European Union (Definition of Treaties) (Canada Trade Agreement) Order 2018 — House of Lords, 2018-06-25
Topic: Foreign Trade
Rona Fairhead (Conservative, Centre-right): I thank noble Lords for their contributions today in what has been an interesting debate on CETA. They have talked about the benefits of CETA and free trade agreements. I recognise the concerns, which I shall come on to, but I am happy to hear the enthusiasm about there being shares for free trade based on rules, with some of the requirements to uphold standards that the noble Lords, Lord Fox and Lord Stevenson, focused on. I will touch on as many of these points as I can in the moments that I have The numbers that I have on our current trade and investment are that our exports are £9 billion and our imports are £7.5 billion. From my information, we have a slight deficit of £265 million on the goods side but a trade surplus of £1.9 billion on our services side. I am also happy to say that CETA includes services but possibly not as many as we had hoped at the beginning of the process. However, there are new opportunities in areas such as telecoms, finance, professional and environmental services. It will also allow UK firms to bid for a much broader range of Canadian public services, once Canada decides to open them up for such bids. Except of course for the public services, we will try to ensure that CETA guarantees the existing services’ liberalisation. There are some ways of helping SMEs, particularly on the processes. There are rapid ways of processing below €6,000. There is also a certification where you just have to put your name forward and HMRC has pre-certified around 12,000 of those I turn to the future trading relationship with Canada. As I said, we will begin to transition CETA into a UK deal once the UK has left the EU, following a clear commitment. We believe that is important because it will prevent the cliff edge and while we remain in the EU, we will continue to support the ambitious trade agenda of the EU. This provision was undertaken within that agenda, so it will ensure that during the implementation period we retain full access to CETA and other EU FTAs. An independent trade policy will allow us to be more ambitious, particularly in services I believe it was the noble Lord, Lord Fox, who asked me what would happen if the treaty was not ratified by all member states. I apologise; it was the noble Lord, Lord Stevenson. We expect ratification to take a number of years. We have noted Italy’s current position and will seek to ensure that everybody ratifies it. As it is currently provisionally applied, that will continue and we will be able to transition on that basis. It does not require such ratification for us to ratify it ourselves and transition that deal A number of noble Lords discussed ICS. Let me be clear that neither ICS nor any other investors’ dispute resolution can force the privatisation of public services. We alone retain the right to regulate. None of these tribunals can overturn Parliament or laws, as has sometimes been claimed. If I may deal with ICS first, there was a question about whether we are in front of the ECJ tomorrow. The answer I have is that we are not on that issue. However, we are aware of the concerns that some parties have with the proposed ICS. We believe in investor protection only where they are treated unfairly or with discrimination. ICS is part of this CETA but in looking at the future, we will look at a number of options of which ICS is one. There are others, which we will bring forward to the House. To be clear, the practical details of ICS have not currently been fully worked through by the Commission but it has committed to consult fully when that has happened The noble Lord, Lord Stevenson, and my noble friend Lady McIntosh asked about the scrutiny process. There is an impact assessment that we have made public, and I will write to noble Lords to give them exact details of how to access it. We are working to make sure that in future the process of negotiating and implementing new trade deals is transparent, efficient and effective because we want a legislative framework that will enable future trade agreements to move quickly from agreement to ratification while supporting due processes for full parliamentary scrutiny. We are currently considering the legislative framework, but Parliament will have a crucial role to play in the scrutiny and ratification of future trade agreements and deals. The Government will bring forward those proposals in due course. The EU has high labour and environmental standards. They are not affected by CETA, and we sign up to them with CETA. The agreements provide that member states should not reduce their standards to encourage trade and investment. I think that is important. We are determined not to compromise food safety or the environment or to reduce labour standards in pursuit of trade agreements. We will be rolling over all the current agreements when we transition CETA into a direct UK-Canada deal. The noble Lord, Lord Whitty, made a serious point about enforcement. We are looking at ways to improve compliance and enforcement. That remains something we are actively working on On the economic benefit figures, I referred noble Lords to the impact assessment. We have looked at impacts in a number of sectors. The total benefit to the UK is expected to be more than £730 million. The sectors that are likely to benefit the most are motor services and financial services. We see increases of £280 million and £70 million respectively. Detailed work has been done, so I would not like to believe it does not exist The noble Lord, Lord Stevenson, referred to geographical indicators. We expect CETA to be positive for UK agriculture. We have been in consultation and were in consultation when the geographical indicators were discussed. We think CETA is positive. It gives access to a market of 35 million people. The protected food names scheme remains in place in the EU. It is true that no UK GIs were included in CETA. That was because there was a process within the EU that it had to reach a certain hurdle. We consulted widely with groups and none of them at the time went above the hurdle that was eventually decided upon by the Commission. However, there is a mechanism to add new GIs in future, which I think will be actively pursued by a number of states. I know that a number of people have raised the question of Scotch whisky outside this House. It is not included because it is already protected. It has been formally registered in Canada since 1998, and it is also protected by the EU-Canada wine and spirits agreement I have tried to answer as many of noble Lords’ questions as I could in the time available. I recognise their concerns; we are working on a number of them and developing our strategy for the future. I realise that their concerns are heartfelt, and we will be working with noble Lords on that. However, I believe that this is a good deal for UK businesses—SMEs as well as larger businesses—and for consumers, and in our national interest to ratify this agreement I thank noble Lords for our debate today and hope that they will feel able to support the ratification and the positive signs that it will send to our future trading partners. I commend the order.