Draft Medicines and Healthcare Products Regulatory Agency Trading Fund (Amendment) (EU Exit) Order 2018
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The Parliamentary Under-Secretary of State for Health and Social Care (Steve Brine)
I beg to move,
That the Committee has considered the draft Medicines and Healthcare Products Regulatory Agency Trading Fund (Amendment) (EU Exit) Order 2018.
It is a pleasure to see you in the Chair, Mr Bailey, and to see other Committee members present. I look forward to spending the rest of the day with them. [Laughter.] I do not see why that is funny.
The Medicines and Healthcare Products Regulatory Agency regulates medicines, medical devices and blood components in the UK on behalf of my right hon. Friend the Secretary of State for Health and Social Care. It is financed by a trading fund established by the Medicines and Healthcare Products Regulatory Agency Trading Fund Order 2003, which was made under the Government Trading Funds Act 1973. The Act introduced trading funds as a means of financing the revenue-generating operations of Departments, which had previously been financed through the Supply process. A trading fund operates outside that process and has standing authority to meet all outgoings from its receipts. Operations financed by a trading fund must be managed so that the fund’s revenue is sufficient to meet its expenditure on them.
Schedule 1 to the 2003 order sets out the MHRA’s funded operations—the operations that it can fund using the revenue that it generates from them. In places, the schedule identifies them with cross-references to specified EU legislation. The draft order’s primary purpose is to remove those cross-references prior to the UK’s withdrawal from the European Union, so that the MHRA trading fund remains fully operational after that time. We would not have detained the Committee today if that had not been necessary, but since it was, we have also taken the opportunity to set out the MHRA activities covered by the trading fund in a clearer and more transparent way.
The changes that the draft order will make are purely administrative; they will not alter the activities that can be carried out by the MHRA under its trading fund. The agency does not seek to carry out any new activity on the basis of them, nor will they enable it to introduce new fees that it could not otherwise introduce. No impacts on third parties will result from the draft order. It has been drafted so that the trading fund will work regardless of the outcome of the EU exit negotiations. We therefore see no reason to delay making these changes, which will also bring greater clarity and transparency, so the draft order is scheduled to come into force the day after it is made.
The draft order makes a simple, but necessary, administrative change. I commend it to the Committee.
Steve Brine
There are lots of wider points, but we have gone off-topic. The order is very specific and seeks to make sure that the agency can still function after Brexit, regardless of the deal or no-deal scenario. The shadow Minister, the hon. Member for Ellesmere Port and Neston, asked about the impact on the NHS and on NHS funds. As I have said, the MHRA is self-funding, and this will not impact the NHS at all. It is not as if the MHRA is going to come and ask for its slice of the £20.5 billion extra funding that we will be giving the NHS every year from next year as a result of the new funding settlement in the long-term plan.
It is self-evident that we cannot have the vast significant change of leaving the European Union without there being a change in our relationship, but as we have made very clear—the Prime Minister made it very clear in her Lancaster House speech and subsequently—the UK is seeking active participation in the EMA, as part of the future economic partnership. That is still very much subject to negotiations, but it is where we want to get to.
As a trading fund, the MHRA is required to cover its costs by charging for its work. The hon. Member for Ellesmere Port and Neston therefore asks an important question, but as part of the Brexit contingency planning, the agency is working in conjunction with the Government and the Department to ensure that it has a balanced budget post-Brexit, irrespective of the outcome. The majority of its licensing activity and the associated income derive from domestic—national, not EU—licensing.
The future trading relationships for the agency were outlined as part of our no-deal preparation planning. On 4 October, the MHRA opened a consultation on EU exit no-deal listed proposals. That is a live consultation which seeks views on how the agency’s legislation and regulatory processes would have to be modified in the event of the UK not securing a deal, and it covers no-deal proposals on medicines, clinical trials and medical devices. That live consultation closes at quarter to midnight on 1 November, so it would not be appropriate for me to pre-empt what it will say, but I am not concerned that the MHRA will raid NHS funds. Of course there are concerns—and we share them—about the change in relationship, but the UK has made clear that it seeks a new relationship, one of associate membership and creative partnership, with the EMA, as part of the future economic partnership.
Dr Whitford
I thank the Minister for giving way. I am sure that he is well aware that no “associate membership” of the EMA exists. It is one of the agencies that simply does not have any opportunity for associate membership, so expecting it to set up an entirely new structure for a member that is leaving seems over-hopeful. The Minister is still talking about no new activities and no rise in fees. It is still hard to understand, particularly if the consultation is still open, how he is able to give that guarantee and yet tell us how the MHRA will have funding to go forward.
Steve Brine
I am not giving the hon. Lady that guarantee. I am saying that it is a live consultation and it would not be appropriate for me to pre-empt it. I do not share the hon. Lady’s half-full view of our ambition for the future, which the Prime Minister set out in terms of our relationship with the EMA. The EU does not have a relationship with the UK as a third country at the moment. That is why we have set out an ambitious proposal for our new relationship with the EU and its agencies, including the EMA. I am hopeful, as are the Prime Minister and the Government whom I speak on behalf of, that we will secure a good deal. We still think that that is the most likely outcome. That includes a new relationship with the EMA. We should remember that the expertise that we have in this country, and the work we do with the EMA, will not suddenly change because it is based in Amsterdam. It will still need that expertise and that relationship. I am ambitious about the future, which is why I say what I say.
The matter before the Committee today is technical, to make changes to enable the agency to function after exit day.
Justin Madders
The Minister is speaking with great confidence, without any basis in fact, in saying that the MHRA will not need any state handouts in the future. Will he commit to report back to Parliament, if it turns out that it is not, in future, self-financing?
Steve Brine
Of course, if there is any change to any arm’s length agency that the Department works with, we will come back to Parliament for that discussion. That is partly what the consultation is about at the moment. So if the hon. Gentleman wants a blank cheque to say that we would come back to the House to have discussions around any future changes, the answer is self-evidently yes.
Question put and agreed to.