Handing every tariff decision to ministers has made trade policy less stable, not more.
Seven years ago the Assembly voted, with little debate and less fuss, to let ministers set and change tariffs by order rather than by legislation. The argument at the time was speed. Trade disputes moved quickly, we were told, and a parliament of 61 members where no party holds more than 24 seats could not be expected to keep up. Give ministers the power, and they would respond nimbly to whatever the world threw at us.
I supported that change. I now think it was a mistake, and I believe the Assembly should take most of those powers back. The case for delegation rested on a promise of stability: a firm hand on the tiller, decisions made by people with the expertise and the information to make them well. What we have actually had is the opposite. Since the powers were handed over, ministers have issued 43 tariff orders. Eleven of them reversed or substantially amended an order made less than a year earlier. Three were reversed within three months. For a business in the valley trying to decide whether to invest in a new production line, that is not nimbleness. It is noise.
Why ministers make worse trade policy alone
The problem is not that ministers are foolish. It is that the incentives facing a single minister are different from those facing a parliament. A minister under pressure from a single loud industry, or looking for a quick gesture in a diplomatic row, can raise a duty overnight. Nobody has to be persuaded. Nobody has to vote. When the costs show up months later, in higher prices or in retaliation against our exporters, the minister has often moved on.
A parliamentary process forces trade-offs into the open. If raising a duty on imported steel will help one foundry in Ardle but hurt every valve-maker and fabricator in the valley, that argument would be made on the floor of the chamber, by members who represent both. The two independents from the hill towns, whose farmers have twice been caught in retaliatory duties on lamb, would have a vote. They currently have a press release.
There is also a democratic point. Tariffs are taxes. They raise money from households and businesses just as surely as income tax or duty on fuel. We would never accept a system in which ministers could raise income tax by order whenever they saw fit. It is odd that we have accepted precisely that for taxes on imports.
The objection, and the answer
The strongest argument against my position is the one that won the vote seven years ago: speed. Sometimes, defenders of the current system say, a government must act within days – to respond to dumping, to a sudden surge of imports, or to retaliation abroad. A parliament that needs weeks to agree anything would leave us exposed.
That is a fair concern, and it can be met without leaving the whole power with ministers. Several parliaments manage this with a simple rule: ministers may impose temporary duties by order in an emergency, but those orders lapse after ninety days unless the Assembly approves them. Permanent changes to the tariff schedule require a vote. That arrangement preserves the ability to act fast while ensuring that anything lasting is debated and agreed.
Others will say that a fragmented Assembly will simply fail to agree, leaving trade policy frozen. I am less worried. Frozen tariff policy would be a considerable improvement on the churn of the last few years, and in practice cross-party coalitions on trade have proved easier to build than on almost anything else. Members from every group represent exporters and importers alike.
What the Assembly should do
A private member’s bill to restore parliamentary approval for permanent tariff changes is due for its second reading next month. It is imperfect: it should include a clearer emergency procedure and a requirement for ministers to publish an assessment of who will bear the cost of each proposed duty. Those are amendments, not reasons to oppose it.
The Assembly gave this power away because it doubted its own ability to use it well. Seven years on, the evidence suggests that ministers acting alone have not used it well either. Stability in trade policy will not come from concentrating decisions in fewer hands. It will come from making those decisions harder to take lightly. Members should want their trade powers back, and they should vote for the bill.
