Trade (Australia and New Zealand) Bill

John Spellar Excerpts

Consideration of Lords amendments
Wednesday 22nd March 2023 Commons Chamber

[Gareth Thomas (Harrow West) (Lab/Co-op)]

Last week the Office for Budget Responsibility published figures on trade which changed the context for this debate on what is an apparently innocuous amendment from the other place. According to the OBR, we now face two years of declining exports, with a huge 6.6% drop in British exports this year, a further drop next year, and then an average growth in our exports of less than 1% for the next three years. We are reaping the results of the Conservatives’ failure to negotiate a better trade deal with the European Union or complete a trade deal with the United States, and the impact of significant cuts in support for attendance at trade shows and access to overseas markets is now all too obvious.

This amendment, and the debates in the Lords, strike me as a big missed opportunity—not for want of trying by Opposition colleagues—to start attempting to put things right. Abolishing the Department for International Trade and moving the deckchairs around in Whitehall is not going to hide away the Conservatives’ dismal record on trade and economic growth. We are lagging behind the rest of the G7 on exports to the world’s fastest growing economies in the G20, and nothing that the Minister has said so far, this afternoon or in previous debates, is going to improve the situation any time soon.

I do not want to detain the House too long, but while the amendment might involve the insertion of only one word in the Bill, the difference it makes does matter, both for what it does and what it does not do. Although there is support across the House to increase trade with our friends in Australia and New Zealand—particularly on the Labour Benches, not least because both countries are now led by progressive Labour Governments—there has also been widespread concern, among hon. Members and certainly outside the House, about what Ministers have negotiated, particularly in the trade deal with Australia. As I say, this amendment feels like a missed opportunity to begin to address those concerns.

We know that Ministers decided to throw British farmers under the bus, ignoring the concerns of the National Farmers Union. We know that the Prime Minister could have intervened, but did not. And we know that the desperation to get any deal meant that too much negotiating leverage was given up. One of the questions that the amendment raises is whether its wording in any way helps to offset, even just a little, those significant negotiating failures by the Government. We on the Labour Benches warned Ministers that the Australian deal would be used as a precedent by the other countries with which Ministers are negotiating, and as the Minister knows, that is exactly what is happening. The weaknesses in the deal that his predecessors negotiated are now being used to demand further concessions in our current negotiations, particularly by the countries with big agricultural interests.

I have considered carefully whether this amendment helps us to find any comfort following the devastating analysis of these trade deals offered to the House by the right hon. Member for Camborne and Redruth (George Eustice), when he explained, back in November, that we

“gave away far too much for far too little in return”.—[Official Report, 14 November 2022; Vol. 722, c. 424.]

He also said that

“the value of the UK agri-food market access offer was nearly double what we got in return”.

I have also considered carefully whether this amendment from the other place improved the scrutiny by Parliament, or even the scrutiny of how the regulations bringing into effect the procurement chapters of these trade deals are implemented. If the amendment had forced Ministers to consult with and in the nations and regions of the UK before the regulations were introduced, it would have been extremely helpful. After all, surely one of the most important lessons from these two trade deals is that the process of parliamentary scrutiny for trade deals is not fit for purpose.

Granted, Ministers in the Department for International Trade were busy disagreeing and attacking each other at the time, but when the then Trade Secretary failed to turn up eight times to give evidence before the International Trade Committee on these deals—and despite that, would not extend the time for the Committee to report on the deals to the House—it became clear that something was very amiss with the system of scrutiny. It is hardly surprising that the International Trade Committee has been abolished by Ministers, but instead of improving the scrutiny of trade negotiations, or even just the regulations implementing the procurement chapters of the negotiations, the amendment makes things a little easier for Ministers.

[John Spellar (Warley) (Lab)]

Will my hon. Friend confirm, notwithstanding the absurdities of the previous Trade Secretary, who was more concerned with a photo opportunity than a proper deal, and some of the other difficulties, that our position is that it is enormously important that we have good trading and all other relations with our great allies in Australia and New Zealand, particularly after we recently strengthened and deepened our strategic relationship through the very welcome AUKUS deal?

[Gareth Thomas]

My right hon. Friend, as ever, makes a hugely important point. Australia and New Zealand, as I said earlier, are important allies of this country with whom we have crucial security interests as well as trade interests. I accept that anything that helps to maintain and strengthen those relationships is very positive, but I am sure he would agree that we need to learn the lessons from how Ministers carried on those negotiations, particularly with the Australians.

Given the specific context of the Bill and the focus on implementing the procurement chapters of the two trade deals, it is a struggle to see how this amendment will help to improve the implementation of the supposed better access to our partners’ procurement markets.

The leading procurement expert Professor Sánchez Graells set out clearly in his evidence to the other place, and indeed to this House, his concerns that the Australia deal worsens the protections for British businesses competing in the Australian procurement market. We are entitled to ask ourselves whether this amendment helps to address that concern in any way. Sadly, I do not think it does.

Professor Sánchez Graells also made clear his view that the benefits of the trade deal in terms of access to Australia’s procurement market have been significantly exaggerated. The noble Lord Purvis and Labour Lords also picked up on that point in the debates in the other House, but the one Lords amendment that the Government backed does not address this concern. What the amendment does, if anything, is ever so slightly increase Ministers’ powers to implement regulations, wherever and however they want.

Given how Ministers excluded some groups from the negotiations—including trade unions—given the disregard for the legitimate interests of our devolved nations, and given the failure to negotiate commitments on climate change or proper protections for specialist British brands such as Stilton cheese or Scotch whisky, Ministers’ apparent determination to try to claim a little more freedom to implement the procurement chapters does not encourage any sense that they have learned lessons from what has happened.

I have one specific question for the Minister on the implementation of these trade deals. It would be very helpful for small businesses across the UK if he set out the Department’s plan to support small businesses that want to access the Australian and New Zealand markets and take advantage of the trade preferences in these two deals.

We will not seek to divide the House, but this amendment is a reminder of the Government’s woeful performance on trade and exports, and of the desperate need for a new Government determined to lift up the living standards of everyone in this country, not just the already very wealthy, by delivering more exports and sustained economic growth.

--- Later in debate ---

[John Spellar]

Do we not have to be careful on public procurement and recognise the world as it is, notwithstanding agreements? Even when we were a member of the EU, we found that other countries gave considerable preference to their own producers within procurement. Our civil service and Treasury resolutely, adamantly and stubbornly refuse to support British industry, including small and medium-sized enterprises, and so when they go into the world market, they hear, “If you are not good enough for the British Government, why are you good enough for us?” They are being constantly undermined, even now, on small modular reactors.

[Anthony Mangnall]

I am grateful to the right hon. Gentleman for that. We have accepted in many instances the terms of the World Trade Organisation and the carve-out measures within them, so we are very compliant in many areas where we can be, for example, in this instance, a little more protectionist in respect of some of the key technologies we are developing in this country. There is a bit of give and take on that point. We do recognise it in some areas, although perhaps not to the extent that he would want to see.

As I was saying, I do not disagree with this Lords amendment, which is a perfectly simple one. There is always a lot in a word, but this will give us the opportunity to take full advantage in our trade deals and through procurement.