Select committee: Welsh Affairs Committee

One-off session on the implications for Wales of the UK/AUS FTA

Closed Opened 6 Jul 2021 Closed 29 Nov 2021 9 recommendations 2 conclusions
Inquiry scope (the committee's words)
The Welsh Affairs Committee is holding a one-off session to look at the implications for Wales of the UK/AUS Free Trade Agreement.

Where it stands

The inquiry is closed, opened 6 July 2021.

The committee has published 1 report, most recently Third Report - Implications of the UK-Australia FTA for Wales on 4 August 2021.

The government's response

Published 25 November 2021. The deadline was 4 October 2021.

Summary written by Accountability Index from the government's response. It is not the government's own words.

The government's response sets out existing engagement and publication arrangements for most recommendations, says it will publish its response to the Trade and Agriculture Commission report "as soon as it is ready", and commits to no new Wales-specific impact assessment.

  • On Welsh Government access to draft treaty text, it says it has "committed–and delivered on the commitment–to sharing FTA draft treaty text with the devolved administrations prior to any signature".
  • On a Wales-specific impact assessment, it states only that DIT publishes scoping and impact assessments at the launch and conclusion of FTA negotiations, which provide analysis of potential impacts on the nations and regions of the UK.
  • On agricultural safeguards in years 11 to 15, it describes product specific safeguards for beef and sheep meat, with a 20% safeguard duty if volume thresholds are exceeded, plus a general bilateral safeguard mechanism.
  • On the Trade and Agriculture Commission, it says its advice "will be published to inform Parliamentarians" before ratification, and on Agriculture and Food Counsellors says "We aim to expand their number", without stating a date.

Read the government's response ↗ Report an error

Recommendations and conclusions

All 11 recommendations and conclusions

Reports

All reports

Evidence

  • 2 oral evidence sessionsLatest 22 July 2021
  • 6 witnesses
All evidence

Recent activity

Recommendations and conclusions 11 shown

Recommendation 1

Recommendation · Third Report - Implications of the UK-Australia FTA for Wales · Addressed to Wales Office

Recommended (the committee's words)
We are satisfied that the UK Government has sufficiently engaged with the Welsh Government during the consultation phase for the UK-Australia free trade agreement. However, given that trade agreements overlap with areas of devolved competence, we suggest that the Welsh Government should have access to the draft treaty text prior to publication. This would enable the Welsh Government to provide feedback on regional and local impacts to inform the UK Government’s impact assessment and to produce its own impact assessment.

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Recommendation 2

Recommendation · Third Report - Implications of the UK-Australia FTA for Wales · Addressed to Wales Office

Recommended (the committee's words)
We welcome the UK Government’s commitment to including the impact on Wales in the impact assessment for the UK-Australia FTA. However, we reiterate our previous recommendation that the UK Government should publish a Wales-specific impact assessment for free trade agreements (FTAs), including the UK-Australia FTA. This should provide more detail than the impact assessment for the UK-Japan Comprehensive Economic Partnership Agreement (CEPA) did, and include short- term impacts and impacts by sector in Wales.

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Recommendation 3

Recommendation · Third Report - Implications of the UK-Australia FTA for Wales · Addressed to Wales Office

Recommended (the committee's words)
We are alert to the concerns of Welsh farmers that the gradual removal of tariffs on Australian beef and lamb potentially poses a competitive threat. However, this is unlikely to manifest in the short term, and it is far from certain that the UK will be flooded with Australian beef and lamb imports in the longer-term. The UK Government should clarify, in the explanatory memorandum accompanying the final treaty text, what conditions would need to be met for agricultural safeguards to be applied in years 10–15 after the agreement comes into force. In response to this report, the UK Government should also explain how it intends to work with the Welsh Government to ensure that its wider trade strategy is coherent with ambitions to make farming more productive and sustainable.

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Recommendation 4

Recommendation · Third Report - Implications of the UK-Australia FTA for Wales · Addressed to Wales Office

Recommended (the committee's words)
The UK Government should respond to the report of the first Trade and Agriculture Commission.

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Recommendation 5

Recommendation · Third Report - Implications of the UK-Australia FTA for Wales · Addressed to Wales Office

Recommended (the committee's words)
We are concerned that the statutory Trade and Agriculture Commission (TAC) is not yet operational and we urge the UK Government to set up the TAC as soon as possible. The UK Government intends to allow the TAC to scrutinise the final text of the UK-Australia free trade agreement (FTA), but this may occur too late to enable effective Parliamentary scrutiny of the agreement. To improve scrutiny of future FTAs, the TAC’s report should be published alongside the final text, impact assessment and explanatory memorandum.

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Recommendation 6

Recommendation · Third Report - Implications of the UK-Australia FTA for Wales · Addressed to Wales Office

Recommended (the committee's words)
On establishing the statutory TAC, the UK Government should publish a statement clearly outlining the role of the TAC and the role that the TAC will play in feeding into Parliamentary scrutiny of FTAs.

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Recommendation 7

Recommendation · Third Report - Implications of the UK-Australia FTA for Wales · Addressed to Wales Office

Recommended (the committee's words)
The TAC must include at least one member who understands and has direct experience of the agricultural and regulatory landscape of Wales.

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Recommendation 8

Recommendation · Third Report - Implications of the UK-Australia FTA for Wales · Addressed to Wales Office

Recommended (the committee's words)
Free trade agreements offer opportunities for Welsh businesses to export and we welcome that the UK-Australia FTA will result in the removal of tariffs for British exports. However, in order to maximise opportunities for Welsh farmers to export their goods and access new markets, the UK should significantly increase the number of Agriculture and Food Counsellors based overseas, particularly in the Asia-Pacific and Middle East regions.

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Conclusion 9

Conclusion · Third Report - Implications of the UK-Australia FTA for Wales · Addressed to Wales Office

Concluded (the committee's words)
We welcome the commitments to new mobility arrangements that will make it easier for Welsh people to travel to and work in Australia.

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Recommendation 10

Recommendation · Third Report - Implications of the UK-Australia FTA for Wales · Addressed to Wales Office

Recommended (the committee's words)
We welcome the Agreement in Principle reached between the UK and Australian governments and await the final text of the free trade agreement (FTA). However, while the UK-Australia FTA is unlikely to have a significant impact on Wales in the short term, we are conscious of the concerns that exist within the Welsh agri- food sector. Farm businesses are already facing some uncertainty in the transition away from the EU system of farm payments and the changing trade environment. The UK Government and Welsh Government must work with the agri-food sector to ensure that UK producers have the skills and support needed to thrive in a new global trading environment.

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Conclusion 11

Conclusion · Third Report - Implications of the UK-Australia FTA for Wales · Addressed to Wales Office

Concluded (the committee's words)
We welcome the UK Government’s commitment to allow three months for parliamentary scrutiny between the publication of the final text of the agreement and laying the text before the House. We will continue to scrutinise the impacts of this and other FTAs on Wales.

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Reports

1 report

Oral evidence sessions

2 sessions

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Date Session and witnesses Source
22 Jul 2021
Oral evidence
Rt Hon Greg Hands MP · Department for Business, Energy & Industrial Strategy
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15 Jul 2021
Oral evidence
David Swales · Agriculture and Horticulture Development Board, Dmitry Grozoubinski · Geneva Trade Forum, Dr Nick Fenwick · Farmers Union of Wales, John Davies · National Farmers Union Cymru, Sam Lowe · Centre for European Reform
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Who gave evidence

6 witnesses

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WitnessOrganisationSessions
David Swales · Head of Strategic Insight Agriculture and Horticulture Development Board 1
Dmitry Grozoubinski · Executive Director Geneva Trade Forum 1
Dr Nick Fenwick · Head of Policy Farmers Union of Wales 1
John Davies · President National Farmers Union Cymru 1
Rt Hon Greg Hands MP · Minister of State Department for Business, Energy & Industrial Strategy 1
Sam Lowe · Senior Research Fellow Centre for European Reform 1