businesses operating abroad are protected.

The second myth relates to devolution. We have been clear that we would not usually legislate in devolved areas without the consent of devolved authorities and never without consulting them. The hon. Member for Dundee East (Stewart Hosie) referred to convenience. If it is more convenient for the UK to legislate for all four nations, then that is a sensible thing.

In terms of standards, we have seen new clause 11, and new clause 7 is even more extreme. New clause 11 wants to make sure that no goods can enter the UK unless they have been produced at standards

“as high as, or higher than, standards which at the time of import applied under UK law”.

That could have massive unforeseen consequences. The Opposition think they are talking about chlorinated chicken and hormone-treated beef, but are they actually able to look people in the eye and say that cocoa from the Ivory Coast has been produced to at least as high environmental standards as in the UK? Are they able to say that beans from Egypt are being produced to at least as high labour standards? Are they able to say that tea from Sri Lanka comes with the same high labour standards? I think they are putting a lot of this country’s existing trade at risk.

The fourth key myth is about the NHS. The NHS remains protected and will never be on the table at any trade deal, and that includes the prices we pay for drugs.

We have had excellent speeches from my hon. Friends the Members for Tiverton and Honiton (Neil Parish), for Totnes (Anthony Mangnall), for Burnley (Antony Higginbotham), for Buckingham (Greg Smith), for Stoke-on-Trent Central (Jo Gideon), for Milton Keynes North (Ben Everitt) and for Stafford (Theo Clarke), from my right hon. Friend the Member for Chipping Barnet (Theresa Villiers), and from my hon. Friends the Members for Witney (Robert Courts), for Montgomeryshire (Craig Williams), for South Ribble (Katherine Fletcher) and for Huntingdon (Mr Djanogly). I thank them for their contributions and the Opposition for theirs.

The Bill is very important in securing the continuity of up to 40 EU trade agreements, the establishment of a Trade Remedies Authority to protect UK businesses and jobs from unfair trade practice, and access to the £1.3 billion global market in Government procurement.

We should accept new clause 5 and related amendments to allow better sharing of data. We should reject the other amendments, which are either unnecessary, such as new clause 4, or, in cases such as new clauses 7 and 11, potentially deeply damaging for this country’s economy.

Question put and agreed to.

New clause 5 accordingly read a Second time, and added to the Bill.

Proceedings interrupted (Programme Order, 20 May).

Trade Bill (Seventh sitting)

(Committee Debate: 7th sitting: House of Commons)
Greg Hands Excerpts
Thursday 25th June 2020

(5 months, 1 week ago)

Public Bill Committees

Read Full debate Read Hansard Text Bill Main Page
Department for International Trade
Gareth Thomas Portrait Gareth Thomas
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25 Jun 2020, 11:34 a.m.

I am relatively new to the Trade Bill and am only catching up with the discussions that my hon. Friend and others have had about these continuity agreements. Something odd certainly seems to have happened. It is true that the Minister has managed to get a deal done with the Faroe Islands.

Greg Hands Portrait The Minister for Trade Policy (Greg Hands)
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25 Jun 2020, 11:34 a.m.

On a point of order, Mrs Cummins. I think that the hon. Member for Warwick and Leamington just accused Lord Price, a Member of the other House, of misleading people. I do not think that that is a permissible term to use in our debates. I invite the hon. Gentleman to withdraw that term.

Matt Western Portrait Matt Western
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I will certainly withdraw it; I recall that I used the word, now that the Minister mentions it. What I was trying to say was that Lord Price was suggesting that there was a simple procedure of cutting and pasting, and that was clearly not the case.

Break in Debate

Mistakes can be made, and in order to prevent them it is important that we have proper scrutiny. Therefore, if we limit the provisions of the Bill purely to its original claimed purpose—just to do the continuity work that is necessary to maintain existing relationships—we should limit the time that is required. It is in that spirit that I offer to the Committee this menu of sensible options to limit the power in the Bill.

Greg Hands Portrait Greg Hands
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25 Jun 2020, 12:03 p.m.

It is a pleasure to welcome you to the Chair, Ms Cummins. I did not get the chance on Tuesday because the supergroup carried on for the entirety of the morning.

Amendment 16 seeks to remove the power to renew the sunset clause after five years, and I am afraid I cannot support it. It would undermine our ability to implement our obligations from trade agreements beyond the first five years, which risks putting us in breach of the agreements and could open us up to legal challenge. I am sure that is not what the Opposition are seeking to achieve.

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

25 Jun 2020, 12:03 p.m.

If the Minister cannot support a change to the five-year sunset period, why did he support it in the previous Parliament, when it was three years?

Greg Hands Portrait Greg Hands
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25 Jun 2020, 12:03 p.m.

I think the hon. Gentleman’s timeline—or the timeline of the hon. Member for Harrow West—may be a little incorrect. As it happens, I left the Department on 21 June 2018, which predated that amendment being made. In any case, the context then, which I will explain, was rather different from the context now, and I think it is very desirable that it be five years, not three years, for the reasons that I am about to explain.

There is a fundamental misunderstanding in everything that the hon. Member for Harrow West just said. The power is in large part needed to make technical changes that ensure that the agreements remain operable. The fundamental misunderstanding on his part is that it is not five years extra to complete the negotiations, sign the deals or finish the negotiations—no. It is five years that is needed to make sure the agreements remain operable once they have been signed.

Before I come to the real detail, let me give the hon. Gentleman an update on some of the agreements he asked about. It was interesting to hear him focus on Andorra and San Marino. Those countries are, of course, in a customs union with the European Union.

We are in discussions with both countries, but in our view, they are largely dependent on what the future relationship between the UK and the European Union looks like, for those two countries are in a complete customs union with the European Union.

The hon. Gentleman asked for clarity about Turkey. I was surprised by that question, because I checked his Twitter feed, and he does actually follow me on Twitter, which I do not take as a compliment ordinarily. He must have seen what we put out three hours ago from my right hon. Friend the Secretary of State for International Trade:

“Great to see”—

UK and Turkey—

“trade talks progress today. Let’s build on our already strong trading relationship worth £19bn. We are working hard to ensure we can reach a UK-Turkey trade deal at the end of the transition period.”

He has it right in front of him on his own Twitter feed; I urge him to read it. People mock social media—I might have been critical of social media in my time—but they occasionally perform a useful function. Helping us to keep up to date with what is going on in the world is one of the most useful aspects. So there he has it from just three hours ago.

The hon. Gentleman asked about the so-called temporary agreement with South Korea. It is not a temporary agreement. The agreement includes a review clause after two years, which is a standard feature of many international trade agreements. The review clause states—I am paraphrasing slightly—that if the two parties do not believe it is mutually advantageous to continue the agreement, there is the option not to. That does not mean to say that it is a temporary agreement. All international agreements can be cancelled by one party or the other, if they feel the agreement is no longer mutually advantageous. Of course it leaves open the possibility of doing a more extensive agreement in the future, but that is the case with all trade agreements.

When a country signs an agreement, no one is saying that it will stay in place forever. There may be opportunities in future to extend it into areas of trade that had not been thought of when the original agreement was signed. That is an entirely normal phenomenon. For example, the EU and Mexico have done an enhanced agreement based on their original agreement, which dated from about 2000 or 2002, to bring it up to date. New things come along, such as e-commerce and so on, so of course trade agreements are updated, but it is wrong to describe that trade agreement as temporary.

We are in discussions with Canada, but I return to the points that the hon. Gentleman made on Tuesday. He is so against the Canada agreement that, if there were any delay in the discussions with Canada, he should be cheering that not condemning it, because he is opposed to the agreement in the first place. I thought that would update him on where we are with the agreement.

Let me describe what it is all about. In the case of a transition mutual recognition agreement, we may need to change secondary legislation after the point of signing, and after 1 January 2021, to update the names of awarding bodies and third countries so that UK businesses can continue to use such bodies legally. It is not extra negotiating time. It is extra time to ensure that the agreement remains operable.

Alternatively, where our trade agreements reference international standards, such as environmental protection, we may need to update references in domestic legislation to ensure that we remain in compliance with our international agreements. Equally, a potential use of the power could be to upgrade the list of entities subject to procurement obligations to reflect machinery of government changes.

I used the example last week of DCMS changing its name from the Department for Culture, Media and Sport to the Department for Digital, Culture, Media and Sport. That name change might need to be reflected to keep one of those agreements operable, so a change in domestic legislation would ensure that the procurement obligations in the agreement are kept operable. It is not extra negotiating time. The power could also be used to update the list of entities subject to procurement obligations, as I have said.

I think there is a misunderstanding of the nature of the power. If Opposition Members had expressed concerns about the breadth of the power—in other words, the ability to carry on amending legislation for many years afterwards—that would be a much more legitimate concern than the professed concern about extra negotiating time. The Bill has been scrutinised by the Delegated Powers and Regulatory Reform Committee. Its 33rd report on the 2017-19 Bill raised no concerns about the delegated powers in the Bill, including the sunset clause, and welcomed our move to introduce the affirmative procedure for any regulations made. I see no reason why it should reach a different conclusion on this Bill.

Matt Western Portrait Matt Western
- Hansard - - - Excerpts

I just want to understand the point the Minister is making. I understand the importance of it, but does it not suggest that the three-year clause in the previous Bill showed a degree of naivety on the part of Government—that they would have sufficient time on the other side to negotiate further agreements with these countries?

Greg Hands Portrait Greg Hands
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No, I do not accept that. It has nothing to do with the negotiations; it is all about keeping the agreements operable. It is a matter of judgment, and our judgment is that five years is a reasonable time. It is renewable by the affirmative assent of both Houses. We think that that is a reasonable time to keep these powers in place, so that we can then make further changes as needed to keep those agreements operable, and it is renewable by both Houses.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

Will the Minister support our amendment to reduce the sunset period from five years to three years, as his own Government did in the previous Bill, or is he determined to reject that suggestion?

Greg Hands Portrait Greg Hands
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25 Jun 2020, 12:12 p.m.

I have just explained that we think that five years, not three, is the appropriate time, so we will vote against the hon. Member’s amendment if he has the audacity to push it. Given that the fundamental premise is incorrect, I would be surprised if he were to push it to a vote, because it is based on a misunderstanding of what the power is all about.

The DPRRC report did not indicate any concerns about the Government retaining the power to renew this clause. Amendment 17 proposes to render the clause renewable only once and for not more than a period of 10 years after the end of the transition period, but that is unnecessary. The clause can be extended only with agreement from both Houses of Parliament and only for a period of up to five years at a time. If Parliament judges that our use of the sunset clause has not been appropriate, it has the power to vote against renewal. As I have stressed before, without the ability to renew the clause, we will not have the power to ensure that signed continuity agreements remain operable, which risks the UK’s ability to fulfil its international obligations. If we do not have this power, we will need to put in place other powers. We should not do tomorrow what we can do today.

Amendments 20 to 23 propose to shorten the sunset period from five to three years. I have already explained why we need the power and the changes the power would make. We believe that a five-year period strikes the right balance between flexibility of negotiations and constraints placed on the power. Our signed continuity agreements are evidence that this is a limited, technical exercise to replicate the effects of existing obligations. Seeking parliamentary permission to renew this capability every three years, rather than five, would be disproportionate and places an unnecessary burden on parliamentary time.

I repeat that the amendments, or at least the description of them, are based on a fundamental misunderstanding. The five years are not extra negotiating time. They allow technical changes to regulations on an ongoing basis, to keep operable agreements that have already been signed. I hope that that reassures the Committee, and I ask the hon. Member for Harrow West to withdraw the amendment.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

I enjoyed very much the answer that the Minister provided. In particular, it is a relief to hear that the Secretary of State has finally got round to launching negotiations with Turkey. I hope that those negotiations will be completed by 31 December, given the huge and dramatic impact that it could have on jobs and steel businesses in the UK. I gently remind the Minister of the considerable scepticism we heard from representatives of UK Steel that that would be achieved. It would be interesting to hear later in our proceedings whether Ministers have any sort of contingency plan for the steel industry, if negotiations cannot be completed in time to get a UK-Turkey deal through.

Break in Debate

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

Sorry, it is new clause 18 that I rise to speak to. I am grateful for the correction.

On 13 March 2019, an identical amendment was tabled by Baroness Fairhead in the House of Lords. I will just remind the Minister of what she said in her brief contribution:

“I trust that this House will accept this as further evidence that the Government have a strong desire to be transparent with Parliament, businesses and the general public about their continuity programme.”—[Official Report, House of Lords, 13 March 2019; Vol. 796, c. 1060.]

She said that in good faith, because she wanted the amendment to be accepted. It was accepted by the House of Lords and became a substantive part of the Bill, and the Commons would have considered it had the Government brought it back in the time available. There was plenty of time to discuss it then. The Government Whip made a point of order earlier. If the Government have a real problem with timing today, they should think about the problem that was caused by their not bringing back the Bill at any time during the period after March 2019, when an identical amendment, tabled by the Government, was agreed. The Minister has to answer the question why, if this measure was good enough for the Government on 13 March last year, it is not good enough now.

Greg Hands Portrait Greg Hands
- Hansard - -

Over the past few days, I have outlined the Government’s position on our approach to clause 2 and I will not repeat that to the Committee. The general point about the continuity powers has been frequently made. I will focus my remarks on the Opposition amendments.

First, I must inform the Committee that the letter I promised the hon. Member for Harrow West on the position of Kenya and Ghana has gone out to all members of the Committee. I pledged that on Tuesday, so I think that is pretty swift. It should be in everyone’s inboxes.

New clause 18 seeks to oblige the Government to publish a statement outlining whether any equalities legislation is affected by our continuity agreements before any regulations are made. As has been rightly pointed out, and as I was aware, a Government amendment to that effect was successfully made to the 2017-19 Trade Bill. The amendment was tabled when there was uncertainty among parliamentarians over the purpose of the Government’s continuity programme, in particular its potential impact on equalities legislation.

Break in Debate

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

One thing the Minister can confirm, surely, is whether parts produced in other European Union countries will still count towards the value of the car or other parts that are being manufactured. That diagonal and horizontal cumulation is a standard feature of the rules of origin, and it might help to give some certainty to British car and car parts manufacturers that that flexibility in rules of origin will not be lost.

Greg Hands Portrait Greg Hands
- Hansard - -

I thank the hon. Gentleman for that; he makes a good point. I refer him to the deal that we have negotiated with South Korea and how it reflects on those rules. That negotiation has been completed. However, here, today, it is not my job to comment on live negotiations or discussions with our counterparts.

The hon. Member for Dundee East talked rightly about sectors that are important in different parts of the UK. He made a very fair point. He talked about the white fish sector being 10 times as important to the Scottish economy overall as it is to the UK. That makes me wonder why—if I understood him correctly—his party’s policy is to rejoin the European Union, where presumably the status of the white fish sector is even smaller than the one tenth it represents in the UK. That baffled me.

It is strongly in the UK Government interest to have good relationships with the devolved authorities on trade, which is a reserved matter, a prerogative matter. None the less, regulations interact with areas that are matters of devolved competence.

It is therefore perfectly proper both for the UK Government to have good relations and discussions with the devolved authorities, and for the UK Government to interact with sectors that are larger—I do not mean to say that they are disproportionately important—for certain devolved Administrations than others. That is one reason why I have gone out of my way since rejoining the Department to have meetings—I am checking my list of engagements—about Scottish smoked salmon, and with the Scotch Whisky Association, the Scottish Beef Association and other bodies in Wales and Northern Ireland, as well as in the English regions.

Hon. Members talked about the unrestricted nature of the power, but it is not quite right to say that this is unrestricted. Any changes made are subject to the affirmative procedure, and the power is only to amend secondary legislation that is direct retained EU law, again subject to the affirmative procedure. It is not as if that is an unrestricted power.

Returning to equalities legislation, I remind colleagues of constraints in the Bill, including the fact that the affirmative procedure is required for any statutory instruments made under the power in the clause. Parliament will rightly make its voice heard on regulations made, but as the Prime Minister outlined in his Greenwich speech, the UK will always be an open, equal and fundamentally fair country. That will remain true regardless of EU membership or any other international agreement. We have not needed the EU to tell us what is appropriate in the field of equalities. For example, the EU provides a minimum of 14 weeks’ paid maternity leave, whereas Britain offers up to a year’s maternity leave, 39 weeks of which are paid, and the option to convert it to shared parental leave. Moreover, UK workers can get statutory sick pay for up to 28 weeks, whereas the EU has no minimum sick leave or sick pay legislation.

Promoting respect for British values, including equality, the rule of law and human rights, is and will remain a core part of our international diplomacy. That is what our continuity programme provides, alongside certainty to business and consumers. It is not, and never will be, about undermining equalities legislation.

I turn to new clause 22, tabled by Plaid Cymru Members. For the benefit of Members who have not sat on a Bill Committee before, it is entirely possible for those who are not members of the Committee to table an amendment—I would not recommend that course of action for Government Members—as we see the hon. Member for Arfon (Hywel Williams) and his colleagues have done. On Tuesday, in a debate on similar issues, I set out that it is an essential principle of the UK constitution that the negotiation of international trade agreements is a prerogative power of the UK Government. The prerogative power serves a crucial role in ensuring that the UK Government can speak with a single voice under international law, providing certainty to our negotiating partners.

Of course, international negotiations are a reserved matter under the devolution settlements—an area in which the UK acts on behalf of all the nations of the UK. These important principles are complemented by the UK’s dualist approach to international law, which provides that international treaties cannot of themselves make changes to domestic law—I think we will return to that this afternoon. This approach ensures that where our agreements require changes to UK domestic law, the UK Parliament will scrutinise and pass that legislation in the normal way. Where that legislation is made by the devolved Governments, the devolved legislatures fulfil that role. It is right that Parliament and the devolved legislatures should have that role, which is why we have provided that regulations made under clause 2 will be subject to the affirmative procedure.

We have also committed ourselves to not normally using the clause 2 power to legislate in devolved areas without the consent of the relevant devolved Administration, and never without consulting them. Combined with the scrutiny mechanisms in the Constitutional Reform and Governance Act 2010, which the hon. Member for Harrow West was so enthusiastic about 10 years ago, those procedures will ensure that the UK Parliament can see exactly what we have negotiated, and if it does not agree with it, can take steps to prevent the Government from implementing and ratifying the deal. There are therefore already rigorous checks and balances on the Government’s power to negotiate and ratify a new agreement.

By giving Parliament an automatic veto over trade agreements, the new clause would cut across those procedures and undermine the important constitutional principle that it is for the Executive to negotiate and enter into deals, and for Parliament to scrutinise them. The new clause would also give the devolved legislatures an automatic veto over our agreement, which would be wholly inappropriate given that this is a reserved matter. On a practical level, a veto for the devolved legislatures would also lead to a situation in which one part of the UK could prevent the rest from benefiting from an agreement.

The Government recognise the important role that the devolved Administrations and the UK Parliament can and should play in our trade agreements, and I welcome the opportunity to put that on the record again. My Department works closely, as I have outlined, with the devolved Administrations and Parliament to deliver trade policy and trade agreements that reflect the interests of the UK as a whole, but we should do so in accordance with the long-standing principles enshrined in our constitution, rather than seeking to undermine them. I hope that reassures the Committee. I ask hon. Members not to press their new clauses, and to agree to clause 2 standing part of the Bill.

Question put and agreed to.

Clause 2 accordingly ordered to stand part of the Bill.

Ordered, That further consideration be now adjourned.—(Maria Caulfield.)

Adjourned till this day at Two o’clock.

Trade Bill (Eighth sitting)

(Committee Debate: 8th sitting: House of Commons)
Greg Hands Excerpts
Thursday 25th June 2020

(5 months, 1 week ago)

Public Bill Committees

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Department for International Trade
Gareth Thomas Portrait Gareth Thomas (Harrow West) (Lab/Co-op)
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26 Jun 2020, 12:05 a.m.

I beg to move amendment 18, in schedule 2, page 11, line 26, leave out from “section 1(1)” to the end of line 27 and insert

“may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.”

This amendment would specify an affirmative resolution procedure for regulations under section 1(1).

I am grateful for the opportunity to speak to the amendment in my name and those of my hon. Friends. Let me make it clear that we have tabled this amendment recognising that the affirmative resolution procedure is not a perfect process by any means. It is, nevertheless, better than the annulment procedure, which Ministers currently have locked into the Bill. An affirmative process is vital, as without it the Government will have carte blanche to introduce regulations to implement the obligations arising from our independent membership of the GPA—the agreement on government procurement—without the slightest hint of anything resembling parliamentary scrutiny.

The negative resolution procedure the Government propose for regulations under clause 1(1) is the least rigorous of all the parliamentary procedures for scrutiny available to the House. The main point of the negative resolution procedure is to allow the Government to have their way without any need to bother with parliamentary democracy. Indeed, I am told that the last time a negative instrument was successfully annulled in the House of Commons was the Paraffin (Maximum Retail Prices) (Revocation) (No. 3) Order 1979.

International treaties cannot be easily repealed, but domestic legislation can be repealed much more easily. If ever there were an example of secondary legislation crying out for proper parliamentary scrutiny and oversight, surely this is it. I remind the Committee of the evidence we heard from Rosa Crawford of the Trades Union Congress. In response to Question 70 from my hon. Friend the Member for Sefton Central, she pointed out:

“The GPA as it stands has no requirement for members to promote social standards in their tendering process.”––[Official Report, Trade Public Bill Committee, 16 June 2020; c. 49, Q70.]

The TUC is worried that, once we leave any kind of relationship with the European Union and no longer have to rely on the EU’s contract regulations, the UK Government may well roll back on those commitments to promote social standards through the tendering process that are currently locked into our law by EU directives.

Opposition Members remember—indeed, Rosa Crawford reminded us all as a Committee—that the Prime Minister and members of the Cabinet have talked many times in the past about wanting to repeal EU-derived rights on working time and agency workers, and other important protections for workers’ rights. Not surprisingly, the TUC is worried that that may well be the direction of travel with procurement regulations in the future.

It is therefore sensible to make sure we have a proper parliamentary process that allows us to explore whether, under the cover of minor technical changes to the GPA—no doubt the Minister will suggest to the Committee that that is all he intends this process for—our contract regulations and the standards associated with them are gradually being undermined and a race to the bottom on standards is under way. We consider the affirmative resolution procedure to be more appropriate than the annulment process in the Bill. However imperfect the affirmative resolution process, it at least provides Members with the possibility of a debate and a vote, and it is then of course up to us to make proper use of that opportunity. That is the spirit of amendment 18.

Greg Hands Portrait The Minister for Trade Policy (Greg Hands)
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25 Jun 2020, 2:05 p.m.

I begin by welcoming you to the Chair this afternoon, Sir Graham. I appreciate the concerns that there should be adequate parliamentary scrutiny of regulations made under the clause 1 power. I am satisfied that that is the case, and let me explain why.

As I have said, the power is intended to allow the UK to make technical changes—for example, to reflect new parties joining the government procurement agreement or existing parties withdrawing from it. In the case of a new or withdrawing party, it is important that the UK is able to respond quickly and flexibly. Once a new party deposits its instrument of accession, there is, under the rules of the World Trade Organisation GPA, a period of only 30 days before that accession comes into force. The UK will then be under an immediate obligation to provide that new party with guaranteed procurement opportunities covered by the GPA, and of course vice versa. If the UK failed to offer the new party this guaranteed access, we would be in breach of our GPA commitments. Equally, a party to the GPA can decide to withdraw unilaterally. When a party notifies the Committee on Government Procurement that it intends to withdraw, it will cease to be a GPA member just 60 days later. It is therefore vital that we are able to react quickly to such a notification, either to join or to withdraw.

If the power to amend UK legislation to reflect a party’s withdrawing from the GPA were subject to the affirmative resolution procedure, we might not be able to legislate in time to remove the party within the 60-day time limit. This could result in UK contracting authorities continuing to give a party that has left the GPA—companies from that country—guaranteed access to the UK’s procurement market that it is no longer entitled to have. Furthermore, the former party would have no obligation at the same time to give UK businesses reciprocal access to its procurement markets. I am confident that Members will agree on the need to regulate quickly in these instances, both practically so that UK businesses are not disadvantaged and to show good faith to the other party.

Bill Esterson Portrait Bill Esterson (Sefton Central) (Lab)
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The Minister made great play two years ago of the idea that the affirmative resolution procedure takes 30 days longer than the negative resolution procedure. However, that is not an issue because the Government are notified months in advance that this is coming, and Government officials are able to put in place the necessary regulations, whether negative or affirmative. There is plenty of time to get ready to avoid the catastrophic outcome that the Minister describes.

Greg Hands Portrait Greg Hands
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25 Jun 2020, 2:09 p.m.

The hon. Gentleman makes a fair point. In fact, accession to the GPA typically take some years, so in that sense it would have been telegraphed quite far in advance—the most recent party to join is Australia. But it would be inappropriate for us to ratify someone joining the GPA in advance of them actually depositing the papers, so although joining is a lengthy process, the actual ratification process is very short. That is the key difference in this case.

The Delegated Powers and Regulatory Reform Committee’s report on the Trade Bill 2017-19 raised no concerns, nor made any recommendations, about the use of the negative procedure in relation to this power. However, let me clear: when new parties are seeking to accede to the GPA, we will ensure that Parliament is kept informed. Parliamentary scrutiny is more effective before an accession is agreed, because that is when the views of Parliament can be taken into account.

Where a WTO member is seeking to join the GPA, it is our intention to notify Parliament, to keep the relevant Committee—in this case, the International Trade Committee—informed as the negotiations proceed, and to allow further discussion where desired. That is the right time for Parliament to be actively involved in a debate, for example, on Australia’s accession to the GPA—although the case of Australia is backward looking, of course, to when we were covered by the GPA through our EU membership. If there were such a case going forward, the right time would be during the discussions to the accession, not after the accession had been agreed.

I remind Members that there has already been parliamentary scrutiny of the UK’s market access schedules and the text of the GPA, which were laid before Parliament in line with the Constitutional Reform and Governance Act 2010. That process concluded without objection in 2019. Any further changes to the GPA, including the UK schedules prior to our accession, will again be scrutinised in line with CRAG.

I hope my comments provide reassurance to the Committee. I ask the hon. Gentleman to withdraw the amendment and commend schedule 2 to the Committee.

Gareth Thomas Portrait Gareth Thomas
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25 Jun 2020, 2:11 p.m.

I was toying with being persuaded by the Minister until the intervention from my hon. Friend the Member for Sefton Central. Given what he said about the amount of telegraphing that Ministers will have about the changes and given the scale of scrutiny provisions that were included in the last Bill come the end of Report stage in the Lords and the Commons, which have now been taken out of the current Bill, I fear that on this occasion, I need to press the amendment to a vote.

Question put, That the amendment be made.

Break in Debate

Bill Esterson Portrait Bill Esterson
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Sir Graham, I am guided by you. The Chair is always right and I completely accept your point. The Minister may choose to respond to the excellent suggestions that my hon. Friend the Member for Harrow West has made, but I think we have made the case that the chair of the TRA should be interviewed and there should be adequate parliamentary scrutiny of his or her appointment.

Greg Hands Portrait Greg Hands
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I would like to start by repeating what I said in 2018 when I first took this clause through a Committee and what I and others have said since: this Government are committed to creating an independent and objective investigation process in which businesses and consumers will have full confidence and to setting up the Trade Remedies Authority with the right pool of skills, qualities and experience.

I recall that broad agreement was evident for the principle of an independent impartial body during the previous debate on the TRA during the Trade Bill’s 2017 to 2019 passage. Without wishing to linger on the point, my startlement that the Opposition are so opposed to this legislation increases, although they claim to support all its parts.

Many will know that the World Trade Organisation allows its members to take action to protect domestic industries against injury caused by unfair trading practices, such as dumping, subsidies or unforeseen surges in imports. Quite to the contrary of what I think the hon. Member for Harrow West said, nobody wants to turn a blind eye to dumping. It is quite the opposite, but we can only do that with a functioning and legally operating Trade Remedies Authority.

Where there is evidence that dumping is happening, countries are permitted to put measures in place to remedy the situation, hence the term “trade remedies”. Measures usually take the form of an increase in duty on imports of specific products following an investigation. Establishing an independent trade remedies function is integral to the UK’s new independent trade policy. We must get it right. Decisions on trade remedies cases can have profound impacts on markets and on jobs, and that is why we need to create an independent, objective investigation process that businesses can trust. We will be appointing the best people.

Gareth Thomas Portrait Gareth Thomas
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The Minister is absolutely right. We need a functioning TRA and we need a functioning trade remedies system. However, decisions that the TRA makes can be challenged and taken up to the WTO. As he knows, there is not a functioning dispute settlement process at the WTO at the moment. Why is there still such resistance from the Minister to joining the multi-party system that the EU has proposed to try to get around Donald Trump’s objection to the WTO dispute resolution process?

Greg Hands Portrait Greg Hands
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25 Jun 2020, 2:40 p.m.

I hear what the hon. Gentleman has to say, and I think he is wrong to say that there is resistance, but I gently suggest that the matter is without the scope of the Bill, interesting though that topic and the future of the WTO might be.

We will be appointing the best people to the TRA, including the non-executive members of its board. As with any public appointments, the appointment of non-executive directors will be subject to the well-established rules that govern public appointments of this kind.

Amendment 1 seeks to give the International Trade Committee the statutory power to approve or veto the appointment of the TRA chair. It is established practice that decisions on public appointments are for Ministers who are accountable to Parliament and the public for those decisions. The Cabinet Office “Public Bodies Handbook” explicitly states that Ministers normally appoint the chair and all non-executive members for non-departmental public bodies.

Following the Liaison Committee’s report in 2011, further guidance was issued by the Cabinet Office setting out the tests for determining which non-departmental public body appointments should be subject to pre-appointment scrutiny. That guidance makes it clear that pre-appointment scrutiny should apply only in respect of three types of post:

“i. posts which play a key role in regulation of actions by Government; or

ii. posts which play a key role in protecting and safeguarding the public’s rights and interests in relation to the actions and decisions of Government; or

iii. posts in organisations that have a major impact on public life or the lives of the public where it is vital for the reputation and credibility of that organisation that the post holder acts, and is seen to act, independently of Ministers and the Government.”

In my view, none of those three requirements is met. The TRA is not a regulator, it does not protect or safeguard against the actions and decisions of Government, and, although we believe it is important for business confidence that it is seen as independent of Ministers, it is not an organisation that can be described as having a major impact on public life or the lives of the public.

I turn now to a few other points that cropped up. On EU remedy measures, we have been clear that we will transition appropriate measures into the UK. We have launched transition reviews of those, and we have consulted and will continue to do so. The economic interest test is a matter for the Taxation (Cross-border Trade) Act 2018, but there is of course a presumption in favour of measures in that Act.

On the engagement of trade unions, Simon Walker and the interim body—the Trade Remedies Investigations Directorate—met the Trades Union Congress yesterday and is engaging unions frequently. I remind the Committee that the board are not the decision makers on trade remedies; they set the strategy and hold the chief executive and the executive to account. There is no role for the TRA at the WTO or any involvement with the appellate body. I believe that I have responded to the British Ceramic Confederation letter, but I will study carefully what is in it.

Under the provisions of schedule 4, to which we will turn shortly, the TRA must produce an annual report, which the Secretary of State must lay before Parliament. The TRA will also be subject to the scrutiny of the National Audit Office and parliamentary Committees. In addition, complaints against it can be considered by the Parliamentary and Health Service Ombudsman, who may also share information with Parliament. I hope that that reassures the Committee that the amendment is not appropriate, and I ask the hon. Member for Sefton Central to withdraw it.

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

The Minister made a number of interesting comments. He talked about businesses and consumers having full confidence in the Trade Remedies Authority. He did not mention workers, and he did not mention the devolved Administrations in that statement at the start of his response. I am sure that causes concern.

The Minister spoke about the need to act independently and repeated the point about business confidence. He has also made the point that the TRA needs to be an organisation that business can trust. But if it is to be independent, there needs to be scrutiny of appointments. He said that a reason why it does not come under the code for appointments to be approved, other than by Ministers, is that it does not have a major impact. Trade disputes have major impacts. I mentioned the SSI closure; that was 5,000 jobs. I am shocked that the Minister does not regard that kind of incident as having a major impact. I am sure that workers up and down the country would share my concern on that point.

Greg Hands Portrait Greg Hands
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I have checked exactly what I said. I said, “organisations that have a major impact on public life”. I did say that it would have a major impact on jobs, but I think “public life” would be considered more broadly than the immediate jobs of a particular workforce, important though they are. We are talking about the broader public.

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

The Minister is in danger of dancing on the head of a pin with his phrases. Honestly, 5,000 jobs is not a major impact on public life? I think the people of Redcar and the north-east would disagree with him strongly about that.

It is essential that we have this system of scrutiny in place. There are pre-appointment scrutiny sessions for many roles in public life. The Minister set out the rules—I think he set them out correctly—but he also gave us, in his description of what is independent, and in the phrase “major impact on public life”, an argument in favour of our amendment. For that reason, we will press it to a vote.

Question put, That the amendment be made.

Break in Debate

Stewart Hosie Portrait Stewart Hosie
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25 Jun 2020, 2:44 p.m.

Amendment 35 would establish a fixed period of office for members of the TRA and make provision for one further period of office. The reason is rather obvious. Introducing a fixed term would give TRA members greater security of tenure and therefore reinforce their independence and impartiality, as their duration of service could not be—or certainly could not be perceived to be—at ministerial discretion.

Amendment 36 would insert wording stating that a person should be considered unable or unfit if the chair is satisfied regarding any of the following matters: that the member becomes insolvent, has been convicted of a criminal offence or is

“otherwise unable or unfit to discharge the functions of a member or is unsuitable to continue as a member.”

The effect would be to define, to a greater extent at least, the meaning of “unable or unfit” in paragraphs 9 and 10 of schedule 4. Introducing a definition of “unable or unfit” would provide greater legal certainty about the circumstances in which a person may be removed from office as a non-executive or executive member of the TRA.

In keeping with the amendments and new clauses that I have spoken to so far, I do not intend to divide the Committee on amendments 35 or 36, but I ask the Minister to consider carefully how the Government might bring forward amendments at a later stage to deal with the matters of a fixed term for, and legal certainty on dismissal from, the TRA. Doing so would remove the perception that a term on the TRA, or dismissal from it, might be based on any political consideration—a perception that would weaken the credibility of the TRA—and strengthen the independence of that body. That is vital, particularly as the TRA will be invited to consider the vexed issue of some questionable, and potentially illegal, trade practices. The TRA’s credibility will be incredibly important when that particular work is undertaken, especially in the absence of a fully functioning WTO appellate board.

The Government should look again, as the Bill progresses through the other place and on Report, at how a fixed term for members might be introduced and at how legal certainty on dismissal might also be written into the Bill.

Greg Hands Portrait Greg Hands
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26 Jun 2020, 12:01 a.m.

Clause 5 will allow the TRA to be established as a new non-departmental public body, and schedule 4 outlines its governance arrangements. Those include detailing how TRA members will be appointed and how the terms and conditions of their appointment will be established. Such provisions should be familiar to those with experience of working with similar bodies.

It is crucial that the right people are appointed as members of the TRA. We are committed to appointing on merit following fair and open competition. That is why we are following standard Cabinet Office guidelines on the appointment of members of the TRA, as set out in the “Governance Code on Public Appointments”, which states that it is usual for Ministers to decide on the length of tenure. The code also sets out

“a strong presumption that no individual should serve more than two terms or serve in any one post for more than ten years”,

other than in exceptional circumstances.

Appointments will be independently regulated by the Commissioner for Public Appointments to ensure that the rigorous principles of public appointments and the “Governance Code on Public Appointments” are applied. Beyond that, the Government and the TRA will have regard to the need to protect the resilience of the board and to ensure that there is a managed turnover of members now and in the future. That may mean, for example, that it is sensible to make some of the initial appointments to the board shorter than five years to stagger any turnover in membership.

Specifying those details in the contractual terms for each appointment is the best way to ensure the flexibility to get the organisation off to the best start. The role of the TRA chair designate is crucial in shaping and forming the board. It is therefore only right that the Secretary of State does that through the terms and conditions for each role in consultation with the chair designate, rather than binding their hands in legislation. We are working closely with the TRA’s chair designate, Simon Walker, to start the recruitment of the rest of the TRA board members in due course. We will specify the duration of appointments as part of that process.

By contrast, amendment 35 would replace the contractual terms for all TRA members with a fixed statutory period of either five or 10 years, with no provision for any other length of tenure. That would deny the TRA the flexibility that it needs, particularly now when we are trying to ensure the best possible start for the new organisation, but such a rigid approach would be detrimental to its good governance at any time.

Amendment 36 seeks to specify a number of criteria that would deem a member of the TRA board unfit to continue in their position. Schedule 4 already provides for the Secretary of State to remove non-executive members, and for the chair to remove executive members, from the board should they be deemed unable or unfit to carry out the functions of the office. That approach will be familiar to hon. Members from the legislation establishing organisations such as the Competition and Markets Authority.

As with all public appointments, the terms and conditions for the non-executive members of the TRA are being developed in line with the “Code of Conduct for Board Members of Public Bodies”, which clearly sets out the standards expected from those who serve on the boards of non-departmental public bodies. The code provides that members of the board must inform the sponsor Department of any bankruptcy, unspent criminal conviction or disqualification as a company director in advance of appointment, or should any such instances occur during the appointment.

The code does not expressly specify that those issues determine an individual’s fitness to serve on a board or that they should be regarded as grounds for terminating an appointment, but I assure the Committee that the Government consider that that should be the case. That is why the terms and conditions of Simon Walker, the TRA chair designate, provide that the Secretary of State may terminate his appointment in those circumstances. It is very much our expectation that the relevant terms of appointment for other non-executive members will follow a similar approach.

The appointment of executive members is a matter for the TRA chair. It is therefore appropriate that the terms and conditions of their employment are managed by the TRA in a way that enables flexibility, while holding its staff to the necessary standards of integrity and professionalism.

I hope that the demonstrates to the hon. Member for Dundee East that we are establishing the TRA in accordance with the existing codes and in line with the practices adopted in other such bodies. I therefore ask him to withdraw his amendment.

Stewart Hosie Portrait Stewart Hosie
- Hansard - - - Excerpts

26 Jun 2020, 12:04 a.m.

I have no intention of pressing the amendments. I listened carefully as the Minister rattled through that answer. I have no doubt that, with the exception of the specific point he made about staggering five-year terms at the very beginning, things are being done in line with guidance that has been used previously. However, that does not really answer the point that, because of the ministerial discretion, particularly on the removal of a member, there may still be a perception, real or otherwise, that members can be removed for considerations that are political and nothing to do with their actual unfitness to serve.

While I will not divide the Committee on the amendment, notwithstanding that the Minister read his answer very quickly, the Government may want to seriously consider how these matters are addressed. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Break in Debate

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

25 Jun 2020, 2:54 p.m.

As with amendment 1, it is the lack of scrutiny that we are opposed to, not the creation of the Trade Remedies Authority. That is the subject of amendments 2 and 3, which are particularly important—as my hon. Friend the Member for Harrow West reminded us in the debate on amendment 1—in the absence of an effective WTO and given the concerns about international co-operation and collaboration on important matters that can lead to damaging trade disputes.

The amendment requires that the Secretary of State lay the annual report of the TRA before Parliament

“no later than 1 August of the calendar year in which the last day of the financial year covered by the report falls”,

and amendment 3 requires that a report is prepared for Parliament in a timely fashion on each recommendation made to the Secretary of State.

Parliament should be able to scrutinise the work of the TRA to ensure that it is working in the best interests of the UK economy and all of its components. Such requirements are nothing new in the realm of trade remedies. In the European Union, the Commission is obliged to report to the European Parliament. This is supposed to be a continuity Bill; the continuity in this case would be to apply equivalent processes in the UK to what we had in the EU.

The report to the European Parliament is obliged to give MEPs statistics on the cases opened and the number of measures adopted. MPs here should be given the same information by our TRA so that they may scrutinise its work. MPs should be able to look at the number of cases initiated and the number of measures adopted, and therefore be able to judge whether the TRA is taking measures to defend our industries and jobs, and is working with the devolved authorities—not just putting the consumer interest first, at the expense of producers, jobs, and the regions and nations of the country.

Industry would be more comfortable if there was a more rigorous approach for parliamentarians to get involved in the setting of the rules for the system—it is not just us saying this, but industry, and both sides of it. As in the rest of the Bill, the Government propose nothing on parliamentary oversight or scrutiny of the TRA. Yet again, they want to make decisions that will have profound impacts—on key sectors of industry, on thousands of jobs and on the regions and nations—behind closed doors, without scrutiny and without accountability to Parliament. Unless that scrutiny is there in law, there is no guarantee that it will happen.

Giving parliamentarians an oversight power over the work of the TRA would ensure proper scrutiny and accountability. A weak trade remedies regime is of benefit to nobody in our country. If anybody thinks that having a weak regime will open up trade opportunities with international partners, they are mistaken. Partner countries will take advantage of that, once again, and we will see the loss of jobs that we saw in the steel sector in 2015 and 2016. It is only right that this House gets to scrutinise the work of the TRA to ensure that it is doing its job properly.

Greg Hands Portrait Greg Hands
- Hansard - -

25 Jun 2020, 2:58 p.m.

I recognise the desire of Opposition Members to ensure that our trade remedies system is impartial, objective and transparent. Those have been our guiding principles, too.

That is why we are establishing the Trade Remedies Authority as an arm’s length body and why we will require the TRA to produce a report on the performance of its functions during each financial year, which the Secretary of State must lay before Parliament. The Bill requires that to be produced

“as soon as reasonably practicable”

after the end of that financial year. That is in line with other arm’s length bodies, such as the Office for Nuclear Regulation and the Nuclear Decommissioning Authority.

Imposing a fixed deadline by which the TRA’s annual report must be laid before Parliament is unnecessary. Prioritising an arbitrary deadline over ensuring a full and detailed report for Parliament and businesses to scrutinise is in no one’s interests. I am sure that the TRA, like all other NDPBs, will use its best endeavours to publish the annual report as quickly as possible following the end of the financial year. It is of course possible that that could be within the timeframe suggested in the proposed amendment. However, the TRA statement of accounts must be certified by the Comptroller and Auditor General before being laid, and that reliance on processes outside the TRA’s direct control makes it unreasonable to set a deadline for publication in statute.

The TRA’s annual report will follow best practice on openness and accountability as set out in the Cabinet Office publication, “Public Bodies: A Guide for Departments”, which provides a clear structure of best practice requirements, although we recognise that these will not be specific to each organisation that they cover. As with all non-departmental public bodies, we expect the TRA to follow best practice for an organisation of its type and to include appropriate performance indicators, rather than that being set by statute. As a new organisation, it is important to ensure that the TRA has the flexibility to develop and adapt these key performance indicators as it settles into its functions and continues engagement with stakeholders.

Amendment 3 focuses on the TRA’s provision of advice and assistance to the Secretary of State regarding international trade disputes. It would require the Secretary of State to share information related to that advice and assistance with Parliament within five days of the TRA’s submitting it to the Secretary of State. Clause 6 sets out the functions of the TRA, allowing it to advise, support and assist the Secretary of State in the conduct of an international dispute, but does not give the TRA responsibility for the handling of international trade disputes. These are, rightly, a matter for the Government to either initiate or to defend.

Break in Debate

On the Scotch whisky industry, I mentioned the 25% tariff because of US actions regarding Airbus and Boeing. Disputes have spill-over effects on other parts of the economy. Will the Minister tell us the reasons for the change and for giving this big new power to the Secretary of State, and will he give serious consideration to what we are proposing? It seems to be entirely consistent with the remit of the Trade Remedies Authority as set out in the Bill.

Greg Hands Portrait Greg Hands
- Hansard - -

26 Jun 2020, 12:05 a.m.

As we have heard, amendment 28 seeks to create a new role for the TRA in analysing the impact of retaliatory or rebalancing duties imposed by the Secretary of State as a result of an international dispute. We should perhaps remind ourselves of the roles and responsibilities relating to international disputes, and the purpose behind the provision in the customs Act—to give it its proper title, the Taxation (Cross-border Trade) Act 2018—which the amendment refers to, and which the hon. Member for Sefton Central has been referring to as well.

Before going into the detail, I will say a couple of things about some of the broader issues that the hon. Gentleman has raised. The Airbus-Boeing dispute is clearly not directly within the remit of amendment 28, but it is not, I suppose, so far from it. Let me be clear about today’s announcement. We oppose the tariffs coming from the US vigorously. We find them unnecessary and harmful to trade between the US and the UK. We have raised our opposition with the US trade representative in person in recent weeks. I confirm to the Member for Warrington North that my understanding is that gin is included. There is not a decision to impose tariffs on gin, by my understanding, but gin is one of the products they are actively looking at.

On the questions that the hon. Member for Sefton Central asked about the Finance Bill, I think I am best off offering to look at those, and the most appropriate Minister will respond to him. As a former Treasury Minister, I am slightly mindful that the questions are probably within the Treasury’s area, and it may be better for the Treasury to respond. I do not think that there will be time to respond before the sitting ends at 5 o’clock in any case. However, contrary to what he suggested, it is highly unlikely that a Treasury or other Minister has said that we should operate outside the World Trade Organisation’s rules in the cases that he raised.

Section 15 of the Taxation (Cross-border Trade) Act provides for the Secretary of State to change the amount of import duty that applies to certain goods as a result of an international dispute. There are several scenarios under which that could come about. The first is if the UK has successfully challenged trade-restrictive measures imposed by another WTO member under the WTO’s dispute settlement system. If the other member fails to comply with the WTO’s ruling in favour of the UK, the UK Government would be able to impose duties to redress the issue.

Secondly, if there is a dispute between the UK and one of our partners under the terms of a free trade agreement, the UK may be able to impose retaliatory duties. Thirdly, there is the possibility that the UK could be subject to a dispute in the WTO, or as part of an FTA, and be required to provide compensation to the relevant WTO member or FTA partner. That conversation could take the form of imposing lower duties on certain goods. I reassure Members that variations in import duties in response to trade disputes are intended to be temporary in nature, and will be removed when action has been taken by the country or territory in question to bring itself into compliance.

What is clear from all this, and what Parliament has already accepted in passing the Taxation (Cross-border Trade) Act, is that it is for the Government to decide whether it is necessary to change import duties as a result of a dispute. We should be clear, however, that the resulting duties, whether higher or lower, are not trade remedies measures. That is the problem with the amendment.

Although the Trade Bill enables the TRA to provide expert support to the Secretary of State in order to build the evidence base for decisions on international disputes where needed, as we have already discussed during our consideration of amendment 3, the TRA does not have a role to play in determining duties arising from international disputes, and those duties are not trade remedies measures. Interesting though they may be to the Opposition, that would expand the role of the TRA into areas for which it is not intended. The TRA will be the UK’s expert body on trade remedies—that is the reason we are establishing it. It will not have the wider remit that the amendment would confer on it. I hope the Committee will agree and I ask the hon. Member for Sefton Central to withdraw the amendment.

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

25 Jun 2020, 3:21 p.m.

That was a quite remarkable finish. I think the Minister said that the TRA will be the UK’s expert body on trade remedies.

Greg Hands Portrait Greg Hands
- Hansard - -

25 Jun 2020, 3:21 p.m.

Yes.

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

25 Jun 2020, 3:21 p.m.

Yet it is not going to be able to get involved in helping the Secretary of State by advising her where she might vary import tariffs in the event of an international trade dispute. Clause 6(1)(a) refers to

“the conduct of an international trade dispute”,

which seems to be entirely the right place to be looking for support for the Secretary of State when she is being given remarkable and unusual powers. If that support does not come from the Trade Remedies Authority, the Treasury will be advising, but it is a role for the Secretary of State for International Trade, not for the Chancellor.

The Minister correctly said that aspects of what I have asked about are for Treasury Ministers, but this is a responsibility of the Secretary of State for International Trade. That is why it has come to this Bill Committee; there is not another opportunity to deal with this issue. It is entirely relevant to look at support from within the Department for International Trade, which is why we tabled the amendment. I am concerned that the Minister has not come back with an alternative to how this power might be used.

Greg Hands Portrait Greg Hands
- Hansard - -

I would not normally intervene on the hon. Gentleman’s summation, but I think he is confusing two things: he is confusing an international trade dispute, the result of which may be retaliatory tariffs or some kind of other tariff action, with a trade remedy, which is in place to prevent something like the dumping of products where the UK is a producer of those products. They are fundamentally different things. The Trade Remedies Authority is set up to deal with trade remedies, not per se with the subjects of international trade disputes.

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

25 Jun 2020, 3:23 p.m.

Not per se. The clause states:

“The TRA must provide the Secretary of State with such advice, support and assistance as the Secretary of State requests in connection with—

the conduct of an international trade dispute”.

It is not just about prevention, but about the conduct of an international trade dispute. We will end up disagreeing on this issue. With the way that the Bill is crafted and the way that the Government are setting up the Trade Remedies Authority, this was an obvious place to be looking to give the Secretary of State support and advice. Given that that is one of the key functions of the Trade Remedies Authority, it would be wise for her to have support in making such decisions.

I will wait for the Minister’s response to my questions. I think the problem was that the Treasury Minister was not able to answer them because they are technically challenging. The questions he was asked were difficult, so I am not surprised by what he says about answering a little later. It is very important that we get this right. Perhaps he can come back with exactly how advice and support will be given to the Secretary of State. I gave the examples at the start because they are current and show just how serious these issues are, and it is really important that we get them right. So I will wait to hear back from him. In the meantime, we will test the will of the Committee.

Question put, That the amendment be made.

Break in Debate

Its effect is the same—to protect LPP. We seek to insert the amendment into this part of the Bill because we are deeply concerned that clause 8 grants are very wide discretion to the Revenue to require information. As with the argument for amendment 33, the scope of that provision should be far more clearly defined to give greater certainty as to the extent of the information they anticipate, the frequency of collection and the method of data collection from it, but the safeguard that ensures that the information that is sought to progress a criminal charge cannot be hidden behind legal professional privilege. I commend the amendment to the Committee.

Greg Hands Portrait Greg Hands
- Hansard - -

It is important, as we turn to the data-sharing powers of the Bill, that the Government have a more comprehensive understanding of UK exporters so that our work to build and grow UK export capability is properly targeted at and tailored to those businesses where it will deliver the maximum benefit.

Clause 7 sets out the powers needed for the Government to collect data to establish the number and identity of UK businesses exporting goods and services, particularly smaller businesses and sole traders, who may not be readily identifiable from existing data, but who may need a helping hand from the Government to develop their export potential reaching into existing and new markets. The clause provides the ability for HMRC to collect relevant data by tick boxes on existing tax returns.

Amendment 32 would restrict the Government’s ability to implement new questions to gather data on exporters at speed, by requiring Treasury Ministers to seek further consultations with stakeholders after any necessary engagement has already concluded—it would be, if you like, an additional round of consultation, which we do not think is necessary. Such an amendment would duplicate the administrative burden on stakeholders and, more importantly, delay the availability of data and, by extension, the benefits to businesses.

Amendments 33 and 34 are closely related and concern legal professional privilege, which the hon. Member for Dundee East will know is a long-standing principle that protects the confidentiality of communications between lawyers and their lay clients, and vice versa. It enables lawyers to consult and advise their clients without clients fearing that their information will later have to be disclosed. Indeed, it is a matter of general interest that any person who wishes to consult a lawyer must be free to do so under conditions that ensure uninhibited discussion. That principle is recognised and protected under article 8 of the European convention on human rights.

I can provide an absolute assurance to the Committee that the Government have no intention, either now or in the future, of using these powers to seek or share information that is protected by legal professional privilege. For clause 7, the information that has been requested from exporters is for trade statistics purposes and will be provided voluntarily. The fact that the information is being provided voluntarily is perhaps an indication of the Government’s position in respect of minimising burdens and therefore not requiring privileged information to be disclosed.

Clause 8 allows for the sharing of data that is already held by HMRC for its administrative functions. We are talking about data to be shared that has already been collected. Such information cannot therefore be subject to legal professional privilege, as it has already been provided to HMRC.

I will take this opportunity to remind hon. Members that the clauses also provide significant assurances on the collection, handling and processing of information collected under the powers. The data-sharing powers in the Bill are permissive, so all instances of data sharing must be approved by HMRC, which acts as guardian of the data. There are criminal penalties for any unauthorised sharing of data under the existing Commissioners for Revenue and Customs Act 2005, which apply in respect to the data shared under clause 8. Nothing in the clause permits the disclosure of information that is not otherwise permitted in data protection laws, including the Data Protection Act 2018 and the Investigatory Powers Act 2016.

I hope the clarification and assurances given provide the hon. Gentleman with the reassurance he is seeking in respect of legal professional privilege. On that basis, I ask him to withdraw his amendment.

Stewart Hosie Portrait Stewart Hosie
- Hansard - - - Excerpts

26 Jun 2020, 12:05 a.m.

I thank the Minister for his commitment in relation to legal professional privilege, confirming that information can be shared between a client and a lawyer and, unless in the course of a criminal investigation, is completely protected. That is a good commitment to receive.

I also understand what the Minister said about information being collected to provide trade statistics on a voluntary basis. That is helpful, but I was slightly concerned at the beginning when he spoke about trying to identify the number and identity of exporters—one would have thought that the Government already knew that, and it is slightly concerning if they do not. It might be useful to understand what gaps there are in the Government’s understanding of what organisations export, what they export and to whom, but that is for another day. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 7 ordered to stand part of the Bill.

Clauses 8 to 12 ordered to stand part of the Bill.

Break in Debate

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

25 Jun 2020, 3:45 p.m.

As we have debated many times, the Bill, with its long title, is a lot more than that.

Greg Hands Portrait Greg Hands
- Hansard - -

25 Jun 2020, 3:45 p.m.

Thanks to the Opposition’s amendments.

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

25 Jun 2020, 3:45 p.m.

The last Bill became an awful lot more after it was amended in the Lords, and I suspect that things are heading the same way. However, the hon. Member for South Ribble is right. Of course we have the highest food standards in the world. I say it already, and we have pride in those high standards. It is matter of safety, production and welfare, and all three of those have to be retained. I remind you, Sir Graham, that it was the US Secretary of State Mike Pompeo who confirmed that chlorinated chicken must be part of any post-Brexit trade agreement with the UK. That was confirmed by trade representative Lighthizer on many occasions, including when he said that on issues such as agriculture

“this administration is not going to compromise”.

Break in Debate

Stewart Hosie Portrait Stewart Hosie
- Hansard - - - Excerpts

25 Jun 2020, 3:53 p.m.

I think people are deeply concerned. No matter how many times Ministers give assurances from the Dispatch Box or elsewhere—Conservative MPs know this—because of what is said by our negotiating partners, there is deep concern among the public and, in particular, those who work in agriculture about standards that may be reduced. My hon. Friend is therefore absolutely right that by accepting various amendments or new clauses, the Government have an opportunity to cement our standards and rule out in negotiations the reduction of standards rather than simply by words in a speech.

New clause 12 in effect does two things: it affirms the UK’s rights and obligations under the agreement on the application of sanitary and phytosanitary measures in appendix 1A of the WTO agreement; and it prohibits the import of food into the UK if standards in the exporting country are lower than those in force here. I do not think there is anything contentious about that, nor do many people in the real world. I suspect the Minister will not be at all surprised that various campaign groups, including Global Justice Now and the Trade Justice Moment, support such objectives.

The list of supporters for such measures is deep and wide. Scottish Land & Estates said:

“Scotland’s producers need guarantees from the UK Government that domestic production and environmental standards are upheld as part of future international trade deals. Our extremely high environmental and food safety standards are amongst our key selling points, and this must be protected after we leave the EU to ensure we don’t find ourselves in a ‘race to the bottom’.”

As NFU Scotland has said that it is concerned that the UK Government’s approach to future trade policy creates the potential for the importation of agri-food into the UK produced to an inequivalent and uncompetitive standard of production, one would think the UK Government should listen. The new clause would ensure that the UK Government had a duty to protect the quality of domestic food supply by ensuring that imported foodstuffs are held to the same standards as domestic foodstuffs are currently. I commend it to the Committee.

Greg Hands Portrait Greg Hands
- Hansard - -

25 Jun 2020, 3:54 p.m.

I turn to new clauses 9, 11 and 17. I am aware of the strength of feeling from colleagues on both sides of the Committee on this important issue. I spoke about the commitments the Prime Minister gave in his Greenwich speech to upholding high standards, which were also in our manifesto.

Theo Clarke Portrait Theo Clarke (Stafford) (Con)
- Hansard - - - Excerpts

25 Jun 2020, 3:54 p.m.

I have received a lot of correspondence from local residents and farmers in Stafford who are concerned about food standards, with food having to be produced to very high standards in the UK. What assurances can the Minister give me that with the Bill we will be supporting and backing British farming?

Greg Hands Portrait Greg Hands
- Hansard - -

I thank my hon. Friend for that intervention. In the time she has been in the House, she has been a strong defender and advocate of her farming sector in and around Stafford. I can say that there will be no compromise on our standards on food safety, animal welfare and the environment, exactly as we laid out in the election manifesto that she and I were both elected on just six months ago, both collectively and individually.

This Bill is about ensuring continuity, particularly at this moment of unprecedented economic challenge posed by coronavirus. We need the power in clause 2 to replicate the effects of our current trading relationships and provide certainty to UK businesses. That includes the continuity agreements, including the Canada agreement, which the hon. Member for Harrow West has mentioned again today. I think there has been yet another shift in the Labour party’s position: last Thursday, we heard from the shadow Secretary of State that Labour was in favour of a trade deal with Canada, but now the hon. Member for Harrow West seems to be back to opposing that trade deal. There does seem to be some confusion, but the purpose of this Bill is not to sign new agreements or alter standards in any way. Without the Bill, we risk being unable to implement continuity agreements, resulting in disruption and uncertainty for businesses and consumers.

As the National Farmers Union confirmed to the Committee last week, the EU’s approvals regime for agricultural products is one of the most precautionary in the world. That regime will be transposed onto the UK statute book through the European Union (Withdrawal) Act 2018. I am pleased to say that the NFU has not expressed any concerns about the framework for mutual recognition in continuity agreements that this Bill provides, and I am grateful for the contribution of its expertise through our expert trade advisory group. As I have previously told the Committee, we have now signed 20 continuity agreements with 48 countries, replicating the terms that we had with them under EU trade agreements. Imports under continuity agreements must continue to comply with our existing import standards. None of these agreements has resulted in a lowering of the agricultural or other standards referenced in the agreement.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

For the record and for the avoidance of doubt, will the Minister confirm that he can see no way in which chlorinated chicken from the US will be allowed to be sold in British stores?

Greg Hands Portrait Greg Hands
- Hansard - -

That is absolutely correct. It is a point that we have made on numerous occasions, and I am happy to make it again today.

Although this Bill relates to continuity with existing trading partners, I recognise the concerns that colleagues have about future FTAs with new trading partners, as I said during Tuesday’s debate. As the Secretary of State, my DEFRA colleagues and I have told this House and the other place on many occasions, the Government will stand firm in trade negotiations. We will always do right by our farmers and aim to secure new opportunities for the industry. Returning to the point made by my hon. Friend Member for Stafford, we would like Stafford farmers to gain opportunities to sell their high-quality produce abroad by breaking down barriers, reducing or removing tariffs, and so on. That is also very important for our agriculture; in fact, the scoping assessment for the US trade deal showed that UK agriculture would be a net beneficiary of any such deal.

All imports under all trade agreements, whether continuity or future FTAs, will have to comply with our import requirements. In the case of food safety, the Food Standards Agency and Food Standards Scotland will continue to ensure that all food imports comply with the UK’s high safety standards, and that consumers are protected from unsafe food that does not meet those standards. Decisions on those standards are a matter for the UK and will be made separately from any trade agreements.

Matt Western Portrait Matt Western
- Hansard - - - Excerpts

The Minister has said that UK farmers would be net beneficiaries of any trade deal with the US on exports, but I do not see how that can tally. If the United States’ No. 1 priority in any trade deal is agricultural products, is he saying that we will be exporting more agricultural products to the US than the US will be exporting to the UK?

Greg Hands Portrait Greg Hands
- Hansard - -

I am surprised by the hon. Gentleman’s apparent enthusiasm for Trumpian mercantilism, thinking that because UK agriculture might gain, that would somehow mean US agriculture would lose. Sir Graham, you and I both know that free trade does not work like that: there could be benefits for both sides in the trade agreement. For example, the US simply does not allow in British lamb, and currently puts very high tariffs—tariffs of between 20% and 23%—on British cheeses, including Cheddar, Stilton, and other high-quality British cheeses that we would like to sell to the United States. Of course there is an opportunity for British agriculture, and the scoping assessment that we published on 2 March shows that the UK agriculture sector has the potential to be a net beneficiary.

Matt Western Portrait Matt Western
- Hansard - - - Excerpts

The Minister has very clearly said that UK farming will be a net beneficiary of a trade deal with the US. Is that correct?

Greg Hands Portrait Greg Hands
- Hansard - -

25 Jun 2020, 3:59 p.m.

I refer the hon. Gentleman to the scoping assessment that we published on 2 March, where that is laid out in considerable detail. Of course, it is a scoping assessment; nobody knows yet exactly what will be in the deal, on which a lot will depend.

We have talked at some length in these debates about the scoping assessment, which lays out the possibilities. The numbers run in the scoping assessment suggested that UK agriculture would be a net beneficiary of the agreement. Our existing import requirements already include a ban on using artificial growth hormones in domestic and imported products, and a ban on using anything other than potable water to decontaminate poultry carcases.

Break in Debate

Stewart Hosie Portrait Stewart Hosie
- Hansard - - - Excerpts

The wording that the Minister uses is fascinating. We were talking about production standards. He spoke about production methods. Those are not the same thing.

Greg Hands Portrait Greg Hands
- Hansard - -

25 Jun 2020, 4:09 p.m.

I am happy to have a debate with the hon. Gentleman about the difference between standards and methods, but I am not sure that the difference is that big.

The dictation of our domestic standards to our trading partners might well appear a laudable goal, but the new clause would require them to keep aligned with just seven days’ notice. Subsection (3) of the new clause states that a register

“must be updated within seven days of any amendment to any standard listed in the register.”

Our trading partners’ standards would therefore have to remain dynamically aligned to our domestic production standards with just seven days’ notice. That could have serious consequences for our existing trade flows, let alone anything negotiated in the future.

This is true for the developing world. The beans that we can buy at Waitrose in Fulham—I imagine that they are similar to the ones at Waitrose in Putney, for example—come from Kenya and Egypt. The last time I bought beans was at the weekend. Bananas from the Caribbean might not have production standards that are the same as those in the UK, but they can still meet our import standards.

Those markets would not be able to keep up with our changes. Given just five days’ notice, they would have to dynamically align with whatever the UK decided and, within seven days, make the changes to their domestic production standards. That strikes me as being wholly impractical. The impact of the new clauses could be severe on livelihoods in the developing world. I invite Opposition Members to go and see some of the Kenyan or Egyptian beans being produced and tell some of those workers that, as a consequence of new clause 9, they might well find themselves having to align with UK production standards in the future.

The new clauses might have been drafted with the US in mind, but this is UK law and it would apply to all our trading partners. These measures would likely render inoperable the very continuity agreements we have been discussing and, indeed, potentially prevent a deal with the EU itself. There would be an irony in the UK, through our domestic law, seeking the EU to dynamically align with our standards.

As I said on Tuesday, the UK banned veal crates some 16 years before the EU, and we can take great pride in that; it is a great achievement. The idea that the EU would sign a trade deal with us whereby it would have to commit to dynamic alignment with our standards with just seven days’ notice is highly questionable, to say the least. Members who want continuity with those 40 deals should not vote for these new clauses, nor should those who want a trade deal with the European Union.

New clause 9 would have the unwanted effect of discouraging partners with whom we are yet to sign a continuity agreement from negotiating with us. This Government were elected on a manifesto promise that, in our trade negotiations, we will not compromise on our high environmental protection, animal welfare and food standards, and we will not. Parliament will have significant oversight of any regulations made under this power, and any statutory instruments brought forward will be subject to the affirmative procedure. Given our robust commitment to British food and farming, I ask the hon. Member for Sefton Central to withdraw the new clause.

Like new clause 9, new clause 11 stipulates that all food imported to the UK should be held to the same standards as that which is produced in the UK. The proposal stands in the name of the hon. Member for Dundee East, although I suspect he has the same intentions as the hon. Member for Sefton Central in tabling it. I have already provided assurances that EU import standards, praised by the NFU and others, will be replicated in domestic law at the end of the transition period. Our import requirements include a ban on using artificial growth hormones in domestic and imported products, and any changes to existing legislation would require new legislation to be passed by Parliament.

Given that we have high safety standards in place, and that the wider unintended consequence of the new clause would be to threaten both the resilience of our food supply chains and our opportunity to ensure that we secure continuity for British businesses and customers through our ongoing continuity negotiations, I hope that the hon. Member for Dundee East will not press the new clause.

New clause 17 stipulates that any animal welfare or sentience regulations arising from trade agreements must be aligned with existing commitments in UK and retained EU law. I can assure Members that our world-leading animal welfare standards are at the heart of our continuity negotiations. None of the agreements already signed with 48 countries is inconsistent with existing standards, as the parliamentary reports published alongside those agreements demonstrate. In fact, the UK has some of the most comprehensive animal welfare regulation in the world. We have introduced one of the strictest ivory bans in the world and we have a manifesto commitment to end excessively long journeys for slaughter and fattening. World Animal Protection rated the UK as having the joint-highest animal welfare standards in the world, tied with Austria, Switzerland, the Netherlands, Denmark and Sweden.

I share Members’ desire to ensure safeguards both for British consumers and for farmers. However, the protections we are already putting in place, coupled with the unintended consequences of the proposals, mean that these measures would be of no benefit. Our manifesto commitment is clear: the Government will stand firm in trade negotiations to support farmers, protect consumers and safeguard standards. I hope that that explanation, alongside the 20 continuity agreements that Parliament ratified, provides reassurance to the Committee that the Government’s commitment to maintaining standards is being delivered. I therefore ask hon. Members not to press their proposals to the vote.

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

25 Jun 2020, 4:10 p.m.

That was really telling. It has taken until today for the Government to come up with a form of words to justify not supporting higher food production standards. The intervention, I think by the hon. Member for Dundee East, really did nail it. There is a world of difference between methods and standards, of course there is. How something is produced to a certain standard is one thing; the method used is entirely another. This is the point we have been making again and again in the proceedings of both this Bill and the Agriculture Bill. The Government have been pushing a defence of food safety, but not how it is produced, how animals are looked after or, indeed, how plants are protected. It is really telling that that is the defence being used and that it has taken them a while to get there. There can be and there are different methods of production all over the world, of course there are, but they can be to the same high standards. I am afraid that it did not work, and it will not work. It will not wash, unlike the chlorine the previous Secretary of State at one point said was perfectly safe and acceptable, before changing his mind when he realised it was not acceptable or palatable.

So, there are those differences and we should have concerns about hormones in animals. We should have concerns about the impact of antibiotics. We should have concerns about the impact on fruit and vegetables as well. As my hon. Friends have pointed out it is not just the United States, but countries that are directly a part of the continuity aspect of the Bill, that the Minister is so fond of reminding us about. It is Japan as well as Canada, by the way.

Break in Debate

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

25 Jun 2020, 4:25 p.m.

Given the extra protections that new clause 12 would lock into law to keep the NHS safe from future trade agreements’ effectively pushing higher pharmaceutical prices or further marketisation of the NHS, we will happily support the new clause tabled by the hon. Member for Dundee East. Indeed, his new clause supplements the protections that amendment 12, had it been agreed to earlier in our proceedings, would have put in place to protect our public services more generally.

We, too, are aware of the leaked documents that the hon. Gentleman referred to, revealing that discussions have already taken place in the UK-US trade talks about possible measures that the American pharmaceutical industry might want, clearly supported by Donald Trump’s chief negotiator, that would effectively push prices up. Given that we have substantially lower pharmaceutical drug costs than the US, the fact that the Americans are continuing to push such measures is profoundly worrying.

Ministers have said that the NHS is not on the table in the UK-US talks and, like the hon. Gentleman, I take that at face value, but it is worth saying that until the text of a trade agreement is published, we will have no way of knowing for sure what is in it. The precedent of the EU-Canada deal does not give reassurance in that respect, as it used the negative list approach to services liberalisation, to which he referred. The Minister will remember the considerable concern that Germany had chosen to add in carve-outs for the whole of its national health service, whereas the UK had not taken such a comprehensive approach.

The NHS Confederation and The BMJ have both published a series of concerns, setting out the ways the NHS could be undermined by a UK-US trade deal. One concern that is highlighted, which again the hon. Member for Dundee East referenced, was the use of ISDS—investor-state dispute settlement—provisions. Again, investor-state dispute settlement provisions were included in the EU-Canada deal, which Ministers count as a roll-over deal.

It would be helpful if the Minister would embrace the spirit of these new clauses, support new clause 12 being added the Bill and, in his wind-up remarks, confirm that he will not push a negative listing approach in a UK-Canada specific deal and that there will not be ISDS provisions in such a deal.

Greg Hands Portrait Greg Hands
- Hansard - -

25 Jun 2020, 4:29 p.m.

I start by thanking Opposition Members for tabling new clauses 12 and 13, which provide me another opportunity to stress the Government’s position on the NHS and our trade agenda. The Government have been clear and definitive: the NHS is not, and never will be, for sale to the private sector, whether overseas or domestic. No trade agreement has ever affected our ability to keep public services public, nor do they require us to open up the NHS to private providers.

We have always protected our right to choose how we would deliver public services in trade agreements, and we will continue to do so. The UK’s public services, including the NHS, are protected by specific exclusions, exceptions and reservations in the trade agreements to which the UK is a party. The UK will continue to ensure that the same rigorous protections are included in future trade agreements.

As stated in our published negotiating objectives with the US, to which I referred the hon. Member for Warwick and Leamington, the NHS will not be on the table. The price the NHS pays for drugs will not be on the table. The services the NHS provides will not be on the table.

Those commitments are clear and absolute, but new clause 12 is unnecessary, however laudable the intention behind it is. It overlooks the fact that there are already rigorous checks and balances on the Government’s power to negotiate and ratify new agreements. In particular, and as we discussed on Tuesday, the UK already has scrutiny mechanisms via the Constitutional Reform and Governance Act 2010 procedure that will ensure Parliament can see exactly what we have negotiated, and if it does not agree it can prevent us from ratifying the deal.

Furthermore, and most importantly, no trade agreement can of itself make changes to our domestic law. Any legislative changes required as a result of trade agreements, including—if not in particular—in relation to the NHS, would be subject to the separate scrutiny and approval of Parliament in the usual ways.

Break in Debate

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

25 Jun 2020, 4:33 p.m.

I beg to move, That the Clause be read a Second time.

I rise briefly to suggest to the Committee that once a free trade agreement has been signed in the future, it makes sense to have a point at which to assess the effectiveness of that agreement, perhaps to see how it has worked in practice in terms of British exporters being able to take advantage of it.

Labour Members remember only too well the Government’s decision to axe by some 60% the support to British exporters. So it will be interesting, five years down the line from the publication and signing of these continuity agreements, to see whether such a severe cut has actually meant that many British businesses have been unable to take advantage of the opportunities in a free trade agreement.

The new clause would also give us the opportunity, five years hence, to see whether the genuine concerns of many—both in this House and out—about investor-state dispute mechanisms, if they have been incorporated into agreements, have taken effect. We would be able to see the damage done to environmental protections, the health service, labour rights or human rights—any way in which they might have been affected.

Given the concerns expressed clearly to us about how many of the continuity trade agreements might actually work in practice, it is surely sensible to have the opportunity to review whether those concerns have been borne out in practice. One can think of the Norway continuity agreement, which still has no services provisions for British companies wanting to operate in service markets in Norway. That is still in some doubt, as only the goods part has been resolved. The situation is similar with Switzerland. We raised a series of concerns about the South Korea agreement and the extent to which some agricultural products, such as cheddar cheese and honey, have been affected by poor drafting of that agreement.

Given how we have thrown away some of the great advantages that Britain drew in terms of soft power from the Department for International Development being a stand-alone Department, again it will be interesting to see whether the Ghana and Kenya agreements—I thank the Minister for his letter—have been able to serve their purpose and support not only agricultural sales to the UK, but regional integration in west and east Africa.

For all those reasons, and given the huge concerns about some of the potential measures in free trade agreements, it makes sense surely—it certainly makes sense to us—to have a fixed point, five years down the line after a trade agreement has been signed, to have the opportunity for the Government to publish a full review looking at the impact.

Greg Hands Portrait Greg Hands
- Hansard - -

25 Jun 2020, 4:39 p.m.

New clause 15 proposes a review, as we have heard, of free trade agreements every five years after entry into force. I have already drawn the Committee’s attention to the parliamentary reports that we have voluntarily published alongside every signed continuity agreement, outlining any significant differences between the signed agreement and the underlying EU agreement. I confirm that we will continue to do so for the remaining continuity agreements.

We have a meaningful and constant dialogue with several Committees in Parliament. Those may provide a more appropriate forum for reviews of our trade agreements and an assessment of the UK’s wider trade environment and relationships. We are keen for Parliament to make its voice heard during the negotiation of our continuity programme in a way that is proportionate and productive. I also draw the Committee’s attention to the fact that six signed continuity agreements have been subject to debate in Parliament without a single one carrying a motion of regret.

As I have said many times before, our objectives for the trade continuity programme are to replicate the effects of existing EU trade agreements, which have all been subject to comprehensive scrutiny at EU level. Given that scrutiny, the parliamentary reports we have committed to publishing and the other constraints contained within the Bill, we do not believe that an additional report in the future would be an efficient use of parliamentary time. Additionally, I argue that looking at each agreement in isolation from the wider trading situation of the UK at an arbitrary point in time risks rendering any such report at best incomplete and at worst meaningless.

As a Department, we have an ongoing obligation to provide meaningful and timely information to the public, businesses and other key stakeholders on our assessment of the UK’s trading relationships. Statutory obligations anchored in specific agreements in the manner proposed by the new clause could in fact act as a constraint to the Department providing that sort of information in a timely and impactful way. As such, I ask the hon. Member to withdraw his new clause.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

I have listened to what the Minister has said. He will understand that we remain concerned that this provision was put in the Bill by the Government on Report in the Commons, and it has been taken out. The Minister who gave the assurance in writing that such reports will continue is no longer in the Department. I think we would still prefer to see the commitment in the Bill, and as a result, I intend to press the new clause to a vote.

Question put, That the clause be read a Second time.

Break in Debate

The European Maritime Safety Agency was set up after the Erika disaster, when the oil tanker Erika broke in two in the bay of Biscay in December 1999 and thousands of tonnes of oil were released into the sea. It triggered a package of EU laws to improve safety in the shipping industry, including the establishment of an agency to oversee the implementation of safety laws, which have helped to ensure that the English channel and the rest of our seas are properly protected from oil spills and other pollution from the big ships that carry traded goods. Surely, it makes sense to remain a member of that agency.

Greg Hands Portrait Greg Hands
- Hansard - -

25 Jun 2020, 4:49 p.m.

On new clause 21, regarding the parameters of the UK’s future relationship with the EU, the Government have made it clear that our priority is to ensure that we restore our economic and political independence on 1 January 2021. The approach to the future relationship with the EU has already been extensively discussed not just in the previous Parliament but in this one, particularly during the debates on the European Union (Withdrawal Agreement) Act 2020. During those debates and subsequently, the Government have been clear that we want a relationship with the EU that is based on friendly co-operation between sovereign equals and centred on free trade. That is what Taskforce Europe, working with the Prime Minister, is pursuing.

The UK published its approach to the negotiation of a future relationship with the EU on 27 February 2020. Our approach builds on the EU’s offer of a Canada-style deal. It reflects the type of free trade agreement that should be achievable between sovereign states that respect each other’s independence, as the EU has done in the past. We will discuss with the EU how to manage our friendly relations, but any solution has to respect our legal and political autonomy. Members will be aware that there are very limited options for third-country membership of EU bodies. We have been clear that we will be operating on the basis of existing precedents and no acceptance of the European Court of Justice.

However, I acknowledge that members of the Committee are looking for reassurance about the Government’s approach to negotiations with the EU in relation to the four bodies listed in the new clause. On the European Medicines Agency, we have stated that the UK-EU FTA should include commitments to co-operate on pharma co-vigilance, and to develop a comprehensive confidentiality agreement between regulators, in line with agreements between the European Medicines Agency and Swiss, US and Canadian authorities. The UK’s published response in respect of the European Chemicals Agency states that the UK-EU FTA should include a commitment to develop a memorandum of understanding to enhance co-operation further, similar to the MOUs that the European Chemicals Agency has agreed with Australia and Canada.

On the European Union Aviation Safety Agency, the UK’s published position is that we have proposed a bilateral aviation safety agreement that will facilitate the recognition of aviation safety standards between the UN and the EU, minimising the regulatory burden for industry. On the European Maritime Safety Agency, the UK is discussing with the EU how best to manage our friendly relations, but any solution has to respect our red line of no commitments to follow EU law, and no acceptance of the ECJ.

It is important to be clear that, in our negotiations with the EU, we are not asking for a special, bespoke or unique deal; we are looking for a deal like those that the EU has previously struck with other friendly countries such as Canada. I hope the confirmation of the Government’s approach to the four agencies mentioned in the new clause has reassured the Committee, and I ask the hon. Member for Harrow West to withdraw the new clause.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

25 Jun 2020, 4:49 p.m.

Although it has been useful to hear the reassurance that the Minister has attempted to provide, we still think that seeking membership of those four specific agencies makes sense. I intend to press the new clause to a vote.

Question put, That the clause be read a Second time.

Question proposed, That the Chair do report the Bill to the House.

Greg Hands Portrait Greg Hands
- Hansard - -

25 Jun 2020, 4:52 p.m.

On a point of order, Sir Graham, I thank you, Ms Cummins, and everybody involved in the Bill for all your hard work in Committee. Once again, I am both pleased and privileged to have been able to engage in a thorough debate on the contents of the Bill, which bears an uncanny resemblance to the Trade Bill in the last Parliament. I have been in and out of the Department for International Trade, but on returning to the Department, I found the Bill looking more or less the same as when I left the Department in June 2018.

I thank the Committee for engaging with the issues in a positive and constructive way; we have had some real insight, not only into trade policy overall, but into how opposition parties deal with trade policy. I will not dwell further on that, because I have made a few points already, but it is good to see that the approach patented by the hon. Member for Brent North (Barry Gardiner)—with the Opposition’s trade policy a moving feast—lives on today in his absence.

We have had a great debate, carried out in a good spirit, during our two-week immersion in trade policy. I think that, no matter which party one belongs to, a full two-week immersion in trade policy is a great thing as we move forward towards our independent trade policy, effective from 1 January 2021. We can all only benefit from such an immersion.

My thanks also go to the Government and Opposition Whips, who have ensured that the Committee has run smoothly and effectively, and to you, Sir Graham, and Ms Cummins, for being exemplary Chairs. I am very grateful for your guidance during our deliberations. I pay tribute to the usual channels for their help and guidance throughout; to Hansard for their diligence in recording all that we have said for posterity; and to the Clerk for his advice.

I also thank my team of officials for their support in undertaking box duty without ever entering the Palace of Westminster; I do not think that is a good thing overall, as I always encourage civil servants to come into Parliament as often as possible. It is very important for civil servants to understand how Parliament works but, given the current circumstances, I am fully understanding of the Department’s procedures for the scrutiny of the Bill.

The last time I stood here, I said that this was the first ever piece of legislation from the Department for International Trade. It is still our first Bill. I am confident that this legislation will now make its way on to the statute book and will be all the better for the work of the Committee.

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

25 Jun 2020, 4:54 p.m.

Further to that point of order, Sir Graham. I add my thanks to you and your co-Chair, Ms Cummins, for your diligent and considerable efforts to ensure order during our deliberations. I thank the witnesses who gave evidence, the Clerk, all the officials and Hansard. As the Minister said, it is a challenging time for all who are involved in making sure that Committees operate effectively.

I thank the Whips. The Government Whip was entirely fair in her criticisms of the Opposition, as she raised the same number of points of order about my hon. Friend the Member for Harrow West and me—fair play to her for her fairness. The Minister described the Bill as a continuity Bill a number of times, and he has been the continuity Minister on the continuity Bill. He is nothing if not consistent, because he gave exactly the same answers as he gave last time around. I hope that this time we will make some progress on the Bill and see the end result. I dare say that we will return to some of these arguments on Report, and that the Lords will have their say.

The Minister mentioned my hon. Friend the Member for Brent North. Where would we be without the hon. Gentleman? At least this time we did not have to resort to making up fictional names for countries to make our points. There will have been no Xanadu in Hansard until now.

I thank hon. Members on the Government Back Benches for bearing with us—it is a thankless task. I hope one day to be on the Government side, although I do not know whether I would hope to be a Government Back Bencher. Being a Government Back-Bencher in Committee, where they take a vow of silence, is undoubtedly a thankless task, but most of them managed to perform their duties diligently. One or two found it impossible, but I understand that. With that, I thank everyone for their contributions.

Trade Bill (Sixth sitting)

(Committee Debate: 6th sitting: House of Commons)
Greg Hands Excerpts
Tuesday 23rd June 2020

(5 months, 2 weeks ago)

Public Bill Committees

Read Full debate Read Hansard Text Bill Main Page
Department for International Trade
Fleur Anderson Portrait Fleur Anderson (Putney) (Lab)
- Hansard - - - Excerpts

23 Jun 2020, 12:01 a.m.

It is four years to the day since the referendum vote to leave the European Union and here we are, hardly oven ready. The stripping out of scrutiny is the most alarming of the many alarming parts of the Bill. A world-leading trade Bill must contain strong parliamentary scrutiny and transparency. The amendments and new clauses would enable debates to be held before, during and after negotiations, and the meaningful involvement of businesses, trade unions and interest groups across the country and around the world to assess the impact of any negotiations and help us make the best decisions.

The coronavirus crisis has shown the importance of proper parliamentary scrutiny. For example, the Chancellor’s economic support package—while I commend and welcome the support on offer—has been flawed in many crucial areas. I do not think that would have happened if there had been time—and there was not, I can see that—for much longer parliamentary scrutiny. That would have allowed self-employed people, people who had new contracts and limited company directors to say where they needed support from the economic support package. That is an example of where there needed to be better parliamentary scrutiny—there should have been more, catching up—and of where there are failings when we do not have time to look at the Bills we pass.

In the post-Brexit world, trade has been catapulted from the margins of public debate into one of the major talking points of political discourse. Trade agreements will have huge implications for our economy and future prosperity, and cut across huge swathes of public policy. They are of interest to all parliamentarians and to all areas of public policy, and are not to be done in secret in smaller areas. Future trade deals should be developed democratically. As such, it is wrong that the Bill does not address the gaping democratic deficit in trade policy. That is what the amendments seek to address.

The system under the Constitutional Reform and Governance Act 2010 is entirely inadequate and has not kept up with the times. It is no surprise that it has been criticised by no fewer than five parliamentary Committees. As the Minister himself has said:

“Parliamentary scrutiny is crucial for trade agreements, and we have seen the difficulties in recent years with trade agreements that have been insufficiently scrutinised, or where there was a feeling that there had been insufficient scrutiny—the Transatlantic Trade and Investment Partnership perhaps being the most important example.”—[Official Report, 17 July 2018; Vol. 645, c. 281.]

Under the current system, MPs will have less say than our counterparts in Brussels and in Washington. In my constituency, 39% of jobs are in sectors identified as being directly and severely impacted by the continuity agreements. I am angry that, as an MP, I will have little say and little opportunity to prevent that. Moreover, given the profound effect that trade deals will have on jobs in Putney and Wandsworth, in London and across the country, it is troubling that under the Bill there will be no formal assessment of the impact of trade deals on different sectors of the economy and different regions of our nation, or consultation with businesses and trade unions.

New clause 6 lists all the different impact assessments: economic, social, human rights, environmental, animal welfare and food standards. Those things are of immediate concern to constituents, and yet we will not have an assessment of the impact of trade deals on them—or, if it does happen, it will happen behind closed doors and will not be open for public debate and scrutiny.

The CBI has noted:

“A trade policy that provides a clear, meaningful way for businesses to feed in all their experience and expertise into government will create the greatest value from the UK’s opportunities across the world—and ultimately support prosperity across the country.”

Surely that is what we want. There are expert groups, of course, but they need parliamentary scrutiny to lock in their feedback.

It is concerning that the Bill only addresses EU roll-over agreements and does nothing to set the parameters of future agreements with non-EU nations such as the United States. The Bill is a huge missed opportunity to establish a framework for future trade negotiations. The scope of the Bill is just too narrow.

For four years, we have been repeatedly told by Trade Ministers that the world is queuing up to do business with the UK. Last year, the then Secretary of State for International Trade declared to the Future of Trade and Export Forum that

“the UK has an untapped potential of £124 billion in the export of goods alone.”

The current Secretary of State has triumphantly announced:

“We are growing wheat more competitively than the Canadian prairies. We’re producing more varieties of cheese than the French. And we are even selling tea to China.”

If the Government are so confident in our attractiveness to prospective trading partners, as they should be, why is there such reticence about codifying the high standards and regulations that have been promised by the Prime Minister? Why are the Government so intent on ensuring the lowest common denominator in trading standards—a rush to get it through without an ambition to get through the best?

There is a constitutional point to be made here as well. The Trade Justice Movement, which represents 60 organisations, noted in its evidence to the House of Lords Constitution Committee that proper parliamentary scrutiny of trade deals is far more compatible with

“the UK’s traditional constitutional division between executive and legislative powers, where the executive is responsible for foreign policy.”

The crucial point is that, when it comes to trade, it is impossible to distinguish between the international and the domestic. The two are intricately linked, so to take trade out of the hands of Parliament runs contrary to hundreds of years of constitutional precedent. To ensure that Parliament is sovereign over domestic affairs, it is essential that it is given a role in scrutinising trade agreements.

To summarise, the amendments and new clauses that my colleagues and I have tabled would address the democratic deficit and create a stronger trade policy, which would ensure greater prosperity across our country. They would ensure a meaningful vote and debate for MPs on the Government’s negotiating objectives from the start, and a much-needed widening of the scope of a Bill that is silent on too many crucial issues. They would ensure far greater transparency during the negotiations, proper public consultation and meaningful engagement with civil society, businesses and trade unions, and the introduction of much-needed impact assessments that look beyond economic metrics to include the impact on the environment, human rights and developing countries. The Trade Bill would be far better for them.

Greg Hands Portrait The Minister for Trade Policy (Greg Hands)
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23 Jun 2020, 2:24 p.m.

May I start by welcoming you again to the Chair this afternoon, Sir Graham? In an oversight, I was not able to welcome Mrs Cummins this morning, because there had yet to be a contribution from the Government Front Bench, thanks to the expansive efforts of the two chief Opposition spokesmen, the hon. Members for Harrow West and for Sefton Central.

Let me start by being in complete accordance with the words the hon. Member for Sefton Central said at the end of our minute’s silence, in paying tribute to the first responders and the emergency services in Reading at the weekend. We owe them all a debt of gratitude for the public response that took place.

Amendment 4 would mean that, before regulations were made under clause 2, the process of parliamentary scrutiny set out by the Opposition in new clause 5 or amendments 6 or 7, as appropriate, would need to be completed. I take this opportunity to remind hon. Members that the power in clause 2 is needed to provide for the continuity of existing trading relationships, not to implement free trade agreements with new trading partners. It will ensure that the UK continues to benefit from the EU-third country agreements to which we were a signatory before exit day.

During the evidence sessions, we heard from a very diverse group of witnesses, ranging as widely as the Institute of Directors, the CBI and ClientEarth, that the Government’s continuity programme was sensible and reasonable. Indeed, Parliament has so far ratified 20 continuity agreements with 48 countries. That accounts for £110 billion-worth of UK trade in 2018, which represents 74% of the trade with countries with which we were seeking continuity before the withdrawal agreement was signed. Those agreements were, of course, subject to extensive scrutiny in their original form as EU agreements. The main purpose of the power in clause 2 is to replicate existing obligations in current agreements. Additional new scrutiny, on top of what we already have in place, would not be a proportionate use of parliamentary time for existing agreements.

To reassure Parliament, we are going further and providing additional measures to constrain the power in clause 2 and provide extra scrutiny for any resulting legislation. All regulations made to implement obligations under these arrangements will be subject to the affirmative procedure, and the power is also subject to a five-year sunset period, which can be extended only with the consent of both Houses. We will discuss the sunset clause under a later group of amendments. Moreover, we have voluntarily published parliamentary reports—alongside continuity agreements—outlining any significant differences between our signed agreements and the underlying EU agreement.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

23 Jun 2020, 2:27 p.m.

The Minister is referring to the voluntary tabling of reports. At Report stage of the last Trade Bill, Ministers were going to put that on the statute book. Why the change this time?

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 2:28 p.m.

I will come on to that shortly, but in brief, the proof has been in the pudding. For each of those 20 agreements, we have published the report. The reports have been available for Members of both Houses to study. A few of the reports have been made subject to a debate in the Lords. None of those Lords debates resulted in a motion to regret on the ensuing agreements. I would say this: rather than trusting in our word, trust in our deeds. We have published those reports and we will continue to do so.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

I simply make the point that the most significant of the so-called continuity trade agreements—with the exception of Singapore and what Sam Lowe described as phase 1 of the South Korea agreement—have yet to be rolled over. Locking into law reports on the significance of those agreements would, I suspect, attract substantially more interest than the other reports have attracted so far.

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 2:29 p.m.

More than half of the continuity agreements have already been ratified, each with a report. The intention is to carry on producing those reports. I will deal with some of the points that the hon. Gentleman raised earlier, including his quite technical points in relation to the roll-over of the South Korea and Switzerland agreements. I will come back to him on the points he raised about differences between the EU version and the UK version.

The reports have enhanced parliamentary scrutiny, and I can confirm that we will continue to publish reports for the remaining continuity agreements.

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

A moment ago, the Minister mentioned that the Lords had held debates on previous agreements that have been subject to these reports. That did not happen in the Commons; that has gone. Given that the Government set the time, will the Minister take this opportunity to promise that the Government will create time in the Commons for debates on the remaining so-called continuity agreements, not least because agreements such as the one with Japan are significantly different to the ones we were party to as members of the EU?

Greg Hands Portrait Greg Hands
- Hansard - -

I thank the hon. Gentleman for that intervention, but there is no way of knowing whether the UK-Japan agreement will be significantly different, because it is yet to be negotiated. We are trying to get an enhanced agreement with Japan, but that negotiation is under way. It is be impossible to speculate in what way, or to what degree, it will be different from the EU agreement. We are hoping for an enhanced FTA, and we believe there is further to go with Japan on that, so I do not think the hon. Gentleman’s request would be appropriate.

Stewart Hosie Portrait Stewart Hosie
- Hansard - - - Excerpts

Taking what the Minister has said at face value, it is true that reports have been published, but the affirmative resolution process that he spoke about is effectively a “take it or leave it” option. There is no ability for Members to amend what the Government have proposed. If the Government were to use clause 2(6)(a) to modify retained legislation, we would be given no more than the opportunity to take or leave something that may look considerably different from the pre-existing arrangement we had through the European Union.

Greg Hands Portrait Greg Hands
- Hansard - -

I thank the hon. Gentleman for that intervention, and I plan to come to constraints on that power shortly. He rightly said that on the face of it, the power is broad, but there are significant constraints on its use. We must not forget that the continuity agreements are already in effect, and have already been scrutinised through previous processes in both the Commons and the Lords.

I draw the Committee’s attention to our track record. Of the 20 signed continuity agreements passed through CRAG, their lordships have recommended six for the attention of Parliament, most recently the UK-Morocco association agreement on 9 March 2020. As I have said, not a single one of those debates carried a motion of regret. Due to the limited scope of the continuity agreements for which we intend to use the clause 2 power and the existing opportunities for parliamentary scrutiny, the scrutiny procedure set out by the Opposition in new clause 5, to which I will turn in due course, would be disproportionate and unnecessary. That consequently means that amendment 4 is unnecessary.

I will now turn to amendment 5, which would seek to bring new FTAs within the scope of the Bill. The Government are only seeking a power in this Bill to ensure the continuity of trading relations with our existing partners, with whom we previously traded as a member of the EU. The Bill is not, and never was in its previous form, a vehicle to implement agreements with partners, such as the USA, that did not have a trade agreement with the EU before 31 January 2020.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

In relation to amendment 5, will the Minister confirm that there is no current legislative requirement for the Government to hold either a debate or a vote on any UK-US deal they negotiate?

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 2:32 p.m.

We have been absolutely clear in the process we have laid out. The publication of the negotiation objectives and the economic impact assessment, the fact that we have reported back at the end of the first round with a written ministerial statement, and the fact that we will publish an impact assessment at the end of the deal all show our commitment to parliamentary scrutiny of deals as we go forward.

Then, of course, there is the procedure under the Constitutional Reform and Governance Act 2010. I would have thought that the hon. Member for Harrow West would be rather more proud of that procedure, because I had a look around at the members of this Committee and studied their dates of arrival in this place quite carefully. I worked out that two members of this Committee voted for that procedure in 2010: myself and him. The only member of this Committee who was here in 2010 and did not vote in favour of CRAG is the hon. Member for Dundee East. Not only that: the hon. Member for Harrow West was a member of the Government at the time, in an international-facing Department to which CRAG was highly relevant, so he would have been part of the team that put forward CRAG 10 years ago. Miraculously, he is now against it. Perhaps he could explain that.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

What the Minister’s brief may not have told him was that the provisions that implemented the relevant CRAG power came into force as a result of his Government’s decision in November 2010, but that is by the bye.

The Minister gave a skilful and studious non-answer to the direct question I posed. Let me give him another opportunity to confirm that there is nothing in legislation at the moment that requires a debate or a vote on any future UK-US deal that his Government may negotiate.

Greg Hands Portrait Greg Hands
- Hansard - -

Sir Graham, you will know that under CRAG it is up to Parliament to determine whether to have that debate. Parliament’s ability to scrutinise the agreement and its ability to study the economic impact of that agreement are absolutely clear. On top of that, any legislative changes that would need to be made as a result of any future trade agreement would have to go through both Houses of Parliament in the usual way.

It is understandable that colleagues are keen to make their voices heard on new FTAs, and as a result the Government have said repeatedly that we will introduce primary legislation to implement new FTAs where necessary. As I have just said, that primary legislation will be debated and scrutinised by Parliament in the usual way, and I can assure Members that Government will draw on the expertise and experience in Parliament when delivering our trade agenda.

Those are not just warm words; I invite the Committee to look at our track record. If we take the current negotiations with the USA as an example, before negotiations began, we launched a public bundle, including our negotiating mandate and a response to the public consultation that we had conducted as well as an initial scoping assessment. My right hon. Friend the Secretary of State made a statement in the House, and she and I have engaged with colleagues intensively. During negotiations, we have committed to keeping Parliament updated. Indeed, the Secretary of State provided a statement to Parliament on 18 May with a comprehensive update on progress in the US talks. These updates will continue as the negotiations proceed. We have said that once negotiations conclude, we will introduce implementing legislation, if it is required. Any agreement will also be subject to CRAG, which will provide further opportunities for parliamentary scrutiny.

I must stress that scrutiny of FTAs with new countries is a conversation that must take place separately from consideration of the Bill. Hon. Members such as the hon. Members for Harrow West, for Sefton Central and for Dundee East have expressed valid concerns about what will happen, and my door remains open to discuss such concerns at a future date. Nevertheless, we must not threaten this essential piece of continuity legislation by having discussions about the future.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

In the spirit of openness about future free trade agreements to which the Minister says he is committed, can he confirm to the Committee, given the concerns that exist about a potential UK-US deal, that there will not be any investor-state dispute settlement provisions in a future UK-US deal?

Greg Hands Portrait Greg Hands
- Hansard - -

I was being very generous in saying that my door was open, but it is not open to discuss the content of the current negotiations with the US. That, of course, is a matter—in the proper way—for statements to Parliament, but that is a live negotiation, so what may or may not be in that negotiation is probably a matter for that negotiation.

We laid out our negotiation objectives, in a document that I commend to the hon. Gentleman, on 2 March. It lays out our objectives in the talks, which are live at the moment, so it would be inappropriate for me to go down that road. However, my door remains open to having further discussions with all the Opposition parties about the scrutiny of future free trade agreements.

Stewart Hosie Portrait Stewart Hosie
- Hansard - - - Excerpts

I think the Minister is inadvertently getting to the nub of the concerns of many people both in Parliament and outside. It is all very well him saying, “We have published this, and we have made these statements to Parliament”, but does he not recognise that simply publishing what are no more than heads of terms for negotiations, and then updates that say “Everything’s going swimmingly”, really does not cut the mustard?

Greg Hands Portrait Greg Hands
- Hansard - -

I thank the hon. Gentleman for that intervention and I am glad that he made it, because I will take him back five years to a very interesting negotiation that I had with his friend, John Swinney, which was a negotiation between the UK Government and the Scottish Government. It related to the Scottish fiscal framework: how exactly Scotland’s finances and support from Westminster would work in coming years. We—John Swinney and I—agreed that it was a negotiation between two Governments, and it was not appropriate to publish text during the course of the negotiation. We would both provide general updates on the progress of the negotiation, rather than constant updates on text. That approach led to us getting a good agreement between the UK Government and the Scottish Government. I think both Governments were not entirely satisfied with it, but both could live with it. That shows the way forward, rather than publishing after each negotiation round, or mid-negotiation, what the latest text or approach is.

Matt Western Portrait Matt Western
- Hansard - - - Excerpts

I hear that, and it is terrific, whatever happened between Scotland and the UK in that arrangement, but nub of this is essentially: how can it be that the EU informs and updates, providing not just heads of terms and whether things are going okay or badly or whatever, but the detail? That is what the US does and what Australia does. Why is the UK the only nation that will not give that detail to its public?

Greg Hands Portrait Greg Hands
- Hansard - -

Sir Graham, I think a comparison of how the UK and European Union do international treaties is a debate for another day. I do not think the two political systems are comparable. The approach proposed by the UK has greater parliamentary scrutiny than that of many Commonwealth counterparts that use the Westminster system—it is more extensive than that of Canada, Australia and New Zealand.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

The Command Paper that the Minister’s colleagues published last February committed the Government to publishing reports at the end of each negotiating round. Is that still a commitment and practice that the Minister recognises, or has his Department and new Secretary of State gone back on that?

Greg Hands Portrait Greg Hands
- Hansard - -

I was going to return to the Command Paper, because the hon. Member for Sefton Central asked me a direct question about it. If the hon. Gentlemen will bear with me, I will return to the status of the Command Paper in due course. I want to make a bit more progress in setting out why we think this approach is not right overall for the Bill.

The Bill focuses on ensuring continuity of trading relationships with existing partners. Businesses and consumers are relying on the consistency that the Bill provides. Amendment 6 would disapply CRAG to international trade agreements and instead seek to apply a super-affirmative procedure to scrutiny of continuity agreements before regulations could be made under clause 2. Like other Opposition amendments, that would undermine the constitutional balance and upset an established, well-functioning system of scrutiny. It would also create a two-tier system of scrutiny for international agreements, whereby trade agreements on the one hand, and other important international agreements on the other, are scrutinised in an entirely inconsistent way. It is worth reminding ourselves that CRAG was designed to cover international treaties of all the types we would expect.

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

The Minister has said that many times. CRAG was designed and passed in this place when we were a member of the European Union. It was designed when international treaties were an EU competence, to complement the system in the EU. I read that out earlier; I will not read it out again. He wants this to be a continuity Bill, but what is the equivalent continuity of scrutiny and parliamentary process for what we were party to where CRAG was part of that European process?

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 2:45 p.m.

It is simply not correct to say that all international treaties are subject to EU competence. Many international treaties are, of course, subject to a UK competence, and CRAG has worked well. It is worth remembering that CRAG was arrived at after an extensive period of consultation—and it may be, Sir Graham, that you voted for CRAG in 2010 as well. It was backed by both the Government party of the day, represented by the hon. Member for Harrow West, and the main Opposition of the day as a sensible way of codifying what he referred to earlier as the 1924 Ponsonby rule. The whole purpose of CRAG was to codify that long-standing rule that has served as well, including over the past 10 years. An extensive change such as this would add significant and unnecessary risk to the Government’s ability—

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

23 Jun 2020, 2:45 p.m.

Yes, it is an international trade agreement, absolutely correct. Where is the equivalent to the EU process that we have been party to? CRAG was party to that international trade bit of it, and yes, I accept that it applies to other elements of international treaties. Where is the continuity from the EU process to what we have now? That was the other half of my question.

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 2:44 p.m.

Again, we are talking about continuity agreements that have already gone through a process of scrutiny in the House. I was a member of the European Scrutiny Committee pretty much exactly when the hon. Member for Harrow West was a member of the Government. There was an established process by which treaties were recommended by the European Scrutiny Committee for scrutiny in this House. Most have already been through an established process of European scrutiny.

On future trade policies, I would say that the EU has a fundamentally different constitutional set-up from the United Kingdom. Our most similar constitutional set-ups are in countries such as Canada, Australia or New Zealand, which have very successful independent trade policies, and have done for a number of decades. I am confident that our scrutiny system, as proposed, stacks up well—in fact, it exceeds those, and stacks up very favourably—against those systems in making sure that our Parliament can have its say on future trade agreements.

I stress again, however, that this Bill is not about future trade agreements; it is about the continuity of our existing arrangements. Such an extensive change as proposed in the amendment would add significant and unnecessary risk to the Government’s ability to secure and bring into effect the remaining continuity agreements by the start of 2021. That situation was not advocated by any of the witnesses we heard from. None of them said, “We want to junk all those 40 agreements and pretend that we have never had them”, from ClientEarth right the way across to the Institute of Directors. Only the Opposition seem to want to junk those agreements by voting against Second Reading of the Bill and by not having the continuity agreements in place.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

23 Jun 2020, 2:47 p.m.

I am sure that the Minister would not wish to imply that the majority of witnesses simply supported the existing parliamentary scrutiny processes for trade agreements in general. It was clear that we heard a majority saying that, for new free trade agreements, the current parliamentary scrutiny set-up was not good enough.

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 2:44 p.m.

I am not saying that; I am clearly saying that the witnesses we heard from were, I think, unanimous in saying that the continuity agreements were important for the UK economy and trade. They would share my surprise at the opposition of the Labour party to rolling over those agreements, many of which were negotiated when Labour was in government, including the hon. Member for Harrow West. He was the Trade Minister when two of the agreements were negotiated by the European Union. I would love him to tell us what he was doing at the time. If he finds the agreements so objectionable in 2020, what on earth was he doing in 2008 or 2009 being party to the negotiations that led to those agreements being put in place in the first place? Perhaps he will tell us, or write to the Committee to explain.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

23 Jun 2020, 2:49 p.m.

What we find objectionable is the lack of proper scrutiny in the process. That is the significant issue. I gently say to the Minister, he has not so far advanced an answer—I am agog to hear it—to the criticisms of a whole series of witnesses, from the business community and the trade union movement to trade exporters, about the failure of the Government to give Parliament a proper debating and voting opportunity on big new free trade agreements, such as a UK-US deal.

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 2:49 p.m.

We are going slightly around in circles, conflating the continuity arrangements and future free trade agreements. I will happily debate with the hon. Gentleman the merits of our proposals for future free trade agreements. I reiterate that my door remains open to his suggestions as to how we might scrutinise future free trade agreements. However, the Bill is about continuity arrangements for the 40 or more EU agreements that we currently have. Many of the witnesses, whatever they said about future trade agreements, were unanimous in talking about the importance of the continuity agreements.

Robert Courts Portrait Robert Courts
- Hansard - - - Excerpts

23 Jun 2020, 2:50 p.m.

I am conscious of what the Minister has said about the Bill being a trade continuity Bill and that being its purpose. We have heard a great deal of debate today about scrutiny of future trading relationships. Would the Minister comment on something that seems to me is the case? We have parliamentary government in this country, where a mandate is derived from a general election. We do not have government by Parliament and any such scrutiny proposal needs to be considered very carefully in terms of its constitutional ramifications.

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 2:51 p.m.

My hon. Friend is absolutely correct. I was going to come on to describe the Opposition’s panoply of amendments taken in their entirety; at the moment, I am still going through the deficiencies in each of the amendments. When we put them all together, they seek fundamentally to rewrite the constitutional balance in this country in terms of international agreements. That is properly a matter for the Executive and for royal prerogative, as scrutinised by Parliament.

Once again, I remind colleagues that continuity agreements have already been subject to significant scrutiny as underlying EU agreements. I say again that we believe that the existing constraints in the Bill are proportionate and provide Parliament with sufficient opportunities to scrutinise agreements. I have drawn Members’ attention to the 33rd report of the Delegated Powers and Regulatory Reform Committee on the 2017-2019 Trade Bill, which raised no concerns about the delegated powers of the Bill and welcomed our move to introduce the affirmative procedure for any regulations.

I turn to amendment 7, which seeks to apply the super-affirmative procedure to any regulations made under clause 2 to implement FTAs with new countries, if the other amendments were to be carried. I will not recap why new FTAs are not included in the application of the Bill. However, I reiterate that we will introduce implementing legislation for new FTAs, if required, which would mean the proposals in the amendment are unnecessary.

Amendment 19 would extend the aforementioned procedures to any regulations made jointly with the devolved authorities. I have outlined the reasons why we do not believe those procedures are necessary. I can also assure colleagues that our approach with the devolved Governments is based on regular dialogue and consultation.

I thank Opposition Members for tabling new clause 5, which outlines in some detail the Opposition’s proposal for how current and future trade agreements might be scrutinised. I have already remarked that this is a continuity Bill and therefore not the place for discussing our wider priority FTA programme or our approach hereto. However, I am happy to reiterate to hon. Members the Government’s commitment to appropriate parliamentary involvement.

I believe we share common ground, insofar as we agree that Parliament should be able properly to scrutinise trade agreements and have sufficient information available to it in order to do so. The Government have ensured that that information is provided through sharing negotiating objectives, responses to public consultations and economic assessments. The amendments go beyond what is needed and, as hon. Members will be aware and as my hon. Friend the Member for Witney pointed out, cross the line that separates the powers of Parliament and the Executive.

We must respect that initiating, negotiating and signing international agreements are functions of the Executive, exercised under the royal prerogative. New clause 5 would have serious consequences. It would both undermine that cornerstone of our constitution and limit the Government’s ability to negotiate effectively and in the best interests of UK businesses, consumers and citizens.

To be clear, the prerogative power is not just a historical throwback or a constitutional quirk. It serves an important purpose in enabling the UK to speak with a single voice as a unitary actor under international law. It ensures that our partners can trust in the position presented during negotiations. It is the same principle that applies in similar Westminster-style democracies with sophisticated trade negotiating functions, such as Canada, Australia and New Zealand.

Setting aside for a moment the significant constitutional issues that we have just examined, the proposals are also unworkable in a practical sense. First, treaty texts are liable to change significantly right up to point of signature. As they say, “Nothing is agreed until everything is agreed.” Sharing texts as we go might be a waste of parliamentary time, as they could quickly be made redundant. It is also not in line with the practice of our FTA partners, including the US, let alone Australia or New Zealand. Those countries will have legitimate expectations of confidentiality around key negotiating texts in our trade negotiations with them.

Final texts of agreements—which, after all, are what matters—are already laid in Parliament for 21 days under the CRAG process, and the Commons has an option to restart CRAG, potentially indefinitely. The Government have gone well beyond the requirements of CRAG and its statutory obligations, in line with our commitment to transparency and scrutiny, by providing Parliament with extensive information on negotiations. For the trade talks with the US on a new FTA and with Japan on an enhanced FTA, the Government have set out their negotiating objectives alongside a response to the public consultation, as well as an initial economic assessment prior to the start of the talks. Ministers have also held open briefings for MPs and peers both at the launch of the US talks—I held one myself—and after the conclusion of the first round.

We will continue to keep Parliament updated on negotiations as they progress, including close engagement with the International Trade Committee in the House of Commons and the EU International Agreements Sub-Committee in the other place. We are committed to publishing full impact assessments prior to the implementation of the agreements. That provides Parliament with more than sufficient information to scrutinise the Government’s trade agenda properly.

Turning to new clause 6, I hope that on the issue of consultation, the Opposition will note the Government’s strong record of consulting widely with the public and key stakeholders on our trade agenda. The Government’s consultation on our priority FTA programme attracted 600,000 responses, making it one of the largest consultations ever undertaken by Government.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

23 Jun 2020, 2:57 p.m.

I want to press the Minister on the proposals that were in the Command Paper last year. He has not quite answered us on that. The Command Paper said clearly that the Government would work with a Committee and give it access to sensitive information that is not suitable for wider publication, including private briefings from negotiating teams. On the record, is the Minister willing to confirm that they will do that with the International Trade Committee and the relevant Lords Committee, or not?

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 2:58 p.m.

I should be clear that the Command Paper was published by a previous Government in a different parliamentary context. However, we have in our approach so far followed what was set out in the Command Paper in relation to publishing negotiation objectives and impact assessments, and reporting back after the first round. I would again ask for confidence in our deeds, in terms of our overall commitment to parliamentary scrutiny.

In line with our commitment, we have published the Government’s response to the consultations on FTAs with the US, Australia and New Zealand, and on an enhanced FTA with Japan. In relation to sustainability impact assessments, as the EU calls them, the Department has published, and will continue to publish, our own scoping assessments for each of our new free trade agreements, prior to negotiations commencing. As with the published UK-US, UK-Japan, UK-Australia and UK-New Zealand scoping assessments, those include preliminary assessment of the potential economic impacts, the implications for UK nations and regions, the impact on small and medium-sized enterprises, the environmental impacts, and the effects on different groups in the labour market, including whether there are any disproportionate impacts on groups with protected characteristics, arising from an FTA with the partner country.

The scoping assessments attracted quite a bit of attention, not least because of all the nations and regions of the UK that would benefit from the US trade agreement, Scotland would benefit the most, followed by the west midlands and then the north-east of England. Those are good things. We are proud of that, and of the fact that we published the assessment.

We are committed to publishing full impact assessments once negotiations have concluded and prior to the implementation of the agreements, when the effects of an agreement can be better understood.

On the point about standards raised in new clause 6, I encourage hon. Members to look at our record on negotiating agreements. We said we would not lower standards, and we have not, as can be seen from the parliamentary reports we published on each of the 20 agreements. None of the 20 agreements that have been signed to date involved any reduction in standards.

New clause 7 would require the Government to seek parliamentary approval before entering negotiations. Again, the principle of the royal prerogative is at stake here. As I have set out, the negotiation of trade agreements is a function of the Executive, which has both principled and practical merits. If our partners are effectively in negotiation with both the Government and Parliament—I cannot for a moment think that that sounds in any way familiar to Members from recent times—that will result in uncertainty, delays and ultimately worse trade agreements for UK businesses and consumers.

Break in Debate

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

In the Command Paper published in February last year, the Government committed during negotiations to publish and lay before Parliament a round report following each substantive round of negotiations. Does that commitment still stand or has it been axed, like the commitment to give sensitive information to a Select Committee of the House of Commons?

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 3:02 p.m.

Nothing has been axed; all I am saying is that the Command Paper was produced at a different time. What we have done is to follow the Command Paper in publishing, for example, the written ministerial statement at the end of round one of the talks with the US. That has greatly enhanced parliamentary scrutiny, as has publishing the negotiation objectives and the scoping assessment of who would be most likely to benefit from the agreement.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

Will the Minister give way?

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 3:02 p.m.

I will make a bit more progress.

As with new clause 5, new clause 8 contains a number of practical flaws in the proposed system. Those flaws would undermine negotiations and disadvantage the UK. I understand that colleagues are keen to remain abreast of negotiations, and the Government are supportive of that endeavour, as I have outlined. I point hon. Members not just towards our commitments to share information but towards our record on the recent US negotiations, which I have mentioned.

Ultimately, this debate boils down to whether we believe that it is right that the UK Government, supported by experts, civil service negotiating teams and advisers, are able to negotiate international agreements on behalf of those who elected them, drawing on the expertise and views of Parliament and of the devolved authorities, via strong scrutiny mechanisms. Or do we believe that Parliament itself should be in control of the negotiations, determining who we negotiate with and how, and within what timeframes?

It seems clear to me that in the national interest, the former scenario must be right. It ensures that when our partners face the UK around the negotiating table, they know that it has a credible single voice—one that is represented by the UK Government alone, after they have consulted with the devolved Administrations and drawn on the extensive expertise in this House and the other place, via close engagement and scrutiny processes, such as those we have here for international agreements.

Matt Western Portrait Matt Western
- Hansard - - - Excerpts

I understand that point. The EU has 27 nations, and yet it manages to achieve that. It has a coherent position from 27 nations, but it can still carry out talks. Surely, it is possible for us to have the involvement of Parliament to scrutinise matters and to be updated about them, and to have its engagement in this process. Can the Minister just answer that one point?

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 3:04 p.m.

I have already outlined in immense detail, probably three or four times now, the involvement that Parliament will have in future trade agreements. I remind the hon. Gentleman that the Bill is about the continuity of existing trade agreements. I may be the only person in this room—perhaps the hon. Member for Harrow West has done so as well—who has represented the UK at trade Foreign Affairs Council meetings of the European Union. I can reveal to the hon. Member for Warwick and Leamington that the EU does not always speak with one voice when it comes to trade. I can tell him of many a fruity row at those meetings involving different member states—rows between the Commission and the European Parliament and so on in relation to EU trade policy. I am afraid that the idea that the EU is one happy whole as it goes into trade agreements, with total uniformity of opinion across the EU27, is for the birds.

I hope that I have provided Members with some assurance that the amendments are unnecessary and impractical, and will unquestionably limit the UK Government’s ability to negotiate in the best interests of UK businesses, consumers and citizens.

On a slightly different topic, new clause 19 seeks to oblige the Government to publish parliamentary reports on continuity agreements, which the hon. Member for Harrow West has already drawn attention to, outlining any significant differences between the signed agreements and the underlying EU agreements. I am aware that, in the last Parliament, the Government introduced an amendment to that effect to the previous Trade Bill. However, Members will be aware that, despite the previous Bill falling, we have committed to publishing such parliamentary reports on a voluntary basis, to assist the House with the scrutiny of agreements.

We have published such a report for each of the 20 continuity agreements we have signed, outlining any significant differences from the underlying EU agreement. That process affords parliamentarians extra transparency on our continuity agreements, above and beyond the statutory framework set out in CRAG. As is demonstrated by the measures we have taken, and by the inclusion of a sunset clause and the affirmative procedure for any secondary legislation, we will ensure that Parliament’s voice is heard when clause 2 powers are exercised. I reiterate the commitment that we will continue to publish parliamentary reports for all remaining continuity agreements.

I suspect the Committee will be glad to hear that I am finally turning to new clause 20, which stipulates that the parliamentary reports must be published at least 10 sitting days before any statutory instruments are made under this power. Members will be aware that trade negotiations, and indeed many other international negotiations, have a habit of going down to the wire. I have only to remind colleagues of the negotiations surrounding the EU withdrawal agreement as evidence of that fact, although that negotiation is not included in the scope of the Bill, perhaps thankfully. As such, it is possible that we will be unable to sign continuity agreements until very shortly before the transition period ends.

I stress that that is possible. We have already signed 20 such agreements, but some may well finally be negotiated and signed in the last days before the UK once again becomes a fully independent trading country. That would make it very difficult to leave a period of 10 sitting days before any SIs are introduced. I assure colleagues that we will leave as much time as possible for essential parliamentary scrutiny. I point again to our record: we have published parliamentary reports alongside all signed agreements entering the CRAG process, meaning that that information has been available for at least the full duration of CRAG. I remind colleagues that CRAG allows a period of 21 sitting days for our agreements to be scrutinised in Parliament before they can be formally ratified. That provides an effective period of time for parliamentarians to scrutinise the agreements.

Turning to a few of the more technical matters that have been raised, the Opposition said that the South Korean and Swiss agreements have not been signed. They have both been signed and have both gone through CRAG. The House of Lords European Union Committee called the Swiss agreement for debate but, as I said earlier, no motion of regret was passed. The hon. Member for Brent North (Barry Gardiner) loved to talk about the Ponsonby rule, which is exactly what CRAG sought to codify. The Ponsonby rule, if it exists at all today, is there only through the living embodiment of CRAG.

The Opposition talked about the mutual recognition agreements incorporated within the Swiss agreement. The MRAs that have been signed and are part of the agreement cover 70% of our trade flow. On a technical point, we have in place a memorandum of understanding to continue discussions about trade continuity before the UK-Swiss trade agreement comes into effect on 1 January. We are committed to aiming to put in place mutual recognition of conformity assessment bodies in time for the agreement coming into effect.

The sectors not covered by the MRAs are underpinned by international standards regimes, not by EU standard regimes. There is therefore greater regulatory confidence in conformity assessments within these. On tariffs and the South Korea agreement, the hon. Member for Harrow West effected some kind of melange between tariffs and tariff-rate quotas. A tariff is the rate of tax at which we charge a product coming into the country; a tariff-rate quota is the quantity of that product that would be allowed on either a lower tariff or on no tariff at all.

Tariff-rate quotas have been resized from the original EU agreement. That is an entirely normal and expected part of the process. The TRQ stated that a certain volume of this, that or another product—the example of Cheddar cheese was used—is allowed to enter from the EU into South Korea without a tariff or with a lower tariff being applied. That volume is apportioned in the ensuing agreements: this part of the tariff-rate quota belongs to the European Union, and this part of the tariff-rate quota belongs to the UK.

How do we determine which part goes to which? Generally, the way in which to do this, which the European Union has agreed, is to look at recent trade patterns, take the average of recent years and say that a part should be determined to be the EU’s and another part should be the UK’s? If no UK products have been exported to South Korea under the tariff-rate quota, the effect will be that the tariff-rate quota ends up going to zero in the ensuing UK agreement, but it may well be that we end up with far more than the UK overall trade flow in the ensuing South Korea agreement in other areas. It simply is not the case that we have lost our tariff-free access, if it is a product that the UK does not currently export to South Korea under the tariff-rate quota.

Crucially, the tariff reductions are in the ensuing UK agreement. Whereas the tariff-rate quotas divide up, the agreed tariff reductions carry on. That is particularly relevant to Cheddar cheese. Tariffs on Cheddar cheese entering South Korea under the EU-Korea agreement have been coming down steadily each year since 1 July 2011. From 1 July 2021, UK Cheddar cheese will be free of customs duties entirely as a result of that gradual stepping-down process, which affects Cheddar made in the EU as much as it affects the UK. There has been no change in that and no loss in our preferential tariff treatment in the UK-Korea agreement.

I have talked at length about the Command Paper and one or two other things. I have responded to each of the points made by Labour Members, possibly to their satisfaction. I find various things a little bit rich. I think I heard regrets from the Labour Front Bench that we will not be able to transition the EU-Canada agreement. I remember, because I was doing this job at the time, a large part of the Labour party, including current Front Benchers, voting against the EU-Canada agreement even coming into effect. So Labour was opposed to the agreement three years ago, but now they suddenly complain that we are not being quick enough in transitioning it to a UK agreement. If there was any consistency in the Opposition’s approach, they should be cheering any delay to an agreement that they do not agree with. I find their position typical of the chaos still present on the Opposition Benches. They complain that we have not rolled over an agreement that they did not want to be part of anyway.

The hon. Member for Putney, who started off regretting the vote four years ago today to leave the EU, then made a speech questioning the trade agreements negotiated by the European Union that we are seeking to roll over. There must be more consistency.

I appreciate that the Labour party has had a leadership change. I thought that the whole basis of the new leader’s approach was to bring organisation and method to its opposition, but instead, we have seen continuing chaos. We see a shadow Front-Bench spokesman who now objects to the agreements that they presented when in government, and a shadow Front-Bench team who now want to roll over the Canada agreement that they originally voted against. Those on the shadow Front Bench regret the Brexit vote but now want to vote against our transitioning the very agreements that the EU, with UK participation, negotiated successfully. That is a recipe for chaos and one that the Opposition would do well to reflect on.

This has been an informative discussion dealing with some very important issues. I hope that the Committee has been reassured as to the scrutiny arrangements that the Government have put in place for the continuity programme, as well as by the restated commitment that the Government will bring forward primary legislation to implement future FTAs where necessary. As a result, I ask the hon. Members to withdraw or not press their amendments.

Break in Debate

Last Thursday morning, we heard clearly from witnesses, including Mr Lowe from the Centre for European Reform, who expected that a UK-Canada deal would be a very different one from the EU-Canada deal that it would replace. Surely, therefore, it should be properly scrutinised. Our amendment would help to achieve that.

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 3:40 p.m.

I was intrigued by the amendment, but let us pause for a moment on what it would do. Amendment 9 would stipulate that agreements are in scope of the clause 2 power only if the underlying EU agreement were ratified, rather than signed, by end of the transition period. For the benefit of the Committee it might be useful to explain the difference. Something can be signed—but the dates on which a trade treaty can be signed, come into effect and be fully ratified are three different dates. A trade treaty can come into effect—this is the way the EU does it—when a certain number of EU countries have ratified it. I forget what that number is, but if about half of EU countries have ratified the agreement it comes into effect. Those three things—being signed, coming into effect, and ratification—happen on three different dates. Under the amendment, the clause 2 power that we currently say must relate to an EU agreement signed before 31 January 2020 would relate to an EU agreement ratified before that date.

Opposition Members will realise—I think, to be fair, the hon. Member for Harrow West covered that in his speech—that the amendment would restrict the scope of agreements that we could implement using clause 2. It would make the scope much narrower. However, it would do so in an entirely unreasonable manner. Important agreements such as the Canada one that he has mentioned would be excluded, as CETA has not been fully ratified by each individual member state of the EU, despite having been in effect for some time now.

Development-focused agreements would be similarly affected. The important matter of international development has yet to feature in discussions of the Bill—with the exception of something that the hon. Member for Putney said about it in passing. However, many development-focused agreements—those important economic partnership agreements—have been signed but not yet ratified. One example, involving the countries of the Caribbean, is the CARIFORUM agreement. In 2017 I signed an agreement with the CARIFORUM countries. We all gathered together—17 countries, I think, which was basically CARICOM—plus the Dominican Republic. We gathered together in Brussels to sign a continuity agreement. The nations of the Caribbean recognise the importance of that trade agreement, and one thing that they mentioned was its importance not just to their citizens but to the Caribbean diaspora in this country.

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

23 Jun 2020, 3:42 p.m.

rose—

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 3:42 p.m.

No, I am not going to give way.

I think that a Member with quite a big Caribbean community in his constituency has quite a lot of explaining to do about why he is now opposed to the CARIFORUM agreement. It is a great agreement that does major good work for international development in Caribbean countries. I represent a quite substantial Caribbean community. I think its members would be alarmed if they were to learn that the Labour party is opposed to that international development agreement, which does great work among our Caribbean friends.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

23 Jun 2020, 3:43 p.m.

On a point of order, Sir Graham. As the Minister knows full well, we are not opposed to the agreement. We simply want better scrutiny arrangements. What arrangements are there for me to correct the record in that respect?

Greg Hands Portrait Greg Hands
- Hansard - -

Sir Graham—

Order. I think I have to respond to the point of order, in spite of the fact that it was not a point of order. As to what the hon. Gentleman asked about, as he knows, he has just done it.

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 3:43 p.m.

The point of the amendment is to rule out of scope agreements that have yet to be fully ratified, which includes not only the Canada agreement but the CARIFORUM agreement and important economic partnership agreements. The hon. Member for Harrow West was a DFID Minister, and I think that that might have been when some of those agreements were negotiated —with important countries such as Kenya, Côte D’Ivoire and Ghana. However, the incredibly important beneficial trade arrangements made for those countries could no longer be effective, for lack of the clause 2 power. The Opposition have a lot of explaining to do. Developing countries are as we know sometimes unable to ratify agreements fully before—

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

On a point of order, Sir Graham. The Minister has a number of times asked us to explain things and then refused to give way. Can you perhaps shed some light on how we might overcome that apparent stand-off?

I think that the hon. Gentleman has been here long enough to know that these things happen.

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 3:44 p.m.

Truth be told, I was going to allow an intervention when I had fully laid out the case, and mentioned the number of people that the trade stance that the hon. Member for Harrow West is outlining today will irritate. I have only just got started on the agreements, and the apologies that the hon. Gentleman will have to make to his constituents, and, on behalf of the Labour party, to people the length and breadth of the United Kingdom.

Developing countries are sometimes unable to ratify agreements fully before they are brought into effect, often for procedural reasons in those countries, but that should not mean that we deny UK businesses the opportunity to continue trading with them, and I am sure Opposition Members would not wish to deny our world-class trade for development assistance to those states either.

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

23 Jun 2020, 3:45 p.m.

rose—

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 3:45 p.m.

I will allow the hon. Gentleman to intervene. Perhaps he can explain and apologise for his position in relation to those countries.

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

23 Jun 2020, 3:45 p.m.

The party that has just abolished the Department for International Development is not in a good place to be criticising anybody for their approach to international development. The Minister knows full well, as he did with the reasoned amendment, that we fully support international development—in a way that his party, apparently, does not. Perhaps, if this is a problem because of the drafting of our amendment, he will tell us that on Report he will come back with an amendment that deals with the problems that he is taking great pains to explain.

Greg Hands Portrait Greg Hands
- Hansard - -

I am certainly not coming back on Report with a drafting correction for the deficiencies in the hon. Gentleman’s amendment; that would be a novel approach to Parliament. The fact is that this amendment rules out of scope all these agreements for roll-overs. I have to say, in fairness to him, that some of these agreements were controversial; some people opposed these EU EPAs in the first place, and I imagined that it was the Labour party’s position that it opposed these EPAs. If we listen to one or two groups, for example, they think that the EPAs have been stacked too heavily in the EU’s favour.

However, I think the hon. Gentleman is now saying that actually that is not his intention, and that his intention was not to prevent their being rolled over. I think he is now saying he is suddenly in support of the continuity of these agreements, despite having voted against the Second Reading of the Bill and despite the fact that virtually every word that we have heard from the Labour Party in this Committee has been against these agreements and against these Bills.

Returning to my point about continuity, these agreements have been subject in this country to the full EU agreement scrutiny process. The delay to ratification is not in this country, but relates to individual country or state delays. There is no scrutiny gap.

Fleur Anderson Portrait Fleur Anderson
- Hansard - - - Excerpts

Returning to the issue of Canada and delayed negotiations, can the Minister confirm that if we do not secure the free trade agreement with Canada before 31 December, we will lose all the benefits of the current EU trade deal with Canada and revert to trading with it on WTO terms?

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 3:47 p.m.

I thank the hon. Lady for her intervention, because I thought the Opposition were opposed to the Canada deal, so if we were to fall outside the Canada deal, they should be celebrating that. The Labour Front Bench opposed Canada in 2017, and I think they have opposed it again today. We are in discussions with Canada and we believe that there is time to do a roll-over agreement, but to do that we need the powers in the Bill. Amendment 9, which I think the hon. Lady has co-sponsored, would delete Canada from the list of agreements subject to the power, so if she votes for this amendment—if indeed there is a vote on it—she will effectively be preventing the roll-over of the Canada deal.

I will come to a conclusion. I was very surprised by this amendment. I praised the shadow Minister, the hon. Member for Sefton Central, last week for the attention he had given to oral questions earlier that day, but now I am not sure whether he really paid enough attention. He may have missed hearing the shadow Secretary of State, the right hon. Member for Islington South and Finsbury (Emily Thornberry), say from a sedentary position that she is in favour of CETA, the Canada agreement, and that she voted for it at the time.

The right hon. Lady is absolutely right: she did vote for it at the time, and that is obviously the Labour party’s new position. We know that sometimes in political parties, particularly when we are in opposition, there can be a new position and it takes a while for that new position to filter out across the whole party, but I am a little bit surprised that the new position has not filtered down to her own Front-Bench team, let alone the whole party, because they are trying to say they do not want to roll over the Canada agreement for an agreement that their shadow Secretary of State was praising only last Thursday. I find that approach absolutely bizarre.

If amendment 9 were to be accepted, there would be no UK-Canada trade agreement to roll over in the scope of clause 2. Labour said one thing in the Chamber last Thursday, but is saying precisely the opposite in Committee. Our Canadian friends will look on askance, as will our friends from the Caribbean, Kenya, South Africa, Mozambique, Ghana, Cameroon, Ivory Coast and so on.

This is a continuity Bill. There is certainly continuity in the Labour party’s confusion on trade. When it came to the original Canada agreement in the vote of February 2017, Labour split three ways: 68 of its members followed the right hon. Member for Islington North (Jeremy Corbyn) in voting for the CT agreement; 86 broke with the right hon. Member for Islington North and voted with the right hon. Member for Islington South and Finsbury in favour of the agreement; and the rest abstained.

I think I heard the hon. Member for Harrow West then say that he regretted the fact that there had not been a debate about the Canada agreement on the Floor of the House. I spent a few years in the Whips Office. One of the first rules of being a Whip in Opposition is never bring a debate on which your own party is divided to the Floor of the House, let alone something where you are divided three ways and your leader is in the minority view. Now he is saying that he regrets that it was not brought to the Floor of the House.

We should vote down amendment 9, because it would rule out of scope Canada, the Caribbean and many other important trade agreements that the EU has negotiated. The UK was part of that negotiating team. They are very important trade agreements. We would like to see the continuity of those trade agreements, as do our constituents and UK businesses. I urge hon. Members to vote against amendment 9. Indeed, I hope the Opposition withdraw the amendment.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

23 Jun 2020, 3:52 p.m.

The Minister has been at his most diversionary with that characteristically chutzpah-led speech. As he knows only too well, constitutionally, the Government are able to sign and ratify international agreements. He went on at some length in his winding-up speech on the previous group of amendments about how wonderful that process was.

The Minister does not need the Trade Bill to sign agreements with CARIFORUM, Canada or Vietnam. The powers are already there for the Government to do so. If Ministers think the provisions in the Bill relating to those clauses are so important, one wonders why they did not bring the Trade Bill back in the last Parliament. It fell because Ministers chose not to bring it back, not because of opposition from the Labour party.

There were genuine concerns about the future of a UK-Canada trade pattern. On this side of the House, we repeat our concern that if Ministers cannot agree to roll over a deal with one of our oldest allies where the Queen is Head of State, it prompts questions about the effectiveness of the Department for International Trade. This was a probing amendment, which we will not push to a vote. The point about scrutiny remains on the record. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Break in Debate

Trade deals must contain mechanisms that effectively enforce the UN sustainable development goals and international treaties on labour and human rights; otherwise we will inevitably see a race to the bottom for workers and citizens everywhere, leading to more precarious work, substandard workers’ rights, increased gender discrimination and human rights abuses, and an increased threat of the undermining of public services and social welfare systems. As Rosa Crawford saliently noted, a race to the bottom can never be won. The amendment will ensure that such mechanisms exist and will bake in compliance with our global commitments.

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 4:19 p.m.

As we have heard, amendment 10 intends to prevent the clause 2 power from being used to implement agreements that do not comply with existing international obligations on human rights, the environment and labour rights. Let me be absolutely clear: our continuity programme is coherent with existing international obligations as it seeks to replicate existing EU agreements, which are, of course, fully compliant with such obligations. By transitioning these agreements, we reaffirm the UK’s commitment to those international obligations.

I have said it before, but I am happy to repeat it as often as the Committee would like: we seek to provide certainty and stability in trading relationships for UK businesses and consumers, not to modify or dilute standards. None of the 20 agreements already signed has reduced EU standards in any area. Committee members can consult the parliamentary reports that we publish alongside continuity agreements detailing any changes required to transition the agreement to the UK context. These will confirm precisely what I have said. We will continue to publish these reports for remaining continuity agreements, so that hon. Members can satisfy themselves that we have not defaulted on our commitment not to reduce standards. That includes the agreement with Vietnam.

I am happy to look into the specific complaints that some Opposition Members have made on labour rights, but it would be helpful for me to understand whether they are in favour of the EU-Vietnam agreement. That was not really clear to me. The Opposition keep wanting to have their cake and eat it, saying that they like EU agreements but then trying to pick holes in them and saying that we should not roll them over because of some of the arrangements within them. The EU-Vietnam agreement is scheduled to come into effect on 1 August, so UK businesses will be able to take advantage of that agreement from 1 August.

As the Prime Minister outlined in his Greenwich speech, the UK has a strong history of protecting human rights and promoting our values globally. We will continue to encourage all states to uphold international human rights obligations. The hon. Member for Harrow West asked for examples of primary EU law that will be transitioned as a result of using these powers. To be clear, we intend to use the powers only for a limited number of obligations, most principally in relation to fully implementing conformity assessments and procurement matters in domestic law via secondary legislation.

To be clear, the human rights commitments in the joint statement that we made with South Korea do not enable the suspension of any of those human rights dialogues that are under way. The Colombia agreement, which is part of the EU-Andean agreement that has also been signed, has seen no weakening of labour rights; there have been some technical changes to that agreement, but none relating to labour rights, so far as I am aware. The continuity agreements signed have not changed those in any way.

The hon. Member for Warrington North mentioned action against the far right and other hate groups preaching violence. I can tell her that the Government are wholly united in our approach to making sure that that is exactly the case, but it is worth reminding ourselves that we are talking about existing trade agreements with those counterparts, not a new agreement as such.

The hon. Member for Putney talked about the commitment to the sustainable development goals. The Government are absolutely committed to the SDGs, but again we are talking about existing trade agreements. I will plough on, because we do not have an awful lot of time. The hon. Lady and her colleagues need to work out what it is that they want. On the one hand they seem to strongly support the EU and perhaps want the UK to rejoin, but on the other she seems, by the sound of it, to oppose the detail of virtually every one of the EU’s trade agreements. Opposition Members need to get clear in their minds whether they are pro-EU—in which case they might be in favour of the EU’s trade agreements—or anti-EU. That was not clear to me at all.

The hon. Member for Putney rightly says that human rights clauses in international trade deals are very important. We agree, which is why we are preserving their effects in these roll-over agreements. The Government have been clear that any future trade deals must work for UK consumers and businesses, upholding our high regulatory standards. The UK will remain committed to world-class environmental product and labour standards. We will not weaken these protections after the transition period ends. Our continuity agreements will safeguard, not undermine, our international obligations. I therefore ask the hon. Member for Sefton Central to withdraw his amendment.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

I had not intended to speak and I will be brief. I wish to amplify and expand on the concern that I raised in an intervention on my hon. Friend the Member for Sefton Central regarding the continuity agreements for Kenya and Ghana. If those agreements are got wrong, they threaten the progress that both countries have made, and potentially that of other countries around them, in trying to achieve the sustainable development goals.

The concern is that what is currently being put to those countries by UK negotiators is a continuity agreement that requires them to sign up to something that risks regional integration in east and west Africa. Kenya and Ghana seek to work closely with the least developed countries that surround them as part of the trading blocs. Those LDCs want to continue to be part of a preference scheme, so Kenya and Ghana are caught in a trap between their desire to work very closely with their neighbouring countries and wanting to ensure that they can still trade on very good terms with the UK in, for example, bananas and cocoa.

Why is working with regional blocs so important? Because it is trade at a regional level in Africa that is likely to lead to faster development, more jobs being created, and, crucially, the development of more manufacturing jobs at a local level. When a no deal was about the happen last October, the UK Government proposed a transitional protection mechanism that would have included Ghana, Kenya and others in a similar position.

Greg Hands Portrait Greg Hands
- Hansard - -

I should apologise; I had not realised that the hon. Gentleman wanted to intervene on me on this issue. I undertake to write to him about Ghana and Kenya, and to copy in members of the Committee. The situation involving both those counterparts is complicated and would be best served not by a debate about this particular amendment, but more broadly were I to contact the hon. Gentleman.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

The Minister has made a gracious intervention and offer, which I am happy to accept. On that basis, I am happy to conclude my speech.

Break in Debate

Fleur Anderson Portrait Fleur Anderson
- Hansard - - - Excerpts

23 Jun 2020, 4:40 p.m.

Moving on from the sustainable development goals, and looking at the environmental regulations and the environmental issues that are baked into the Bill, we are already committed to climate action. The Minister has affirmed that we are and want to be compliant, and we aspire to see the achievement of the sustainable development goals. That means taking radical action and treating the climate situation as an emergency. To do that we need to add the amendment to the Trade Bill.

In doing so, we will be safeguarding life in water and on land. Earlier this year, the Prime Minister reaffirmed his Government’s commitment to achieving net zero by 2050 and boldly stated that “we will crack” the climate emergency. As a global leader on climate action, the UK must set an example to the rest of the world by honouring its international obligations under the Paris agreement and other multilateral environmental agreements. Trade policy is an integral part of that, so it should not be left out of the Bill.

Trade agreements can foster good climate action, but they can also impede Government implementation of climate commitments. They could threaten to increase fossil fuel use, for example, which we explicitly decided not to do in declaring a climate emergency. They could also hinder the sharing of green technology.

Trade agreements typically include national treatment for trade in gas, thereby locking in dependency on a fossil fuel with high greenhouse gas emissions, while incentivising increased fracking and fossil fuel infrastructure. We would not want continuity agreements that include those. The EU’s own impact assessment of TTIP—the EU-US trade deal—predicts that it would generate an additional 11 billion tonnes of carbon dioxide per year. That is fundamentally at odds with our international climate obligations, so we must bring our trade policies up to date with our environment obligations.

The dangers that trade deals pose to the environment can be clearly seen in the EU-Mercosur trade agreement currently under negotiation. A fortnight ago, the Dutch Parliament rejected the agreement, due to a lack of enforceable agreements on the protection of the Amazon or the prevention of illegal deforestation. Conducting trade negotiations without clear environmental red lines on the statute book—which this amendment would provide—with countries led by individuals such as President Bolsonaro, under whom deforestation of the Amazon has increased by 27% according to the NGO SOS Atlantic Forest Foundation, poses a huge threat to the Government’s international, climate and environmental obligations.

As the WWF has noted, rushing into trade deals with partners that do not share our ambitions could undermine UK leadership on positive environmental outcomes, by allowing imports from industrialised agricultural systems or through supply chains that promote deforestation. “Risky Business”, a report by the WWF and the Royal Society for the Protection of Birds, demonstrates that the UK is already moving backwards on reducing the UK’s overseas land footprint, which increased by 15% between 2016 and 2018, suggesting that we are increasingly offshoring our environmental impact. We need to do better.

To conclude, the Bill gives us an opportunity to ensure that our trade policy supports our environmental ambitions by explicitly putting them into the Trade Bill, including the target of net zero carbon emissions by 2050. Amendment 11 is a positive step towards that goal and is consistent with the Government’s own commitments and obligations, so everyone should agree to it, to ensure that the UK complies with international law and that we remain a world leader on climate action.

Greg Hands Portrait Greg Hands
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23 Jun 2020, 4:44 p.m.

As I have set out, the Government’s continuity programme is coherent with existing international obligations, as it seeks to replicate existing EU agreements to secure continuity for businesses and consumers. As I have made clear, we have no intention of lowering standards—environmental, labour or otherwise. The Prime Minister set out that commitment in his Greenwich speech and I have repeated it on many occasions, including today.

The UK has often led the way and exceeded EU minima on environmental issues, such as greenhouse gas emission reduction targets. I predict that we will continue to do so, thus making the amendment redundant. For example, the UK was the first country to introduce legally binding greenhouse gas emissions reduction targets through the Climate Change Act 2008. We were also the first major economy to set a legally binding target to achieve net zero greenhouse gas emissions from across the economy by 2050. We have cut our carbon emissions by nearly twice the EU average since 1990—by 42%.

Put simply, the UK has an extremely strong record on environmental action. I hope that the Committee will agree that the amendment is unnecessary, as we will be safeguarding and promoting, not undermining, our environmental obligations. Consequently, I ask that the amendment be withdrawn.

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

23 Jun 2020, 4:45 p.m.

I thank my hon. Friend the Member for Putney: it is absolutely right that we set an example to the world by honouring our Paris commitments, and honouring them in primary legislation is a formidable way of doing that. I am glad that she reminded me about fracking. There is fracking a mile from my constituency, and it causes enormous problems. Its relevance to the amendment is that the same companies engaged in fracking are able, under ISDS provisions if they are in place, to take action against the UK Government to defend their fossil fuel interests, even if the Government do not want to support such an industry and want to pursue a renewable energy agenda, so it is an important consideration.

That is why the amendment or something similar—if the Minister wants to bring it back, I will be very happy to look at it on Report—is the way to deal with this matter. We need to ensure that it is there, specified and clear in primary legislation, as part of our international trade framework, which is what the Bill should be. It is great of him to reference the Labour Government’s Climate Change Act 2008, but it is time for this Government to put such things into law as well, and this is their opportunity. I will press my amendment to a vote.

Question put, That the amendment be made.

Break in Debate

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

I have finished.

Greg Hands Portrait Greg Hands
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23 Jun 2020, 4:51 p.m.

Amendment 12 would mean that the power in clause 2 could not be used to implement agreements that might restrict the delivery of public services through public monopolies, exclusive rights or nationalisation.

The amendment is not necessary, because this is a continuity Bill. None of the agreements in question restrict our ability to deliver public services in that way. We have always protected our right to choose how we deliver public services in our trade agreements. Indeed, the UK’s public services, including the NHS, are often protected by specific exclusions, exceptions and reservations in the trade agreements to which the UK is a party. No trade agreement has ever affected our ability to keep public services public.

Colleagues will observe from our record of the signed agreements that the continuity programme seeks to preserve current trading relationships and not to alter the way in which our public services are designed or delivered. The amendment is therefore unnecessary, and I ask the hon. Gentleman to withdraw it.

Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

23 Jun 2020, 4:53 p.m.

Again, through secondary legislation the Bill enables the Government to do some of the things that we have described. More to the point, however, this issue is important because of the nature of the continuity agreements that will be renegotiated. We have discussed the agreements with Canada, Japan, Mexico and Turkey. I do not know whether any of those agreements would do what I have described, but they could potentially do so because they are not just continuity agreements.

The Bill sets the framework for trade agreements, because the Government are not bringing forward a different framework or alternatives on how trade agreements will be scrutinised and how they will end up. The Government are not challenging what the United States might do. We know the concerns that exist about how the US has expressed in the past its desire to intervene in public services in this country. We should be concerned and we should put this kind of commitment into law as it relates to international trade. I will press the amendment to the vote.

Question put, That the amendment be made.

Break in Debate

Charlotte Nichols Portrait Charlotte Nichols
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Very quickly, the provisions in the amendment could prove to be some of the most significant debated today, particularly proposed new paragraph (e) regarding antibiotics. We have seen that antibiotic resistance is one of the greatest threats—perhaps even an existential threat—facing humanity. It is as significant as the climate crisis. As we have seen with coronavirus, it would wreak not just a public health impact but an economic impact on our country.

When we discuss the food standards that are laid out in the legislation, it is not only what we eat that is important; the conditions in which animals are kept can often be breeding grounds for diseases that can spread to humans. Ensuring that antibiotics are used appropriately and in line with current regulations is of massive importance.

Greg Hands Portrait Greg Hands
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As the Committee will know, the UK’s food standards for both domestic production and imports are overseen by the Food Standards Agency and Food Standards Scotland. Those agencies provide independent advice to the UK and Scottish Governments and will continue to do so to ensure that all food imports comply with the UK’s high safety standards.

Through the work of those independent organisations, consumers are protected from unsafe food that does not meet our high domestic standards. I reassure the Committee that all imports, whether under continuity agreements, most favoured nation terms or new free trade agreements, must comply with our import requirements and food safety standards. Countries seeking access to our markets in future will have to abide by those food standards.

The Government have always been clear that all trade deals must work for UK consumers and businesses, upholding our high standards. The UK will remain committed to world-class food and agricultural standards. We will not weaken those levels of protection after the transition period ends.

Break in Debate

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

23 Jun 2020, 5:21 p.m.

I beg to move amendment 14, in clause 2, page 2, leave out lines 27 and 28.

The amendment is designed to remove the Henry VIII powers from the Bill. In its write up of the Trade Bill, Linklaters noted that constitutionally, the Government are already able to sign and ratify trade agreements with minimal reference to Parliament. The Trade Bill is designed to shortcut this process and to authorise the Government to implement the new agreements directly, by Executive act. To help them to do that, the Government seek to use Henry VIII powers to enable them to amend various bits of EU legislation, as they think appropriate, using regulations.

Liberty and others have argued that that represents a fundamental breach of Parliamentary sovereignty. The Committee has already debated the considerable weaknesses in the Bill in terms of opportunities for scrutiny. It is true that in comparison with the previous Trade Bill, Ministers have made a minor concession and agreed to the use of the affirmative process, but we can see no reason for the scale of the power grab represented by the Henry VIII powers in subsection (6)(a), and our amendment seeks to take them out.

Greg Hands Portrait Greg Hands
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23 Jun 2020, 5:23 p.m.

I will now address amendment 14. As the hon. Gentleman has pointed out, the amendment would remove the power to modify direct principal EU legislation, or primary legislation that is retained EU law, in order to implement obligations arising from continuity agreements.

It is important for Members to understand that without this power, we would, unfortunately, be unable to implement our obligations and we would risk being in breach of international law. It would also mean that our agreements were inoperable, adversely impacting upon UK businesses and consumers. I feel reasonably sure, Sir Graham, that that is not something that any Member of this Committee would support.

In addition, not only is this power necessary, but it is proportionate and constrained, because it only allows for the amendment of primary legislation that is retained EU law. Since trade continuity agreements will have been implemented substantially through EU law, the power is necessary to implement any technical changes that keep the agreements operable beyond the end of the transition period.

The Government have constrained the power as much as possible while ensuring that it is still capable of delivering continuity in our current trading relationships, which benefit businesses and consumers in every constituency represented by members of this Committee. To provide reassurance to Parliament, we have added a five-year sunset provision, which we will turn to shortly, and any regulations made under the clause 2 power will be subject to the affirmative procedure.

I ask Members not to take my word for it, but to take the word of the Delegated Powers and Regulatory Reform Committee, who raised no issues with the delegated powers in this Bill, gave it a clean bill of health and praised the introduction of the draft affirmative procedure for any regulations made. I hope that, in the light of the explanation that I have given, the Committee is reassured that not only is this power necessary, but it is proportionate and constrained. As such, I ask the hon. Gentleman to withdraw the amendment.

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

23 Jun 2020, 5:17 p.m.

I do not intend to press the matter to a vote, in the interests of time. I am not convinced by the Government’s argument, and we may return to the matter at Report stage. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Break in Debate

Gareth Thomas Portrait Gareth Thomas
- Hansard - - - Excerpts

23 Jun 2020, 5:30 p.m.

New clause 16 would put on the face of the Bill a joint ministerial committee, and give it powers to discuss international trade issues with the devolved Administrations. The Labour party brought the devolution settlements into effect. It has continued to champion the rights of the people of Wales, Scotland and Northern Ireland, through the devolved Administrations, to use to good effect the rights and powers devolved to them under the settlements.

In the new world, post-Brexit, we need the devolution settlements to be slightly updated to reflect the significance of the international trade agreements that will be negotiated. Putting into statute the joint ministerial committee and effectively establishing a ministerial forum for international trade seems to us to be the most sensible way to lock in proper consultation between Whitehall and each of the devolved Administrations.

One area of potential future negotiations where discussions on trade at joint ministerial committee level might well be needed is that of geographical indications, given the significance to the Welsh economy of Welsh lamb, for example, and to the Scottish economy of Scottish salmon and Scotch whisky. One recognises that the Administrations will understandably want to make sure that those industries are properly taken into account in future trade agreements, given the considerable number of jobs dependent on them in those countries.

GIs raise a further issue—the question of who has the power to legislate on them during the implementation of a trade agreement. My understanding is that that remains an issue. The most recent Cabinet Office revised framework analysis, published in April last year, stated that Ministers believed there were four areas that were reserved but subject to continued discussion. Two of those seem to me to have strong relevance to international trade. One is state aid and one is food GIs. If the question of who has power to legislate on those issues has not yet been fully resolved, it is surely all the more important to establish a formal forum for serious discussions between Ministers in the devolved Administrations and the UK Government on what should or should not be in a future trade agreement.

I have some sympathy with the argument that the hon. Member for Dundee East has advanced, but one of the problems with his amendment was encapsulated in an exchange in the fourth sitting of the Committee on the previous Trade Bill, between the former Trade Minister Mark Prisk and the then Trade spokesman for the hon. Gentleman’s party—I believe that that was the hon. Member for Livingston (Hannah Bardell). In column 116 of that sitting, the then Minister asked whether the hon. Lady thought that Welsh Ministers should have the power to veto a deal that was hugely in the interest of Scottish whisky. As a result, I gently suggest to the hon. Member for Dundee East that when we seek to press new clause 16 to a vote—perhaps on Thursday—he may be open to supporting that as a sensible route to managing the inevitable slightly differing priorities of each of the devolved Administrations and, potentially, the UK Government too.

Greg Hands Portrait Greg Hands
- Hansard - -

23 Jun 2020, 5:34 p.m.

I welcome the opportunity to discuss the important issues raised in the amendments, which I think are fundamentally on different topics from those that we have dealt with for much of today. There is significant common ground between the Government and the Opposition parties. I welcome the hon. Member for Dundee East to the debate, for his first contribution today. It was noticeable that he chose not to take part in the chaos that ensued earlier when the main Opposition party’s Front Benchers struggled with whether they are for or against the Canada agreement and so on. He wisely decided to sit that one out.

Under the UK constitution, the negotiation of international trade agreements is, as I have already made clear, a prerogative power of the UK Government. It is also a reserved matter, where the UK Government act on behalf of the whole UK. When exercising that reserved power, the Government have made clear that they will deliver trade agreements that benefit all parts of the UK—I have already referred to the scoping assessment for the US deal, showing that Scotland would be the nation or region of the UK that benefited most—unleashing the potential of businesses from all four countries of the United Kingdom.

I recognise the important role that the devolved Administrations can and should play in that endeavour, not only as representatives of their respective nations’ interest, but because we know our trade deals will interact with areas of devolved competence. As such, my Department has worked and will continue to work closely with the DAs on our trade policy.

Turning to new clause 16, I will explain why I think it is unnecessary and impractical, although the principle of engagement behind it is one that I share. The new clause seeks to create a statutory role for a joint committee of the UK Government and the devolved Administrations as a forum to discuss trade policy, but such an arrangement is already in place.

During the passage of the Trade Bill 2017-19, the previous Secretary of State for Trade, my right hon. Friend the Member for North Somerset (Dr Fox), committed to establishing a new bespoke ministerial forum for trade with the devolved Administrations, in recognition of the importance of this relationship. That forum had its inaugural meeting in January and meets regularly to discuss our approach to trade negotiations, including key areas such as our objectives for the US trade agreement.

I am also happy to put on record my commitment to continuing to work closely with the devolved Administrations at all stages of trade negotiations, not only through the ministerial forum for trade, but via bilateral ad hoc engagement to reflect the sometimes fast-paced nature of trade negotiations. Indeed, I spoke about the US free trade agreement with all my counterparts in the devolved Administrations last month and have also recently written about the Trade Bill and other trade policy issues.

My former ministerial colleague, my right hon. Friend the Member for Bournemouth East (Mr Ellwood) travelled to Belfast in February to meet colleagues in the Northern Ireland Executive to discuss trade policy. For the benefit of the hon. Member for Dundee East, 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.

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. In contrast, 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.

Nor is this proposed new clause practical. It would lock us and the DAs into prescribed ways of working under the existing intergovernmental memorandum of understanding, a document last updated in 2013. It would constrain our ability to develop and adapt bespoke engagement mechanisms as we embark on negotiating our first UK trade agreements for more than a generation.

Turning to amendment 8, the powers created by this legislation will be used for the purpose of transitioning trade agreements with those countries that the UK had agreements with through its membership of the EU. That will ensure certainty, continuity and stability in our trade and investment relationships for businesses, citizens and trading partners in all parts of the UK.

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, allowing each devolved Administration to implement the agreements independently in some cases, while also allowing the UK Government to legislate on a UK-wide basis where it makes practical sense to do so. This approach permits greater administrative efficiency, reducing the volume of legislation brought through the UK Parliament and through the devolved legislatures.

I recognise that the devolved Administrations and members of this Committee seek reassurance that those powers will be used appropriately. The Government have already made clear that we will not normally use them to legislate within devolved areas without the consent of the relevant devolved Administration or Administrations, and never without consulting them first. I am, of course, happy to restate that commitment here.

It is not appropriate, however, to put that commitment on a statutory footing, as, like new clause 16, it would give the devolved Administrations a statutory role in the reserved area of international trade, undermining the important constitutional principles enshrined in the devolution settlements. We recognise that the technical implementation of international obligations in devolved areas is a devolved matter. However, as I have explained, the decision on which international obligations the UK enters into is a reserved matter and a prerogative power exercisable only by the UK Government. This rightly ensures that the UK Government can speak with a single voice under international law, providing certainty for our negotiating partners and the strongest possible negotiating position for the whole of the UK, for the benefit of all of the UK.

A statutory consent provision in the Bill would in effect give the devolved Administrations a veto over a reserved matter. This would be highly constitutionally inappropriate and could lead to a situation where international agreements applied in some parts of the UK but not others. This would be a fundamental weakening of our Union and the long-established principle that in the matter of international relations the UK Government negotiate for all parts of the UK.

Additionally, placing the commitment on a statutory footing could open us up to convoluted and lengthy procedures in which the courts were asked to determine in minute detail what was reserved and what was devolved. This is disproportionate and would create significant uncertainty for UK businesses, undermining the fundamental purpose of the Bill, which is to maximise certainty and continuity of trading arrangements. Our commitment to not normally legislate in areas of devolved competence without consent, and never without consultation, strikes the proper balance between providing sufficient reassurance to the devolved Administrations while preserving international relations as a reserved matter. It is a sincere commitment that we will honour, as we have honoured the commitments made to the devolved Administrations on the Trade Bill 2017-19.

For example, we committed to seeking suggestions from the devolved Administrations on the optimal way of recruiting non-executive members for the Trade Remedies Authority, which we will discuss on Thursday, with regional knowledge, skills and experience, and we fulfilled that earlier this year.

Our new independent trade policy absolutely calls for engagement with the devolved Administrations and respect for the important role that they can and should play, but it does not call for fundamental shifts in the nature of devolution or the weakening of powers that Parliament agreed should remain reserved to the UK Government. We have worked collaboratively with all the DAs to ensure that the Bill enables us to transition arrangements in a way that delivers for the whole UK. Our existing commitments, which I have restated today, provide sufficient reassurance to the devolved Administrations on the issues covered by the amendments. This is demonstrated by the fact that the Welsh Government have recommended consent to the relevant clauses of the Bill.

I hope I have been able to satisfy hon. Members that we have recognised and met their objectives in this amendment and that the hon. Member for Dundee East will withdraw it.

Stewart Hosie Portrait Stewart Hosie
- Hansard - - - Excerpts

23 Jun 2020, 5:44 p.m.

I thank the Minister for reconfirming the non-legislative commitments made by his predecessor in his letter to Ivan McKee. That has genuinely helped. However, the Minister falls back on the argument that bespoke powers are better than a permanent credible structure. I disagree. I think a permanent credible structure provides more stability and certainty than the bespoke ad hoc use of powers and discussions from time to time. However, in the current devolved process, I recognise that international treaties are reserved matters. I absolutely understand and respect that, but he knows as well as anyone who might be listening that the interface of the intersection between an international trade treaty and a devolved competence might be fairly high. That is all the more reason for structured statutory formal engagement rather than an ad hoc bespoke process, which may or may not satisfy one or more parties, or one or more of the nations, in the UK about the Government’s actions over a given international trade agreement.

Although I do not intend to press the matter to a vote, and I thank the Minister sincerely for the commitments he has restated, there is a fundamental difference of opinion on the bespoke ad hoc approach being suggested and a formal statutory structure, and I am sure we will return to that theme on Report. On that basis, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Ordered, That further consideration be now adjourned.— (Maria Caulfield.)

Trade Bill (Fourth sitting)

(Committee Debate: 4th sitting: House of Commons)
Greg Hands Excerpts
Thursday 18th June 2020

(5 months, 2 weeks ago)

Public Bill Committees

Read Full debate Read Hansard Text Bill Main Page
Department for International Trade
Bill Esterson Portrait Bill Esterson
- Hansard - - - Excerpts

18 Jun 2020, 2:10 p.m.

My hon. Friend is quite right: we need to make more of the opportunities available in procurement, and this kind of amendment is a way of delivering on that agenda.

I am pleased that the hon. Member for Dundee East has tabled the amendment. I note his comments about waiting, to ensure that the Minister is able to respond in full and in the event that he needs additional advice. I am happy to support the hon. Member in principle, on the basis of waiting to hear what the Minister’s reply might be.

Greg Hands Portrait The Minister for Trade Policy (Greg Hands)
- Hansard - -

18 Jun 2020, 2:11 p.m.

Sir Graham, first of all, it is a pleasure to serve under your chairmanship, and I welcome everyone to the Committee. I think the previous Bill Committee I served on was for the previous gestation of this Bill, in early 2018, so I know from past experience that we have interesting discussions ahead in the coming days on this important legislation.

As the Secretary of State and I made clear on Second Reading, the Bill is about ensuring continuity and providing certainty for businesses and consumers as the UK strikes out once more as an independent trading nation. We will use the freedom that we have gained through our departure from the EU to negotiate trade agreements with new partners, but we also remain committed to seeking continuity in our trade relationships.

I will turn to the amendment in just a moment, but let me be absolutely clear. I have not spoken about the Bill since Second Reading, and I was genuinely surprised that the Opposition parties opposed the principle of it. The Bill consists entirely of wholly sensible proposals to secure the continuity of more than 40 trade agreements and our continued membership of the World Trade Organisation’s government procurement agreement, and to allow UK trade defences.

I hope that the Opposition parties will reconsider their principled opposition to the Bill after all the scrutiny that we are about to have and on Report, and will consider voting for it on Third Reading.

Gareth Thomas Portrait Gareth Thomas
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18 Jun 2020, 2:12 p.m.

I am sure we would be happy to reconsider if the Minister committed at this point to being sympathetic to some of the amendments we have tabled—for example, on extending scrutiny opportunities and extending the Bill to cover future free trade agreements. I will look sympathetically at his request if he will look sympathetically at ours.

Greg Hands Portrait Greg Hands
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18 Jun 2020, 2:23 p.m.

I thank the hon. Gentleman. He is an old sparring partner of mine over different years and different Sessions. It would be impossible for me to commit to that today, because there is still the opportunity, as I understand it, for further amendments to be tabled, so it would be impossible for me to either rule in or out opposing all future amendments.

I want to say a quick word on the practicalities for Members who are on their first Bill Committee. Due to the social distancing requirements, as you mentioned, Sir Graham, there is no one to pass notes to the Hansard reporter. Normally, the Minister also has with him or her a small group of officials, but they are unable to be with us today, also due to social distancing. On occasion, therefore, if a Member has an extremely technical question—I am just trying to think of a good example; perhaps it would be something about diagonal accumulation rules in the EU-Faroes agreement—it may be necessary for me to write to them. However, I commit that if I do write to a Member, I will of course copy the information to all members of the Committee.

I now turn to the WTO’s government procurement agreement, which is the subject of clause 1 and, indeed, the amendment. The GPA was negotiated and agreed in 1994, and the UK has participated in it through our EU membership from the very beginning. We continue to be covered as if we were an EU member during the transition period, but once it ends, on 31 December, the UK intends to join the agreement as a member in its own right and on substantially the same terms that we had under EU membership.

Break in Debate

Gareth Thomas Portrait Gareth Thomas
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18 Jun 2020, 2:17 p.m.

That may be one of the issues on which the Minister needs to write to the Committee. He will know that there have been long-standing concerns about British companies’ ability to get access to public procurement markets in an honest way, in, for example, China and Russia, given the levels of support that the Governments there often give to their own companies. The market is not necessarily an honest and level playing field. I understand that China and Russia are in the process of acceding to the GPA, but it might be helpful at some stage for the Committee to understand how far along the journey to accession those two countries are. They are potentially critical for British companies that want to get into the procurement markets there.

Greg Hands Portrait Greg Hands
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18 Jun 2020, 2:19 p.m.

I thank the hon. Gentleman for that very good question. I do not have current information about how far down that process China and Russia may be. Of course, both those countries are members of the WTO. It would, ordinarily, not be unnatural for them to seek membership of the GPA, but, of course, the GPA does not include all members of the WTO—it has 20 members, and they are typically western liberal democracies. Australia is the most recent to join. I imagine that China and Russia joining would become a significant issue on the international stage, and at the WTO.

If the UK were not an independent member of the GPA in its own right—or if it were to fall out—our ability to influence accessions would be very much diminished. That is another good reason to be a member of the GPA—so that we can exert UK influence on the global stage to make sure that accessions are in the interests of the wider world community, as well as UK businesses and taxpayers.

The reciprocal nature of the agreement supports the public sector to get the best value for every taxpayer pound that it spends. Those benefits will increase each time another party joins. Each new party that joins increases the procurement opportunities available to UK businesses and public sector bodies.

Turning to amendment 29, the powers in clause 1 will enable us to give effect to our international obligations on joining the GPA as an independent party, and to make changes as necessary in response to specific circumstances that may arise from time to time after our accession. Examples might be changes to reflect, and arrange for, the accession of other parties to the GPA—the hon. Member for Harrow West mentioned a couple of possible future members—or to make the necessary adjustments where parties leave the agreement. The ability to make these changes is essential to allow us to keep in line, and up to date, with our international obligations.

Gareth Thomas Portrait Gareth Thomas
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The Minister will understand that there have been concerns about acceding to the GPA and doing so at a time when we have exited the European Union. One concern relates to how low the threshold is for other GPA members to potentially get access to central Government contracts, thereby potentially putting at a disadvantage British companies wanting to win those contracts. What reassurance can he offer British companies that are potentially beginning to seek out opportunities to win central Government contracts that they will not lose out against other countries’ companies?

Greg Hands Portrait Greg Hands
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19 Jun 2020, 12:04 a.m.

It is a good question, but the assurance I would give is that our intention is to join the GPA with substantially the same arrangements as we currently have as members of the EU. That will give the assurance of continuity as we move forward.

The power in the clause is appropriately drafted to ensure that our international obligations will be fully complied with, including by making changes to national law, where appropriate, using the power in this clause. The use of the power is expressed in the usual way. I say to the hon. Member for Dundee East that we have expressed these powers using quite a usual formulation, allowing authorities to make regulations in the circumstances set out. If the wording were to be changed from “may” to “must”, as proposed in the amendment and as he suggests, changes would need to be made in all circumstances covered by clause 1. There would, however, be certain circumstances where it would not be appropriate or necessary for regulations to be made. For example, a dispute with another party might be resolved without the need to make any changes at all to domestic regulations. Likewise, not all modifications of another party’s appendix I will require changes to domestic law. On that basis, I ask the him to withdraw the amendment.

Stewart Hosie Portrait Stewart Hosie
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19 Jun 2020, 12:03 a.m.

I make a number of observations. The Minister said that the Bill was about continuity. If I take that at face value, as I do, it strengthens the case for the relevant authority being required to make the necessary regulatory changes. He also said that the flexibility allows the relevant authority to respond to specific circumstances, but if those change, there are lots of reasons why it should—absolutely must—make the necessary regulations to respond to those changes. The final argument the Minister made does not hold water:

“An appropriate authority”—

must—

“by regulations make such provision as the authority considers appropriate”.

So if a circumstance stands changed where the relevant authority did not deem it appropriate to make a change, it would not be required to do so.

The hon. Member for Harrow West said that the amendment might encourage more businesses to take advantage of procurement opportunity. It would not do so directly, but, certainly, if the relevant authorities were required to do something, it might act as a nudge measure to encourage businesses to look at those procurement opportunities.

I will do what I said at the beginning: I will not seek to press these matters to a Division now, but I will ponder on the Minister’s answer. I am sure he will consult others and ponder further, and we may have a similar debate on Third Reading. On that basis, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Break in Debate

Bill Esterson Portrait Bill Esterson
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19 Jun 2020, 12:04 a.m.

I am grateful to my hon. Friend. He said that smaller organisations find it difficult to win contracts, and that is why the Government have to use their authority and make sure the regulations are in place. Amendment 26 is about small and medium-sized enterprises, and it should absolutely cover social enterprises too, many of which are SMEs. It is essential that such things are in regulations to support the sorts of enterprises that my hon. Friend describes, and to pursue socially valuable activities. I will come to the Public Services (Social Value) Act 2012 a bit later, which was initiated by a former Conservative MP, Chris White, and passed with the support of the coalition Government. It gives more detail in this area.

Similar descriptions are applied in amendment 25, which mentions,

“environmental exceptions and carbon considerations”.

The current UK minimum standards take into account energy and water use, carbon footprint, resource efficiency, and life-cycle costs in order to set minimum standards of sustainability for Government purchases. Our standards need to be protected, both in terms of maintaining these procurement standards and of ensuring that our schedules at the GPA remain up to date with the action needed to address the climate crisis. If we allow the public procurement regulations to lapse, we will not include such provisions as those I have just described, which are picked up in amendment 25. I know that Ministers take this seriously because the point was made in oral questions just this morning. I cannot remember whether it was the Minister of State or the Secretary of State who quoted the Government’s attitude towa