Transatlantic Trade and Investment Partnership

Mark Pawsey Excerpts

Tuesday 25th February 2014 Commons Chamber

[Mark Pawsey (Rugby) (Con)]

It is a great pleasure to speak in this important debate and I add my congratulations to the all-party group on EU-US trade and investment, and to the right hon. Member for Wentworth and Dearne (John Healey) and my hon. Friend the Member for Aberconwy (Guto Bebb) on securing this debate. I am pleased to contribute to this debate because, along with other Members from across the House, I had the opportunity to visit the United States in November as part of the British-American parliamentary group, on a visit focusing on the TTIP negotiations. I confess that prior to that visit, like many Members and people across the country, I had a lack of awareness about the negotiations. I was aware that something was taking place, but frankly I could not have said what TTIP stood for. On the visit I was particularly interested in the impact on small businesses, having run a small business before coming to this place. I represent a constituency in the west midlands with a resurgent motor industry, so I was also keen to see the impact on that sector.

It takes two parties to make a deal. Across the House, I think we have seen broad enthusiasm for the TTIP, and that is reflected across the UK and the EU. Generally, I think there is less enthusiasm in the US. Part of our role is to understand the anxieties and fears of people in the US and consider how we might persuade them to come to a deal. In Washington, we met politicians from both parties. We also went beyond Washington to meet officials in places such as Philadelphia and Delaware. We raised with the Governor of Delaware the possibility of public procurement being included in the TTIP and becoming available for countries outside the US. I have to confess that the Governor’s principal concern was jobs. Indeed, we heard concerns about jobs across the piece from all the organisations we spoke to.

We met the American Farm Bureau Federation and spoke about the opportunities for its produce in the UK. It expressed concern over geographical indicators: it would not be able to call its hard cheese “parmesan” in the UK market, as it is able to in the US. It also has concerns regarding the accessibility of its largely genetically modified foods in the UK. We met the American Federation of Labor and the Congress of Industrial Organizations. Perhaps I might reassure the hon. Member for Wansbeck (Ian Lavery), who has just spoken, that labour organisations in the US see the TTIP as an opportunity to bring Europe’s higher labour standards to the US, rather than allowing for transit in the opposite direction.

Throughout our discussions we heard about the need for a fast-track authority in the US that provides an unamendable resolution. The Minister talked about whether the granting of the fast-track process would affect the timing of a deal. I think it goes further than that. In the absence of fast track, it is highly unlikely that any deal will ever be made, because without a fast-track process any vested interest that believed it was threatened by the TTIP could derail an agreement. President Obama has made it clear that he would like to see a fast-track negotiating authority, but this remains unresolved. Indeed, we were shown a letter from 22 Members of Congress addressed to the President stating that they would not agree to cede constitutional authority to the Executive through the approval of a fast-track authority.

We found a real shortage of awareness about the TTIP in the US. It is important to recognise that in November, when we were there, the US Government had just had their first shutdown as a consequence of the stand-off between the parties on the budget. That in itself had led to the postponement of talks. There was also a preoccupation with the Affordable Care Act, otherwise known as Obamacare. More than once in meetings we heard people say that Obamacare was sucking the oxygen out of all other policy discussions in the US.

My impression of how Americans see the TTIP talks is that they are bothered that they have more to lose than they have to gain. They have a massive prize that they believe they are being asked to give away: access to the biggest and most successful market in the world. They need reassurance that if they allow access to their market, there will be something in it for them. There is a feeling that in earlier trade agreements—perhaps the agreement between Canada and Mexico—US negotiators had given too much away and that that had led to “Buy American” campaigns. The concern of opponents is that the TTIP might give too much away and that that will lead to labour losses.

[Guto Bebb]

On the “Buy American” strategy in America, is it not the case that the concern lies more with politicians than businesses? One business in Philadelphia said that “Buy American” often means paying more for lower quality, and that they do not have their own businesses to develop it.

[Mark Pawsey]

My hon. Friend makes a fair point, but the perception of politicians was that the “Buy American” policy kept jobs in the United States and prevented them from being lost. As politicians, they wanted to ensure that employment in their states was being maximised.

The US does not always give things away and there is not a gung-ho attitude to the free market. Regular reference was made to the 1920 Merchant Marine Act, otherwise known as the Jones Act, being a great example of how America can be protectionist when it wishes to be. That is the legislation that requires all goods transported by water between US ports to be carried on US-flagged ships constructed in the US, owned by US citizens and crewed by US citizens. So the US can be protectionist and prevent other countries from gaining access to its markets. We heard more than once the quote from Benjamin Franklin:

“No nation was ever ruined by trade.”

The TTIP provides massive opportunities for US goods and produce in the EU.

In the UK there is broad support, as we have heard from both Front Benches today, and why would there not be, when we are talking about 50% of world GDP and 30% of international trade? This is an opportunity for us only if our economy, our industry and our service companies are in shape to take advantage of it. That is why the broader policies of this Government to increase our competitiveness and our skills agenda are important. If those are right, we can take advantage of an additional £10 billion to the UK economy.

I am pleased that the Federation of Small Businesses here in the UK welcomes the TTIP negotiations and looks forward to a resolution. A fifth of FSB members are exporters, and the US is the second most important destination for small businesses that export. It is believed that the TTIP could add 400,000 UK jobs. The FSB has set out a wish-list for the TTIP, including a pledge to promote entrepreneurship and a pledge of smart regulation on both sides of the Atlantic.

This has been a very important debate. There are big opportunities for both the EU and the US in growth and jobs. There needs to be a timetable. One of the concerns that I was left with as I came away is that there are rather more serious consequences of not doing a deal than there would ever be of doing a deal.