North Warwickshire Borough Council Agenda Item No. 10 8 July 2002 World Trade Organisation's General Agreement on Trade in Services Report of the Chiref Executive 1. Summary 1.1 This report is to raise awareness and to express concern at the possible implications of the World Trade Organisation's - General Agreement on Trade in Services (GATS) on local authority powers and freedoms, and at the fact that the Government (DTI) has not consulted with local government on this matter. 2 Recommendation to the Board a) That the Authority write to the Minister of State for Trade and the Minister for Local Government: (i) to ask for further and formal opportunities to be consulted prior to any further GATS commitments being agreed; and (ii) to inform them of the authority's concerns about the possible impact of GATS on local authority freedoms in procurement, planning and other decision making. b) That the Council write to the LGA to ask them to consider the effects of GATS on the provision of local services and to lobby to protect local authority freedoms in procurement, planning and other decision making; and c) Write to both the MP and the MEP's to urge them to take up these concerns on behalf of the Authority. 3 Background 3.1 The World Trade Organisation (WTO) had for a number of years pursued a strong liberalsiing approach to world trade, advocating the removal of barriers to trade and competition in the belief that this provides the best possible chance for economic development and poverty eradication 3.2 The (WTO) is historically associated with freeing up trade in physical goods such as agricultural produce and manufacturing but has most recently turned its attention to trade in services which in developing economies constitutes a significant proportion of the GNP. 3.3 Services not include private sector activities such as finance, IT, accountancy and consulting, but also services more frequently found in the public sector, such as education, health and social care. There has been considerable concern that the current negotiations at the WTO may have far reaching consequences for local authorities in terms of powers and freedoms, particularly in respect of procurement, regulatory activities and land use planning. 3.4 Clarification is required ont he following key questions: Which services does the EU and UK Government intend to offer to open up as part of the GATS negotiation and what impact assessment has been done on this? Will addiitonal public services be required to open up to global private sector markets? What assessment has been done on the impacts of GATS on the planning system and on the UK and local sustainable development strategies? Does the government intend to involve or consult with Local Government in developing its approach to GATS? That a seminar be organised on GATS for members, officers and other interested parties. 4 Observation 4.1 Whilst considerable uncertainty surrounds the scale of the threat posed by GATS to local government powers and freedoms - a threat denied by national governments and made by European Commission negotiators - that there is reasonable cause for concern. However, local government has not been formally consulted on the implciations of GATS. 5 Report Implications 5.1 Financial Implications 5.1.1 None 5.2 Crime and Disorder Implications 5.2.1 None 5.3 Legal and Human Rights Implications 5.3.1 None 5.4 Sustainability Implications 5.4.1 None at this stage 5.5 Personel Implications 5.5.1 None 5.6 Porfolio Holder 5.6.1 The Porftolio Holder for Community Planning, Sustainability and Partnership (Councillor Sweet) has been consulted/ The Contact officer for this report is Julie Taylor (01827) 719437 ----------------------- The Council House, South Street, Atherstone, Warwickshire CV9 1BD Telephone (01827) 715341 Fax: (01827) 719225