Jonathan Edwards MP has today used a debate in the House of Commons to argue that the Welsh Government should be granted a veto on the TTIP (Transatlantic Trade and Investment Partnership) in order to protect public services.
The proposed trade deal between the European Union and the United States has attracted substantial criticism for the secretive nature of discussions and for threatening the public sector with privatisation.
Mr Edwards argued that given public services are devolved to Wales, the devolved government should be granted a veto in order to protect the NHS and other services from sweeping privatisation.
He added that while Wales holds huge potential for securing lucrative trade deals throughout the world, this must not be "at any price" and that consideration must be given to environmental and public justice factors.
Read Jonathan Edwards' speech in the House of Commons below:
Jonathan Edwards (Carmarthen East and Dinefwr) (PC):
I last spoke on this issue in February 2014, and I started out, as I will now, by noting that Wales is a proud exporting nation, despite recent setbacks. Wales outperforms the other component parts of the UK, and according to HMRC statistics we have a trade balance of £5.86 billion based on 2014 figures. By contrast, England has a deficit of £125.6 billion.
Despite recent setbacks in Welsh exporting figures, the potential of a trade deal for Wales is hugely significant, but it should not come at any price. The cost should certainly not be the destruction of public services or environmental and safety standards, or the subversion of public justice to one law for corporations and one law for everybody else. I should state from the outset that I am in favour of further developing trade links between the EU, which is already the world’s largest trading bloc, and the United States. However, I still have many reservations about the proposed TTIP, despite the recent attempts by the European Commission to allay those concerns by proposing alternatives.
It is a great irony that the UK Government are dead set on ploughing ahead with TTIP while at the same time jeopardising the future of Wales and the UK within the EU with a referendum conceded in panic by the Prime Minister when UKIP were hot on the Tories’ tails. I see that the renegotiation is not going as well as he planned and I suspect that the charade of Tory unity on this issue will disappear very rapidly as the referendum approaches.
Is the hon. Gentleman not concerned that the attacks on TTIP, which is being negotiated by the European Union, are in effect undermining our relationship with the European Union? Is it not the case, therefore, that some of these outspoken attacks are more damaging to the position that he supports, which is continued Welsh membership of the European Union?
I am grateful for that half-clever intervention. The biggest danger to our relationship with the EU is Tory policy on the needless referendum that we will be having in the next year.
When I spoke on TTIP 22 months ago, I set out many of the concerns that I and my party, Plaid Cymru, had regarding the proposal as it stood then. I set out our concerns about the highly controversial ISDS as well as the potential for the agreement to allow for the privatisation of public services despite the public’s desire to keep those services in public hands, not to mention the concerns over lowering environmental and safety standards through so-called harmonisation.
The economic benefits of TTIP are contested. A study for the Department for Business, Innovation and Skills estimates that the gains for the UK would be £4 billion to £10 billion annually by 2027. However, the average tariffs on trade between the EU and the US are already relatively low. Therefore, many of the proposals within TTIP and much of the negotiation are centred on non-tariff barriers to trade, such as product regulation and standards, which would need to be harmonised, and measures to protect the rights of investors.
Does the hon. Gentleman agree with the Tufts University analysis of TTIP, which concludes that we would suffer a net loss as a result of the proposals for the future of our economy?
I have not read that report, but I take the hon. Lady’s word for it.
The estimates overstate the gains, and alignment of regulatory standards in areas such as consumer safety, environmental protection, procurement and public health could have substantial social costs. Wales’s existing trade with north America has grown rapidly over the past decade and a half as a share of our overall exports, without TTIP in place. Of course, a trade deal could help to grow that even further, but that should not happen at any social cost, and certainly not at the risk of further hollowing out Wales’s industrial base. Any trade deal that does go ahead should definitely not be a large corporation closed shop in relation to trading across the Atlantic, as TTIP most definitely appears to be at present. Some 99% of Welsh companies are SMEs, making up the backbone of the Welsh economy. In any trade deal they deserve as much of a look-in as the big companies.
Alongside the potential for the default privatisation of public services such as health, the most controversial element of TTIP so far has been the ISDS provisions, which would allow investors to bring proceedings against Governments who are party to the treaty. The proceedings would be heard in tribunals outside the domestic legal system, meaning that Governments might determine policy with an overriding fear of being sued by corporations—a point made earlier. I said the last time I spoke on TTIP, and I will say again, that the US and the EU already have advanced legal systems. Neither is a banana republic, and corporations should abide by the same well-functioning legal system as the rest of society.
Throughout Europe, including here in Wales and the UK, Governments have been listening, and the UK Government and the European Commission have sought to allay concerns via a new proposal for an investment court system, published only last month. It appears, though, that they are only changing the name. My original point is relevant and remains valid. We already have a highly advanced court system in existence in all the places within the reach of the proposed trade agreement. The proposals for any alternative shadow legal system should be dropped immediately. Not to do so is an affront to democracy.
Given that public services are devolved, the devolved legislatures and Governments of the UK should have a veto over TTIP.
Jim Shannon (Strangford) (DUP):
I want to put on record how TTIP could affect NHS contracts. We in the Democratic Unionist party are totally opposed to it for that reason. We also oppose ISDS. As health is a devolved matter, we want to put it on record that it should be the regional Assemblies and Parliaments that make the decisions, and the Government should liaise closely with them. Does the hon. Gentleman agree?
I entirely agree with the hon. Gentleman. I am sure there will be some collaboration on the issue between Northern Ireland, Scotland and Wales in the near future. Those areas of public service delivery are the competencies of those Administrations. They might have a different agenda from the UK Government, and devolved Administrations should be fully consulted on and fully involved in any ratification of TTIP by the UK Government.
I am grateful to groups such as Global Justice Now and the Council of Canadians as well as Unison for bringing to my attention CETA, the comprehensive economic and trade agreement between the EU and Canada, often referred to as TTIP’s little brother. Although there is much public awareness of the TTIP negotiations, CETA is on the verge of being ratified but is not receiving the scrutiny or attention it deserves. CETA includes the most controversial part of TTIP, investor state dispute settlement. Many US firms have Canadian subsidiaries, thereby allowing US firms to operate in the EU market. Public services are vulnerable because CETA locks in current levels of liberalisation, meaning that future Governments will find it extremely difficult to stop Canadian companies delivering public services in the EU. CETA is due to be fully ratified in mid-2016, and I urge the UK Government, the Welsh Government and the public to reject this deal unless the safeguards that I have outlined in relation to TTIP are put in place.
The public and politicians should also be aware of the Trans-Pacific Partnership, which is little known over here. Again, the criticisms of this proposed deal bear the hallmarks of TTIP and CETA—secrecy, and the fact that large corporations will exert undue influence over public policy through shadow legal systems.
In conclusion, I am still optimistic that a trade deal aimed at further reducing tariffs in order to secure a level playing field can be achieved, and I believe it would benefit Welsh exporters and our economy as a whole. Many of the environmental standards that the EU requires from its producers and manufacturers should not be compromised. They are already above and beyond those required in the US, placing us at an advantage without the potential social costs that would result from the proposals that are the areas of major concern. In order for any trade deal to have my support and that of Plaid Cymru and the wider public, it must unquestionably drop any proposals for a shadow corporate legal system and ensure that the EU’s existing environmental and social safeguards are maintained.