My Lords, it is a great privilege to follow my noble friend, who has been a friend for nearly 20 years. We worked together on the charity she founded, now called Action Against Abduction. I know that all noble Lords will join me in extending to my noble friend Lady Meyer a very warm welcome, and thank her for her fascinating and emotional personal story.
The great strength of her contribution today has been to show her achievements nationally and internationally, especially in the area of children and families, for which she was duly honoured by Her Majesty the Queen. She brings experience, knowledge and good sense to your Lordships’ House, and we very much look forward to her next contribution. She has an energy, vibrancy and charm that will warm the whole House.
I start my contribution to today’s debate by referring to my interests in the register and by congratulating my noble friend Lady Fairhead on her opening speech. I liked her clear summary of the powers in the Bill and of the work already in hand. I will add a historical perspective. Trade is the linchpin of prosperity. It is a fascinating subject, from the trading of obsidian and flint during the stone age to the Hanseatic League, an alliance of trading cities in northern Europe—a precursor of the EU—running a trade monopoly between the 13th and 17th centuries.
Trade is disproportionately important economically, as we have heard. For example, there was a great trade collapse after the last financial crisis between the third quarter of 2008 and the second quarter of 2009. World GDP dropped by 1% and world trade by an amazing 10%. So, in view of the enduring importance of trade to the UK, the Government are right to want to prepare for a vibrant international trading future in the post-Brexit world.
I support the Bill and its speedy passage. It rightly seeks to provide continuity in our trade and investment relationships with third countries. It replicates the effect of existing EU preferential trade agreements and makes us a member of the government procurement agreement on our own account. The Bill passed by this House last week will deal with tariffs and customs matters, but this Bill will allow us to implement our non-tariff obligations. It does not look forward to new free trade agreements since, as the Secretary of State for International Trade helpfully made clear in his Statement on
I will touch on a few issues. I am known for my interest in impact assessments and I studied the one issued on this Bill as long ago as
What I found most interesting was that from this group, in 2015 Switzerland, the Iceland, Lichtenstein and Norway group, Canada, Turkey and Korea were our top five trading partners among those with FTAs. When I worked at Tesco I had something to do with the agreement with Korea. When it was being negotiated, the Korean Government were very helpful with my company’s problems as an overseas investor. Keen to conclude the FTA, they shied away from discrimination against our business and that of others in a similar position. But, once the EU-Korea agreement was signed, our problems returned in spades. Indeed, Tesco has since sold the business to help restore its balance sheet. But, given the vibrancy of that business—called Homeplus in Korea—its contribution to the whole group on innovation and digital, and, looking at it the other way, the substantial amount of capital it received from us to build a leading Korean retailer, this seems very sad. The lesson for today is the importance of looking beyond the here and now of a trade agreement to what happens afterwards and the need for good remedies and dispute resolution.
That brings me on to an area of the Trade Bill that I am interested in exploring—the Trade Remedies Authority. As my little example shows, the quality of this aspect of trade arrangements is very important. The EU’s comparable body has some of the very best career officials, as I saw when I was a Business Minister in the EU Council. So we need a highly professional team looking after the UK’s trade interests in the new world. I have to admit that I am somewhat doubtful about having a new authority separate from the trade department, partly because of the stringent financial controls on pay imposed on such bodies. However, that has been decided and we cannot delay the Bill.
The proposed body is of a very special type. Different considerations apply to it than apply to most, superficially comparable, bodies. In this case, having everyone inside the tent would not be a good idea. In particular, I would be very much against including stakeholders, whether from producing industries, trade unions or devolved Administrations, as members or non-executives of the new authority.
I was glad that the Commons voted against this concept. The investigation process should be run by people who are independent-minded and able to stand up to the various interests who will want to influence the outcome of something as a delicate as a trade dispute. I am also pleased that the Government are planning to move some of the experienced staff that they have developed or recruited for the Department of Trade into the new authority.
Another area that is very important and on which I have had representations from the retail sector is how VAT will operate post Brexit and the sums involved. While it is strictly a tax issue and not for this House, I hope that the Minister will agree to find time to answer questions on this.
Finally, in response to the noble Lords, Lord Grantchester, Lord Fox and Lord Hain, perhaps I may offer a wider, fundamental observation. I voted remain in the referendum, because, on balance, I thought then that continued membership of the EU was the better option. However, it does not follow that, when we leave, people of my persuasion should consider the best outcome to be to remain as close as possible to the EU, via membership of the single market, customs union or whatever. Past support for remain implies no such conclusion.
We need to review the matter from first principles, covering such considerations as why the UK would profit from membership of an organisation whose rules are set by others. My point is simple: remainers who now advocate the closest possible ties with the EU need to argue their case and not assume that all who once agreed with them must accept the truth of their current proposition. Of course, if we stay in the customs union or the EEA, the powers in this Bill and the new authority will go largely unused, bringing home the extent to which that outcome would limit our influence on trade.