Monday, April 25, 2016

Peter Lilley on TTIP

Nine out of ten of those who have criticised the Transatlantic Trade and Investment Partnership have been talking nonsense - which certainly includes Jeremy Corbyn and David Owen.

However, Peter Lilley is the tenth.

Peter advises both the Remain and Leave sides of the debate that they need to look very hard at the terms of the proposed treaty.

As someone with impeccable free trade credentials, Peter's concerns expressed at Conservative Home here have to be taken a lot more seriously than those of most other critics of the proposed treaty.

Peter does not oppose removing tariffs and quotas, or in principle the harmonisation of product specifications, but he is concerned about the tribunals to be set up to review trade disputes under the Investor-State Dispute Settlement System (ISDS) proposed by the draft treaty.

His three main concerns about these tribunals are that
  1. US companies could sue the UK government should it want to take back into the public sector privately provided services in the NHS, education, and so forth  or open fewer services to private provision. The EU and the UK government have denied that this is possible. But a cogent Counsel's Opinion argues that because these tribunals can award unlimited fines they could exert a chilling effect on government decision making.
  1. These tribunals give foreign multinationals their own privileged legal system, too costly for smaller foreign companies (since the average case costs $8 million), and from which UK companies are excluded.
  1. The Stabilisation Clause protects all investments made under the treaty for at least 20 years. A recent legal treatise explains how this could undermines parliamentary democracy by binding future parliaments. Of course, the UK enters into other long term treaties and contracts but our government can always renegotiate or, in the last resort, resile from them. Exceptional circumstances may make that necessary: but if they don't work well, Peter argues that even if we subsequently left the EU. So we would still be bound by the Stabilisation Clause for 20 years

If I understand Peter correctly, he is not endorsing the ridiculous and hysterical suggestion of some anti-globalisation lefties and thoughtless "leave" supporters that TTIP could allow companies to enforce the wholesale privatisation of the NHS - the issue is with the 6% or so of NHS spending which has already been outsourced and he gives an example of one failed outsourcing initiative from the last Labour government which had to be taken back into the public sector.

Like a large number of medical professionals who previously had concerns about this point, I think the safeguards being proposed to prevent TTIP being used to keep part of our Health service in the private sector against the wishes of an elected government are adequate. But it is fair enough that these and other terms of the treaty should be kept under scrutiny.

TTIP is potentially worth billions to the UK, the USA, and every other country involved. Whether we are in or out of the EU, lower trade barriers in both directions between ourselves and the USA would be a very good thing. But we do need to make sure the terms of the treaty are right.

Knee-jerk opposition to TTIP such as we have seen from some quarters is entirely unhelpful and destructive, and has lowered my opinion of anyone who goes along with it. But when someone like Peter Lilley makes carefully judged and constructive criticisms that is another matter entirely. I hope the government (and the EU negotiators if there is a "remain" vote) will take them into account.

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