UK Parliament / Open data

Trade (Australia and New Zealand) Bill

I hear exactly what the right hon. Gentleman says, and he is right to an extent. However, let us suppose I were to give him £1 this year and £1.50 next year, and ask him how his income from the Member for the hon. Member for Na h-Eileanan an Iar had changed. He could say that it had grown by a staggering 50%”, but it would have grown by only 50p. When you are starting with something very small and you say that the percentage is going to be very big as a result of the growth, you still have something very small at the end of it. We should bear that in mind.

I return to the point about the Brexit damage of 5% of GDP and the effect of this Australian trade deal, depending on which type of modelling we use. The first model gave us a 0.02% gain—that was on the Armington trade theory spectrum, which all members of the Committee know just like that. When we moved to the Melitz-style spectrum, we were given a figure of 0.08%, which represents growth of 400%. That is a fantastic bit of growth, but this was still only 0.08%. If Brexit is 5%, this is like saying, “I am losing £500 but the Australian trade deal is taking in £2, if I am using the pessimistic option, or £8, if I am using the optimistic option.” That still leaves the UK economy as a whole £498 to £492 out of pocket by this entire transaction. The joy and boosterism that comes from some parts of the former Government, at least, should be seen in that context. If we add in all the other trade deals—the American trade deal represents 0.2% of GDP, the New Zealand one that we are considering today represents about 0.1 % or 0.2% of GDP and the CPTPP represents about 0.08% of GDP—we might find ourselves up around the £40 mark. It is a bit like going to the races with £500 and coming back with 40 quid. That is basically what is happening here.

Type
Proceeding contribution
Reference
719 cc164-5 
Session
2022-23
Chamber / Committee
House of Commons chamber
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