Emma Reynolds and Cat Smith debate the pending transatlantic trade agreement
The European Union and United States account for nearly half of global GDP and almost a third of world trade. The Transatlantic Trade and Investment Partnership would be the biggest free trade agreement ever. It is an opportunity to better regulate this trade and push up standards in areas like environmental and food protection.
TTIP would attract foreign investment, create jobs, lower the cost of consumer goods and services, and bring new opportunities for business in the United Kingdom. The Department for Business, Innovation and Skills estimates the deal to be worth £10bn a year to our economy. The average household could benefit by up to £400 a year.
British companies that export to the US pay £660m a year in tariffs. They also have to deal with hidden costs of meeting different regulations. Many are bureaucratic rules that could be standardised. For instance, American and European regulators have different requirements for testing the safety of cars, pharmaceuticals and even furniture. These different standards can be expensive for firms and, in the worst cases, some goods have been banned, such as British lamb.
TTIP would remove tariffs and many of the hidden barriers to trade. It would harmonise regulations and bring in common standards. This would reduce costs for businesses and would benefit consumers too. We pay up to 20 per cent more for products imported from the US as a result of tariffs. Without TTIP, people will continue to pay higher prices for food, clothes and other products.
Opponents of TTIP often make two arguments. First, they claim that the NHS will be opened up to American private healthcare companies. Labour has been clear that NHS services should be excluded from TTIP. The European commission recently reassured the health select committee that ‘all publicly funded public health services, including NHS services, will be protected in TTIP.’ Labour members of the European parliament are closely scrutinising the draft agreement to make sure these promises are honoured.
Second, they claim that TTIP’s inclusion of investor-state dispute settlements is secretive and favours multinational companies. Under the ISDS, if there is a breach of the rules companies have the right to bring legal proceedings against governments involved in TTIP. The UK already has 90 such agreements in place with other countries, but there has never been a successful claim against us. There is nothing unique or inherently sinister about this proposal being included in the TTIP deal.
Finally, some opponents of TTIP are simply protectionist or anti-American. The EU has already negotiated free trade agreements with many countries, such as South Korea, Canada and Vietnam. None of these deals have provoked the same hostility that is directed at TTIP.
We should neither oppose nor fear free trade provided it is underpinned by sensible, proportionate and progressive regulation. We can fight for high standards in the final agreement which will benefit workers in sectors like car manufacturing, textiles, chemicals and construction. Here TTIP has the potential to stop spiralling low standards and cost-cutting at the expense of working people and their wages. Previous trade deals have not weakened standards. The EU and US already trade more than £1bn a day. TTIP is a huge opportunity for progressives to push for better standards in both the world’s largest economy and its largest single market. It is an opportunity that we should seize and shape according to our values.
Emma Reynolds MP is a member of the health select committee
The debate surrounding the Transatlantic Trade and Investment Partnership is essentially a debate about democracy. Do we want decisions on policies relating to our public services and regulations taken by elected governments democratically chosen by the people or do we want them taken by investor-state dispute settlements tribunals between overseas investors and those governments?
Much of Labour’s focus on TTIP to date has involved exempting the NHS from it. It is not difficult to see why. Legal advice from Unite the union has suggested that TTIP could lead to the United Kingdom having to compensate private providers for ‘future losses’ should services be brought into the public sector. Labour went into the last election with clear commitments to introduce a levy on tobacco companies to pay for doctors and nurses, to reverse many of the changes introduced in the Health and Social Care Act and place a limit on the profits private healthcare operators could make on patient treatment. Should TTIP go ahead it may be difficult to make similar commitments in future without risking a substantial financial penalty. Many of the Blair governments’ reforms of the NHS centred on putting the patient in control and challenging what were often defined as ‘producer interests’. While we can debate the policy choices that were made few would disagree with the principle. We cannot allow TTIP to bring this approach to an end and put the needs of pharmaceutical companies and private health and social care providers ahead of those of the patient.
It is not only the NHS which is at risk. European Union regulations on a range of issues might be affected. Barack Obama has publicly made reference to EU regulations on food standards which are much more robust than those in place in the United States. Prior to the last election the cross-party environmental audit committee expressed its concerns about the impact which TTIP would have on EU environmental protections. While the government is keen to paint such concerns as scaremongering the evidence suggests otherwise. The number of ISDS cases being taken worldwide has increased significantly in recent years. High-profile cases include Philip Morris taking action against Uruguay and Australia for putting in place regulations on tobacco not dissimilar to those being pursued in the UK.
Labour is currently fighting to protect its landmark Freedom of Information Act from Tory attempts to water down its provisions. This act has ensured that governments have becomes more transparent and allowed the public to know about important issues such as the number of times police officers have used Tasers on children. The secrecy surrounding TTIP negotiations as well as the potential secrecy of ISDS proceedings also represents a serious threat to open democracy.
Recent debates within the Labour party and the wider Labour movement since the general election defeat have demonstrated, to put it mildly, that there are a diverse range of views about the future of progressive politics in the UK. One unifying theme, however, appears to be the need to change our politics so that individuals have greater control over their own lives. This is incompatible with a treaty being negotiated in secret and which, instead of devolving power to individuals and communities, transfers it away from democratically elected governments and to unaccountable tribunals and corporations.
Cat Smith MP is shadow minister for women and equalities
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