Traidcraft and Fair Trade — [Mr Philip Hollobone in the Chair]

Part of the debate – in Westminster Hall at 10:19 am on 18th December 2018.

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Photo of Preet Kaur Gill Preet Kaur Gill Shadow Minister (International Development) 10:19 am, 18th December 2018

It is a pleasure to serve under your chairmanship, Mr Hollobone, in this important and timely debate. I congratulate my hon. Friend Liz Twist on securing it, and I associate myself with her comments and concerns. I thank the other Members who spoke. Jim Shannon mentioned having derived his fair trade values from his father, who was a shopkeeper, and urged us to do more to be a voice for the voiceless. My right hon. Friend Stephen Timms spoke of retailers committing to sell Fairtrade items in the UK and Traidcraft’s role in making that happen. I also thank him and Will Quince for the work they do through the APPG for Fairtrade. It was a pleasure to hear the strength of support among all Members for just and fair trade in which workers and countries are not exploited.

Let me start by welcoming the work that Traidcraft—and, indeed, everyone who buys Fairtrade—does to ensure justice in the consumer-producer relationship. Fair trading initiatives have led the way in ensuring that the true costs of produce are not paid by people living in poverty and insecurity through exploitative and dangerous working conditions, being ripped off by powerful global agribusinesses, or environmental destruction and degradation. However, fair trade must be just the start of a broader move towards more just global trading relationships, so it is deeply disappointing to learn that many social businesses and smaller fair trade companies are struggling as they absorb the hit of the pound’s depreciation as a result of the Brexit negotiations. They have been unable and unwilling to pass those costs down the supply chain as many larger companies have done.

A bad deal for Traidcraft would not only be damaging for its workers in the UK but contribute to worsening the position of vulnerable people around the world. If the Government continue to flounder in their attempt to finalise a Brexit deal, developing countries will face an estimated £1 billion in additional taxes on imports. That will foster poverty and inequality, burden already struggling countries with further debts, and deny workers their rightful access to living wages and robust labour rights. Will the Minister say what steps the Government are taking to ensure that those social businesses are able to continue to produce and sell Fairtrade products? Why did the Government see fit to reduce funding to promote and encourage ethical and fair trading?

The Fairtrade market in the UK is worth more than £1.6 billion, so it is clear that it is not a niche movement. Rather, it is a powerful example of the British public’s support for the benefits of trade being shared with workers around the globe, not funnelled into a narrow pool of corporations. That is further emphasised by the breadth of support for fair trade across the United Kingdom. Hundreds of individual businesses across the UK help to empower fair trade farmers and workers in developing countries. There are more than 10,000 local campaigning groups, including more than 600 towns and 1,000 schools as well as universities and faith groups, boosting awareness and understanding of international trade issues up and down the country.

Fair trade and its supporters in the UK are part of a global fair trade system that supports 1.66 million fair trade workers in 73 countries around the world. The UK should be proud of its role in the formation of that movement, which has become truly global. We need to uphold that legacy, and we should use those groups and the practical and real successes of the fair trade movement to drive wider reform of international trade conventions so they are built on equality and justice.

It is important to remember that what we are talking about goes beyond what can be achieved by the fair trade movement alone. Trade relationships between the richest and poorest countries are at the heart of uneven global economic development. We in the Labour party want to introduce long-term structural change to the global economy to eradicate poverty and inequality. We want to work hand in hand with the world’s poorest countries to ensure that trade works for them and us, rather than forcing them to be beholden to corporate interests or always to give British companies an advantage regardless of whether that is good for domestic development strategies.

We know that, when done justly, economic development initiatives can lift people out of poverty, tackle inequalities and help to change lives. However, the Department for International Development’s economic development strategy fails to do that, instead falling back on old, discredited tropes about free trade alone succeeding in addressing those problems. Will the Minister explain why DFID’s economic development strategy does not recognise fair and ethical trade as a cornerstone of economic policy?

The Government know full well that when the UK and other countries industrialised, they used the kinds of industrial development strategies that are now withheld from the poorest countries. Will the Minister tell us what impact assessments are done on trade deals, and will be done on any future deals, to ensure that they support development targets, the national development strategies of southern countries and poverty reduction?

Rather than having trade deals that require Governments to cut corporate taxes, increase privatisation and promote deregulation of our social and environmental protections—all policies that increase inequalities and push already vulnerable people into more precarious situations—why do we not ensure that our trade deals act as positive incentives to foster equality, in particular gender equality? We must end the model whereby the UK dominates economically weaker nations and insists on policies and agreements that weaken workers’ rights and protections, remove or undermine environmental standards and reinforce a world of “winners” and “losers”. We know from the example of the fair trade movement that trade can have a positive impact for the world’s poorest nations, but only when it is done right.

The Taxation (Cross-border Trade) Act 2018 outlines the Government’s plan to roll over the EU’s existing “Everything but Arms” scheme, ignoring calls from the Labour party, the Fairtrade Foundation, Global Justice Now and the Trade Justice Movement to introduce a UK preferential treatment scheme that covers a greater number of vulnerable economies. Considering the transformative potential of fair trade for people’s lives, will the Government commit to developing unilateral UK preferential access schemes for developing countries?

People in the UK want to be paid a fair wage for the work they do, to be protected from malicious or irresponsible employers and to live secure lives. Everyone the world over should have those rights, and trade that is ethically and fairly driven is vital to achieving them.