Peers call for more transparency on trade deals

Lord Goldsmith QC, Chair of the House of Lords International Agreements Sub-Committee, has today called for more detail on the progress and objectives of trade negotiations in two letters to Secretary of State, Liz Truss. The letters, one in relation to UK-US trade talks and the other on UK-Japan negotiations, detail initial concerns with the ongoing negotiations and areas where the Committee call for more transparency with Parliament to support scrutiny.
 
UK-US Letter

“The Government's own figures suggest little will be gained from a deal”.
 
In the first letter, the Committee conveys findings that the agricultural and food manufacturing sectors “see a number of significant risks that might arise from a UK-US FTA”, with only modest opportunities. It notes that UK dairy and sheep associations may see the largest opportunities, but that even in these areas a deal could also ‘pose a major competitive challenge', especially as it could allow American agriculture to undercut UK producers. The letter also asks the Government what direct support it might offer UK farmers if a US deal makes it hard for them to compete.

“General concern the sanitary and phytosanitary standards (SPS) that are currently in place in the UK might be undermined by a UK-US deal”.

The letter also highlights growing concerns that a deal could lower UK food standards despite the UK's current “strong reputation for high-quality food” in the US.

The Government has given little detail on how it will achieve its goal to protect the NHS.

The letter goes on to discuss healthcare and drug pricing, calling for more information on how the Government will actually achieve its commitments to protect the NHS and prevent the cost of drugs rising, as there are concerns that “the US' objective to secure what they see as fairer drug pricing…might lead to increased costs”.
 
The full letter also details other areas on which the Committee have been taking evidence and where a UK-US deal could benefit the UK's economy or other policy areas, including breaking down US protectionism in the area of government procurement, enhancing digital trade, protecting the UK's creative industries, achieving environment and climate goals, and supporting the UK's vital services industries across sectors, including financial services.
 
The Committee has also today launched a new Call for Evidence on the UK-US talks, focusing on some of these issues, which will remain open until 31 August.

UK-Japan Letter

The Government must provide sufficient time for effective scrutiny of a UK-Japan deal by Parliament and stakeholders.
 
The letter asks the Government to ensure there is enough time for effective scrutiny of UK-Japan trade deal by providing the Committee with the agreement before it is formally laid before Parliament. It also calls on the Government to “encourage real and meaningful consultation with the devolved administrations and Parliaments to ensure that international agreements reflect the interests of the constituent parts of the UK”, as well as with the Crown Dependencies and Overseas Territories, such as Gibraltar.
 
“Any gap between potential UK-Japan and UK-EU agreements will have major consequences for businesses.”
 
The letter calls for the Government to clarify what provisions it is seeking in negotiations to ensure business continuity for the UK automotive sector, such as rules of origin and extended cumulation. The Committee also asks the Government to detail measures it would provide to support the UK automotive sector if there is increased competition from Japanese automotive companies.
 
“The Japanese agri-food industry has indicated strong opposition to allowing the UK further access to its market beyond what it has given to the EU.”

Given the sensitivity of agri-food trade in Japan, the letter asks the Government to clarify how it intends to negotiate no rollbacks on key UK access to the Japanese agriculture market.
 
Japanese investment in the UK is significant, but Japanese businesses have faced a high level of uncertainty since Brexit.

In addition, it asks how the Government would maintain Japanese investment in the UK and whether a UK-Japan deal might include investor protection mechanisms that are currently missing from the investment chapter of the EU-Japan deal. 
 
Further clarity needed on how aspiring to be member of CPTPP impacts the UK's objectives in Japan trade talks.
 
While the Government has made clear it would seek to use a UK-Japan agreement as a stepping stone to joining the CPTPP, the Committee asks how the UK's prospective membership of CPTPP might limit the objectives that the Government sets for itself in bilateral agreements that are currently being negotiated.  
 
Lord Goldsmith QC, Chair of the International Agreements Sub-Committee, commented:
 
“As our recent report into effective treaty scrutiny suggested, there is incredibly limited time for us – and for stakeholders across the UK – to scrutinise UK treaty negotiations effectively, which raises concerns over ensuring these deals provide real value to all parts of the UK, the industries affected and to the public as a whole. While that is the Government's ambition, Parliament must be able to scrutinise the Government's actions and check whether that ambition has been realised.
 
“Post-Brexit, the UK finds itself in a wholly new position. As an EU Member State, much of the work negotiating agreements was done on our behalf and the European Parliament, including UK MEPs, scrutinised these deals with veto powers. Now, the UK Government and Parliament are taking up these functions, but Parliament has very limited formal powers. We therefore urge the Secretary of State to come back to us with more details about how the Government plans to achieve its goals, the progress of negotiations, and the specific areas we have outlined in these letters.”