Progress with trade negotiations

This is a House of Commons Committee report, with recommendations to government. The Government has two months to respond.

Forty-Fifth Report of Session 2021–22

Author: Committee of Public Accounts

Related inquiry: Progress with trade negotiations

Date Published: 18 March 2022

Download and Share

Contents

Introduction

Following the UK’s exit from the EU, the UK became responsible for its own international trade policy for the first time in almost 50 years and must now build new trade and investment relationships with global partners. This has included negotiating new free trade agreements (FTAs) which aim to make trade easier between two or more countries by removing or reducing existing barriers to trade and negotiating the roll-over of 33 out of 39 existing EU trade agreements with non-EU trading partners ahead of the EU transition period deadline, representing £185.3 billion of UK trade in 2020.1 The Department for International Trade (the Department) has overall responsibility for convening these trade negotiations, while other departments provide expertise, lead aspects of the negotiations in their policy areas and provide diplomatic support overseas. For example, the Department for Environment, Food & Rural Affairs (Defra) leads on aspects of the negotiations covering agri-food, sanitary and phytosanitary and animal welfare. The Department is not responsible for the UK’s trade negotiations with the EU which were led by the Cabinet Office until December 2021 when responsibilities transferred to the Foreign, Commonwealth and Development Office (FCDO).

Conclusions and recommendations

1. The Department for International Trade faces significant challenges in meeting its target for 80% of UK trade to be covered by FTAs by the end of 2022. As of January 2022, 64% of UK trade was covered by FTAs including the UK’s Trade and Cooperation agreement with the EU which represents 47% of UK trade. As well as concluding an agreement in principle with New Zealand, the Department’s programme for the coming year includes negotiations on existing agreements with Canada and Mexico, on a new agreement with India, and to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Achieving the 80% target will be challenging as joining the CPTPP and a deal with India will only contribute 0.4% and 1.5% respectively to the target. Prioritising and sequencing the programme of negotiations is important but the Department is not in full control of its negotiating timetable – a key deal with the US, representing 16.8% of UK trade, is on hold because the US decided to pause negotiations. In the meantime, the government is seeking to promote trade with the US through other means, such as by improving market access through US state to UK trade relationships. It has also negotiated to end US bans on UK beef and lamb. Defra estimates that lifting the lamb ban could generate more than £30 million of economic benefits over five years. In addition to its programme of trade negotiations, the Department’s workload includes implementing signed agreements and meeting commitments to review transitioned EU agreements.

Recommendation: The Department should write to the Committee within 12 months to update on progress with the programme of trade negotiations, including:

i) progress against the overall target and an updated plan for the future programme;

ii) progress in securing state level market access agreements and the potential value of these; and

iii) impact on the agriculture sector and the UK economy versus forecast from the ending of the US ban on UK beef and lamb imports.

2. The Department has not set out how it will measure the benefits and outcomes of its programme of trade negotiations. The Department has published impact assessments, including projected economic benefits for each of the new FTAs it is pursuing, and has set out metrics that aim to demonstrate its progress in securing trade agreements in its Outcome Delivery Plan (ODP). However, the ODP measures projected, rather than secured, benefits and outcomes of each concluded trade agreement, and the Department has not set any associated targets. The Department acknowledges that these are forecasts and also that they do not cover potential wider benefits of trade deals such as productivity or geo-political impacts. It has committed to publishing regular monitoring reports for the new trade agreements with Japan and Australia and conducting comprehensive evaluations within five years to assess what has actually been achieved. However, we are concerned that without outcome-based targets, Parliament will not have the information it needs to hold the Department accountable. When considering this, the Department may wish to emulate the six-monthly reporting exercise now being undertaken by the Department for Transport in relation to High Speed 2 following recommendations from this Committee.

Recommendation: The Department should develop a set of clear and measurable outcome-based metrics with targets for its programme of trade negotiations. It should commit to regular reporting of progress to Parliament, including actual benefits and value achieved versus initial forecasts.

3. The Department is not doing enough to help businesses, particularly SMEs, to take advantage of opportunities offered by new trade agreements. Businesses need to understand and take advantage of the opportunities arising from trade agreements if agreements are to deliver their predicted benefits. However, UK businesses’ use of existing agreements may be relatively low. For example, less than a third of surveyed UK businesses knew whether the goods they most frequently exported were eligible for reduced customs duties. We raised concerns in 2020 that the Department was not doing enough to support small and innovative businesses to export. The Department’s November 2021 export support strategy sets out a new approach, aiming to bring its export support services together in one place. To promote the new agreement with Japan, the Department conducted a virtual trade mission with around 250 businesses, but it could not tell us if this event had led to new export opportunities.

Recommendation: The Department should write to the Committee within 12 months to set out how it has supported businesses, particularly SMEs, to take full advantage of existing and newly negotiated trade agreements. It should:

i) regularly measure and report the preference utilisation rate for UK exports (the rate at which exporters use preferential tariffs) for each of its trade agreements;

ii) consider how it can reduce burden and costs for SMEs; and

iii) set out initial progress with its new export strategy.

4. The farming industry has concerns about the effect of significant competition from imported Australian meat, and there is a lack of clarity on the potential environmental impacts from increased trade with Australia. The FTA with Australia signed in December 2021 removed tariffs and quotas on many agricultural products imported from Australia. There are four safeguards to protect the agriculture sector, including a 15-year safeguard to protect UK beef and lamb from a rapid rise in Australian imports following implementation of the deal. The Department says that the safeguard is adequate given the length of the transition period and because the increase in imports is expected to be small relative to the size of the UK market. However, the National Farmers Union remains pessimistic about the impact of competition from Australia on farmers who may lose out in exchange for gains in other areas of the economy. Defra expects imports from Australia to largely displace existing imports, for example from the EU, and says that it is doing a lot to help the agriculture sector export, such as setting up a food and drink export council. The Department and also Defra tell us that they have modelled the environmental impact of the deal with Australia, and do not expect there to be changes in greenhouse gas emissions of UK production, or that transporting goods from Australia will have a big impact on carbon emissions when compared to other parts of the production process. However, the departments acknowledge that more needs to be known about carbon emissions and the interaction between transport and trade.

Recommendation: Defra should work with the Department for International Trade to monitor the impact of free trade agreements in its policy areas. In particular, it should:

i) monitor imports closely to make an ongoing assessment of the impact of the Australia FTA on beef and sheep farmers, and set out what support could be provided to those farmers whose livelihoods may be affected;

ii) monitor the actual transport emissions and other environmental effects resulting from increased trade between the UK and Australia, to determine what action may be needed to ensure that the UK can still meet its climate commitments; and

iii) consider what lessons can be learned for the approach to the upcoming FTA with New Zealand and other countries in due course.

5. Parliament and the public are not being provided with clear and transparent information to understand the impact of trade agreements. Business associations and consumer groups are concerned that it is unclear how trade policy aligns with other policy objectives, and how any trade-offs required may impact on the groups they represent. The consumer group Which? has found that consumers have limited awareness of the status and implications of trade negotiations. Although the Department says it has found that the public is highly supportive of its trade agenda, we are not convinced that the public has significant knowledge and interest in trade agreements. The Department does recognise that it faces a challenge in how it communicates important information to Parliament and the public on what it is doing on trade agreements and why. In addition, the Department could not explain why, in its impact assessments of the agreement with Australia, the projected value of UK exports to Australia increased by more than 600% between June 2020 and December 2021 (from £900 million to £6.2 billion). It thought that the rise was probably driven by a change in the methodology it uses to forecast economic benefits, but could not be more specific.

Recommendation: The Department should improve transparency and communications around trade agreements and their impacts, to aid understanding and inform scrutiny. As part of this exercise, it should:

i) explain clearly to Parliament and the public the policy trade-offs, particularly in relation to human rights and environmental priorities, in new FTAs and the potential impact for sectors, businesses and individuals; and

ii) set out clearly the factors and underlying assumptions driving any changes in the forecast benefits.

6. The Department has not done enough to support effective Parliamentary scrutiny of trade agreements. Despite the Department making additional commitments beyond the statutory framework, the International Trade Committee has not been provided with information from the Department in sufficient time to enable it to perform its scrutiny function effectively. For example, although the Department shared the final agreement with Australia three months ahead of the statutory process for Parliamentary scrutiny, this still makes it difficult for that Committee to consider and produce a report for Parliament in time for it to have an impact. It would also be easier for Parliament to scrutinise trade agreements if it had sight of the negotiating objectives at the outset. There is a precedent in Parliament where government has provided privileged information to the Committee and to other select committees. The House of Lords International Agreements Committee has also called for Parliament to have a stronger formal role earlier in the process and for provision of the agreement text prior to signature.

Recommendation: The Department should make further commitments that would support robust and timely Parliamentary scrutiny. These should include providing the International Trade Committee and the House of Lords International Agreement Committee with the negotiating objectives, under privileged access, at the outset of the negotiations, providing oral updates at regular points on a trusted basis, and sharing any other key information in sufficient time for scrutiny.

1 The trade negotiations programme

1. On the basis of a report by the Comptroller and Auditor General, we took evidence from the Department for International Trade (the Department), the Cabinet Office and the Department for Environment, Food & Rural Affairs (Defra).2 We were also joined for this evidence session by Mark Garnier MP and Anthony Mangnall MP from the International Trade Committee.

2. International trade is a key driver of growth and prosperity. It can lead to better, higher-paying jobs, lower prices, increased productivity and greater sharing of knowledge and innovation. In 2020, total UK trade was £1,197.7 billion. UK exports were worth £601 billion and UK imports were worth £596.7 billion.3

3. Following the UK’s exit from the EU, the UK became responsible for its own international trade policy for the first time in almost 50 years and must now build new trade and investment relationships with global partners. This has included securing the roll-over of 33 out of 39 existing EU trade agreements with non-EU trading partners by 31 December 2020 and negotiating new free trade agreements (FTAs). FTAs are intended to offer a range of benefits to the UK economy, businesses, consumers and wider society by opening markets to UK exports, supporting UK supply chains, increasing consumer choice and increasing the UK’s global influence.4

4. The Department has overall responsibility for convening trade negotiations, while other departments provide expertise, lead aspects of the negotiations in their policy areas and provide diplomatic support overseas. For example, Defra leads on aspects of the negotiations covering agri-food, sanitary and phytosanitary and animal welfare. The Department for International Trade is not responsible for the UK’s trade negotiations with the EU which were led by the Cabinet Office until December 2021 when responsibilities transferred to the Foreign, Commonwealth and Development Office.5

Progress on the Department’s trade negotiations programme

5. In 2020, the Department launched negotiations with the US, Australia and New Zealand, and in 2021 it began negotiations to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP, a trade agreement between 11 countries around the Pacific Rim).6 The UK signed its first new FTA with Australia on 17 December 2021, and the other negotiations are ongoing.7 The Department has recently launched negotiations with India, and in 2022 it plans to improve existing agreements with Canada and Mexico.8 It has also announced plans for negotiations with the Gulf Cooperation Council.9

6. The Department told us that it thinks carefully about the prioritisation and sequencing of negotiations to ensure that its teams have the required capacity but also to ensure that sufficient capacity exists in the other departments that contribute to the negotiations.10 In addition it considers sequencing in terms of the decisions and tactics it deploys at certain points in the negotiations.11 For example, the Department considered negotiations with Japan, Australia and New Zealand as strategically important in advance of negotiations to join the CPTPP as they are existing members and good allies.12 The Department told us that, although it had started to negotiate with the US, concluding five rounds of negotiations, the current administration is reviewing all of its negotiations and is currently not negotiating with anyone.13

7. In addition to the programme of negotiations, the Department also needs to implement and review existing agreements.14 The Department told us that it has set up governance committees to provide an overview of how FTAs are being implemented in practice and to discuss issues arising. However, these implementation processes are at relatively early stages.15 We asked the Department about the work it may need to do to renegotiate the continuity agreements that the UK was originally party to as an EU member, where the EU may have made certain concessions without any benefit to the UK. The Department told us that the picture is mixed, and with some of these agreements, the UK made a clear commitment to come back to the overall deal to consider further opportunities. These include Canada and Mexico (where the Department has already run consultations), and South Korea, Turkey and Switzerland, but the Department said that it is not the case that every country wishes to re-negotiate existing agreements.16 However, we note the important point that the Department’s workload is more than the headline negotiations.17

8. The Department aims to secure agreements with countries representing 80% of total UK trade by the end of 2022. This aim is stated in the Department’s 2020–21 annual report and accounts and is a government manifesto commitment. The National Audit Office (NAO) report stated that 64% of total UK trade is covered by trade agreements, including agreements in principle, and the UK’s Trade and Cooperation Agreement with the EU which represents 47% of UK trade.18

9. We noted that the Department is quite a long way from reaching the 80% target and asked the Department when it expects to meet it. The Department told us that it thinks it will reach the 80% target but that the timescale will be challenging.19 The NAO found that joining the CPTPP and a new agreement with India would represent 0.4% and 1.5% respectively.20

10. A deal with the US would contribute 16.8% towards achieving the 80% target as the US is the UK’s largest trading partner.21 However, negotiations with the US are not currently progressing. The Department told us that in the meantime it is concentrating on improving market access to the US.22 In particular, the Department said that the Government has negotiated to end the US ban on UK beef and lamb, and is also pursuing a state-by-state approach to allow the UK to trade more at a state level with large economies such as California. The Department added that this activity also keeps the onus on a free trade agreement with the US as a whole.23

11. We asked the Department about the value of state-to-UK bilateral agreements, in terms of contributing to the 80% target. The Department could not tell us and thought this would be hard to calculate. The Department said that it had not set a target for increasing market access at a state level.24 We also emphasised that the lifting of the ban on beef and lamb is only an achievement if it actually has an impact on British exports to the US. Defra told us that the ban on lamb was lifted at the end of 2021 so there have been no impacts yet. However, it estimates that, over five years, the lifting of the ban could be worth more than £30 million to the sector. Defra told us that it is working closely with the sector and the devolved administrations to ensure that the benefits are realised.25

2 Outcomes of trade agreements

Measuring the Department’s progress

12. The Department set out four measures in its Outcome Delivery Plan (ODP) for 2021–22 to measure its progress on its programme of trade negotiations. One of these measures, described in the previous section, is the percentage of UK trade with partners with whom the UK has a trade agreement. The NAO found that the other three outcome measures in the Department’s ODP are the projected, rather than secured, benefits and outcomes of each concluded trade agreement, and that the Department has not set any associated targets for these measures.26 We noted that it is really important that it is clear to Parliament where things have gone well and where they have not. We asked the Department if it would work with the NAO to develop a set of metrics that can be used to report to Parliament on its progress with its programme of trade negotiations.27 The Department agreed to this, stating that it had a good starting point with the existing measures in its ODP and other published material.28

13. The Department has published an impact or scoping assessment for each new FTA it is pursuing to help businesses and the public understand the potential economic benefits of the agreement and to support Parliamentary scrutiny.29 For example, the impact assessment for the UK-Australia free trade agreement (FTA) projects that the agreement will lead to an increase in UK GDP of £2.3 billion in fifteen years.30 We questioned whether the Department was putting too many resources into trade negotiations given the relatively small impact the agreements are expected to have on the economy. In response, the Department told us that it expects any long-term increase to GDP to be a permanent, annual increase. It also said that it spends about £50 million to £70 million a year doing these trade negotiations, and that there are few government programmes that would deliver that rate of return.31 The Department also explained to us that its assessments do not cover all potential impacts and that they are just forecasts of the future. For example, they do not cover secondary impacts that agreements could have, such as changes in production as a result of innovation, or wider geopolitical impacts such as furthering the UK’s environmental, human rights, animal welfare and wider agendas.32

14. We asked what the Department was doing to measure the actual benefits of trade agreements. The Department told us that it is committed to monitoring and evaluating the impacts of agreements.33 For example, it has committed to publishing monitoring reports for the Australia and Japan agreements two years after they enter into force and evaluating the agreements within five years.34 The Department said it recognises that it will be challenging to deliver the forecast impacts and ensure the agreements are being used by businesses.35

Use by businesses

15. We asked the Department how it planned to support businesses, particularly small and medium-sized businesses (SMEs), to take advantage of the opportunities in trade agreements.36 The Department’s 2020 survey of UK registered businesses found that just 28% of surveyed businesses who exported to non-EU countries knew whether the goods they most frequently exported were eligible for reduced customs duties.37 In our 2020 report on government support for exporters, we raised concerns that the Department was not doing enough to support small and innovative businesses to export.38

16. The Department acknowledged that “agreements are only as good as the businesses that utilise them”.39 It told us that its new export strategy, published in November 2021, had been informed by our previous report on support for exporters, and that a particular focus of the new strategy was on supporting small businesses to export.40 For example, it said as a result of our report it was working more closely with UK Export Finance which is focusing more on small and medium-sized enterprises (SMEs) in the work that it does.41 The Department’s new export strategy includes a 12-point plan to encourage UK exports and it explained to us that the big change that it has made is the introduction of the Export Support Service. The Department said that this service aims to help small UK businesses to trade with the EU, though the Department intends to widen this to the rest of the world in the future. It told us that it had received positive feedback from businesses on its new strategy, including from organisations like the Federation of Small Businesses.42 We asked the Department why it had cut the Tradeshow Access Programme and funding for the British Chamber of Commerce overseas, if it wanted businesses to export more. The Department wrote to us after the evidence session to explain that it has replaced the Tradeshow Access Programme with a new UK Tradeshow Programme which was launched as part of its 2021 export strategy. The new programme continues to support businesses to exhibit at trade shows and it also supports smaller companies to visit tradeshows prior to exhibiting to help them make a choice about whether exhibitions should be part of their export strategy.43

17. We asked the Department how it would benchmark its trade promotion activities against those of countries such as Singapore and Hong Kong. The Department said that it had developed an analytical framework to sit alongside the new export strategy that would be used to measure its success.44 It told us that it was moving away from taking credit for deals made by large companies where the Department’s role was questionable and focusing more on SMEs instead. However, when we asked about the outcomes of a specific export support activity—a virtual mission held by the Department to raise awareness of the UK-Japan trade agreement attended by around 250 businesses—the Department was unable to say if it had led to any export deals being signed.45

18. We received written evidence from Logistics UK, asking for specific provisions to be included in future FTAs to make it easier for UK businesses to trade with the rest of the world. These include, for example, commitments to clear goods at the border within a pre-determined timeframe and cooperation between tax authorities to simplify requirements.46 Logistics UK would also like government to pursue Mutual Recognition Agreements and Customs Cooperation Agreements in addition to pursuing FTAs, as it said these agreements can lead to useful benefits for businesses without going through the full FTA process.47

Impact of trade agreements on agriculture and carbon emissions

19. The FTA with Australia signed on 17 December 2021 removed almost all tariffs and quotas on agricultural products from Australia over 15 years. Tariff-free beef quotas, for example, would increase from a current 4,669 tonnes to 35,000 tonnes immediately after the agreement comes into force, a 7.5-fold increase in the tariff-free quota.48 We asked the Department whether this means that British famers were disadvantaged in return for the bigger, macroeconomic benefits of concluding an agreement with Australia.49 The Department told us that this was not the case and that the deal includes four safeguards to protect the agriculture sector, including a 15-year transition period that it considers will protect the farming industry against a rapid rise in beef and sheep meat imports.50 The Department acknowledged that Australia is a competitive producer of beef, but that it would be unlikely that Australia would divert its exports to the UK because it makes a lot of profit in East Asia. It also said that the size of the total UK domestic market for beef is large relative to the level that Australia would be allowed to export to the UK in the first year of the agreement.51

20. We asked Defra for its assessment of the effect of the Australian FTA on British agriculture. Defra said that it was confident that the phasing in of the liberalisation and the safeguards provide a period of adjustment for the UK agriculture sector, particularly as it goes through major domestic challenges following EU exit.52 The Department for International Trade also suggested that Australian imports may displace European beef that is currently imported to the UK. Defra confirmed its modelling showed that new imports mainly, but not entirely, displace existing imports and would not necessarily damage UK production.53 Defra told us that it is also doing a lot to help the sector to reorient itself towards exports, such as by setting up a food and drink export council and by working with overseas trade attaches to open up new markets in places like China and the Gulf.54

21. We asked why the National Farmers Union is so pessimistic about the trade agreement. The Department admitted that there were risks and downsides to the deal and that a body which represents the interests of farmers would be concerned about the downside, although the Department considered the downside to be very unlikely.55 We acknowledged that a trade deal requires compromise on both sides. However, the National Farmers Union may have concerns that farmers have been disadvantaged by the agreement so that the UK can gain access to Australia’s financial services market.56

22. Defra told us that it has looked very carefully into the question of carbon emissions.57 Its analysis so far suggests that carbon emissions resulting from shipping goods from Australia to the UK are not the most significant factor when looking at the carbon footprint of different sorts of production. The Department for International Trade added that it has modelled the environmental impact of the UK’s agreement with Australia and it does not think the greenhouse gas emissions of UK production will change much although transport has to be looked at as a whole.58 We asked Defra whether emissions outside territorial waters are counted when measuring the UK’s carbon emissions. Defra did not know but said that the quantitative assessment of environmental impacts is a very live topic across the world.59 The Department for International Trade wrote to us after the evidence session to confirm that its transport emissions modelling uses the whole distance between two trading partners, and captures the emissions associated with travel in non-territorial waters. It applies sensitivity analysis using the shortest and longest typical maritime routes between two trading partners to estimate the distance travelled by shipping freight.60 The NAO noted that the UK’s target to achieve net zero emissions by 2050 is set on a territorial basis and does not include emissions from goods produced overseas and traded with the UK.61

3 Transparency and scrutiny

Transparency of information

23. When we asked the Department about its overarching trade strategy it told us that it aims to have “an open trade environment that promotes jobs and wages and reduces poverty”. The Department plans to achieve this through trade negotiations and the right protections against unfair practices at both bilateral and multilateral level, while promoting exports and investment.62 However, the NAO found that it was unclear how trade policy aligns with other policy objectives, and how any trade-offs required may impact on business associations, civil society and consumer groups. For example, it is unclear how the government’s international trade ambitions help to achieve domestic and wider policy objectives in areas including agriculture, the environment, international development and human rights.63 Evidence we received from Which? supported the NAO’s recommendation that the Department should set out an overarching trade strategy so that it is clear how its trade policy supports wider policy objectives and how it will use trade negotiations, alongside other levers to achieve its objectives.64

24. We asked the Department whether it thought that the general public knew about trade. The Department told us that based on its survey, the public was “highly supportive of the trade agenda”.65 However, the NAO noted that the Department has identified public concerns about the actual or feared impact of its trade agenda, and a lack of belief in the potential benefits as a key strategic risk to achieving its objectives.66 Similarly, evidence submitted by Which? shows that consumers have limited awareness of the status and implications of the government’s trade negotiations. For example, two thirds of respondents to a Which? survey felt that the UK government currently provides ‘too little’ information about new trade deals it is negotiating.67 The Department acknowledged that there is a “big communication issue” for the Department at an official and ministerial level to set out what it is it does and why it does it.68

25. Which? also highlighted the importance of reflecting consumer interests more generally and suggested that a consumer chapter should be included in each trade agreement.69 The Department confirmed that the UK-New Zealand trade agreement will include a “first ever” chapter on consumer protection and it said that it wants to test appetite in this area with other partners – where partners are equally interested in pursuing this. The Department said that consumer chapters serve to improve cooperation and to ensure the benefits are more clearly explained to consumers.70 It wrote to us to explain that the consumer protection chapter that the UK is negotiating with New Zealand aims to uphold consumer protection rights and ensure that consumers continue to benefit from trade in both online and offline settings. For example, the agreement is currently expected to include commitments requiring goods to be of satisfactory quality at the time of delivery and requiring services to be performed with reasonable skill and care..71

26. The Department said that it is its job to explain, engage and communicate and that when communicating information about trade agreements, it tries to set out what this might mean for consumers.72 We asked the Department why its forecast of the value of UK exports arising from the agreement with Australia had increased by 600% from £900 million in June 2020 to £6.2 billion in December 2021. The Department could not tell us what the difference was, and we considered the lack of clarity to be a failing of some of the Department’s documentation and its communication to parliamentarians. It thought that the majority of the rise was due to changes in its approach to modelling the forecast economic benefits, as part of continuous improvement, and that this is set out in publicly available documents.73 The NAO also underlined the need for the Department to provide greater transparency in the impact assessment for the UK-Japan trade agreement. The report said that the Regulatory Policy Committee, academics and the two Parliamentary committees leading scrutiny have highlighted that the costs to businesses and environmental impacts are areas where better quality information is required.74

Parliamentary scrutiny of trade deals

27. The Department has made additional commitments beyond the statutory framework under the Constitutional Reform and Governance Act 2010 (CRAG) for Parliamentary scrutiny of trade agreements, but the Parliamentary committees responsible for trade agreements scrutiny have called for Parliament to have a stronger formal role.75 We expressed concerns that the Department did not share proper information in a timely manner given that scrutiny of trade agreements is important to ensure that people understand trade deals and that members of Parliament can justify them to constituents. For example, sharing of the text of the Japan agreement by the Department was delayed and the International Trade Committee did not have the full time it expected to scrutinise the agreement.76 Although the Department shared the final agreement with Australia three months ahead of triggering CRAG, we did not feel that it was generous enough given that that the International Trade Committee needs to produce a report alongside.77

28. The opportunity for Parliament to view negotiating objectives at the outset would aid its scrutiny of trade agreements.78 There is a precedent in Parliament to share privileged information between government and select committees. For example, this Committee routinely sees privileged information and the Intelligence and Security Committee sees documents on a confidential basis. The Department said that it is not refusing to share the text of the agreement and is increasing the time that it allows for scrutiny, but it understands that it needs to improve.79

29. We also note that the House of Lords International Agreement Committee reported that the statutory framework under CRAG is insufficient to facilitate robust and effective scrutiny of international agreements. As stated in the NAO report, the International Agreement Committee has called for Parliament to strengthen its formal role earlier in the process and for provision of the agreement text ahead of signature, and that Parliament’s consent should be required prior to ratification through a new mechanism beyond CRAG.80

Formal minutes

Wednesday 9 March 2022

Members present:

Dame Meg Hillier, in the Chair

Sir Geoffrey Clifton-Brown

Peter Grant

Kate Green

Sarah Olney

Progress with trade negotiations

Draft Report (Progress with trade negotiations), proposed by the Chair, brought up and read.

Ordered, That the draft Report be read a second time, paragraph by paragraph.

Paragraphs 1 to 29 read and agreed to.

Summary agreed to.

Introduction agreed to.

Conclusions and recommendations agreed to.

Resolved, That the Report be the Forty-fifth of the Committee to the House.

Ordered, That the Chair make the Report to the House.

Ordered, That embargoed copies of the Report be made available, in accordance with the provisions of Standing Order No. 134.

Adjournment

Adjourned till Monday 14 March at 3:30pm


Witnesses

The following witnesses gave evidence. Transcripts can be viewed on the inquiry publications page of the Committee’s website.

Wednesday 19 January 2022

James Bowler CB, Permanent Secretary, Department for International Trade; Crawford Falconer, Chief Trade Negotiation Adviser and Second Permanent Secretary, Department for International Trade; Amanda Brooks, Director General Trade Negotiations, Department for International Trade; Katrina Williams, Director General International & Borders, The Department for Environment, Food and Rural Affairs; Beatrice Kilroy-Nolan, Director General Trade and Brexit Opportunities, Cabinet OfficeQ1–82


Published written evidence

The following written evidence was received and can be viewed on the inquiry publications page of the Committee’s website.

PTN numbers are generated by the evidence processing system and so may not be complete.

1 Logistics UK (PTN0002)

2 Which? (PTN0001)


List of Reports from the Committee during the current Parliament

All publications from the Committee are available on the publications page of the Committee’s website.

Session 2021–22

Number

Title

Reference

1st

Low emission cars

HC 186

2nd

BBC strategic financial management

HC 187

3rd

COVID-19: Support for children’s education

HC 240

4th

COVID-19: Local government finance

HC 239

5th

COVID-19: Government Support for Charities

HC 250

6th

Public Sector Pensions

HC 289

7th

Adult Social Care Markets

HC 252

8th

COVID 19: Culture Recovery Fund

HC 340

9th

Fraud and Error

HC 253

10th

Overview of the English rail system

HC 170

11th

Local auditor reporting on local government in England

HC 171

12th

COVID 19: Cost Tracker Update

HC 173

13th

Initial lessons from the government’s response to the COVID-19 pandemic

HC 175

14th

Windrush Compensation Scheme

HC 174

15th

DWP Employment support

HC 177

16th

Principles of effective regulation

HC 176

17th

High Speed 2: Progress at Summer 2021

HC 329

18th

Government’s delivery through arm’s-length bodies

HC 181

19th

Protecting consumers from unsafe products

HC 180

20th

Optimising the defence estate

HC 179

21st

School Funding

HC 183

22nd

Improving the performance of major defence equipment contracts

HC 185

23rd

Test and Trace update

HC 182

24th

Crossrail: A progress update

HC 184

25th

The Department for Work and Pensions’ Accounts 2020–21 – Fraud and error in the benefits system

HC 633

26th

Lessons from Greensill Capital: accreditation to business support schemes

HC 169

27th

Green Homes Grant Voucher Scheme

HC 635

28th

Efficiency in government

HC 636

29th

The National Law Enforcement Data Programme

HC 638

30th

Challenges in implementing digital change

HC 637

31st

Environmental Land Management Scheme

HC 639

32nd

Delivering gigabitcapable broadband

HC 743

33rd

Underpayments of the State Pension

HC 654

34th

Local Government Finance System: Overview and Challenges

HC 646

35th

The pharmacy early payment and salary advance schemes in the NHS

HC 745

36th

EU Exit: UK Border post transition

HC 746

37th

HMRC Performance in 2020–21

HC 641

38th

COVID-19 cost tracker update

HC 640

39th

DWP Employment Support: Kickstart Scheme

HC 655

40th

Excess votes 2020–21: Serious Fraud Office

HC 1099

41st

Achieving Net Zero: Follow up

HC 642

42nd

Financial sustainability of schools in England

HC 650

43rd

Reducing the backlog in criminal courts

HC 643

44th

NHS backlogs and waiting times in England

HC 747

1st Special Report

Fifth Annual Report of the Chair of the Committee of Public Accounts

HC 222

Session 2019–21

Number

Title

Reference

1st

Support for children with special educational needs and disabilities

HC 85

2nd

Defence Nuclear Infrastructure

HC 86

3rd

High Speed 2: Spring 2020 Update

HC 84

4th

EU Exit: Get ready for Brexit Campaign

HC 131

5th

University technical colleges

HC 87

6th

Excess votes 2018–19

HC 243

7th

Gambling regulation: problem gambling and protecting vulnerable people

HC 134

8th

NHS capital expenditure and financial management

HC 344

9th

Water supply and demand management

HC 378

10th

Defence capability and the Equipment Plan

HC 247

11th

Local authority investment in commercial property

HC 312

12th

Management of tax reliefs

HC 379

13th

Whole of Government Response to COVID-19

HC 404

14th

Readying the NHS and social care for the COVID-19 peak

HC 405

15th

Improving the prison estate

HC 244

16th

Progress in remediating dangerous cladding

HC 406

17th

Immigration enforcement

HC 407

18th

NHS nursing workforce

HC 408

19th

Restoration and renewal of the Palace of Westminster

HC 549

20th

Tackling the tax gap

HC 650

21st

Government support for UK exporters

HC 679

22nd

Digital transformation in the NHS

HC 680

23rd

Delivering carrier strike

HC 684

24th

Selecting towns for the Towns Fund

HC 651

25th

Asylum accommodation and support transformation programme

HC 683

26th

Department of Work and Pensions Accounts 2019–20

HC 681

27th

Covid-19: Supply of ventilators

HC 685

28th

The Nuclear Decommissioning Authority’s management of the Magnox contract

HC 653

29th

Whitehall preparations for EU Exit

HC 682

30th

The production and distribution of cash

HC 654

31st

Starter Homes

HC 88

32nd

Specialist Skills in the civil service

HC 686

33rd

Covid-19: Bounce Back Loan Scheme

HC 687

34th

Covid-19: Support for jobs

HC 920

35th

Improving Broadband

HC 688

36th

HMRC performance 2019–20

HC 690

37th

Whole of Government Accounts 2018–19

HC 655

38th

Managing colleges’ financial sustainability

HC 692

39th

Lessons from major projects and programmes

HC 694

40th

Achieving government’s long-term environmental goals

HC 927

41st

COVID 19: the free school meals voucher scheme

HC 689

42nd

COVID-19: Government procurement and supply of Personal Protective Equipment

HC 928

43rd

COVID-19: Planning for a vaccine Part 1

HC 930

44th

Excess Votes 2019–20

HC 1205

45th

Managing flood risk

HC 931

46th

Achieving Net Zero

HC 935

47th

COVID-19: Test, track and trace (part 1)

HC 932

48th

Digital Services at the Border

HC 936

49th

COVID-19: housing people sleeping rough

HC 934

50th

Defence Equipment Plan 2020–2030

HC 693

51st

Managing the expiry of PFI contracts

HC 1114

52nd

Key challenges facing the Ministry of Justice

HC 1190

53rd

Covid 19: supporting the vulnerable during lockdown

HC 938

54th

Improving single living accommodation for service personnel

HC 940

55th

Environmental tax measures

HC 937

56th

Industrial Strategy Challenge Fund

HC 941


Footnotes

1 C&AG’s Report, Progress with trade negotiations, Session 2021–22, HC 862, 8 December 2021

2 C&AG’s Report, Progress with trade negotiations, Session 2021–22, HC 862, 8 December 2021

3 C&AG’s Report, para 1

4 C&AG’s Report, para 2

5 C&AG’s Report, para 3, footnote 13

6 Q 33; C&AG’s Report, para 12

7 Q 11; C&AG’s Report, para 3.1

8 Qq 15, 33, 43

9 Q 43; C&AG’s report Figure 12

10 Q 31

11 Q 36

12 Q 41

13 Q 6

14 Q 9; C&AG’s report 3.38 – 3.40

15 Q 9

16 Q 39

17 Q 40

18 Q 6; C&AG’s report, paras 20, 4.2

19 Chair’s opening remarks, Q 6

20 C&AG’s report, para 4.6

21 Q 6; C&AG’s report, para 4.6

22 Q 6

23 Q 7

24 Qq 7–8

25 Qq 75, 76

26 C&AG’s Report, para 4.2 and Figure 13

27 Q 81

28 Qq 34, 81

29 C&AG’s report, para 4.2; Qq 16, 30, 73

30 Qq 4, 10

31 Q 4

32 Qq 27, 30

33 Q 30, 34, 54

34 Q 30; C&AG’s report, para 4.19; Department for International Trade, Impact assessment of the Free Trade Agreement between the United Kingdom of Great Britain and Northern Ireland and Australia, 2021, part 8: Plans to monitor and evaluate the agreement

35 Q 34

36 Q 53

37 C&AG’s Report, para 4.16

38 Committee of Public Accounts, Government support for UK exporters, Twenty-First Report of Session 2019–21, HC 679, 28 October 2020

39 Q 4

40 Q 52

41 Q 57

42 Qq 52, 54

43 Letter from Permanent Secretary, DIT, to the Chairs of the Public Accounts Committee and the International Trade Committee, 4 February 2022 https://committees.parliament.uk/publications/8916/documents/152325/default/

44 Q 53

45 Qq 55–57

46 PTN0002

47 PTN0002

48 C&AG’s report, para 3.25, Figure 11

49 Q 20

50 Qq 10–11; 18–19

51 Qq 11, 20

52 Q 12

53 Qq 21–22

54 Q 12

55 Q 13

56 Q 14

57 Q 23

58 Q 24

59 Q 26

60 Letter from Permanent Secretary, DIT, to the Chair of the Public Accounts, 4 February 2022 https://committees.parliament.uk/publications/8916/documents/152325/default/

61 C&AG’s report, para 3.6

62 Q 3

63 C&AG’s Report, paras 16, 25

64 PTN0001

65 Q 47

66 C&AG’s Report, para 16

67 PTN0001

68 Q 48

69 PTN0001

70 Qq 58–60

71 Letter from Permanent Secretary, DIT, to the Chair of the Public Accounts, 4 February 2022

72 Qq 14, 61

73 Qq 67–69, 79

74 C&AG’s Report, para 4.10

75 C&AG’s Report, para 19

76 Qq 70–73

77 Qq 71

78 Q 73

79 Q 72

80 C&AG’s Report, para 3.19