Former Conservative environment secretary George Eustice on Monday admitted that the UK’s post-Brexit trade deal with Australia was “not actually a very good deal” for Britain.
Eustice, who led the Department for Environment, Food and Rural Affairs between 2020 and 2022, said the UK-Australia Free Trade Agreement, signed in December 2021, “gave away far too much for far too little in return”.
The deal was regarded as the first “from scratch” agreement following the UK’s departure from the EU in 2016 and was hailed as a “landmark moment” by then international trade secretary Anne-Marie Trevelyan last year.
Proposals in the agreement included removing tariffs on UK exports, which the government said would unlock £10.4bn of additional trade and expanded access to labour markets through the lifting of some visa requirements. The deal was also pitched as a gateway to the UK joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
However, speaking in a parliamentary debate on Australia and New Zealand trade deals in the House of Commons, Eustice — now a backbench MP — argued that while there were some positive aspects of the deal such as the “special agricultural safeguard for years 10 to 15”, overall the deal did not benefit the UK.
“Unless we recognise the failures that the Department for International Trade made during the Australia negotiations, we won’t be able to learn the lessons of future negotiations,” Eustice told MPs.
Eustice offered harsh criticism of former prime minister Liz Truss, who served as trade secretary between 2019 and 2021, arguing that her desire to set “arbitrary targets” placed the UK in a worse negotiating position.
“The UK went into this negotiation holding the strongest hand, holding all of the best cards, but at some point in early summer 2021, the then trade secretary [Truss] took a decision to set an arbitrary target to conclude heads of terms by the time of the G7 summit [held that year in Cornwall], and from that moment the UK was on the back foot repeatedly,” he said.
“In fact, at one point the then trade secretary asked her opposite number from Australia what he would need in order to be able to conclude an agreement by G7, and of course the Australian negotiator very kindly set out the Australian terms, which then shaped eventually the deal.”
Eustice also argued that Crawford Falconer, the interim permanent secretary of the Department for International Trade was “not fit for that position”.
“His approach always was to internalise Australian demands, often when they were against UK interests. His advice was invariably to retreat and make fresh concessions and all the while he resented people who understood technical issues greater than he did,” the MP for the rural seat of Camborne and Redruth said.
The UK agriculture sector has repeatedly warned that the deal would have a negative impact on farmers. Commenting in December 2021, Minette Batters, president of the National Farmers’ Union, described the deal as “one-sided”, adding that it would increase pressure on farmers already facing inflation and labour shortages.
Nick Thomas-Symonds, Labour’s shadow international trade secretary, said after Eustice’s attack on the Australian deal that the government’s trade policy was in utter disarray. “Even George Eustice, a cabinet member when the Australia trade deal was negotiated, has now agreed that ‘the UK gave away far too much for far too little in return’.
“On trade the Conservatives have no strategy and they are — badly — letting down the UK, which will cost jobs, investment and growth.”
Meanwhile, Michael Saunders, a former external member of the Bank of England’s rate-setting monetary policy committee, warned that the UK’s whole economy had “been permanently damaged by Brexit”.
In an interview with Bloomberg TV, Saunders argued that leaving the EU had reduced Britain’s potential output “significantly” as well as eroding business investment.
“If we hadn’t had Brexit, we probably wouldn’t be talking about an austerity Budget this week,” he said. “The need for tax rises and spending cuts wouldn’t be there if Brexit hadn’t reduced the economy’s potential output so much.”