Free Trade Agreements: Parliamentary Scrutiny

Debate between John Spellar and Angus Brendan MacNeil

Thursday 3rd November 2022 Commons Chamber

[Angus Brendan MacNeil]

Thank you, Mr Deputy Speaker—I remember many a ding-dong that we had on Brexit, as you may recall. I thank the hon. Member for Cleethorpes (Martin Vickers) for what he said. He is right—I point out the facts and numbers around Brexit, and they are not good. I compare Brexit to going to the horse-racing with £500 and coming back with trade deals worth £2 or £8 or whatever—we are still £490-odd down, but I will leave that there in deference to the hon. Gentleman.

The hon. Gentleman is right that a majority of the Committee want to reset that, and under the circumstances in which we find ourselves, we want to see trade deals. The question is about the terms of those trade deals, and that is where the House should be involved. That is why we look at trade deals that the European Union might achieve with New Zealand or Australia, versus what we have achieved, and we must also remember the words of the Prime Minister, who said that those deals are “one-sided”.

I was speaking to a member of the Trade and Agriculture Commission who said that—I had better phrase it this way—the Australia trade deal was the biggest giveaway of agricultural liberalisation that has been seen in any trade agreement. We should remember that free trade agreements are not about free trade; they are about bureaucratic trade, and they usually replace tariffs with bits of paper. There is nowhere where trade occurs as freely—to return to that word—as it did with the European Union before Brexit.

[John Spellar (Warley) (Lab)]

Members on both side of the House share some concerns about the performance of previous Trade Ministers—not only their attitudes to the way deals were conducted, but their relations with this House. May I also express disappointment with the position of the Committee, and perhaps strike a note that dissents from the general congratulatory tone? The Chair rightly identified the issue of questioning Government strategy, but I am not clear what the strategy and trade policy of the International Trade Committee is. I heard nothing in the contribution to outline a recognition that trade has been of enormous benefit to humankind over centuries, and particularly since the second world war, in bringing hundreds of millions, if not billions of people across the planet out of poverty, and nothing about the opportunities for trade. Those who argued for us staying in the EU were surely arguing about the benefits of trade.

I also do not see any indication of the countries with which we ought to be doing trade deals, and I would like a response on that. If we are not able to do trade deals with countries such as Australia and New Zealand with which we share history, family, strategic, security and defence relations, who can we make agreements with? Please do not just tell me it is the EU. We need to look in government but also, I would argue, in the Committee, at having a consistent trade policy, and I look forward to that in future debates.

[Angus Brendan MacNeil]

I am grateful to the right hon. Gentleman —it is good to be criticised, because that forces people to look inwards and see exactly what is happening and what needs to be done. The role of the Committee is first to scrutinise and sometimes to help the Government, and indeed, as the Minister will know, perhaps to chide them. It is also to set the agenda at times—that alludes to other countries, as the right hon. Gentleman says. We can trade with countries without trade deals, but the terms of trade vary. We pay tariffs, and usually when we get rid of those in a trade agreement we have bureaucracy instead.

The right hon. Gentleman gives me the opportunity to raise an important point on the Floor of the House, which is about resources. He is asking the Committee to do more. Yes, the Committee can do more. We are aware we can do more, but we are very aware that our workload leaves a heavy burden on Committee staff. If he can add his voice to other voices to ensure that the Committee is well resourced, we will be eternally grateful to our critical friend on the Labour Back Benches.

Trade (Australia and New Zealand) Bill

Debate between John Spellar and Angus Brendan MacNeil

2nd reading
Tuesday 6th September 2022 Commons Chamber

[John Spellar (Warley) (Lab)]

I think we should initially recognise that trade does not exist in a vacuum. It is about relationships and trust, and which country is better to trust than Australia? In April, we have the Anzac Day commemoration in Whitehall, where we acknowledge and remember the hundreds of years of joint working and joint operations against tyranny and dictatorship. We have the long-standing and deep Five Eyes intelligence relationship, which also underpins our defence of our freedoms, and only this morning the Defence Committee was conducting an inquiry into the AUKUS agreement. We also have much wider relationships—family, political, trading, business, trade union, cultural and sporting—and of course a common basis in the common law.

Therefore, if we are going to do trade deals with anyone—and this is what has always surprised me about the opposition shown by some on the Opposition Benches—it should be a deal with Australia, as we have so much in common. That is why the contribution from the shadow Secretary of State, my right hon. Friend the Member for Torfaen (Nick Thomas-Symonds), was so welcome today. It had a very different tone from some speeches we have heard previously, and it is all the more welcome for that.

We have to recognise—and I forget which colleague mentioned this—that there is always a dynamic between free trade and fair trade. It is a debate that has dominated British politics from time to time over the last 150 or so years, and it has even twice torn the Conservative party apart. It is right to have such a debate, and we therefore need to focus on the details and on the principles, because such agreements cannot be an open door to pillage. We also have to make sure that the other parties are living up to the commitments they make in these agreements. Probably the most telling example is the accession of China to the World Trade Organisation, in that the great failure of the WTO and partner countries has been the failure to hold China to the commitments it made in joining that organisation.

At the same time, unlike some on the right and left of politics who seem to be opposed to trade in and of itself, we should recognise the huge benefits that trade has brought throughout history. Otherwise, we would have to go back to the days before the industrial revolution, when not only did trade drive the growth of Britain as the world’s leading industrial power, but imports of food from the new world fed the new urban masses running such industries. We cannot ignore that.

Equally, while we should not dismiss some of the particular impacts of trade—with sometimes the movement of work and sometimes the exploitation of those opportunities—we should recognise the huge reduction in poverty worldwide post war through the growth in trade. That is especially so, frankly, in China, where hundreds of millions have moved out of poverty in what is probably the biggest move out of poverty in history. Our starting point should be to encourage the development of trade, but with caution. We should not have predatory trade, and certainly not trade based on a race to the bottom on standards.

[Angus Brendan MacNeil]

Does the right hon. Member agree that the trade pursued by the European Union with Australia and New Zealand, which will see economic growth, has on the face of it been done with less risk to certain sectors, including the agriculture sector? Yes, trade is good, but there is also what we are throwing away, and the UK Government have admitted that they are throwing away a few tens of millions on agriculture in the New Zealand deal alone. There was a better balance to have been reached, but in being too keen on getting into the CPTPP and other things, the UK has just thrown the baby out with the bathwater, unfortunately.

[John Spellar]

I have always believed in the basic principle in any negotiations: that it is the terms of the deal, not the fact of the deal, that matter. Too often in takeover bids in this country, the intermediaries are far keener to get the deal done than to make sure it is a good deal for the participants.

However, I also caution the hon. Gentleman that in terms of meat production, we ought to be looking more at the problems posed by, for example, Brazil, or indeed the EU—in many cases there has been EU competition with less favourable animal standards than we have in this country. We should recognise that this is not unique in any way to the Australian agreement. I also point out that some of the hon. Gentleman’s arguments about percentages may also apply in meat terms to these two trade deals.

Returning to the topic of basic standards, particularly workers’ standards, a welcome development in international trade discussions has been the strong position taken by the Biden Administration in making sure that the beneficiaries are the working class—middle class in American terms—who have built the trade union movement in America and built America, and also workers in other countries. The British Government should note that. I am pleased that the TUC has been brought along to the trade talks with the United States in both Baltimore and Scotland; I fear that was probably at the insistence of the United States rather than willingly from the UK, but it is a good precedent and I hope it will be applied in other trade talks, particularly with Australia and New Zealand.

Australia and New Zealand have strong trade union movements and high labour standards. This deal is not about making ourselves liable to face undercutting competition; this is about opportunity and the ability of firms to trade, perhaps on much more equal terms than with some other countries.

That was touched on earlier in the debate, in relation to the movement—particularly in services and professional areas, but also in manufacturing—of skilled and technical workers. The Minister must acknowledge that previous Home Office restrictions on visas have been a real point of friction with both the Australian and New Zealand Governments. It would be a welcome development if other Government Departments influenced and pressurised the Home Office about that, not just for the economies on both sides but for individual development and to give skilled and professional workers in all three countries the opportunity to move and develop their careers and experience.

Alongside that, I hope there will be mutual recognition of qualifications. Instead of, frankly, allowing professional bodies’ self-interest to override that, we should look at where there is enough common ground and make sure that retraining and recertification, if needed, is very limited rather than taking a blanket approach. As I said earlier, the fact that we are common-law countries should help to facilitate that.

Political, geopolitical and trade interests often meet. For example, China has launched a massive campaign against Australian wine to put pressure on Australia on policy issues. We should work with the Australians as much as we can to facilitate our ability to import Australian wine, although not to the detriment of the growing number of British vineyards, obviously. That would have the side benefit of getting the attention of the Australian trade Minister, Senator Farrell, who represents the great wine-producing state of South Australia.

[Angus Brendan MacNeil]

The right hon. Gentleman makes a great point. Australian wine producers have argued that Treasury banding undermines the spirit of the agreement. To those who are exporting to another country, it would feel like a bit of skulduggery if that country’s Treasury undermined the agreement.

[John Spellar]

The Chair of the International Trade Committee makes the exact point made to me by Senator Farrell. I hope that that was heard by those on the Government Benches.

To broaden that point, with reference to AUKUS, following the Russian assault on Ukraine, there is a much deeper understanding across the world of the fragility of supply chains and the imperative of supply chain resilience. That is about not just physical industrial capacity, but a skilled workforce. Indeed, AUKUS is in part about the movement of skilled workers in the defence industry to sustain the agreement. It is also about critical materials, such as rare earths. Actually, they are not particularly rare, and Australia has the ores in abundance, but China has consolidated them—often through unfair competition and under-pricing competition —by dominating the refining capacity. Those are areas where we need to work with our security allies, but they also need to be our trade allies. Of course, that is also about trusted suppliers, so there could not be, for example, a “buy America first” policy. There is one level of understanding of that in the United States, but there needs to be greater understanding. That must be an objective of Government.

We should welcome the deepening of relations with our Australian friends and, in particular, with the new Government and Prime Minister Albanese. We look forward to building on that for a successful and shared future.