3Parliament’s role in trade policy
Current UK parliamentary oversight of trade policy
23.Currently, Parliament scrutinises EU legislation and policy through the Commons European Scrutiny Committee (ESC), and the House of Lords EU Select Committee and its Sub-Committees. Further detail about the role and work of these Committees is available on their websites.25
24.Parliament’s role in the ratification of EU treaties, including EU FTAs, is laid down in the Constitutional Reform and Governance Act 2010 (CRAG). Under CRAG, the Government has a statutory requirement to lay before Parliament any treaty that is subject to ratification or its equivalent. CRAG also gives Parliament a statutory role regarding treaty ratification, including a power for the Commons to block ratification by indefinitely passing motions that state that a treaty should not be ratified. The Act does not, though, provide Parliament with a yes / no vote on treaty ratification.26
25.The Trade Justice Movement has raised concerns about the procedure under CRAG, saying that it:
gives the Government broad powers to negotiate trade agreements in secret and to ratify these agreements without a vote in Parliament […] There is no guarantee of debate. It is not absolutely clear how an objection could be made, but it would have to either be in government time (if the government was prepared to provide this opportunity), opposition time (if an opposition day debate is scheduled within the 21 days) or a delegated legislation committee. If an objection is made, the government can provide an explanation as to why the agreement should nevertheless be ratified and the process repeats. It is therefore not technically possible for Parliament to outright reject a trade agreement if the government wishes to persist.27
26.Despite Parliament not currently having the power to vote against the ratification of a treaty under CRAG, since the UK is a “dualist” state28 it could stop a treaty being implemented in domestic law, given that, as the House Commons Library notes: “for a treaty provision to become part of domestic law, the relevant legislature must explicitly incorporate it into domestic law.”29 This was made clear in the Supreme Court’s January 2017 judgment in the Miller case, where the majority judgment stated that the Government cannot make or withdraw from a treaty that amounts to a “major change to UK constitutional arrangements” without an Act of Parliament.30
Government proposals for parliamentary involvement in future trade policy
27.The Government announced the following proposals with respect to parliamentary involvement in trade policy in July 2018:
As negotiations progress, the Government will keep Parliament closely involved with regular Ministerial statements and updates to the International Trade Committee. The Government will - before entering formal negotiations - publish an “Outline Approach” to each negotiation, setting out the high-level objectives and scope of that negotiation. This document will be accompanied by a scoping assessment.
[…]
Once a free trade agreement is finalised, if it changes existing UK laws, and where necessary legislation doesn’t already exist, then new primary legislation will be introduced. Parliament will also be provided with comprehensive analysis of its effects. Importantly, Parliament will be able to scrutinise any new legislation in the usual way, as well as the ratification of all agreements through the usual procedures (the Constitutional Reform and Governance Act).31
28.Maddy Thimont Jack, from the IfG, argued that these proposals are “extremely vague”, saying “there is not much detail and we don’t know how they envisage any of this working.”32
Parliamentary committee
29.In evidence to us, the Minister for Trade Policy, George Hollingbery, stated:
We are going to make sure that Parliament is informed and Parliament has its input. At every stage of the negotiation we are in a position, perhaps after each round of negotiation, for example, to bring a report—perhaps to this Committee—we will be doing that.33
30.This accords with evidence to our inquiry, which suggested that a parliamentary committee “could play a vital role in scrutinising trade treaty negotiations and could act as a focal point for interested parties to contribute to that scrutiny.”34 A Trade Model That Works for Everyone notes how this could work in practice:
This could be a role for the existing International Trade Committee or for a new parallel trade scrutiny committee–whichever seems most appropriate for parliamentary procedure. The committee could build upon the role of the existing EU Scrutiny Committee.35
31.Evidence from Ewan Smith, a Junior Research Fellow at Jesus College, Oxford, outlines the potential models for such a Committee:
Parliament could give existing Committees new powers in relation to treaties, or establish ad hoc committees for particularly important or controversial treaties. Or it could set up a new Treaty Committee in either House or as a Joint Committee, to sift, scrutinise, inquire into and report on proposed treaties. A Commons Committee would have greater perceived democratic legitimacy; a Lords Committee might be more able to find time on the floor of the House, and might contain greater expertise. A Joint Committee would combine these respective advantages.36
32.Dr Brigid Fowler, of the Hansard Society, informed us that there would be a need to bring in expertise across different committees, and so a cross-committee approach could be effective.37 We note that the House’s recent approval of changes to Standing Order No. 137A, on powers to work with other committees, could facilitate this.38
33.Various proposals for a parliamentary committee, and the House as a whole, to have a role at various points during trade agreement negotiations are set out below.
Negotiating mandate and priorities
34.The Government’s proposals, outlined above, do not provide for Parliament to have a role in approving a negotiating mandate. The Secretary of State, Dr Fox, told us that he was “very keen that we consult”, and said:
We are awaiting a debate in the House of Commons at the moment on the consultation of the four trade agreements before the Government move on to the next stage. It is very important that Parliament has its say.39
Mr Hollingbery, did, however, signal that there was Government support for Parliament to have a debate on the Outline Approach—while stating that he felt Parliament having a vote would not be “right”:
We have an ambition to allow Parliament to debate the outline approach that has been taken by Cabinet. It would be fair to say at that stage the outline will be set, so at a Cabinet level, which is a reflection of the Government of the day […] I do not think it can be right and the constitutional settlement that we have, that Parliament should be given a binding vote on whether or not the mandate is as it should be, that is not how we have done things up to this point. I personally do not believe that is right. But I do believe that Parliament should be able to opine upon the outline approach.40
35.Others have suggested Parliament’s role should involve a guaranteed vote. The organisations that have developed A Trade Model That Works for Everyone call for:
A mandate agreed by parliament in advance of negotiations—setting out the guidelines and red lines for trade talks, which are publicly available and which require amendment by parliament to materially change.41
36.Ms Thimont Jack, from the IfG, told us that she felt the debate, rather than a vote, was most important:
I am not sure that you need to have a formal vote on a mandate but I think that a debate in the House would be a sensible approach because it allows MPs to express their views. The Government can then take that into account or at least explain to MPs why they have chosen to take the approach they have.42
37.David Henig spoke positively of the European Parliament’s way of expressing a view on negotiation mandates:
I think the system they have come up with in the European Parliament works quite well. The European Parliament gets to pass advisory motions. They are not necessarily binding on the Commission but they give a sense of feeling and that works quite well in allowing a pressure valve for views without it having to become a big conflict.43
In relation to the UK Parliament having a formal approval role in respect of negotiation mandates, Jude Kirton-Darling MEP told us “that that is something that certainly you should be pushing for.”44
38.Both Global Justice Now and War on Want suggested that a parliamentary committee should be involved at an early stage of the process by approving negotiating mandates, pointing to the processes in place at the Danish Parliament as an example.45
39.In relation to scrutiny of a mandate, the Minister for Trade Policy stated that:
As to a further role of the Committee or Parliament in closer scrutiny of the actual negotiating mandates, we have not absolutely decided whether to or not engage in that.46
Ongoing parliamentary involvement during trade negotiations
40.Global Justice Now argued that:
In the current system, not only is the UK parliament effectively cut out of the process of negotiation entirely, but MPs, Lords and members of the devolved assemblies have effectively no access to negotiation documentation. This makes any meaningful parliamentary oversight of trade agreements before they are finalised nearly impossible.47
It proposed to us that Parliament should therefore “be allowed full access to negotiating texts”.48
41.Global Justice Now also argued that Parliament “should have a meaningful role during the negotiation phase itself.49 David Henig, however, stated that providing to the House a “running commentary” on negotiations might not be a practical or efficient means of involving Parliament as a whole. He did suggest, however, that more general reports to the House may be desirable:
there could be a regular report from the Government on each negotiation that it is going through, not necessarily in great detail but enough to say, “We are currently negotiating with X country. We have had three rounds. We have gone through these. We are covering these sort of general issues”, to provide information.50
The Equality and Human Rights Commission also stated in their evidence that Parliament should have regular formal updates on negotiations.51
42.Ms Kirton-Darling described the role of the European Parliament Committee on International Trade (INTA) during the negotiations:
Throughout the negotiations, we have a monitoring group, which is chaired by the rapporteur, inside the INTA Committee. The Commission negotiators responsible for the trade negotiations, and anybody else that the Parliament wants to have there, come to report to that monitoring group. The work of that monitoring group, in most cases, is done behind closed doors. It is a space to ask detailed questions of the negotiators.52
43.In relation to scrutiny of ongoing negotiations, the Minister for Trade Policy stated that: “there is a role for the Committee to receive the reports on any stage negotiations or when the Government wish to report back.”53
44.In relation to the role that a Parliamentary Committee should play in scrutinising texts which are the subject of ongoing negotiations, Mr Henig suggested:
I think you probably should have the power to see, at least in private, the latest state of play, to have a full report on what is happening to scrutinise in that way. I don’t think there should be a veto. Similarly, we have not mentioned yet the publication of texts.54
Ratification
45.In its report, Taking back control of trade policy, the IfG compares the CRAG arrangements relating to ratification of treaties to the powers that other executives hold over their legislatures:
On paper, these arrangements mean that the UK Parliament will exercise a significantly weaker form of legislative constraint on negotiators than in Australia, the EU, New Zealand or the USA. In each of these, the legislature is guaranteed a vote on the deal: one in which a single rejection will collapse the talks, or send negotiators back to the table (rather than in the UK, where an ongoing series of votes is required).55
46.Ms Kirton-Darling told us how the European Parliament is involved in the ratification of trade agreements:
With the Lisbon Treaty, the European Parliament was given a blunt power of consent over international treaties and international trade agreements […] basically a blunt yes or no to international treaties and trade treaties.56
She also noted the European Parliament’s informal powers over trade policy, whereby “the European Parliament would informally set out its position on the negotiations [before these begin]. There would be a resolution.”57
47.The IfG report acknowledges that Parliament could constrain the Government’s negotiations through withholding consent to domestic legislation. It suggests that failing to give Parliament a vote on a final deal could weaken the UK’s negotiating position, given a lack of internal oversight on potential concessions and may also cause parliamentary opposition to trade deals to find other outlets.58 These risks could be reduced, the IfG argue, by giving Parliament a role in ratification.59
48.A Trade Model That Works for Everyone calls for a “guaranteed debate and vote to ratify the deal—in both UK parliamentary chambers after the agreement is finalised and without which it may not enter into force. “60
49.Mr Hollingbery stated that, while CRAG could theoretically allow Parliament to halt trade agreements coming into force:
It would be disingenuous of me to agree absolutely that Parliament can indefinitely delay. Yes, theoretically it can but it would have [to] stay organised for quite a long time. Not absolutely definitely, but very probably, [Parliament] will have a legal way of blocking any future trade deal because it is almost certain that any trade deal that is sufficiently contentious for Parliament to wish to block will require primary legislation to enact it. That, Parliament can certainly do, in which case it will make the free trade deal inoperable from our end and that clearly would be a problem. I do not think on that basis it is absolutely necessary for Parliament to have a binding vote. It would be a huge constitutional change.61
50.An October 2017 poll, conducted by Dod’s research for the Fairtrade Foundation and the Trade Justice Movement, found that 86% of MPs surveyed agreed that Parliament should have a role in the scrutiny and approval of new trade and investment deals.62
51.Ms Thimont Jack, from the IfG, suggested that a parliamentary committee with oversight of trade policy, as mentioned above, could have privileged access to information relating to trade negotiations and could report on such negotiations prior to a vote on ratification:
It might be that when you come to the end of the negotiations, it is up to that committee to report to Parliament and tell Parliament what it thinks about how the process has gone because it has access to more information.63
52.Ms Kirton-Darling also made a comparison with the role of the European Parliament’s INTA Committee in reporting to a plenary session of the Parliament a recommendation for a vote on ratification:
The first report is a very short report, a consent report. It says, “Parliament recommends to adopt—or reject—this agreement”. The second report is a non-binding report that sets out the reasoning for the position of the Parliament, so a set of recommendations or a set of concerns, things from the agreement that we recognise and welcome. That report goes through the parliamentary system, INTA vote, into the plenary, and the plenary votes on the recommendation from the committee responsible. At any point, however, in the INTA Committee or in the plenary, there can be a motion to amend the consent resolution, which would lead to the rejection of the deal.64
53.In relation to the notion of Parliament having the power to recommend a vote on the floor of the House, Dr Brigid Fowler noted that this was challenging because:
Putting limits on what the Government may do internationally is, as we all know, very constitutionally sensitive when it is using prerogative powers […] You can’t impinge on the prerogative.65
However, she also stated that:
there is nothing to stop you creating a system in which a committee got guaranteed time on the Floor of the House before an agreement was signed and able to move a substantive motion saying, “This should not be signed”.66
54.Parliament should be given an opportunity to debate the Government’s Outline Approach on a substantive motion before the mandate is set and negotiations commence. We welcome the indications to us that it is the Government’s aim to provide for a debate on the Outline Approach, but the Government should confirm that such a debate would be on an amendable, substantive motion. The motion, and debate, will provide an opportunity for Parliament to express any concerns and objections regarding the proposed mandate, and allow the Government to modify it if necessary.
55.Current processes for treaty ratification under the Constitutional Reform and Governance Act 2010 are insufficient. While Parliament can theoretically block indefinitely the ratification of a treaty, or decline to legislate its provisions into domestic law, doing so in practice would be a difficult and unsatisfactory means of rejecting a trade agreement which does not have the support of Parliament. The House of Commons should have a final yes / no vote on the ratification of trade agreements.
56.A parliamentary committee should be charged with the detailed scrutiny that will be required for future trade negotiations. At present, the most suitable committee to take this responsibility is ours. We could draw on the experience of other Committees, such as the European Scrutiny Committee, in carrying out this task. We should have full access to all negotiating documents, on a confidential basis when required, and should receive regular updates, in private, from ministers and civil servants who are involved in ongoing trade negotiations. We must be provided with the power to scrutinise negotiating mandates, and the final text of agreements, before they are presented to Parliament for debate. The International Trade Committee would expect to make a report to the House on the final text of agreements before a vote on ratification takes place, and the Government should ensure that, where possible, there is sufficient time between a final text being agreed and it being presented to Parliament to allow us to do this.
57.In addition to private updates to this Committee, the House should be provided with updates on negotiations, through general statements to the whole House.
25 European Scrutiny Committee (Commons); EU Select Committee (Lords)
26 Parliament’s role in ratifying treaties, Standard Note SN05855, House of Commons Library, February 2017
28 In a dualist state, domestic law is not automatically changed as a result of the Government ratifying a treaty; domestic law can only be altered in accordance with a treaty by means of legislation being passed specifically for that purpose. States where this is not the case are known as “monist” states.
29 Parliament’s role in ratifying treaties, Standard Note SN05855, House of Commons Library, February 2017
30 The Supreme Court, R (on the application of Miller and another) (Respondents) v Secretary of State for Exiting the European Union (Appellant) Judgment, 24 January 2017
31 Department for International Trade, “Liam Fox delivers Parliament and the public a central role in post-Brexit UK trade agreements”, 16 July 2018
35 A Trade Model That Works for Everyone, August 2018
38 Standing Order No. 137A, amended 27 November 2018, now contains the following provision: “to invite members of any other committee to which this order applies to attend any meeting and, at the discretion of the Chair, ask questions of witnesses or otherwise participate in its proceedings; but no member of another committee so invited may move any motion or amendment, vote or count towards the quorum.” For background to the change, see: Liaison Committee, First Report of Session 2017–19, Changing committee practice and procedure: enhancing effective working, HC 922, para 6
39 Oral evidence taken on 5 December 2018, HC (2017–19) Q505
41 A Trade Model That Works for Everyone, August 2018
55 Oliver Ilott, Ines Stelk, Jill Rutter, Taking back control of trade policy, Institute for Government, May 2017
58 Oliver Ilott, Ines Stelk, Jill Rutter, Taking back control of trade policy, Institute for Government, May 2017
59 Oliver Ilott, Ines Stelk, Jill Rutter, Taking back control of trade policy, Institute for Government, May 2017
60 A Trade Model That Works for Everyone, August 2018. War on Want (UTP0027) suggests that this could use the “superaffirmative” procedure. This involves an additional stage of scrutiny where Parliament considers a proposal for a statutory instrument before the statutory instrument is formally presented (“laid”). This procedure is used for statutory instruments that are considered to need a particularly high level of scrutiny. For more information see: UK Parliament, “MPs’ Guide to Procedure: Super-affirmative procedure”.
Published: 28 December 2018