In a new report the Public Accounts Committee says “there is no guarantee” that the new international trade agreements being negotiated by the Department for International Trade “will deliver actual economic benefits”.
The PAC said the Government remains opaque and secretive about the deals it is negotiating – publishing its own “impact assessments” of new trade deals prior to implementation but not setting any associated targets or providing the information to Parliament and the public to allow them to assess the practical, real-world impact of the new deals, or if the interests of businesses and the public are actually being served.
The PAC casts further doubt on the benefits that might actually be realised in the new trade deals unless DIT “provides vital support to help businesses use the agreements, particularly for smaller businesses wanting to export worldwide.”
It says DIT must “ensure that its approach to trade has coherence and that there is sufficient clarity about how government is making trade-offs across different policy areas, such as agriculture, the environment and human rights.”
In particular, in the strategically critical agriculture sector, UK farmers are concerned about competition from imported products including beef and lamb, and the environmental impact of increased trade with countries at a distance from the UK remains uncertain.
Sir Geoffrey Clifton-Brown, Deputy Chair of the Public Accounts Committee, said: “The Department for International Trade seems to have forgotten that its first and core duty is to deliver for UK consumers, business and our environment - to create deals that will deliver real economic benefits while offering the choice of food, goods and services at the standards and prices they expect and have long enjoyed. The PAC has previously expressed concerns that our consumer protection system is unable to deal with the new arrangements, and recent reports of tax fraud and modern slavery breaches cast doubt on capability in other critical parts of the trade system.
“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.”
William Bain, Head of Trade Policy at the British Chambers of Commerce said the report rightly highlights that more must be done to help smaller exporting businesses get the full benefits from trade deals negotiated by government.
“We need to focus on how we support and measure that,” he continued. “The BCC’s Trade Manifesto has ideas on both. We need a Trade Growth office within the Department for International Trade (DIT) to focus on ensuring that smaller businesses are properly connected with the export opportunities in UK trade agreements.
“It is also vital that more effort is put into making businesses aware of the preferential tariffs that trade agreements can offer, and that DIT properly measures their take up rate.
“The Chambers Network, at home and across the globe, and Chamber Customs have the track record and skills to work with the UK Government to secure both of these aims.
“We must maximise the benefits of trade agreements for exporting SMEs if we are to see the real worth of these agreements in encouraging exports and strengthening the UK economy.”
