Updated response on TTIPMarch 21st, 2015
Thank you for writing to me about the Transatlantic Trade and Investment Partnership (TTIP), a free-trade agreement that is currently being negotiated between the USA and the EU.
Labour believes it is right that this important issue is debated in Parliament and I agree that these proposals deserve proper scrutiny at both a UK and EU level.
The Labour Party supports trade agreements which can bring significant benefits through boosting trade and growth, securing and creating jobs, and bringing down costs and extending choice for consumers.
The Transatlantic Trade and Investment Partnership (TTIP), a trade agreement between the US, the world’s largest economy, and the largest single market, the EU, has the potential to bring significant benefits. Europe and the United States are the UKs’ most important markets today. Indeed, the US is the UK’s biggest export market and likewise the UK economy attracts a significant level of Foreign Direct Investment (FDI) from across the Atlantic. That’s why we support the principles behind these negotiations and recognise that more and better trade is good for the UK. Reducing barriers could for example help our car industry export more vehicles to the US where there are regulations inhibiting this and negotiations could remove.
However, we do have four main areas of concern:
- Public services: we share the concerns about the impact that TTIP could have on public services encouraging commercialisation, particularly in the NHS. Labour believes that the NHS and all public services need to be more, not less, integrated. That is why we believe that the NHS should be exempt from the agreement. Other countries have sought to exempt areas from the agreement but this Government has not done this. Labour will continue to press for exemption.
- Investor State Dispute Resolution(ISDS): this is a dispute mechanism, commonly used in trade agreements and bilateral investment treaties. It allows investors to take proceedings against a government that is party to that trade agreement. If the government is found to be in breach of the obligations, the investor can receive redress. There is a major concern that the ISDS provisions could hinder our plans to reverse the privatisation of the NHS as it could result in those companies seeking compensation for loss of potential earnings. We believe that it is a right of governments to be able to legislate in the public interest and this should be protected effectively in any dispute resolution mechanisms. The European Commission has instigated several changes which have improved the transparency of the agreement which Labour welcomes. However, it is right that the European Commission has decided to temporarily suspend negotiations on ISDS until the final stages of the negotiations. Labour will be urging the Government to use this opportunity to call for far greater transparency around an exclusion for legislation in the public interest, like the NHS.
- Standards: the benefits of any treaty must filter down to employees and consumers. Treaties can cement and even increase labour, consumer, environmental and safety standards. Concerns have been raised that TTIP could reduce standards, although the principle behind the treaty is to keep or raise standards rather than reduce them. Labour will only support an agreement that avoids a race to the bottom and promotes decent jobs and growth and would safeguard standards.
- Non-inclusion of the US States: A significant stumbling block has been raised that the US states are not covered by the agreement and therefore procurement will not opened up. This mean we could be at a disadvantage as our markets are opened up but not to the same extent in the US. This is important because significant procurement spend in the US is at the State level.
A number of worries similar to our own have been raised by member states and these would need to be reflected to secure agreement and will need to be taken on board by the European Commission.
I hope this is helpful and outlines our position with regard to TTIP.