Transatlantic Trade and Investment Partnership

Jim Shannon Excerpts

Tuesday 25th February 2014 Commons Chamber

[Zac Goldsmith (Richmond Park) (Con)]

It is good news that we are discussing the TTIP which, as far as I am aware, is the most ambitious free trade agreement ever attempted. On these complex agreements, national legislators, in their worthy pursuit of job creation, growth and trade, do not always pay attention to the finer details.

Some years ago when I interviewed Ralph Nader, the consumer activist and occasional presidential candidate, about the North American Free Trade Agreement, he told me that even though Congress was set overwhelmingly to back the treaty, he was convinced from his discussions with members that few of them, if any, had bothered even to read the text. He eventually offered a substantial prize to any member who was willing publicly to answer 12 simple questions about NAFTA. Following a long pause, a strongly NAFTA-supporting Republican, Senator Hank Brown of Colorado, accepted the challenge and reserved the Senate Foreign Relations Committee room for the ordeal. The cameras and journalists were there and, to everyone’s amazement, he answered each of the 12 questions correctly, but when he had finished, he turned away from Ralph Nader to the cameras and said that having read the treaty, which he had not previously done, he realised just how awful it was, so he chose to do a U-turn and to vote against it.

At this stage, we do not have a huge amount to go on regarding the TTIP but, whatever one thinks about it, it clearly has serious implications and it merits close scrutiny. On the whole, free trade agreements are about lowering barriers to trade—that is their purpose—but, compared with the situation in other countries, there are relatively few barriers to trade between the EU and the US, so the main focus must be standards and regulations, with the goal of trying to harmonise them. However, it is hard to imagine that the process will involve any key standards going up; on the contrary, I suspect that we will see a spiral downwards. We only have to read several of the publications put forward by some of the most substantial big business lobby groups to see that they are openly talking about removing under the TTIP whole rafts of standards and regulations that businesses believe hinder their activities. One does not have to believe in a conspiracy theory; one just needs to read the communications of some of the companies that are playing an active role in the process.

We are already seeing an emphasis on lobbying with regard to food, about which several hon. Members have spoken, and it is difficult to imagine the harmonisation of food standards working in our interest. Europe believes that providing clear labelling for genetically modified food is a consumer right, but such practice is absolutely opposed by the vast majority of states in the US.

[Jim Shannon (Strangford) (DUP)]

On the subject of food, two companies in my constituency wanted to export to the United States, but the border controls and financial conditions to which they were subjected ensured that they could not be competitive there. They therefore had to franchise out in the United States, which meant that the company back home could not grow or create jobs here, which shows the unfairness of the system.

[Zac Goldsmith]

I thank the hon. Gentleman for that intervention.

There are so many differences between the US and the EU, and not only in the quality of standards, but in the approach to developing them. I cannot imagine a situation in which harmonising standards and regulations would work in the interests of the consumer. I have given the example of GM food labelling, but there are many others. A number of countries around the world, and indeed the EU as a whole, have chosen not to allow the import from the US of beef from cows fed a diet that includes the hormone ractopamine, because of the fairly grave health concerns. I suspect that most British consumers would support that position. Would that be challenged? Well, there is already plenty of talk among agribusiness in the United States that it should be.

Most worryingly, US agribusiness is strongly opposed to EU attempts to limit endocrine disruptors. The links between the use of such chemicals and the alarming increase in precocious puberty among young girls are not disputed. Will those standards that we have set across Europe be adhered to and maintained? That remains to be seen, but we know that plenty of lobby groups in the United States have their sights set on reducing those standards.

It is easy to imagine that regulatory convergence will mean chasing the lowest common denominator. It is worth noting that, according to a whole raft of freedom of information requests conducted by the Corporate Europe Observatory in the context of the TTIP, the Commission has met civil society groups just eight times over the course of those discussions, whereas it has met corporate lobby groups—I do not know how they are defined and am only repeating what has been reported—119 times.

I suspect that most Members across the House would agree that removing or simplifying unnecessary regulations, removing barriers to entry, particularly for small firms, and encouraging free trade are all laudable aims, but they need not happen at the expense of democracy. My concern is that the proposed ISDS mechanisms, which we have already heard a great deal about, will undermine democracy. Under those mechanisms, companies wishing to challenge a national regulation could effectively bypass the usual process and go straight to an investment tribunal. Often hugely important outcomes therefore rest on the shoulders of just three arbitrators—one is chosen by the company, another by the state and the third is a compromise of the two. It is hard to understand how this country would want or need such a system.

My right hon. and learned Friend the Minister was asked recently—

--- Later in debate ---

[Ian Paisley (North Antrim) (DUP)]

Let me say at the outset that I am pro-trade. I want our export industry to increase, and I want everything possible to be done to ensure that that can happen—and happen successfully. I think that we should approach the TTIP with confidence, but I agree with the Minister that we should also be alert to the needs of our community and our businesses, and ensure that they are given as much protection as possible in the negotiations.

I congratulate the hon. Member for Paisley and Renfrewshire North (Jim Sheridan) not only on the fact that he represents the finest-named constituency in the House, but on his agility in rightly focusing Members’ minds on the dynamics of the Scottish debate and how important it is to us. The Minister responded to the hon. Gentleman’s comments robustly, but I think that the issue should be a priority for us as well, and that we should remind our neighbours and friends of its importance to them.

I want to focus on farming, food production and consumer rights, because they affect my constituents dramatically. As I said to the Minister in an intervention, a good deal will be marked by how we ensure that the rights and needs of our farmers—our primary producers of food, and of excellent food—are protected, aided and abetted in the negotiations. There is no doubt that we produce the best traceable food in the world. It is a £20 billion-plus industry and an essential trade, and in my part of the United Kingdom it is the most essential trade. It is a mainstay of business and employment. It is the one sector in which our productivity is increasing annually. I believe that last year our food production increased by an average of about 12%. That is a Chinese-style proportion of growth. We need to keep a careful eye on it, and ensure that it continues.

The fact that we produce the best food in the world makes that food not just worth protecting, but worth exporting. It is clear that people want to buy our food and drink products. In my constituency, for example, the Bushmills distillery produces what I am told is the finest whiskey in the world. The Minister will have sampled it many, many times. That distillery employs 102 people in my constituency, but 90% of what it produces is exported, and the vast majority goes to the United States of America. Last year, its trade increased by 14%. Such growth must be encouraged, and must be seen as a major opportunity in the TTIP negotiations.

[Jim Shannon]

Not teetotal!

[Ian Paisley]

No, not teetotal, but TTIP.

I urge the Minister to think of the 85,000 people in our community who are involved in agri-food production, and to ensure that they and their rights are put at the top of the agenda, because that affects consumer confidence. We can say to our consumers, with strength and authority, that we know what they are consuming because it is traceable. That is one of the advantages that we have as an island nation, and we must use it to our advantage, because it makes our food a very desirable commodity. We need to ensure that food that is imported to the United Kingdom meets the same exacting standards as the food that we produce here. One way in which we can do that is to ensure that labelling is accurate, so that when we, as consumers, go to the supermarket, the local butcher or another local shop, we can see for ourselves what has been imported and where it has come from.

I think that farmers in the United States have a significant cost-of-production advantage over many farmers in the European Community. US farmers bear a lighter regulatory burden; they have a different approach to animal welfare, and they have a very different approach to animal traceability in their food production. They use hormones, and their environmental legislation is very different from ours. We must take cognisance of that in any trade negotiation. Trade must mean ensuring that imports are produced to equivalent standards, and that product labelling clearly distinguishes between different production methods in a way that is meaningful and not misleading. The Minister spoke about red lines. We do not have to reveal all the red lines; this should be a priority, and we should be aware of that.

The US is very competitive in beef production. Our prices are at crisis levels. Given the significant cost and production advantages in the US through the use of hormone growth promoters, if any changes are made to the EU hormone rules and tariffs are eliminated, it is likely that the US would be in a position significantly to increase the volume of beef exported to the UK. That could damage our significant industry. We need to be alert to that and to ensure that we get the best deal for our primary producers.

The poultry sector should be treated as a sensitive sector. Why do I say that? Since 1997, American poultry has not been allowed to be imported into the European Community because of pathogen reduction treatments. Those treatments mean that we do not believe that consumers should eat American poultry. If changes to the PRT rules result in an increase in poultry imports to the EC from the US, we need to take a careful line on that and ensure that we put our poultry industry, which is one of the biggest in the world and is associated directly with Brazil, first in the negotiations.

Those are key issues that will determine business direction in our country. I hope that the Minister will, as he has said, be alert to those issues.