From the TUC

A creeping liberalisation? TTIP and public services

27 Nov 2014, by Guest in Public services

The latest meeting of the All Party Parliamentary Group on TTIP this week was dedicated to the impact of TTIP on public services at which UNISON general secretary Dave Prentis debated with the EU’s lead negotiator on TTIP, Ignacio Garcia Bercero. As Dave pointed out in his opening remarks he was at a slight disadvantage because given the secrecy over the content of the negotiations on TTIP Mr Bercero was probably the only person in the room to have seen both the EU and US offers on services liberalisation.

However, we do know, both from leaked texts and from the EU-Canada agreement (CETA) that has recently been made public, that the European Union, has for the first time, decided to deal with services based on a ‘negative list’ approach which means that, unlike with previous trade agreements, all services including public services, are open to liberalisation unless a specific exclusion or reservation is entered for them either by the EU or individual member states.

Using the negative list is highly complex as reservations and exclusions have to be entered both for existing services and regulations and all future services and regulations. Unless this is done, new services are deemed automatically to be open to liberalisation and new regulations on services could be challenged as a breach of the market access commitments in the agreement.

Experience from the use of negative lists in other trade agreements has shown that there is inevitably a creeping liberalisation as a consequence, regardless of the intentions of the parties to the agreement. That is why UNISON has consistently called for a positive list for both TTIP and CETA which only applies to named services and therefore guarantees protections for excluded public services.

At the APPG the Commission negotiator sought to reassure us that the EU has put in place public service exclusions in both CETA and TTIP, which would not mean new liberalisation or prevent services being brought back in-house. UNISON is currently getting legal advice on the scope of these in the CETA text to see whether they really are sufficient for the high degree of outsourcing and privatisation of UK public services.

However TTIP and CETA are not just trade treaties seeking to promote growth in the trade in services. They are also investment treaties designed to protect foreign direct investment. We know from the CETA agreement that whilst the EU has tried to negotiate exclusions and reservations for public services with regard to market access, it has not done so for the investment chapter provisions. This means that the future organisation and regulation of vital public services could be determined by private Investment Arbitration Tribunals under the now infamous Investor State Disputes Settlements (ISDS) mechanism. UNISON has consistently argued that there is no justification for an investment chapter in either agreement as there is already a high degree of FDI from both sides of the Atlantic due to existing investor protection laws.

What is clear however is that the European Commission is on the defensive over TTIP and the secrecy surrounding the negotiations: yet the more the public know about this trade agreement the less they are prepared to support it.