Government ‘struggling to point to tangible wins’ on trade policy, MPs find

The Commons Public Accounts Committee delivered a critical assessment of the UK’s trade deals.

18 March 2022

There is “no guarantee” that post-Brexit trade deals will deliver any real economic benefits unless firms are given greater support to take advantage of them, MPs have warned.

A cross-party report said the Government had not provided sufficient clarity about the “trade-offs” involved in the deals signed by the UK since leaving the European Union, particularly the impact on British farmers, while the environmental impact of increasing business with countries further afield than EU neighbours “remains uncertain”.

The Commons Public Accounts Committee also cast doubt on the Government’s goal of having 80% of the UK’s trade covered by free-trade deals by the end of the year, particularly as progress on an agreement with the United States is “on hold”.

The MPs said there was a “lack of clarity” from the Department for International Trade (DIT) about how it will measure whether it is achieving any benefits from its negotiations on free-trade agreements (FTAs).

“There is no guarantee that the agreements will deliver actual economic benefits unless the department provides vital support to help businesses use the agreements, particularly for smaller businesses wanting to export worldwide,” the report said.

Tory MP Sir Geoffrey Clifton-Brown, the committee’s deputy chairman, said: “The department needs to communicate what benefits we might expect from this brave new world we’ve entered and what trade-offs we face.

“The department is really struggling to point to tangible wins for British business, consumers or our own agriculture sector – even as the pandemic and energy price crises demonstrate the critical importance of robust trade arrangements.

“DIT is constrained by the deliberations and choices of our biggest trading partners – this is a problem of its own making, and for it to fix: families struggling out of the pandemic and into a massive cost-of-living crisis must not be the ones to pay.

“As well as negotiating new FTAs, the department must concentrate more on enabling small and medium-size companies to export, often for the first time.”

The committee’s report said that as of January 2022, 64% of UK trade was covered by FTAs including the EU deal which represents 47% of UK trade.

The report said that achieving the 80% target “will be challenging” as major goals such as joining the CPTPP Pacific trade bloc and an agreement with India will only contribute 0.4% and 1.5% respectively to the target.

A deal with the US, representing 16.8% of UK trade, “is on hold because the US decided to pause negotiations” under Joe Biden, although there has been success in ending the US bans on British beef and lamb, the MPs said.

The committee also complained about problems with MPs being able to properly scrutinise trade deals.

A DIT spokesman said: “Getting a good deal for consumers and businesses is at the heart of our trade strategy. We have already secured over £770 billion of trade deals with 70 countries plus the EU, while continuing to attract inward investment and boost our world-class exports.

“Last year we launched our landmark Export Strategy so more businesses can seize new opportunities in the world’s fastest growing markets and bring prosperity to every corner of the country.

“We take parliamentary scrutiny of FTAs very seriously and have made enhanced commitments to scrutiny and transparency at every stage of negotiations, going far beyond our statutory requirements.”

Consumer group Which? stressed the need for proper information about the deals.

Sue Davies, the group’s head of consumer protection policy, said: “Our research has found that although UK consumers are clear on what they want from trade negotiations – they want deals to maintain safety standards for food and products, keep their data secure online and look after the environment – more than two-thirds of people feel left in the dark about what new trade deals will mean for them.”