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Trade Bill - Sitting 4

18 June 2020

Proposing MP
Altrincham and Sale West
Type
Public Bill Committee

At a Glance

Issue Summary

The MP discusses the Trade Bill's implementation of the Agreement on Government Procurement (GPA) and proposes an amendment to ensure mandatory regulation implementation. Greg Hands discusses the Trade Bill and its aim to secure continuity in trade agreements while addressing concerns about public procurement opportunities. The statement discusses the UK's intention to join the Government Procurement Agreement (GPA) independently and the powers needed in the Trade Bill to comply with international obligations. MP Graham Brady discusses amendments to clause 1 of the Trade Bill, focusing on environmental exceptions, carbon considerations, and support for small and medium-sized enterprises in UK procurement contracts under the GPA. The discussion focuses on the importance of supporting social enterprises and ensuring environmental considerations in public procurement regulations. The MP is discussing amendments related to public procurement and its environmental, health, and economic impacts. The statement addresses the challenges faced by small and medium-sized enterprises (SMEs) in obtaining government contracts, highlighting issues such as procurement barriers and competition with larger firms. Bill Esterson discusses examples of local businesses in his constituency that were unable to secure government contracts despite meeting quality standards and having innovative solutions. MP Graham Brady responds to a point of order regarding adherence to the scope of the Trade Bill during discussions. Bill Esterson discusses the need for improvements in public procurement policies within the context of the Government Procurement Agreement (GPA) to address issues like public health, environmental impact, and social value. The statement discusses amendments related to labour market interventions and compliance with ILO standards in supply chains. The statement discusses the importance of including International Labour Organisation (ILO) conventions in the Trade Bill. The statement addresses concerns about including labor rights, climate considerations, support for small businesses, and protections for public health in the Trade Bill. The speaker discusses concerns about the potential rollback of existing legislation allowing public authorities to prioritize quality over lowest price in procurement, emphasizing the importance of protecting local organizations and small businesses. Gareth Thomas discusses the importance of co-operative businesses in public procurement and highlights the need for amendments to the Trade Bill to support such enterprises. The statement discusses amendments related to placing a statutory obligation on negotiations with GPA parties for policy objectives and reports on developments through the Department for International Trade annual report. Greg Hands addresses concerns raised about government procurement agreements, small business access, and procurement standards. Graham Brady proposes new clauses to the Trade Bill requiring the Secretary of State to conduct social, environmental, public health, and economic impact reviews of regulations. MP Graham Brady is presenting new clauses for the Trade Bill regarding reviews of regulatory impacts on small and medium-sized enterprises (SMEs) and individuals with protected characteristics. MP Graham Brady is discussing the Trade Bill, specifically Clause 1 which pertains to UK's independent accession to the GPA (Government Procurement Agreement). Graham Brady is proposing amendments to clarify the definition of international agreements within the Trade Bill. The statement discusses definitions within the Trade Bill related to international agreements, including free trade agreements and mutual recognition agreements. Graham Brady addresses the timing of amendment 15 in the Trade Bill.

Action Requested

The MP requests that the relevant authority must make regulations to implement the GPA, ensuring continuity upon withdrawal from the EU and continued alignment with EU requirements. The MP also emphasizes the need for clarity in legislation to support businesses taking advantage of procurement opportunities under the GPA.

Key Facts

  • The World Trade Organisation suggests a global trade fall between 13% and 32% due to the covid crisis.
  • The GDP drop is larger than during the financial crisis, being the largest recorded historically.
  • The amendment would require the relevant authority to make regulations for GPA implementation.
  • The Trade Bill aims to secure continuity in more than 40 trade agreements and maintain membership of the World Trade Organisation’s government procurement agreement.
  • The UK intends to join the GPA as a member in its own right by December 31, ensuring access to £1.3 trillion a year of procurement opportunities for UK businesses.
  • There are concerns about British companies' ability to compete honestly in public procurement markets in countries like China and Russia.
  • The GPA includes 20 members, mostly western liberal democracies.
  • Australia is the most recent member to join the GPA.
  • Clause 1 powers are needed for compliance with international obligations after accession.
  • Amendments aim to improve public health, support small businesses, and include labour standards.
  • The Public Contracts Regulations 2015 will expire on December 31, 2020.
  • NAECI sets a minimum rate of pay at £18.63 an hour.
  • The amendment aims to cover small and medium-sized enterprises including social enterprises.
  • Hackney Community Transport is highlighted for providing employment opportunities for offenders.
  • Baywind Energy Co-operative supplies renewable energy that may be more expensive than nuclear power from Sellafield but crucial for climate action.
  • The Office for National Statistics reports a loss of about 40,000 green jobs despite tripling the renewable output in the UK's energy mix over ten years.
  • The report by the Crown Commercial Service from 2018-19 stated work had continued on supporting government growth strategies through public procurement.
  • In the US, federal public procurement involves 25% of all federal monies, compared to only 11% in the UK four years ago.
  • The MP runs a microbusiness and found it extremely hard to contract with Governments at national or local levels before entering Parliament.
  • The Government spends nearly £6.5 billion on procuring with UK SMEs.
  • Scottish procurement has been significantly better in terms of proportion of contracts going to SMEs compared to the UK figure.
  • Manchester City Council and Warrington North have delivered support for workers and public health agendas.
  • Bill Esterson's constituent can manufacture 40,000 reusable medical robes per month.
  • A British man in California designed saliva-only tests but faced difficulties getting UK approval.
  • The Government's procurement process allegedly discriminates against northern firms based on geography.
  • Graham Brady responds to a point of order made by Maria Caulfield regarding adherence to the scope of the Trade Bill.
  • The debate had been ongoing for more than an hour and was on only the second group of amendments.
  • The amendments aim to address public health impacts, environmental standards, and social considerations in procurement.
  • The TUC expresses concerns over limitations in GPA provisions compared to EU Procurement Directive 2014.
  • Section 56(2) of the Public Contracts Regulations requires contractors to comply with applicable environmental law and social labour standards.
  • The Modern Slavery Act 2015 is cited as a model for supply chain policing.
  • Security contracts are mentioned as an example of how amendments might be applied.
  • Amendment 24 addresses labour market interventions and compliance with ILO standards.
  • UK ratified 87 conventions including eight core fundamental ILO conventions.
  • Amendment 24 aligns with the ILO's declaration on fundamental principles and rights at work.
  • The EU-Vietnam free trade agreement has been praised for its commitment to labor standards.
  • Chapter 13 of the EU-Vietnam FTA reaffirms commitments under the ILO.
  • TUC expressed concerns about freedom of association, child labour, discrimination, low pay and dismissal without notice.
  • Trade deals have been struck with countries where labour and human rights abuses are prevalent.
  • South Korea has imprisoned trade union leaders for peaceful protests.
  • Colombia is the most dangerous country in the world for trade unionists.
  • Lebanon's agreement allows for exploitation of migrant domestic workers.
  • The Paris agreement was deemed legally fatal to a policy statement regarding Heathrow airport expansion.
  • Investment chapters allow companies to sue governments over climate measures.
  • Trade agreements can hinder the sharing of green technology and increase fossil fuel use.
  • Over 60 businesses in Anderson's constituency have requested help during the pandemic.
  • SMEs make up 39% of businesses in her constituency and are crucial for economic recovery.
  • The EU agreements provide vital protection to the NHS from commercial pressures.
  • Concerns exist about rolling back current procurement regulations post-Brexit.
  • Amendments seek additional protection for local organisations and small businesses.
  • Example given of Hackney Community Transport competing with large corporations.
  • Mention of Harrow Community Transport's struggle to survive.
  • Reference to the Modern Slavery Act's importance in supply chain transparency.
  • Support for co-operative organizations and community wealth building initiatives.
  • Co-operative sectors in Germany, France, Netherlands, Finland, Sweden, and New Zealand account for between 4% to 10% of GDP compared with 2% in the UK.
  • By 2030, the number of people needing help with basic needs such as washing, feeding, or clothing will double to 2 million.
  • Amendment 26 aims to assist small and medium-sized businesses within the co-operative sector to win more public contracts.
  • Amendments seek to place a statutory obligation on negotiations with GPA parties before creating regulations.
  • The UK’s GPA coverage does not cover healthcare services but covers goods and certain services procured by the NHS above specific value thresholds.
  • The Department for International Trade annual report will be published each year from 2021.
  • EU public contracts regulations date from 2015.
  • The Federation of Small Businesses supports UK's GPA accession.
  • New measures were announced in September 2019 to tackle slavery, servitude, forced labour, and human trafficking in Government supply chains.
  • New clause 1 focuses on social impact including worker and consumer rights.
  • New clause 2 addresses environmental impacts towards meeting Net Zero targets and managing waste.
  • New clause 3 covers public health outcomes such as food safety and standards in production.
  • New clause 4 involves economic impact reviews.
  • New clause 10 requires reviews of regulations' impact on SMEs.
  • Reviews must be laid before both Houses of Parliament starting by December 31, 2021.
  • New clause 14 mandates reviews of the impact on individuals with protected characteristics under the Equalities Act 2010.
  • Subsequent reviews shall be conducted annually thereafter.
  • The UK’s membership of the GPA ensures guaranteed access to approximately £1.3 trillion per year in procurement opportunities.
  • Clause 1 allows the Government to implement UK’s independent GPA membership in domestic law.
  • Regulations under clause 1(1) cannot be used for wholesale renegotiation of the GPA or changes to market access offer, requiring further primary legislation.
  • Amendment 31 aims to clarify the definition of an international agreement.
  • Clause 2(2) currently refers to 'an international agreement that mainly relates to trade, other than a free trade agreement'.
  • The proposed amendment provides a clearer purpose for international agreements: reducing barriers to trade in goods and services.
  • Amendment 15 seeks to insert a definition in clause 4 to cover 'international agreement that mainly relates to trade'.
  • Mutual recognition agreements (MRAs) are crucial for minimising non-tariff barriers and ensuring continuity for UK businesses post-Brexit.
  • Investment treaties, which were under EU competence from 2009 to 2018, now fall back within the UK's responsibility.
  • Amendment 15 is to be considered at a later stage in the Bill.
  • The committee adjourns until Tuesday 23 June at 9:25 pm.
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