Trade Bill

Written evidence submitted by Global Justice Now (TB01)

Submission to the Public Bill Committee for the Trade Bill

Summary

 

1. Modern trade agreements affect vast areas of public policy that would normally be reserved for Parliament – from food standards to worker’s rights to the provision of healthcare. For this reason, it is critically important that Parliament has a significant role in the development of trade agreements and an effective framework for scrutiny and transparency is vital.

2. Current processes for agreeing trade agreements are outdated and provide a far lower level of scrutiny than that in many major trading partners such as the EU or US.

3. The Trade Bill is the only legislative process where a scrutiny framework for trade policy can be introduced, something that should be standard in a modern democracy. Parliament must take the opportunity to put this in place.

4. We propose a world class process for ensuring democracy, accountability and transparency in trade deals. The very minimum we would expect is that MPs would have the powers currently enjoyed by MEPs and members of the US Congress.

5. This should include:

· Before negotiations: a debate and vote for MPs on the government’s negotiating objectives

· During negotiations: transparency through the public release of negotiating texts and other key documents, alongside regular updates to Parliament

· At the end of negotiations: a vote for MPs on a final deal, with the power to seek amendments.

· Throughout: public consultation and meaningful engagement with civil society, informed by an independent impact assessment which looks beyond economic metrics, including impact on the environment, human rights, labour gender, regions and developing countries.

· Throughout: A guaranteed role for the devolved administrations and legislatures

6. During the previous bill process, five parliamentary committees published reports criticising current scrutiny processes for trade agreements and other treaties, and the bill itself was amended to introduce a scrutiny process. We believe these developments should be taken account of in the current bill process.

7. Global Justice Now believes that if the Trade Bill is amended to incorporate the aspects outlined here, this will lead to improved functioning of trade negotiations. Ultimately it could help the UK develop trade agreements that are better able to support efforts to build a decent life for all across the world, end inequality and restore the environment.

Introduction

 

8. Global Justice Now welcomes the opportunity to make a submission to the Public Bill Committee for the Trade Bill. Global Justice Now is a democratic social justice organisation working to create a more just and equal world. We used to be the World Development Movement.

9. We are submitting evidence because of our long history of campaigning for trade justice. Recently this has been around the proposed EU-US Transatlantic Trade & Investment Partnership (TTIP) and the EU-Canada Comprehensive Economic and Trade Agreement (CETA). We were particularly concerned about the extent to which EU negotiation and ratification of trade deals lacked adequate scrutiny and accountability by democratic authorities.

10. We are, therefore, especially concerned about the aspect of the Trade Bill which makes provision for the implementation of international trade agreements.

Scrutiny and transparency of trade deals

 

11. Modern trade agreementss are about far more than tariffs. They affect vast areas of public policy including food and animal welfare standards, healthcare and medicine prices, workers’ rights, climate action, environmental standards, and the power of internet platforms. These trade deals affect everyone in society, in multiple ways

12. These are areas of public policy that would normally be expected to be reserved for parliament and subject to parliamentary scrutiny and debate. As such, it is critically important that parliament has a significant scrutiny role in the development of trade agreements.

13. The UK’s procedures for agreeing trade agreements have not been updated for decades and provide a far lower level of scrutiny than that in many major trading partners such as the EU or US. [1] At present:

· Before negotiations there is no role for Parliament in the decision on who to negotiate with nor on the objectives, priorities and red lines for a negotiation.

· During negotiations there is no guaranteed Parliamentary scrutiny role.

· At the end of negotiations, Parliament is not guaranteed a debate or vote before a trade agreement is signed.

14. Parliament’s role is currently limited to ratification. At this stage the UK has already made commitments in international law by signing the agreement. Ratification procedures are set out in the Constitutional Reform and Governance Act 2012 (CRAG). It is a negative procedure, meaning no debate or vote is required, and it can at most repeatedly delay ratification. These procedures are inadequate and also too late. For scrutiny to be meaningful and effective, it needs to be front-loaded.

15. There is no role for the devolved administrations in scrutiny of trade agreements, even though such agreements frequently affect devolved issues.

16. The Government highlights that implementing legislation will be scrutinised separately. But many aspects of a trade deal will not need implementing legislation. Investor state dispute settlement (ISDS) is one example. Equally trade deals will have profound effects aside from legislative changes, which Parliament should be able to consider.

17. The UK has thus far indicated it intends to take a highly secretive approach to negotiations. For instance, for many of the ‘continuity’ deals signed so far, no information was available, including even that negotiations were underway, until the announcement that the deal was concluded. In current negotiations with the US, the UK has agreed to keep documents secret until five years after an agreement enters into force. [2]

18. Scrutiny and transparency are integral to good policy making. In trade negotiations, scrutiny and transparency should not be viewed with suspicion, but as things that can help to deliver enhanced legitimacy, heightened trust, an educated debate, and a better agreement in substance.

19. The Lords Constitution Committee has said that: "the powers available to Parliament to scrutinise ministers’ actions are anachronistic and inadequate". [3]

20. Business groups, unions and civil society have come together to jointly call for "a robust modern, inclusive and democratic governance model to oversee trade policy". [4]

The need for scrutiny provisions in this Trade Bill

 

21. The Trade Bill provides an opportunity to put in place a modern framework for scrutiny of trade negotiations and agreements. It appears to be the only opportunity which Parliament will have to do this.

22. We understand that, among other things, the Trade Bill focuses on the replacement of EU external trade deals, in order to provide continuity after Brexit. The government has chosen not to include ‘new’ trade deals from the bill, although the formal scope of the bill includes all international trade agreements. This has been used as a rationale for why scrutiny questions are unimportant in the Bill, because in effect continuity deals will replicate the current situation.

23. We reject this rationale for a number of reasons. Firstly, it is clear that the replacement deals themselves are not identical to the EU deals they are replacing and the changes are not as simple as replacing EU with UK. In deals signed so far there have been changes including to tariff price mechanisms, tariff rate quotas, rules of origin, geographical indications, replacing or not replacing various joint committees and incorporating various protocols and joint declarations – or not doing so. A few specific examples are excluding provisions on social security for migrants with Israel, excluding provisions related to the Single Market with Andean countries and not including food safety and plant or animal health regulations (SPS) or other technical regulations (TBT) with Norway and Iceland because of their close alignment with EU regulations. There are reasons for all of these changes, but that does not mean it might not have been worthwhile to scrutinise them before the agreements were signed.

24. Secondly, if scrutiny of ‘new’ trade deals is not addressed in this bill, when is it going to be dealt with? When the previous Trade Bill was going through Parliament, the government gave assurances around a scrutiny regime for ‘new’ trade deals, but has not delivered any legislation on this, nor any plans for it.

25. Over a year ago, the government did publish a command paper on, Processes for making free trade agreements after the United Kingdom has left the European Union. This makes certain proposals on scrutiny, some of which are welcome in themselves such as a commitment to publish negotiating objectives. However this is inadequate for three reasons:

· The proposals are voluntary. If the government considers these proposals are good practice, they should be put on a legislative basis

· They do not go far enough and leave a major democratic deficit:

o MPs would not be able to vote on the objectives or have the power to guide a Government’s negotiating strategy

o MPs would not be guaranteed a vote or debate on the signed deal. The proposals allow a scrutiny committee(s) to recommend a debate on a final deal, but leave it to the discretion of the Government whether to actually hold one

o Trade deals would continue to be negotiated in secret, even though trade deals are matters of public policy

o MPs would have no right to see negotiating texts. Some material would be shared with a scrutiny committee(s) but limited to what the Government agrees to provide

o The role given to devolved administrations would amount to no more than regular discussions

· It is not clear what the status of this command paper is with a new government and parliament. Proposals such as those to establish a scrutiny committee have not been implemented in the time since, which is over a year, although we understand some discussions maybe starting now.

26. In the meantime, negotiations for ‘new’ trade deals with the US, Japan, Australia and New Zealand are already underway. Negotiations with the US have been especially controversial, yet six rounds of preparatory talks and one round of formal negotiations have already taken place without any adequate process in place for scrutiny and accountability.

27. The SoS’s statement to the House on the first round of formal negotiations with the US was little more than a list of the standard chapters in a trade deal and a reassurance that "the meetings were positive and constructive". [5] This level of transparency allows for no meaningful engagement or scrutiny on negotiations that could profoundly affect food standards, farmers’ livelihoods, medicine prices and climate action, and about which there are high levels of public concern.

28. The Trade Bill is the only legislative process where a scrutiny framework for trade policy can be introduced, something that should be standard in a modern democracy. Parliament must take the opportunity to put this in place.

A framework for scrutiny and transparency

 

29. We support a world class process for ensuring democracy, accountability and transparency in trade deals. The very minimum we would expect is that MPs would have the powers currently enjoyed by MEPs and members of the US Congress.

30. We consider that a framework for scrutiny and transparency should be incorporated in the bill including the following elements:

· Before negotiations: a debate and vote for MPs on the government’s negotiating objectives

· During negotiations: transparency through the public release of negotiating texts and other key documents, alongside regular updates to Parliament

· At the end of negotiations: a vote for MPs on a final deal, with the power to seek amendments.

· Throughout: public consultation and meaningful engagement with civil society, informed by an independent impact assessment which looks beyond economic metrics, including impact on the environment, human rights, labour gender, regions and developing countries.

· Throughout: A guaranteed role for the devolved administrations and legislatures

31. Parliament’s consent should be secured for the trade negotiations to begin, including on objectives, principles, priorities and ‘red lines’. This is similar to processes in Denmark and other European countries where Parliament sets a mandate for its representatives to the EU.

32. During negotiations, negotiating texts should be transparent wherever possible, unless there is a specific and convincing reason why they should remain secret. Even in these circumstances, it should be possible for MPs to see them. This is now common practice in the EU post-TTIP. Many international negotiation processes, such as the UNFCCC, are far more open.

33. Once concluded, parliament should have an automatic debate and vote on a trade agreement before it is implemented, via super-affirmative procedure. The EU Parliament and US Congress are both guaranteed a vote on trade agreements. In Canada and Belgium, devolved administrations are involved in ratifying trade deals, which we recommend.

34. The government should conduct independent scoping and impact assessments and make them available to both MPs and the public, as is done in the EU. This should include social, economic, environmental, human rights, labour and gender impacts both across the UK and, where relevant, in developing countries with whom we wish to negotiate an agreement. These findings must be taken into account in any decision as to whether to go ahead and how the trade negotiations should be shaped. The government should carry out a public consultation on the potential trade agreement, as is required in the US. Efforts must be made to actively reach out and encourage submissions from those who would be directly affected by the potential deal.

35. Devolved powers are likely to be affected by trade agreements, for instance on issues such as health, agriculture and climate. A Joint Ministerial Committee on trade should be set up with representatives from all administrations in the UK. This committee should be required to give its consent to negotiating objectives, insofar as their powers are affected, should be kept up to date during negotiations, and similarly should give its consent before an agreement is signed. Devolved legislatures should be able to use the legislative consent process, again insofar as devolved powers are affected, both on initial negotiating objectives and on the final deal before signing. Representatives from the devolved administrations should be included in the negotiating team.

Developments during the previous bill process

 

Committees

36. During the previous bill process, five parliamentary committees published reports criticising current scrutiny processes for trade agreements and other treaties: the International Trade Committee , the Constitution Committee, the Scottish Affairs Committee , the Lords EU Committee and the Joint Committee on Human Rights

37. The International Trade Committee stated that "current processes for treaty ratification under the Constitutional Reform and Governance Act 2010 are insufficient" and set out essential principles for trade policy:

· Conducting trade negotiations is the prerogative of the executive, but there must be a meaningful role for Parliament in the trade policy process.

· Trade policy must be open and inclusive, and maximise benefit throughout the UK.

· Government must operate from a presumption of transparency.

· Consultative processes must be formalised.

38. The Lords Constitution Committee said that: "the powers available to Parliament to scrutinise ministers’ actions are anachronistic and inadequate".

39. The Scottish Affairs Committee recommended that "The Scottish Government must have a meaningful role in future trade negotiations including in the setting of negotiating mandates and participation in the negotiations themselves."

40. The Lords EU Committee stated that "the CRAG Act is poorly designed to facilitate parliamentary scrutiny"

41. The Joint Committee on Human Rights stated that "The current system of scrutiny for non EU agreements only allows scrutiny after the event. There should be more information provided to Parliament, earlier in the process."

Amendments

42. The Lords passed Amendment 12 at Report Stage on ‘Parliamentary approval of trade agreements’ by 215 to 168. This amendment would have ensured:

· Parliament would have got a meaningful vote before negotiations for a trade deal begin, on setting a mandate

· Parliament would have got a meaningful vote at the end of negotiations on the signed deal, including the ability to amend the motion

· A Parliamentary committee to scrutinise negotiations

· Mandatory consultations with devolved administrations 

· Mandatory comprehensive sustainability impact assessments

43. This amendment provided the basic democratic scrutiny framework that is needed for a modern democracy, r eflecting the essential principles that the International Trade Committee recommend ed.

44. We believe all of these developments should be taken account of in the current bill process and are disappointed that they are not reflected in the present drafting of the bill.

Conclusion

 

45. Global Justice Now believes that if the Trade Bill is amended to incorporate the aspects outlined here, this will lead to improved functioning of trade negotiations. Ultimately it could help the UK develop trade agreements that are better able to support efforts to build a decent life for all across the world, end inequality and restore the environment.

June 2020