From the TUC

Government fails to address BIS Select Committee’s concerns on TTIP

04 Aug 2015, by in International

Last week the Government slipped out its response to the previous BIS Select Committee report on TTIP released last March.

In light of the fact that one of the criticisms the BIS Select Committee raised was the lack of engagement by the government with stakeholders concerned by TTIP, publishing a response with zero-fanfare when most of the country is on holiday suggests that the government’s approach to public engagement on TTIP hasn’t improved since the Coalition left power.

The BIS Select Committee’s report had raised other criticisms of TTIP and the government’s approach, stating the case for the controversial Investor-State Dispute Settlement (ISDS) ‘had not been made’; that public services like the NHS should be explicitly excluded from the deal and poured doubt on government projections for the economic growth that would result from the deal.

This level of criticism from a Committee that at the time contained more Coalition government MPs than Labour was significant.

The TUC gave evidence to the BIS Select Committee last November about the many threats TTIP posed to workers’ rights, jobs, health and safety, public services and democracy itself through the notorious ISDS provisions.

The TUC General Secretary said of the report the BIS Select Committee produced that:

“The government should respond to the MPs’ view that the case for including Investor State Dispute Settlement (ISDS) has not been made by scrapping this undemocratic and unfair preferential treatment for foreign investors.”

Unfortunately, rather than change direction, the government’s response suggests it is more determined than ever to plough on in the same way with TTIP negotiations, throwing public concern about the damage the deal will do to the wind.

Here are three areas of concern raised by the BIS Select Committee report on TTIP that the government report fails to satisfactorily respond to:

  1. Dodgy CEPR analysis on benefits of TTIP

We know a number of expert studies have raised serious concerns with the CEPR research both the UK government and EU have been touting as proof that TTIP will have incredible benefits for growth, jobs and incomes. 

Not only does a closer inspection of these studies reveal that they only promise a family of four will be €545 better off from TTIP, but the model these studies use is clearly flawed.  They assume the unrealistic scenario of full employment and perfect competition which doesn’t tell us much about what the impact of TTIP will be in the real world where austerity has wracked Europe or parts of the US or the EU where corporate cartels operate.

Other studies using different models suggest jobs might be lost from TTIP and incomes reduced.

The TUC has said from the start of the TTIP negotiations that if you really want to know the impact of TTIP on workers, you should talk to unions.

Unfortunately, in this response paper, the government stands steadfastly by the CEPR research, stating:

‘the Centre for Economic Policy Research’s (CEPR’s) studies for UK, European Commission and other member states provide the most reliable and useful guide to the potential benefits of the agreement.’

So get prepared to hear more discredited economic boasts about the benefits of TTIP in the near future.

  1. No legal text in TTIP protecting NHS or public services

The text of TTIP currently being negotiated is a legal document, so every word matters.

And unless the text clearly excludes public services from being opened up by TTIP, they are not protected.

It seems to have escaped the civil servants who produced the government response here that a letter from EU Trade Commissioner Malmström or her joint statement with US Trade Representative Froman saying public services are safe is not a substitute for legal text.  Therefore they cannot expect us to take them as proof public services will be protected in TTIP.

What we would need to see to prove beyond doubt public services are protected is to see a TTIP text where  a complete carve out for public services is written in in what is called a ‘positive list’ .  This is where you only list the services you want to open up to be bound by the market access and competitive conditions of the treaty. 

Of course this would also entail us having access complete access to the TTIP negotiating texts which we don’t at the moment. The US negotiators are keeping there texts secret while EU negotiators have only shared a select number of texts.  

Rather than being told ‘trust us’ by the government, we need to be able to check the negotiating text ourselves – and negotiators need to listen to concerns that civil society raises about them.

  1. Major threats posed by ISDS and ISDS-lite

Protecting public services also requires a clear statement in the TTIP text that investors are not able to challenge any regulation around public services. 

And what we want to make sure there is no mention of in the TTIP text is any form of ISDS. 

Unfortunately the government response says it supports the ISDS-lite, modified version of ISDS that EU Trade Commissioner Malmström proposed earlier in the year.  

The TUC has condemned ISDS-lite as it continues to provide privileged rights for investors to make claims against government policies that threaten their profits.

Despite unions opposition and that of a significant number of MEPs, including the European Socialists and Democrats Party, the European Commission plans to carry on with its proposals to promote ISDS-lite this autumn  (when the next round of TTIP negotiations take place) as Labour MEP Judith Kirton Darling blogged on Touchstone recently.

We will need to step up the campaign against any version of ISDS in trade agreements – including the EU-Canada trade agreement which will come to the European Parliament much sooner than TTIP, possibly by June 2016.

By failing to engage with the important concerns the BIS Select Committee report was right to raise on  TTIP, the government’s response looks bizarrely out of touch with growing concern across Europe.  

They need to have a better response to unions, civil society and their fellow EU governments  that are calling for  trade to be in the public interest, rather than for private profit.