This Would Be The Real Price Of A Trade Deal With Donald Trump

Jon Ashworth

MPs are debating fears the NHS will be sold off in an US trade deal following Donald Trump’s recent visit. While a range of voices lined up to declare “the NHS is not for sale”, the reality is more complex, and with Boris Johnson likely to be crowned Tory Prime Minister, the moment is fast approaching when the UK could enter into its own trade negotiations with dangerous implications for the NHS. 

Trade deals, from the World Trade Organisation (WTO) to Free Trade Agreements (FTAs), are no longer limited to setting rules about how goods cross borders. They reach into almost every area of everyday life, including the way that we run our health services. While there are exemptions in trade deals, the problem is that they are often very narrow. For example, under the WTO, public services can only be excluded where there is either no competition with a private provider or where they are not ‘run for profit’. Following the Tory Health and Social Care Act, the enforced competitive tendering of contracts means private health providers already operate ‘in competition’ with public NHS providers. Meanwhile some services, like dentistry, charge fees and therefore could be considered to be run ‘for profit’. This means that significant parts of the NHS do indeed come under WTO services provisions and as such would be used as baseline in FTAs as well.

Some argue that it matters little what is covered by trade deals because the UK has liberalised its health service anyway. Indeed, US firms already provide health services such as the private equity owned Priory Group. But crucially a trade deal with the US or any other country locks this model in. So-called ‘standstill’ and ‘ratchet’ clauses mean a nation commits to maintaining levels of liberalisation the same as at the time the agreement is signed and that any future liberalisation is also locked in. This makes the reversal of privatisation difficult, if not impossible, potentially binding the hands of future governments.

To make matters worse, the US is likely to insist all services are included unless we specifically exempt them – called a ‘negative listing’ approach. This means that UK negotiators would need to have detailed and expert knowledge of all aspects of the health service, as well as all the ways in which trade deals can impact them, in order to ensure they were properly exempted. To illustrate how difficult this is, when countries first listed their services sectors at the WTO, more than 1,400 commitments of 7,040 were later found to have been listed in error, including by the US, which has one of the largest and most experienced negotiating teams in the world.

Trade negotiators would have to pay particular attention not just to specific services chapters, but also to provisions that allow private international investors to sue governments if they think a policy negatively impacts on their investment. This could seriously threaten attempts to reverse privatisation. Governments are already facing challenges for their health policies: healthcare company Achmea sued the Slovakian government when they tried to reverse a decision to privatise health insurance; pharmaceutical company, Eli Lilly sued Canada for rejecting the patents for two drugs and tobacco giant Philip Morris sued Australia for introducing plain cigarette packaging laws. A government-commissioned study warned of the dangers of this provision for the UK in the context of the EU-US deal (TTIP), yet Liam Fox continues to argue for it to be included.

The horror show doesn’t end there. The US is very clearly eyeing up the way that the NHS buys medicines. Trump has tried to present this as an issue of fair pricing for US patients, but in reality wants the NHS to be forced to pay more for drugs. US pharmaceutical companies have long-complained that mechanisms to keep drug prices affordable for the NHS - such as the National Institute for Health and Care Excellence (NICE) - are a barrier for their high-priced drugs. Weakening these price control mechanisms is a core demand of the powerful US pharmaceutical lobby group, Pharmaceutical Research and Manufacturers of America (PhRMA). They argue that such mechanisms “artificially depress the market value of US innovative medicines” and call on the US government to use a trade deal with the UK to pry open the door for their expensive drugs.

The list of areas that impact on the NHS doesn’t end there. The NHS hold some of the most comprehensive data sets in the world, it’s no surprise US tech firms would be very keen to get their hands on it and store it on US servers. Notwithstanding the obvious questions around data protection, US tech firms will use NHS data to develop new sophisticated medical tools and apps and then attempt to sell them on to the NHS.

The future of our NHS as we know it really is at stake and so the fight to protect the NHS must go beyond rhetoric. In any trade deal we need a watertight exclusion for the NHS. After all, no deal is worth trading-in our NHS for. 

Jonathan Ashworth is the shadow health and social care secretary

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