Hansard

As we know, trade agreements are the rules that govern our economic relationships with the rest of the world. For more than 40 years, those rules have been shaped by our place in Europe and for more than 40 years, as a willing member state, we have shaped those rules.

Exiting the European Union will inevitably change our relationship with the rest of Europe and the rest of the world. However, the extent of that change remains unclear because, even now, with six months to go until exit day, no agreement has been reached on a Brexit deal or on the rules that will come to govern our relationship with the EU. As Jackie Baillie said, the Prime Minister’s Chequers deal is dead, the Cabinet has been in open revolt and no deal looks more and more likely.

However, today’s Scottish Government motion is not about the wisdom of leaving the EU or the options that will have to be decided on. It is about trying to build something constructive when it comes to international trade agreements and surely, all around the chamber, we can agree on that. I welcome the tone and the content of the motion.

The intention of the UK Government is, from March 2019 onwards, to negotiate a series of bilateral deals. However, until we know what the nature of the UK’s relationship with the EU will be, we will not know the extent to which there can be an independent UK trade policy post-Brexit, and we will not know the full impact that it will have on the economy.

The Scottish Government publication on future UK trade arrangements sets out in detail the significance of trade to the UK and Scotland. Paragraph 23 of the report spells out in sobering terms what leaving the single market and customs union could mean. It says that a World Trade Organization rules scenario would lead to loss of 8.5 per cent GDP in Scotland by 2030 and that a free-trade agreement relationship would lead to GDP being “6.1% lower by 2030”. For all those reasons, the Brexit deal matters. We need to get it right, but we should also be prepared for all eventualities.

Promising a “transparent and inclusive” independent trade policy in July, the International Trade Secretary, Liam Fox, said:

“To develop and deliver a UK trade policy that benefits business, workers and consumers across the whole of the UK we need to reflect the needs and individual circumstances of England, Scotland, Wales and Northern Ireland.”

One of Labour’s six tests for any Brexit deal that the Government might come forward with is whether it delivers for all the nations and regions of the UK. We must apply that same test to any future trade agreement to which we sign up post-Brexit.

As we know, all the UK’s international trade deals are negotiated through the EU but, as the report points out:

“Losing the EU’s negotiating power, scrutiny and expertise will require a massive step change in the way the UK conducts its affairs in relation to international matters.”

Jackie Baillie and other members have said that that is a key challenge for us all—for decision makers, trade negotiators, regulators, Governments and leaders across party lines. We have to achieve a “massive step change” while ensuring that any trade arrangements are transparent, inclusive and meet the needs of the nations and regions of the UK.

Brexit is testing political conventions and orthodoxies in this country to destruction. It is time for new ways of thinking and working to emerge. We need a new mindset around how the Governments of these islands work together. It requires goodwill and co-operation. It challenges us to learn from good practice elsewhere, as well as introducing new and innovative practices of our own.

In evidence to the Finance and Constitution Committee in April, Kathleen Walker Shaw of the GMB—I declare an interest as I am a member of the GMB—outlined concerns about existing global and EU-level trade agreements:

“predominantly because of their lack of democracy, transparency and inclusiveness of stakeholders.”—[Official Report, Finance and Constitution Committee, 25 April 2018; c 3.]

We can better engage with stakeholders by giving our devolved Parliament a meaningful say, and by the UK Government accepting that the devolved Administrations are not its competitors or opponents but partners in an endeavour the like of which none of us have ever had to engage with before. To do that, we need a formal structure, clear and binding agreements, mutual respect and understanding, and parity of esteem. As Kathleen Walker Shaw also said,

“the Scottish Parliament and other devolved Administrations must have a formal and substantial say on why we are having any trade agreement, what its aims, objectives and scope are and what its mandate is.”—[Official Report, Finance and Constitution Committee, 25 April 2018; c 6.]

As Bruce Crawford said earlier, the Finance and Constitution Committee has been taking evidence on trade, and I agree with him that it has been useful for us to hear about the experience of officials and representatives of different countries. I am struck by the fact that other countries, especially those with federal or devolved structures, deliver complex trade deals that are acceptable to their nations and regions when they have a robust agreed process that is underpinned by a genuine spirit of co-operation. That could mean central Government and devolved Government agreeing a common negotiating position before entering formal trade talks. It could mean observer status for the devolved Administrations. It could even mean proper recognition for local government as a sphere of government—not just a tier—with a significant interest in our future trading relationships.

There are no easy answers. What works well in one agreement with one country will not necessarily work well in others, but surely a new framework of co-operation and understanding is a sound and legitimate basis on which to proceed. Governments and devolved Administrations will not always get everything they want. Kathleen Walker Shaw again pointed out, in relation to the Canadian provinces:

“I know that whether the provinces were able to get where they wanted to be on CETA is an open question. A lot of compromises were made ... There is no perfect model.”—[Official Report, Finance and Constitution Committee, 25 April 2018; c 10.]

Even if we do not always get what we want, let us put in place the framework that allows us to try. Let us make a complex process more transparent and inclusive, and let us make sure that it reflects the needs of our economy.

We are entering uncharted and turbulent waters. I hope that the UK Government responds positively to the motion lodged by the Scottish Government.