Agreement subverts democracy

By PAUL GOULTER*

Does Gats raise genuine concerns for New Zealanders? The Council of Trade Unions (CTU) certainly believes so, and is concerned about both the substance of Gats and the lack of time for effective consultation.

The CTU is very concerned at the impact Gats will have on developing countries. The grand tradeoff is that, in return for opening up their services markets to the developed world, developing countries will receive increased access to the commodities markets, including agriculture, of the developed world.

Developing countries quite rightly ask why they should open up their services to trade disciplines when those services, such as education, are fundamental to their development.

For development reasons they need the right to support their own services however they see fit. They also say that developed countries have not fulfilled their end of the bargain, in particular by increasing agriculture access.

The CTU believes that certain services should not be subject to trade agreements: education, core public services and water supply are not commodities to be traded as if they were goods.

These services are often designed to meet non-economic objectives, such as social and environmental goals.

Opening them to the Gats disciplines confounds a government's ability to regulate and support progress on these goals, because trade interests dominate.

We want to see New Zealand expressly exclude these areas from commitments.

Our Government's inability to make progress on its policy commitments on local content in the media provides a good example of the far-reaching, non-democratic impact of Gats.

A perfectly sensible and legitimate goal, widely accepted within New Zealand, cannot be implemented because the previous Government entered into Gats commitments that prevent quotas.

To that degree Gats is undemocratic: it prevents future governments implementing policies that may have been the reason they were elected. If they withdraw the previous commitment they face claims for compensation by other states.

Gats, far more than any other trade treaty, reaches into legitimate areas of domestic policy and government activity. Its implications are still being worked out, a point made by Renato Ruggerio, a previous Director-General of the WTO.

The Government claims that Gats retains governments' rights to regulate in their own interests.

But closer investigation reveals otherwise. Such a right is limited to services that are supplied neither on a commercial basis nor in competition with one or more service suppliers.

In a mixed economy it is almost impossible to find a government service that fits within that definition.

The CTU has asked the Government what services are actually covered by that exemption - after all, if the Government is negotiating Gats it is fair to assume it would at least know just what is covered. We are still waiting for the answer.

A summary of the Gats requests made of New Zealand and the 10 principles that will guide our negotiating position have been published. We welcome this, in contrast to the secrecy of the past.

However, the Government is committed to submitting its offers by March 31, leaving very little opportunity for effective consultation.

The CTU is asking the Government to delay submitting its offers so there can be effective consultation. This means putting back the March 31 date.

Little harm will be done to our negotiating position and it would be consistent with the Government's commitment to effective consultation.

Meanwhile the Gats negotiations are under way.

New Zealanders should be concerned at the far-reaching implications and join the CTU in asking the Government to allow effective consultation and to protect its right to govern in the interests of all the country, not just business.

* Paul Goulter is secretary of the Council of Trade Unions.