Protecting the NHS from TTIP

By shalondon, Aug 28 2014 11:28PM

House of Commons July 21st 2014.
Published at http://sochealthlondon.com/blog/4584293153

Socialist Health Assoc London with the Labour Movement in the EU

We are aware that TTIP is still in the midst of vital negotiations and we hope this paper will prove helpful in highlighting some of the key concerns with respect to its potential detrimental impact on the NHS if measures are not taken to protect it.

There was great concern about the cloak of secrecy surrounding negotiations.

Thanks to a leak in March there has been an opportunity for feedback on some clauses, but the fact that even the Shadow Secretary of State for Health has found himself blocked from establishing the detail of up to date information on the EU papers, was viewed by the meeting as a serious indictment of the system, especially given the serious implications of the legislation on the national health economy if it goes through.

This criticism is not to be taken as an indication of hostility to the EU, but the culture of secrecy does the institution no favours at a time when it is experiencing an unprecedented level of criticism. It is ironic that information on a topic which is focused on free trade is not freely available.

TTIP proposes Free Trade between the EU and the US in the name of multilateral economic growth, however it is highly questionable as to the relative benefits

CORE CONCERNS

- Barriers will no longer apply with respect to the public sector

- US will never agree uniform health and safety standards

- Danger of the UK being sued by a disgruntled company or group of companies.

The implications for damage to the Exchequer and the health economy are obvious.

- How can we agree in principle to an unseen document involving secret negotiations?

 

Overall, the meeting was opposed to TTIP per se, for the following reasons:

1.Trade agreements, which are often represented as ‘pushing back red tape’ - a negative way of describing legislation which has in the main been introduced to protect the wellbeing of individuals, can be defined as instruments of multinational corporations, which free up the market and tend to have a negative impact on public services.

2.TTIP will make it much more difficult for the relative governments to regulate markets

3.It was reported by the MEP present that a decision has been taken to include this with the Lisbon Treaty if it is accepted.

4.Although it is estimated to have potential to generate an additional £4billion to the economy, it is not clear on what this calculation is based, nor who exactly will benefit ie. multinationals who avoid paying taxes or struggling families/small businesses

5.In particular, strong opposition to the inclusion of the NHS was voiced.

 

A FOCUS ON THE NHS

How far will TTIP impact on the repeal of the Health and Social Care Act and for which there is a stated commitment to introduce into the first Queens Speech of any new Labour government, along with full exemption from TTIP. The Efford Bill which is to be debated in November 2014 is the first step in this process.

Shadow Secretary of State for Health, Andy Burnham MP stated :

‘We need to give the green light to collaboration, working across traditional divides without tendering

The real threat is the Health & Social Care Act which , but if an aggressively pro competition government is in power then the NHS could not withstand conditions which would accelerate its break up.

We also have to ensure that TTIP holds no threat to the policy agenda for the NHS

Were the NHS to be insufficiently protected then it will be left at the mercy of both TTIP and any government not sympathetic to the principles of the NHS. In this circumstance it is unlikely to survive.

Nobody gave the current government permission to sell off the NHS and they have specifically stated they are ‘not persuaded to exclude health services from TTIP’

 

However in the Commissioner’s judgement, ‘Centre Right Neo Liberal marketising governments in the EU are a threat’.

It is clear that the market is not the answer to Century 21 society’s health needs.

The NHS repeatedly scores top on cost and efficiency and is one of two countries ( the other is Italy) where less than 10% GDP is allocated to health spend.

 

The planned nature of delivery makes for increasing efficiency. The market takes this away, losing the ability to plan because ‘the cards’ are all held by the market.

- Inflationary pressures

- Duplication

- Inability to control costs

- Affects quality

 

Before he retired, David Nicholson told the Health Select Committee

‘the NHS is bogged down in a morass of Competition Law’ ( which was brought in to this extent by the Health & Social Care Act ).

A key example is the failure to merge Poole and Bournemouth Hospital Trusts which would have been to the advantage of the local population, as a direct result of a challenge using Competition Law – ironically stating that such a merger was ‘anti competitive’.

The current route to reform through contractual market oriented arrangements is not compatible with the preferred preventative approach, especially with respect to social care and public health. Instead we need a focus on a rejection of the market and a focus on the counter argument to privatisation where whole person care is the primary objective.

NHS as the preferred provider is thus ‘the enabler’ and a model which turns the tide against the current contractual/tendering approach under the Health & Social Care Act.

 

‘The public NHS should be the preferred provider of services with no threat to the NHS from EU treaties and provisions’

 

RISK

The NHS is a £100bn business at the heart of the UK which TTIP would definitely leave the service open to any kind of challenge from private profiteers who have little or no focus on the interests of patients let alone the general population.

Section 75 could offer a means for predatory US companies to apply pressure for a greater number of contracts – given the means for legal challenges which this piece of legislation offers.

TTIP is a problem because it is in essence a deep reflection of health policy in our time under the Coalition. If it becomes applicable to health in the UK it applies ‘rocket boosters to the Health & Social Care Act’.

 

There are particular concerns about ISDS:

- One example being Chevron suing Ecuadorian Govt in order to avoid what should be their legally obliged responsibility to clearing toxic waste.

- Loss of 1 million small businesses in Mexico with additional loss of one million jobs

- Health and Safety standards under attack

- Potential for the US health and health insurance industries to exploit NHS

The UK has a reputation for being ISDS-keen to a greater or lesser extent dependent upon which party is in power. NHS at the mercy of ISDS would be high risk to the well-being of the UK.

 

There is disagreement between those who support and those who oppose as to the degree which there are safeguards concerning the right to regulate.

An LSE Enterprise survey on ISDS ( Lauge, Kovgaard and Poulsen - April 2013) illustrated examples such as the Canadian experience where a key matter did not proceed through the national courts and there was no right of appeal.

 

Of additional note – the following demonstrated the worth of negotiating on behalf of nation state interest : ( whilst ) the US did agree to remove ISDS from the investment chapter of its 2004 FTA with Australia—at Australia’s request—we understand that several stakeholders in the EU and the US desire comprehensive ISDS

Those stakeholders who favour the widest interpretation of ISDS may have the following priorities in mind :

If a foreign investor routes its investment from the ‘home’ state to the ‘host’ state via a subsidiary incorporated in a third state (perhaps for tax purposes) this investment would show up twice in FDI data, both as an investment of the home state in the third state and as an investment of the third state in the host state. It would not, however, show up in FDI data as an investment from the home state in the host state, making it difficult to determine how much FDI in a host state is indirectly owned by investors of the home state. This is an important point, since it would seem that a significant amount of both UK and US investment is routed through third states, such as the Cayman Islands.

 

This conclusion regarding ISDS is of particular note :

‘we conclude that an EU-US investment treaty that does contain ISDS is likely to have few or no benefits to the UK, while having meaningful economic and political costs. Removing ISDS from the treaty would be unlikely to have an appreciable impact on the (already negligible) benefits of a treaty with ISDS, while largely removing the costs of the treaty to the UK.’

The overall lack of open negotiation and planning is clearly not designed to inspire confidence

 

PROTECTION

Statements from the European Parliament indicate support for the principle of protection for the NHS and include :

Mary Honeyball MEP

‘There is a general view in the EU that the NHS is good value and must be protected’

 

Karel de Gucht, Commissioner for Trade

‘the NHS will be protected and will not be part of the deal’

 

Ignacio Garcia Bercero, TTIP Chief Negotiator

‘although health services are within the scope of these agreements and ongoing negotiations, we are confident that the rights of EU member states to manage their health systems according to their various needs can be fully safeguarded……

The GATS and all EU free trade agreements contain a specific safeguard ( GATS 1:3b) which exempts all services supplied in the exercise of governmental authority’

 

In addition, the 2014 Labour Party NPF document states that

‘we believe that the NHS and public services should not be included in any TTIP agreement’.

 

KEY QUESTION : How might services be protected from ISDS and TTIP in the face of governments who are pro competition and pro market should they be ratified?

 

KEY RECOMMENDATIONS

1.The parties of the left must guard against the danger of Neo Liberal governments and also the more extreme groups who have now gained a foothold in the European Parliament

2.The position adopted should be one where it is a non negotiable that the NHS should be protected from TTIP

3.Please apply the maximum pressure to ensure that full exclusion is the case

4.Other treaties already exempt services and there is the potential to add more within TTIP

5.We would recommend a broad exemption of all public services – particularly health, justice and education.

6.Based upon the LSE study and other examples we see that it is essential to include national safeguards – preferably discarding TTIP altogether, but at the least identifying national priorities which should be rigorously applied

7.We recommend taking out ISDS completely – especially in view of US corporate strength and the potential imbalance in the relationship with countries such as the UK and EU countries

8. Given the impact of austerity it should be a priority to protect jobs and services

9.The UK Parliament – and others, should have access to the necessary information at all points of the process.

10.Please be vigilant to ensure the closure of detrimental loopholes

11.Advice from a QC on the matter of preferred provider is that it is legal under EU law to use the language of NHS arrangements as oppose to contract law – which will protect the ethos of NHS. This is a key point of reference for protection.

12.Should this legislation proceed, there needs to be the option to reserve the right to opt out at some future point

 

This was the considered and collective view of the meeting, attended by 52 members and other interested individuals.

 

With thanks to panelists –

Secretary of State for Health, Andy Burnham MP

Mary Honeyball MEP

Bert Schouwenburg, Internal Officer GMB

 

Chaired, David Schoibl, Labour Movement in Europe



Jos Bell

Chair, Socialist Health Assoc London

August 2014

NoTTIP European Day of Action Rally in Parliament Square at 2pm on Sat 11th October

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NoTTIP European Day of Action Rally in Parliament Square 2pm Sat 11th October

TTIP: EU ombudsman opens public consultation on 19th September 2014

The European Ombudsman, advice Emma O'Reilly, has opened on Friday 19th September a public consultation about the Transatlantic Trade and Investment Partnership over fears that the negotiations, which will have an important impact on the lives of EU citizens, lack transparency. She said: “Concerns have been raised about key documents not being disclosed, about delays, and about the alleged granting of privileged access to TTIP [Transatlantic Trade and Investment Package] documents to certain stakeholders.”


In December 2013 200 civil society groups wrote to the EU Trade Commissioner, Karel de Gucht and the USA Trade Representative Michael Froman calling on them to remove the clauses on financial penalties, the Investor-State Dispute Settlement mechanism, which rides roughshod over national laws and imposed swinging penalties for "lost profits".

On 29th July Ms O'Reilly opened an action for "maladministration" against the European Union alleging lack of transparency and public participation.

But Ms O'Reilly should explain to the public why she has done this. SHE knows the issues, but the public DON'T.

The issues are explained by Corporate Europe Observatory (http://corporateeurope.org/international-trade/2014/04/still-not-loving-isds-10-reasons-oppose-investors-super-rights-eu-trade and http://corporateeurope.org/international-trade/2014/07/ttip-debunking-business-propaganda-over-investor-rights)

For a brief summary see John Hillary’s “The Transatlantic Trade and Investment Partnership – a charter for deregulation, an attack on jobs, an end to democracy” (http://rosalux.gr/sites/default/files/publications/ttip_web.pdf). The last is the horrific consequence of the proposed “regulatory co-operation council” (http://corporateeurope.org/trade/2013/12/regulation-none-our-business).

Let the multinational corporations make their case: tell us your side NOW.

If not, we will draw our own conclusions about the secrecy of the negotiations, the sweeping “Top-down” legal approach and the presumption that democratic laws and regulations of elected governments, designed to protect the public interest, are “barriers” to trade: this is a fundamental misconception of the role of government (The Really Good Friends of Transnational Corporations Agreement – TISA. See http://www.epsu.org/IMG/pdf/Report_TISA_ENG_LR2.pdf)

 

The public consultation is a "box for e-mail submissions" at the European Ombudsman's website. There is no need to write a long response. Why not copy and paste my paragraph just above? And add in bold "No ISDS". The advertised deadline for submissions is 31st October 2014.

Thank you.

 

EU-TIPP negotiations: background and update

The latest round in trade negotiations between the European Union and the US, advice called the "Transatlantic Trade Investment Partnership" or TIPP, try started in March 2014. Later this year, medicine possibly as early as July, they will be sealed with a treaty which will be a permanent set-back to hopes to reverse the privatisation of the NHS. It will be impossible to change this legal framework just because of its status as an international treaty. Please consult the "Keep Our NHS Public" (KONP) position paper and leaflet.

There is also a useful "Occupy London" page called "what are the likely consequences of the TTIP trade deal?", which contains a link to a YouTube video where Pia Eberhardt, a lawyer for "Corporate Europe Observatory", highlights two legal flaws: equitable (even-handed) access to justice and judicial independence (impartiality) do not exist in the proposed ISDS (Investor to States Disputes Settlement) mechanism.

The EU Trade Commission present on their website the issues of trade policy raised in the TTIP negotiations with the US .


There is a "public consultation", which I invite you to complete. It comes with a warning that you have to complete the questionnaire within 90 minutes or the session will automatically be ended. The consultation was launched on 28th March 2014 and will close 90 days after the publication of the reference materials in all languages a few days later, i.e. about end June. I have tried answering the questions, but I think that if you read the above brief campaign materials and confine your replies to bullet points about the effects on NHS you will have done a good job!

Please note that these negotiations, which are not public, are the latest round in a series of transatlantic trade negotiations which have seen the balance of power tilt inexorably in favour of large multinational companies. A tobacco company is even suing the Australian Government for loss of profit from having to sell its cigarettes in plain packaging in that country. Outrageous!

 

Update on 30th June 2014:

I have finally completed the questionnaire (12 specific questions plus q.13, a general "comments" box). To all the 12 questions I answered "No Investor-State Dispute Settlement - see question 13".

Question 13:

In December 2013 a group of 177 civic societies worldwide, mostly from either side of the Atlantic including Keep Our NHS Public and Patients4NHS in the UK, wrote a letter to Mr Froman, the US Trade Representative and to Mr de Gucht, the EU Commissioner for Trade. In it they expressed their opposition to the inclusion of investor-state dispute settlement (ISDS) in the Trans-Atlantic Trade and Investment Partnership (TTIP).

 

I can do no better that to copy and paste below their succinct and elegant presentation of the strong arguments against ISDS.

ISDS grants foreign corporations the right to go before private trade tribunals and directly challenge government policies and actions that corporations allege reduce the value of their investments. Even if a new policy applies equally to domestic and foreign investors, ISDS allows foreign corporations to demand compensation for the absence of a ‘predictable regulatory environment’.

In recent years, the use of ISDS to challenge a diverse array of government policies has expanded dramatically. Inclusion of ISDS in free trade agreements and bilateral investment treaties has allowed corporations to file over 500 cases against 95 governments. Many of these cases directly attack public interest and environmental policies. For the following reasons, we strongly urge you to exclude ISDS from TTIP:

 

(1) ISDS forces governments to use taxpayer funds to compensate corporations for public health, environmental, labour and other public interest policies and government actions:

ISDS has been used to attack clean energy, mining, land use, health, labour, and other public interest policies. In fact, of the more than $14 billion in the 16 claims now pending under just U.S. free trade agreements, all relate to environmental, energy, financial regulation, public health, land use and transportation policies not traditional trade issues.

Increasingly, corporations are using ISDS to challenge non- discriminatory government measures. For example, EU investors have attacked Egypt’s minimum-wage increase, and a U.S. corporation has attacked the Peruvian government’s decision to regulate toxic waste and close a dangerously polluting smelter under deals with ISDS. In one of the most notorious cases, U.S. tobacco giant Philip Morris launched investor-state cases challenging anti-smoking laws in Uruguay and Australia after failing to undermine the health laws in domestic courts. Particularly because of the significant number of cross-registered companies in the United States and the EU, the number of ISDS attacks on public interest policies is likely to increase dramatically if TTIP includes ISDS. Governments must have the flexibility to put in place public interest policies without fear of trade litigation launched by corporations. ISDS is an abhorrent proposal.

 

(2) ISDS undermines democratic decision-making:

ISDS grants foreign corporations the right to directly challenge government policies and actions in private tribunals, bypassing domestic courts and creating a new legal system that is exclusively available to foreign investors and multinational corporations. ISDS also offers corporations a venue through which to challenge domestic court decisions, further undermining domestic decision-making. In short, ISDS is a one-way street by which corporations can challenge government policies, but neither governments nor individuals are granted any comparable rights to hold corporations accountable. ISDS is an abhorrent proposal.

 

(3) European and U.S. legal systems are capable of handling investment disputes:

The United States and the EU have very strong domestic court systems and property rights protections. Inclusion of ISDS in TTIP would only provide to corporations a new means to attack domestic policies deemed permissible by domestic courts. A state-to-state dispute settlement system is more than sufficient to handle investment disputes in TTIP.

 

These and the particular concern of “SOH” to keep flexible and PUBLIC hospitals inside our PUBLIC National Health Service in the UK underscore why we are opposed to including investor-state mechanism in TTIP. We call on you to exclude the proposed investor-state dispute settlement from the agreement.